Sitting of 24 March 1980

Preamble
The House met at half-past Two o'clock
PRAYERS
[Mr. SPEAKER in the Chair]
ORAL ANSWERS TO QUESTIONS
  INDUSTRY

    South-West Durham
    Mr. Fosterasked the Secretary of State for Industry what is the Government's policy for attracting industry to South-West Durham.
    The Under-Secretary of State for Industry (Mr. David Mitchell): The Darlington and South-West Durham travel-to-work area is to remain an assisted area.
    Mr. Foster: Is the Minister aware that there are parts of my constituency in South-West Durham where the unemployment rate is now 12 per cent? Does he realise that, now that the area has been downgraded, not only incentives but a large part of the advance factory programme will be lost? Will he now, in partnership with the local authorities, invest in an advanced and nursery unit programme and also in the refurbishment of small units for small businesses?
    Mr. Mitchell: The hon. Gentleman has raised two matters. The first concerns the level of unemployment in his constituency which is made up partly of the Barnard Castle travel-to-work area, where 319 people are unemployed, and partly of a section of the South-West Durham travel-to-work area, where unemployment in 1979 was 6·8 per cent. which compares with the national average of 5·6 per cent. Therefore, the hon. Gentleman was referring to a small pocket, in relation to the very high figures which he just quoted. As regards nursery units, my Department has just received a report from Coopers & Lybrand Associates Limited relating to small firm premises
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    and we shall be publishing that next month.
    Mr. Armstrong: Does the Minister realise the seriousness of the situation in West Durham? Statistics and averages are no answer to the men and women who now feel that their only alternative, if they are to secure work and provide for their families, is to move to the South. Is he aware that this is not acceptable? Does he appreciate that unless more regional aid is made available, the cynicism, bitterness and, indeed, anger now growing because of the savage cuts in regional aid will lead to serious repercussions?
    Mr. Mitchell: We are concentrating regional aid on the areas of greatest need. That means that they will stand out much more than they have done in the past. We really care about the problems of very high unemployment in areas such as Newcastle and other special development areas.

    British Steel Corporation
    Mr. Michael Brownasked the Secretary of State for Industry when next he intends to meet the chairman of the British Steel Corporation.
    The Secretary of State for Industry (Sir Keith Joseph): I do not have a meeting arranged with Sir Charles Villiers at the moment, but we meet from time to time.
    Mr. Brown: When my right hon. Friend meets the chairman of BSC will he draw to his attention the fact that there are many steel workers who now wish to settle along the lines of the offer made by the corporation? Can my right hon. Friend give us some assessment of the damage to job prospects and job security caused by this strike?
    Sir K. Joseph: I fear that the strike will have jeopardised the size of the industry but I hope very much that when it gets back to work—we all hope that that will happen as soon as possible—it will quickly manage to recover its market share.
    Mr. Roy Hughes: Does not the Secretary of State agree that British steel workers have put up a remarkable display of solidarity in supporting what they believe to be their just wage claim? What is more, does he not agree that they are not likely to forget in a hurry those

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    people, including their elected representatives, who have done everything possible to undermine them in the dispute?
    Sir K. Joseph: I have a high respect for the steel workers. I hope they will recognise that the sooner they get back to work, the better it will be for the future of their own jobs.
    Sir Anthony Meyer: Although it is clear that the strike has not gained an additional penny for the steel workers but has lost them vast sums, will my right hon. Friend make it plain that once the strike is over he will be prepared to listen very carefully to anything that the corporation may say about the possibility of a more intelligently phased operation of slimming down the size of the industry?
    Sir K. Joseph: I shall listen to anything that the corporation may say, but the limitation upon the money available to it from the taxpayer must remain firm.
    Mr. John Silkin: May I remind the Secretary of State that the gap between BSC's offer and the union's claim is less than £50 million? Using the Minister's figures of some weeks ago, the loss of revenue to BSC at £10 million a week or so now totals £120 million. If we add to that the loss of revenue to British Rail and the National Coal Board, we are discussing a figure four times the amount of that gap. Therefore, was not it extremely stupid of the Prime Minister to say on Saturday that the Government could have avoided the steel strike but did not do so for the sake of the taxpayer?
    Sir K. Joseph: No. The gap to which the right hon. Gentleman referred is far more about where the money to meet the earnings shall come from than about the size of the earnings. The issue is whether the taxpayer should be asked to meet some of the increase in earnings which, in the view of many people, myself included, should come from the productivity of the steel workers and not from the taxpayer.
    Mr. Silkin: But the £200 million of which I have spoken, and which the Secretary of State cannot possibly deny, will have to be found by the long-suffering taxpayer anyway.
    Sir K. Joseph: The right hon. Gentleman did not ask me a question, but per-
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    haps I may treat his remarks as if they were a question.
    It does not follow that the loss imposed upon the Steel Corporation by the strike has to be met by the taxpayer. The Steel Corporation is required, as any private business would be, to take every step that it can, including cutting its overheads—
    Mr. Russell Kerr: Prices.
    Sir K. Joseph: Alas, if the hon. Member for Feltham and Heston (Mr. Kerr) knew more about the steel industry—I withdraw that, because the hon. Gentleman was Chairman of the Select Committee. He should know, even when he comments from a sedentary position, that steel is a buyer's and not a seller's market. But I was saying that the Steel Corporation will be required, as any private business would be required, to break even by every legitimate means in its power—that is, including cutting overheads, buying better, reducing stock, disposing of non-essential assets and, if necessary, increased redundancies.

    Manufacturing Industry
    Mr. Knoxasked the Secretary of State for Industry what is his estimate of the effect of the present exchange rate on production in manufacturing industry.
    Sir Keith Joseph: The present exchange rate must affect our manufacturing competitiveness. But a strong exchange rate should help to contain inflation, and success on that front is important for future manufacturing production.
    Mr. Knox: Does not my right hon. Friend agree that this is having a very severe effect on the profitability of our manufacturing industry? Has he drawn the attention of the Chancellor of the Exchequer to this matter? If not, will he do so?
    Sir. K. Joseph: The Chancellor of the Exchequer is certainly extremely well aware of the effect of the exchange rate upon manufacturing industry. But I repeat that to alter by Government action the level of the exchange rate, even if it were practicable, would endanger the priority objective of reducing inflation, which is equally if not more important for manufacturing industry.
    Mr. Robert Sheldon: Is the Secretary of State not aware that in one month last

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    year imports of finished manufactures actually exceeded exports of finished manufactures, and that this situation is likely to deteriorate further this year? Will he bear in mind that his monetary policy—to which he adheres and which is responsible for the failure to instruct the Bank of England to intervene in the exchange rate—is a very heavy price to pay for the certainty of the damage that it is doing to our competitiveness and to the export possibilities for British industry?
    Sir K. Joseph: There is a lag in all these things. I do not want to put too much weight upon the performance of British manufacturing industry at present, but the fact that British manufacturing industry is maintaining and even increasing the volume of its exports, while the volume of imports did not increase so much last month, is encouraging. I repeat that to let inflation rise further, which is what would be involved by seeking to lower the exchange rate, would be more damaging still to British manufacturing industry.
    Mr. Viggers: Does the Secretary of State agree that Germany and other countries have shown that it is possible to prosper with a strong exchange rate, and that this can enable the benefit of our prosperity to be spread by enabling higher wages to be paid to our labour, whereas the low exchange rate is needed only if one is concentrating on cheap labour?
    Sir K. Joseph: I agree with the gist of what my hon. Friend has said. It is true that good manufacturing companies are finding the high exchange rate an intense stimulus to their efficiency.
    Dr. John Cunningham: Is there not a widespread and strongly held view throughout British industry that sterling is overvalued? Has not the Secretary of State been told this by a large number of industrial organisations, including the footwear industry, the textile industry and, most recently, the chemical industry? For the first time for many years, record import levels of chemicals are coming into the British economy, which is surely a disgrace. The Minister's answer would be acceptable if inflation were falling and output were increasing, but is not the reverse the truth in both cases?
    Sir K. Joseph: As I have said before, there is a lag in these matters, and
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    inflation is still reflecting the loss of control of the money supply by the Labour Government in their last year. I repeat that manufacturing industry recognises that the defeat of inflation, to which the exchange rate contributes, is in its own highest interest.

    National Enterprise Board
    Mr. John Evansasked the Secretary of State for Industry when next he expects to meet the chairman of the National Enterprise Board.
    Sir Keith Joseph: I see the chairman frequently.
    Mr. Evans: When the Secretary of State next meets the chairman of the NEB will he be informing him that it is the intention to go ahead with the Inmos microchip production unit and that the Government will finance it? Will he also further indicate to the chairman that the Government's decision is that the production unit must be placed in an assisted area?
    Sir K. Joseph: This is a very complex question. I shall make a statement as soon as a decision is reached.
    Mr. Butcher: Does my right hon. Friend agree that pressure for direct investment from the NEB in the information technology industry should be resisted, and that, alternatively, there is a role for the Department of Industry in the co-ordination of Government buying schemes and the placing of large contracts with successful British companies in this field?
    Sir K. Joseph: I agree with the latter part of my hon. Friend's question. As to the former part, the NEB has been given a remit by the Government.
    Mr. McNally: When the Secretary of State meets the chairman of the NEB will he make clear that it is his firm belief that, where the NEB is being forced to dispose of assets, such as in Fairey Engineering, the workers in those industries should be fully consulted about would-be purchasers?
    Sir K. Joseph: The NEB is required to take into account the interests of the company as well as the national interest in its disposal policy, and it is for the NEB to decide how to carry out that instruction.
    Mr. Woolmer: As the Government can expect oil and gas revenues of between £15 billion and £20 billion a year within the next three or four years, will the Minister have discussions with the NEB on how best it can make sure that those revenues are channelled into industry and manufacturing and are not squandered simply on higher imports within the next few years?
    Sir K. Joseph: We must not spend money before we have it. It is the Government's view that such money as is available is better spent by the consumer than by Ministers and officials.

    Trades Union Congress
    Mr. Barry Jonesasked the Secretary of State for Industry when next he proposes to meet leaders of the Trades Union Congress.
    Sir Keith Joseph: At the National Economic Development Council on 2 April.
    Mr. Jones: Does the right hon. Gentleman accept that, if he meets the TUC leaders, some of them certainly would say to him that his industrial policies are needlessly turning some of our workplaces into centres for trials of strength between management and the shop floor? Does he agree that his inflexible monetarist policies are posing a danger to the social fabric of our country as well as bringing about the likelihood of an unemployment figure well beyond 2 million?
    Sir K. Joseph: I did not notice that the previous Government's industrial policy brought about a situation of unrelieved sweetness and light in every workplace.
    Mr. Peter Bottomley: When my right hon. Friend meets the TUC will he discuss the apparent difference between the industrial rate of exchange and the financial rate of exchange? Will he make the TUC understand that a neutral monetary policy—monetary control—leaves it to employers and trade unions to negotiate pay increases that are greater than the increase in the money supply? Does he not agree that those increases will lead to reduced industrial competitiveness, and higher unemployment?
    Sir K. Joseph: I agree that excessive unit labour costs, which result from wage
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    claims that are not accompanied by higher productivity, will destroy jobs.
    Mr. Heffer: When the right hon. Gentleman meets the TUC—apart from his philosophical discussions about monetarism—will he hold concrete discussions on selective import controls? Does he not agree that such import controls will save some of our industries from the pressures that they now suffer?
    Sir K. Joseph: At present, we have some selective import controls. To go further would risk encouraging inefficiency and price rises as well as retaliation.
    Mr. Henderson: When my right hon. Friend next meets the leaders of the TUC will he stress the important role that they could play in the application of microprocessor technology to industry? Does he not agree that that technology can substantially improve our industrial efficiency and assist in raising the standard of living of TUC members?
    Sir K. Joseph: TUC leaders do not need much persuasion. A TUC booklet called "Employment and Technology" was recently published. As I have mentioned in public before, it contained a most encouraging welcome for micro-processing as a new technology. However, I think that some of the conditions attached to the application of those new techniques are misguided.
    Mr. Winnick: Is the right hon. Gentleman aware of the sense of dismay that is felt by leaders of the TUC and by the country about the Government's monetarist policies? Does he not recognise that such policies can lead only to a return to massive unemployment? Does he not accept that we shall have disaster areas instead of industrial areas?
    Sir K. Joseph: The hon. Gentleman has got it entirely wrong. It is long-established common sense that a monetary policy involves moving towards a balance between the growth of demand and the growth of supply. The hon. Gentleman has forgotten that the last leader but one of the Labour Party, the right hon. Member for Huyton (Sir H. Wilson) got it exactly right. He said that inflation, which monetary policy seeks to abate, is the father and mother of unemployment.
    Mr. Emery: When my right hon. Friend speaks to the TUC will he emphasise the need for increased productivity in most of our industries? Does he not agree that if we are to compete and to attain the level of production and employment that all hon. Members desire, there must be a heightening in the level of productivity and a lowering in unit costs? Will he stress that point, above all else, in his discussions with trade union leaders?
    Sir K. Joseph: To be fair, those trade union leaders attending the NEDC do not need any persuasion. They understand that perfectly well. However, at shop steward level, one finds resistance, because there is fear about the loss of jobs. At that level there is no understanding that higher productivity is a source of greatly increased employment.
    Mr. John Silkin: When the Secretary of State meets TUC leaders and gives them his ideas on the necessity to curb inflation, will he explain why his Government doubled VAT in the last Budget, thereby increasing inflation to double the figure that existed when they took over?
    Sir K. Joseph: The right hon. Gentleman must remember that the previous Labour Government complained throughout their lives that the inflation that occurred during their first two years of office resulted from an inherited lag from the previous Conservative Government. We can, therefore, make the same claim now. We inherited rising public expenditure and a rising monetary supply. At present, the country is suffering from the consequential inflation.

    Finniston Report
    Mr. Douglasasked the Secretary of State for Industry if he will list the organisations that have submitted their views to him on the Finniston report.
    Mr. Kenneth Carlisleasked the Secretary of State for Industry what actions he is taking both to assess the Finniston report on engineering and also to implement its findings.
    The Under-Secretary of State for Industry (Mr. Michael Marshall): The Department is currently seeking views on the key recommendations of the report from over 350 organisations and in-
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    dividuals. Over half of these have replied to date and I expect most of the remainder by the end of the month. Other Departments are carrying out their own consultations. In addition, many unsolicited views are being received.
    I do not think it would be appropriate to list the individuals and companies who have submitted their views, whether solicited or not, but I shall place in the Library a list of those representative organisations from which the Department sought comments.
    The consultation exercise is being co-ordinated by officials, who are also advising my colleagues and myself on various aspects of the report. As I told the House on 29 January, we intend to reach decisions on the key recommendations quickly and to announce them in the summer.
    Mr. Douglas: Will the right hon. Gentleman consider eschewing a noninterventionist view of the report? Does he not recognise that Government intervention is needed if the major recommendations of the Finniston report are to be accepted and carried into practice? Will he further note that there is a shortage of science and mathematics teachers? If we are to have engineers, those teachers are required now.
    Mr. Marshall: I note the hon. Gentleman's remarks, particularly those referring to the work of educationists. No doubt my colleague in the Department of Education and Science will consider those remarks. I appeciate the hon. Gentleman's broader point about intervention. I hope that he will use his influence to encourage industry to put its money where its mouth is to ensure development along those lines.
    Mr. Carlisle: Further to that reply, does my hon. Friend agree that this is a most important report about the future of British engineering and the economy? Will he ensure that the Government implement the report's major conclusions as soon as possible?
    Mr. Marshall: I am glad that the right hon. Member for Deptford (Mr. Silkin) has already welcomed the report. I think that the House will recognise the significance of the analysis. There was a great deal of agreement about it. The

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    decisions that flow from it must be carefully analysed.
    Mr. John Silkin: Does not the Minister agree that there is a great shortage of skilled workers on the shop floor? Does not that shortage flow to a great extent from the trouble that arose in 1973–74 when apprenticeships in many parts of British industry came to an end? Does not the Government's policy of massive deflation encourage the loss of skilled workers, although they will be needed, in the future?
    Mr. Marshall: The right hon. Gentleman seeks to widen the debate. The question of technicians is not covered by the Finniston reports, although some people would have liked it to have been. The right hon. Gentleman's arguments are therefore somewhat specious.
    Mr. John MacKay: Does my hon. Friend realise that some of us feel that it is high time that the House had a debate on this important document? Will he give us a guarantee that a debate will be held before the Government reach a conclusion?
    Mr. Marshall: I note my hon. Friend's remarks. However, he will appreciate that the issue has been debated in another place. We shall want to consider that point when we are nearer to reaching our own conclusions.
    Mr. Budgen: Does my hon. Friend not agree that the shortage of skilled labour—complained of throughout British industry—is an inevitable consequence of freezing differentials as a result of successive wage controls?
    Mr. Marshall: There is great force in what my hon. Friend says.

    Investment in Industry
    Mr. Hooleyasked the Secretary of State for Industry what estimate his Department has made of intended Government investment in industry in 1980–81.
    The Minister of State, Department of Industry (Mr. Adam Butler): Details of Government assistance to industry in 1980–81 will be given in the White Paper on public expenditure and the Supply Estimates, both of which will be presented to the House on 26 March. It would not be appropriate for me to anticipate the publication of these documents.
    Mr. Hooley: Is the Minister aware that the gap between industrial investment in Britain and that in Germany, France, Japan and other major manufacturing countries is terrifying? Does he not realise that Government policies will do nothing to encourage private investment in Britain? Does he not accept that substantial public investment is essential if we are to survive as an industrial nation?
    Mr. Butler: The hon. Gentleman is aware that massive industrial investment has been made in the public sector. He knows that losses are now being made in that sector. The best investment will come from the private sector putting money into projects from which it knows that a profit can be made.
    Mr. Adley: Is not the Treasury right to wish to encourage the State's accretion of funds through the sale of State assets so as to reduce the level of direct Government holdings in industry? What action is my hon. Friend taking to bring that about in the case of British Leyland?
    Mr. Butler: I know my hon. Friend's concern about British Leyland. He knows the Government's position, which is that we should not stand in the way if it were the commercial decision of British Leyland to sell. On my hon. Friend's first and more major point, it will be significantly to the benefit of British industry for certain assets held by the State to be returned to the private sector.
    Mr. Les Huckfield: Is not the Minister aware that the biggest fear on the shop floor, not only in British Leyland but in successful manufacturing nationalised industries, such as British Aeropace, is that Government investment in those industries is about to disappear?
    Is the hon. Gentleman aware that half of the British Aerospace workers have stopped work today, and that 5,000 have marched on the House this afternoon because they fear that British Aerospace will be sold off to foreigners, or to those who pay most to Tory Party election funds?
    Mr. Butler: The hon. Gentleman would do a great service to British Aerospace and its employees if he did not—as he has done yet again today—perpetuate untruths about the industry's future. He is thoroughly to blame for the anxieties which exist in British Aerospace. The hon. Gentleman is perfectly well aware

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    that in the articles of association there will be a maximum limit of 15 per cent. foreign ownership. That will be safeguarded by the Government retaining 25 per cent. of the shares and their preparedness to vote their shareholding to defend the articles.
    Mr. Grylls: As my hon. Friend's answer indicates that a large sum of money is likely to be involved, is there not enormous scope for reducing the amount of money invested by the Department of Industry? Does he agree that the right level of investment by the private sector will never be achieved if the Government continue to pre-empt so much of its money? That is a lesson that the House should learn.
    Mr. Butler: My hon. Friend, as always speaks a great deal of wisdom on the subject.
    Mr. Huckfield rose—
    Mr. Speaker: Order. I shall call the hon. Member for Nuneaton (Mr. Huckfield). However, as the House knows, I do not usually call even Front Bench spokesmen twice on one question, especially when many other hon. Members are seeking to catch my eye.
    Mr. Huckfield: If there were not 5,000 workers from British Aerospace outside the House I should not press my case Mr. Speaker. Will the Minister confirm or deny that there is nothing in the Bill that will prevent the breaking up of British Aerospace, and that there is no provision, if the Bill reaches the statute book, that will prevent British Aerospace being taken over lock, stock and barrel by foreign interests?
    Mr. Butler: I have stated very clearly the safeguards against British Aerospace being taken over by foreign interests. I should like to think that a statement to this effect from the Dispatch Box—which has been made on previous occasions—would be accepted by the House.
    The Government have made it clear that it is not their intention to split up British Aerospace. There is allowance for only one successor company to the corporation, and that, in itself, is a safeguard and an assurance that British Aerospace will remain in its present form.

    Concorde
    Mr. Michael McNair-Wilsonasked the Secretary of State for Industry what work on the Concorde project is currently being funded by his Department.
    Mr. Michael Marshall: Work on the Concorde project currently being funded by the Department is mainly for the support of the aircraft and engines in service with British Airways and Air France, including, in particular, in-service development, continued fatigue specimen testing, the meeting of warranty claims, and the manufacture of spares.
    Mr. McNair-Wilson: Because £800 million of taxpayers' money is being spent on the project, will my hon. Friend tell the House whether the Government are seeking to persuade American manufacturers to become interested in the advanced technology developed by ourselves and the French, so that this vast sum will not cease to exist in practical terms when the aircraft ceases to fly? Will he do that to ensure that we shall have a stake in the second generation of supersonic aircraft that will fly within the next decade or two?
    Mr Marshall: Discussions on the matter are continuing between British Aerospace and American manufacturers. There is nothing more that I can add this afternoon.
    Mr. Dalyell: Is the Minister aware that about 20,000 people turned out yesterday to see Concorde on its first appearance at Edinburgh airport? What is the extent of the warranty claims? Has the Minister figures in his brief?
    Mr. Marshall: I cannot answer that question without prior notice. I shall write to the hon. Gentleman.
    Mr. Bruce-Gardyne: As this is the supreme example of State entrepreneurship to date, will my hon. Friend contemplate establishing a Select Committee to examine the whole ludicrous story, together with the enormous sum of public expenditure that has been wasted for no purpose whatever?
    Mr. Marshall: My hon. Friend is aware that the question of Select Committees is one for the House itself. If he wants a more detailed exposition on the matter, I

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    suggest that he consults his own splendid book.

    North-East Lancashire Development Association
    Mr. Strawasked the Secretary of State for Industry whether he will now meet representatives of the North-East Lancashire Development Association.
    Mr. David Mitchell: My noble Friend will be meeting the North-East Lancashire Development Association on 22 April. My noble Friend the Under-Secretary of State for the Environment and my hon. Friend the Parliamentary Secretary to the Ministry of Transport will also be present.
    Mr. Straw: Is not the Minister aware that there is deep concern across the whole political spectrum in North-East Lancashire that the Secretary of State views the region's problems with such complacency that the association is to be fobbed off with a meeting with Ministers who are not hon. Members of this House? Is he aware that there is even greater concern that one of those Ministers is Lord Bellwin, whose only contribution to North-East Lancashire was increasing unemployment by some hundreds through the closure of firms of which he was chairman?
    If the Secretary of State is not willing to meet the representatives, is he willing, at some stage during the next six months, to visit North-East Lancashire so that he can appreciate what damage or success his policies are causing?
    Mr. Mitchell: The hon. Gentleman refers to complacency. The fact that three Ministers will meet the deputation is a sign that there is no complacency. The Government intend to examine carefully what is said by the deputation.
    The hon. Gentleman referred to unemployment in the area. The level of employment will be determined by employers and workers in the way in which they proceed. I am bound to say that there is substantial concern that wage increases not covered by improved productivity are being demanded and granted, and that these will lead to job losses.
    Mr. Trippier: Is my hon. Friend aware that I and my constituents are grateful for his visit to Rossendale last year when he made himself aware of the problems there? When considering the representa-
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    tions of the North-East Lancashire Development Association will he remember that the two most important grants that we are anxious should be continued after 1 August 1982 are the industrial grants from the EEC and the derelict sites grant, which is of great value to certain parts of East Lancashire? I understand that no decision on these matters has yet been reached.
    Mr. Mitchell: I am grateful to my hon. Friend for drawing attention to these matters. He took me to see some of the areas concerned, and I held subsequent discussions with Ministers in the Department of the Environment.

    Post Office Corporation
    Mr. John Townendasked the Secretary of State for Industry when next he intends to meet the chairman of the Post Office Corporation.
    Mr. Pollockasked the Secretary of State for Industry when next he expects to meet the chairman of the Post Office.
    Mr. Adam Butler: My right hon. Friend meets Sir William Barlow as the need arises. I myself met Sir William on 20 March and expect to do so again later this week.
    Mr. Townend: When my hon. Friend next meets the chairman of the Post Office, will he seek to persuade him to reconsider the refusal of the Post Office to issue a special stamp to commemorate the opening of the Humber bridge? [Laughter.] Is he aware that despite the recent unfortunate problem, the bridge will be the longest single-span suspension bridge in the world? Opposition Members may laugh, but it will be a great engineering achievement, by British firms.
    Mr. Butler: Perhaps I could use this occasion to express considerable regret about the accident which occurred in the building of the bridge, and about the delay in its completion.
    Both the Post Office and my Department receive a large number of requests for commemorative stamps. I am sure that my hon. Friend's remarks will be read by Sir William, but I cannot give him much encouragement.
    Mr. Pollock: When my hon. Friend next meets the chairman will he raise

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    with him the increasing absurdity of the Buzby advertising campaign? Is he aware that we now have a Buzby balloon, and that when such a balloon is deflated it produces a sound which approximates very closely to the feelings of many of my constituents about the declining quality of our postal services?
    Mr. Butler: I must congratulate my hon. Friend in giving an indirect raspberry to the public relations section of the Post Office. However, it is entitled to use whatever advertising it wishes, and the Post Office's view is that the Buzby advertisements are increasing traffic and are proving profitable.
    Mr. Golding: Will the Minister discuss with Sir William Barlow the damage being done by the irrelevant application of cash limits to the Post Office telecommunications business? In addition, will he agree that the increase in the calling rate which has been achieved by the Buzby campaign, has been important in increasing profitability in this public service?
    Mr. Butler: In the second part of his question the hon. Member agreed with what I said a few minutes ago. On the question of cash limits, I would like to think that the whole House would support the Government in their determination to observe cash limits as one way of helping to overcome inflation. In the current year the Post Office's cash limits have been put very seriously at risk by the damaging strike last summer, which greatly affected cash flow. I hope that in his position of influence, the hon. Member will try to ensure that such disputes are minimised in future.
    Mr. Hill: When my hon. Friend meets the chairman of the Post Office will he convey to him the views that I have conveyed to my hon. Friend from the Post Office Engineering Union? That union is looking forward to the division of the Post Office, and would like to think that this will occur in the immediate future. Is he aware that its members would like to think that their jobs will be protected by this extra commercial incentive, but they want an assurance that the telecommunications department will not be split further than the one initial split in the Post Office itself?
    Mr. Butler: My hon. Friend is quite right in drawing attention to the Government's policy, namely, that there shall he a split of the telecommunications side from the postal side and Giro. These are very disparate activities, and we are certain that both will benefit from the split. I note what my hon. Friend says about not splitting the telecommunications side any further.
    Mr. Armstrong: Will the Minister tell the chairman that the Government will not countenance any change in the way that social security benefits are being paid at present? Is he aware that the inept handling of this matter by the Government has brought genuine anxiety to the most vulnerable sections of the community? Will he give an assurance that this nonsense will be dropped?
    Mr. Butler: The alarm was caused by rumours that were spread and intensified some weeks ago. It led to a debate in the House, during which my right hon. Friend and I were ready to give an assurance about the future of the network. More recently it was made abundantly clear that there would be no question of forcing pensions to be paid through a bank—but we hope that that will be an option open to people—and that secondly, the retention of weekly payments will be maintained for those who want it.

    Manufacturing Industry
    Mr. Dorrellasked the Secretary of State for Industry whether he is satisfied with the level of profitability in manufacturing industry.
    Mr. Michael Marshall: No, Sir.
    Mr. Dorrell: Will my hon. Friend agree that one of the features that has distinguished British industry from its competitors in recent years is the low and falling rate of profitability? Will he accept that one of the prices that must be paid for a high exchange rate is further compression of that profitability? Accepting the argument that there will be a lag before Government policies are successful, may I urge my lion. Friend to give the House some idea of when productivity in British industry will improve, in order to restore the competitive balance?
    Mr. Marshall: My hon. Friend rightly points out that the profitability of manufacturing industry has been falling over a number of years and has become a long-term problem which reached its crescendo in the last four years of the previous Government.
    Dr. Summerskill: Will the Minister bear in mind that the manufacturing industries, especially carpets, textiles and machine tools, which have formed the backbone of the industries of Halifax and West Yorkshire for many years, are now in serious difficulty? What specific proposals have the Government to help those industries, particularly in view of the great contribution that they made in the past towards industrial development?
    Mr. Marshall: The House is unlikely to forget the contributions made by these industries as long as the hon. Lady is a Member. The question that she raises comes back to the broad ways in which the economy must be stimulated in order to produce the growth that we all seek.
    Mr. Kenneth Baker: In the representations that my hon. Friend or his ministerial colleagues have made to the Treasury in the last few weeks, have they drawn attention to the fact that one of the major factors intensifying the liquidity squeeze on British companies is the high level of the national insurance employer's surcharge, which was increased so savagely by the former Chancellor of the Exchequer?
    Mr. Marshall: As ever, my hon. Friend has put in a timely word to remind my right hon. and learned Friend, the Chancellor of the Exchequer, but I am sure that he is aware of these matters. I did not fully answer my hon. Friend the Member for Loughborough (Mr. Dorrell) on the previous question. It is impossible to say what the time lag will be, particularly given the nature of the long term problem that we face.
    Mr. Jay: Does the Minister realise that the present Government's policies are making private manufacturing industry and investment less profitable than for many years past?
    Mr. Marshall: The right hon. Gentleman should bear in mind that the profitability of British industry fell to an all-time low of 2 per cent. during the life of
    934
    the previous Government. We seek to reverse that trend as a matter of policy.
    Mr. Kenneth Lewis: Is my hon. Friend aware that there are many businesses and industries, especially small businesses, which are in great difficulties at present? They are profitable, but they are threatened with liquidation because they have cash flow problems. Will he ask the Chancellor to have a word with the banks to ensure that they lend money to industry, rather than give personal loans? This is not being done sufficiently at present.
    Mr. Marshall: I am sure that the Chancellor will note my hon. Friend's suggestion. There is a good deal of evidence that the banks are being particularly helpful at present, bearing in mind the existing difficulties.
    Mr. John Silkin: Will the Minister explain how he proposes to increase profitability in the manufacturing industry when his Government are, by savage deflation, destroying demand; by high exchange rates, preventing our exports from being competitive abroad; and by ludicrously high interest rates, driving many companies into liquidation?
    Mr. Marshall: As usual, the right hon. Gentleman presents only one side of the picture, and he does so with his usual vigour. He has overlooked the fact that in the battle against inflation it is vital to strike a reasonable balance on wage agreements. I hope that he will lend his weight to that side of the argument as well.

    Nationalisation (Compensation)
    Mr. Nicholas Bakerasked the Secretary of State for Industry what steps he is taking to compensate the companies owning assets nationalised under the Aircraft and Shipbuilding Act 1977; and if he will make a statement.
    Mr. Adam Butler: Compensation is not yet determined for 12 out of the 25 companies. Payments on account totalling £60 million have been made in respect of the 12 companies. Arbitration is in progress concerning three of the companies. The position remains open in respect of the remaining nine companies, effectively involving seven negotiations. These inevitably raise some particularly intractable issues. It would not be appropriate for

    935
    me to comment further on individual cases.
    Mr. Baker: Will the Minister give an assurance that the Government have not been dragging their feet in this matter? It appears that these negotiations have taken an unconscionable amount of time. Can he say whether the possibility of denationalisation has entered these negotiations?
    Mr. Butler: I assure my hon. Friend that Ministers have not been dragging their feet. It is a highly complicated matter and in some cases there is a difference between what is asked by the previous owners and what the Act appears to allow. This dictates a longer period of negotiation. Compensation payments and denationalisation are separate matters, but it remains the firm policy of the Government to introduce private sector capital into British Shipbuilders at an appropriate time.
    Mr. Les Huckfield: Does not the hon. Gentleman understand that, despite what he says, he is trying to denationalise an industry which has not yet been properly nationalised? Does he accept that, on the basis of the replies that he has given today, there is nothing in his Bill, and there will be nothing on the statute book if the aerospace denationalisation Bill gets through, to prevent British Aerospace from being either broken up or taken over, lock, stock and barrel, by foreigners?
    Mr. Butler: I am interested in what the hon. Gentleman says about the companies not being properly nationalised, but I understand that, in law, ownership was transferred on vesting day. In regard to the hon. Gentleman's repeated remarks about the aerospace industry, I can say only that there are none so deaf as those who will not hear.

    SHOPLIFTING
    Mr. Archerasked the Attorney-General in how many prosecutions for shoplifting offences during the latest period of 12 months for which figures are available the Director of Public Prosecution has either undertaken the prosecution or been consulted.
    The Attorney-General (Sir Michael Havers): Of prosecutions undertaken by the Director in 1979, eight have to date been concluded where an offence of theft of the shoplifting variety was charged.
    It is not possible to give details of cases of shoplifting theft on which the Director was consulted in 1979: this sort of offence is not normally reported to the Director and is, therefore, not a type of theft for which detailed indices are kept in the registry. Those cases which are reported normally involve one or more of the following factors:
    the alleged offence was committed by a police officer or a police officer's spouse;
    the alleged offence was committed by a public figure;
    the alleged offence was committed in addition to other offences which are reportable, for example murder or corruption;
    the alleged offence involves an issue of identification;
    a private prosecutor wishes to withdraw the summons.
    Mr. Archer: I am grateful for that careful reply. Does the right hon. and learned Gentleman agree that, while the right to bring a private prosecution is an important constitutional safeguard, it can operate harshly against individuals who ought not to be subject to criminal proceedings? Will he further agree that shoplifting is an example of an offence in which the motives and circumstances can vary, from the persistent professional offender to the merely absent-minded? Bearing in mind the recent example of an 83-year-old man who was driven to suicide, will the right hon. and learned Gentleman discuss with the DPP whether those who bring private prosecutions for shoplifting might be asked to consult the Director beforehand?
    The Attorney-General: I agree with the right hon. and learned Gentleman. Wherever there is a public interest aspect, for example the advanced age of the proposed defendant, that is a matter which

    937
    the Director, when deciding whether to prosecute, would bear in mind. I would welcome that going out to private prosecutors so that, where they felt that there was a public interest aspect, they could consult the Director for his advice.
    Mr. Neubert: Although the matter is not my right hon. and learned Friend's direct responsibility, does he agree that there is an obligation on shops and stores to limit the opportunities for shoplifting and that the provision of bag parks is a commendable and constructive action to that end?
    The Attorney-General: Any shop operation that affords an amount of temptation will lead to prosecutions, and sometimes to ill-considered prosecutions when an offence is not intended. It is just as serious for my hon. Friend to leave his wallet in his room when he goes to wash his hands. That is offering temptation to the cleaner who comes to clean his office. The circumstances must be decided on each case.
    Mr. Lawrence: I hope that my right hon. and learned Friend will follow through the sort of exception outlined by the right hon. and learned Member for Warley, West (Mr. Archer) by circulating private prosecutors so that that matter can be brought before them. Is my right hon. and learned Friend satisfied that the general principle of stores prosecuting offenders is working in the public interest and can he tell us what saving results to the public purse by continuing the present system?
    The Attorney-General: Bearing in mind the shoplifting figures, I believe that it would place an impossible burden on police forces if they had to prosecute such offences in addition to all their other duties. The right of private prosecution has been jealously guarded over the centuries and I should not like to alter it.

    PICKETING
    Mr. Adleyasked the Attorney-General what representations he has received following his recent statement on the law relating to picketing.
    The Attorney-General: None, Sir.
    Mr. Adley: Does not my right hon. and learned Friend feel that some of the more aggressive noises from the TUC and particularly, I understand, from the GMWU over the weekend are not representative of the views of the majority of trade unionists? Will he therefore do all that he can to ensure that the sensible proposals going through the House are pursued in such a way as to retain the support for them of the majority of working people?
    The Attorney-General: The enforcement of picketing laws, whether as they exist or as they will be if clause 14 of the Employment Bill becomes law, is entirely a matter for the chief constables and particularly the police officers at the site. The statement that I made on 19 February was circulated to chief officers of police and no doubt they will bear it in mind when they advise their officers what to do about picketing.
    Mr. John Evans: In view of the Attorney-General's repeated statements that primary pickets will retain the right to peaceful persuasion after the passing of the Employment Bill, will he inform the House whether the Government intend to introduce a new clause to the Bill to allow primary pickets the right to stop lorry drivers to persuade them peacefully of the justice of the dispute?
    The Attorney-General: There has been a great deal of discussion about that matter and it has been decided that there should be no right to stop lorry drivers. One of the questions that always occurs to me is what would happen if a lorry driver did not want to stop. Would he be committing a criminal offence? That is the sort of problem that one would face if one went down the road suggested by the hon. Gentleman.
    Mr. David Price: Does my right hon. and learned Friend agree that, even under the existing law, so ably defined by him recently, there are still difficult situations for the police and those who are trying

    939
    to picket peacefully? Does he agree that it would be a great help if the TUC would go further with the law enforcers in agreeing basic guidelines that could be enforced by both police officers and those operating picket lines?
    The Attorney-General: I said on 19 February that I thought that the guidelines issued by the TUC were sensible. I was sorry to see some comment the other day that tended to suggest that the TUC was withdrawing those guidelines.
    Mr. John Morris: Is the Attorney-General aware that in some areas there is automatic fingerprinting of pickets charged with obstruction? Does not that increase tension? Would it not be better to limit fingerprinting to cases where serious charges are involved and not make it automatic, as is the case in many areas? Does he not agree that automatic fingerprinting causes increased tension in those areas?
    The Attorney-General: That is a question which would be better put to my right hon. Friend the Home Secretary.

    POLICE CONDUCT (COMPLAINTS)
    Mr. Meacherasked the Attorney-General if, in the light of the recent Lannon case, he will now make available to interested parties the reports submitted to the Director of Public Prosecutions by the police following complaints about police conduct.
    The Attorney-General: No, Sir.
    Mr. Meacher: Since the judge in the Lannon case ruled that the family had a right to see the police investigating officer's report in order to pursue a civil action, on what grounds, in equity, can the Attorney-General deny sight of such reports to other families, whether or not they decide to go for the elaborate and expensive procedure of instituting a civil action?
    The Attorney-General: In the case to which the hon. Gentleman referred, the only claim for privilege was for profess-
    940
    sional legal privilege. In other cases it may be necessary for the Director to consider whether he is to make a claim for privilege upon the class or contents grounds. The reasons for that were given in detail by the Director when he gave evidence before the Select Committee on Home Affairs on 14 February. I refer the hon. Gentleman to the full account. In summary—the reports are confidential—they contain views and opinions of the police officer making the report; the credibility of the witnesses is discussed together with, in some cases, their previous convictions. Details are also given about the suspected police officer which, if the Director decided not to proceed, could lead to a form of public trial without the safeguards of a trial in court. Those are strong public aspect reasons why it should not be a matter of course that section 49 reports should be published.
    Mr. Jeffrey Thomas: Is the Attorney-General aware of reports that the team under Commander Cass, which investigated the circumstances of the death of Blair Peach, was anxious—
    Mr. Speaker: Order. I wish to help the hon. and learned Gentleman and the House. Hon. Members will be aware that both the Blair Peach and the Kelly case are sub judice at the moment. No one in the House would want to seek to influence in any way the decisions of the coroner's court. It could have a serious effect on people later.
    Mr. Thomas: In those circumstances, Mr. Speaker, I do not pursue the matter.
    Mr. Michael McNair-Wilson: Has my right hon. and learned Friend had a chance to see a replay of the BBC television plays called "Law and Order"? If he has, can he think of any drama series that is more likely to undermine confidence in the police?
    The Attorney-General: I have seen part of the series. I agree with my hon. Friend that it shows not only the police but lawyers and others concerned in the administration of justice in a very unfavourable light when that light is the exception to the rule rather than common form.

    QUESTIONS TO MINISTERS
    Mr. John Morris: On a point of order, Mr. Speaker. Has the learned Attorney-General made any request to answer question No. 47 or to make a statement regarding jury vetting?
    Mr. Speaker: Not to me.

QUESTIONS TO MINISTERS
Mr. John Morris: On a point of order, Mr. Speaker. Has the learned Attorney-General made any request to answer question No. 47 or to make a statement regarding jury vetting?
Mr. Speaker: Not to me.

QUESTIONS TO MINISTERS

  BUSINESS OF THE HOUSE
  Ordered,
  That, at this day's Sitting, Standing Order No. 3 (Exempted business) shall apply to the Motion relating to European Economic Community Convergence and Budgetary Questions with the substitution of half-past Eleven o'clock or three hours after it has been entered upon, whichever is the later, for the provisions in paragraph 1(b) of the Standing Order.—[Mr. MacGregor.]

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

      OBLIGATORY TEST CERTIFICATES FOR PASSENGER-CARRYING VEHICLES
      'In section 44 of the Road Traffic Act 1972 (obligatory test certificates) in subsection (4) (excluded classes of vehicles) the following words (which relate to the exclusion of large public service vehicles) shall be omitted—

      (a) the words from "to public service vehicles" to "passengers or"; and

      (b) the words from "but shall apply" onwards.'.—[Mr. Fowler.]

      Brought up, and read the First time.
      3.32 pm
      The Minister of Transport (Mr. Norman Fowler): I beg to move, That the clause be read a Second time.
      Mr. Speaker: With this we are taking new clause 8—Annual inspection of public service vehicles:
      'The Minister shall prescribe in regulations arrangements for the annual inspection of public service vehicles at either official public service vehicle testing stations or, if the equipment provided is adequate, the operator's premises, but no such regulations shall be made until a draft thereof has been laid before, and approved by a resolution of, each House of Parliament.'.
      and Government amendments Nos. 75, 76, 91 and 92.
      Mr. Fowler: I am delighted to open the debate by proposing a new clause that I am sure hon. Members on both sides of the House will welcome. The clause concerns, basically, the safety of vehicles. It paves the way for a new annual test of all large passenger-carrying vehicles. It is a commitment to higher standards.
      On the day after a coach accident in France in which 16 young people lost their lives, we must all be aware of the need to tighten standards. I emphasise again, as I did in Committee, that although this Bill reduces restrictions on the number of services that can be provided in this country—we look forward to an increase in services—it does not reduce safety standards. Our aim has been to

      943
      produce a system that does not mistake paperwork for effective safety controls.
      The Bill generally attacks the problem in three ways. It deals first with the fitness of the operator—what I might call the first level of prevention. The Bill requires an operator to demonstrate both his competence to run buses and that he has adequate maintenance facilities or arrangements. If an operator cannot meet the standards, he cannot operate.
      Secondly, the clauses on vehicle fitness ensure that the Ministry of Transport's examiners have powers to inspect public service vehicles at any time and to prohibit their use straight away if they are defective. With this clause we are looking ahead to the more formal requirement of the annual test, as my hon. Friend the Parliamentary Secretary undertook to do in Committee. I should like to thank the hon. Members for Holborn and St. Pancras, South (Mr. Dobson) and for Newcastle upon Tyne, Central (Mr. Cowans), who raised the matter in Committee.
      What will the annual test achieve? I believe that it will be a tighter, more foolproof means of ensuring that all buses undergo a thorough examination. The rather informal process of inspection now carried on runs the risk that some vehicles may not be examined as regularly as they should be. Secondly, and just as important, the new test will apply to all passenger vehicles with more than eight passenger seats, regardless of whether they are used for hire and reward. As we discussed in Committee, there has been, since 1930, a rather uneasy distinction between the safety standards required of public service vehicles and the lack of controls over privately run buses. The new annual test takes a major step towards bringing all buses into line. I believe that this will help to give the public the confidence that they deserve to have, whatever kind of bus they are travelling on.
      When will the new test be brought in? Inevitably, there must be time to make all the necessary practical arrangements. We are required by the EEC—this is one EEC requirement, whatever hon. Members' views, that can be welcomed—to have a testing system fully in operation by January 1983. This means carrying out the first tests in January 1982 at the latest.
      944
      We shall shortly be circulating the necessary regulations in draft for consideration by all interested parties. We shall also be discussing with operators the best arrangements for testing. We have already said that we accept the case for using operators' premises to the fullest extent possible consistent with the maintenance of safety standards and a reasonably economic deployment of resources, both public and private.
      I commend the new clause to the House.
      Mr. Speaker: Before I call the right hon. Member for Barrow-in-Furness (Mr. Booth), I draw the attention of the House to the fact that the Government did not move the motion on the order of business, outlined on the Notice Paper. In order that there should be no misunderstanding later, I should like to put on record that the result is that instead of proceeding to Government amendment No. 1 after new clause 9 is disposed of the House will go straight on to discuss the remainder of the new clauses, beginning with new clause 5.
      Mr. Fowler: On a point of order, Mr. Speaker. That is correct. The Government did that with the agreement of, and at the request of, the Opposition.
      Mr. Speaker: I understood that. In case the matter is raised by hon. Members who are not now in the Chamber, the occupant of the Chair will be in a position to say that the matter was explained succinctly.
      Mr. Albert Booth: Thank you, Mr. Speaker. We always welcome your guidance. It is helpful for the House to be absolutely clear about the order in which it is to proceed with the Bill.
      The Minister's statement on new clause 1 is surprising. In a Committee stage that was pretty barren of joy for Opposition Members, the willingness of the Minister, on the raising of this issue, to agree that there should be some provision within the Bill for annual testing of public service vehicles shines like a beacon. It should have been in the Bill from the outset. There should have been a Government proposition in the Bill for annual testing of public service vehicles.

      945
      When the issue was raised in Committee, the Minister undertook to consider it and to bring forward his own proposition for inclusion at this stage. But his proposition in new clause 1 does not create a statutory obligation for annual testing of public service vehicles. The new clause removes from the Road Traffic Act 1972 the specific exclusion of public service vehicles from the range of classes of vehicle for which test certificate provisions can be made. Those test certificate provisions in the 1972 Act can be for 10-year tests or tests of other periods.
      We want spelt out clearly in the Bill that public service vehicles shall be annually tested. That is a basic safety requirement that we want to see written into the law.
      The Minister touched upon the use of operators' premises. There is nothing in his new clause that touches on operators' premises. I believe that new clause 8 is much better for this purpose.
      I wish to deal first with the question of a statutory requirement for annual inspection. If one was to use the procedure used under the 1972 Act for other vehicles, one would not bring about a satisfactory position on the annual testing of public service vehicles. Public service vehicles are in a special position and their testing is not the same as the testing of other vehicles.
      In Committee the Minister withdrew the requirement for an operator's disc to be displayed on the vehicle, so we have to be assured that this testing requirement can be enforced in its own right. We cannot rely on the operator licence requirement. It is virtually unenforceable, since the requirement to display the discs has been removed from the Bill that we considered on Second Reading, so the link has been removed between the operator and the number of licensed vehicles that he runs. Therefore, in some ways, the annual safety check becomes more important. It means that any safety inspector or policemen can ensure that the fitness to carry passengers of any vehicle on the road has been tested in the previous 12 months. It would be impossible to know from an examination of the vehicle whether it was covered by an operator's licence.
      But a specific requirement for annual safety tests is important because of the
      946
      nature of the operation. We should all be alarmed that any large vehicles should be able to travel on our roads without safe brakes and steering, for example. A major public service vehicle can affect the safety not only of other road users but of those who travel as passengers on it. The vehicle is in constant use and stops and starts frequently. Safety control is crucial.
      The other question raised by new clause 8 is whether the operator's premises should be available for inspection. The control of PSV safety has, if anything, a longer history than safety control of other vehicles, so it is surprising that annual testing has not been insisted upon before. There is testing provision, however. Good operators often have good testing facilities on their premises. This testing has developed in a way very suited to the needs of the PSV. Major fleet operators have their own engineering facilities which they can use in the interests of greater efficiency. That should be recognised in legislation of this sort.
      However, we know that we are dealing with Ministers who are on record as wanting to put testing facilities in the hands of private operators rather than those of Government inspectors. We put down a marker about the need for independent monitoring by the Department's own engineers. There may be a difference between the two parties as to how safety testing is best achieved and how specific the legislative commitment to annual testing should be, but I hope that there is no difference between us that stringent and impartial requirements should be imposed for annual testing so that it is done to a uniform and high standard.
      3.45 pm
      At some time in the near future we need some assurance that, however the tests are done—in what are now Government stations and handed over to private control, a move that we would oppose; on the operator's own premises; or in Government test stations run by the, Minister's own staff—they will all be subject to independent monitoring by the Department's engineers, in whom we have great confidence.
      In all these circumstances, the annual inspection of PSVs should not be dealt with in general test regulations by removing the ban in the 1972 Act to imposing a test requirement on public service

      947
      vehicles but should be specifically related to the needs of the special case of the PSV.
      That is why new clause 1 is inadequate. It does not achieve the purpose or the specified period of testing. New clause 8 is vastly superior. It achieves our intention and that which I think the Minister spelt out.
      Mr. Frank Dobson: I am grateful to the Minister for thanking my hon. Friend the Member for Newcastle upon Tyne, Central (Mr. Cowans) and myself for pointing out that the Bill contained no provision for annual testing of public service vehicles. If the Minister's intention is met by the new clause, we welcome it, because people who travel in PSVs are entitled to high standards of safety.
      However, I must add that it was pointed out on Second Reading that some provisions of the Bill would adversely affect safety. Right at the end of his reply to the Second Reading debate, the Parliamentary Secretary said:
      "I reject completely suggestions that safety is threatened. That is absolute nonsense. If anything, the Bill will improve the safety arrangements."—[Official Report, 27 November 1979; Vol. 974, c. 1246.]
      As originally drafted, the Bill clearly would not have improved safety because it would have got rid of the annual testing of vehicles. I am afraid that the Parliamentary's Secretary's brief was somewhat amiss.
      The Parliamentary Secretary to the Ministry of Transport (Mr. Kenneth Clarke): There is no system of annual inspection of vehicles at the moment, so there could have been no question of the Bill getting rid of it. All that we are introducing in the new clause is the ability to bring in the annual inspection of vehicles as a new concept in this country. We always intended to bring it in anyway, but we had not intended to use this Bill to do so.
      Mr. Dobson: I accept that, but we are getting something worth while from the suggestion of my hon. Friend and myself. We look forward to the introduction of annual testing, which will make things safer both for PSV passengers and for other road users.
      In the spirit in which he moved new clause 1, however inadequate it may be,
      948
      I hope that the Minister will recommend the House to accept our amendment No. 25. That would extend the provision for the safety testing of vehicles to include vehicles owned by education authorities and used as school buses. There is no requirement at present to test them as there is with public service vehicles.
      Mr. Clarke: I was delighted to hear from the right hon. Member for Barrow-in-Furness (Mr. Booth) that there were some aspects of the Bill about which we agreed. We have agreed throughout on the principle that the safety of passengers should be paramount in the passenger transport industry.
      I repeat without hesitation what I said on Second Reading, that there is no provision in the Bill which threatens or reduces the present protection given to passengers in trying to maintain the proper level of safety on public transport vehicles. There are aspects of the Bill that will strengthen the protection for passengers and make the system more adequate and enforceable.
      The new clause introduces a new system of annual inspection of all public service vehicles. The Government have always contemplated that, and it is an innovation to which we are bound by an EEC directive—the so-called roadworthiness directive. This has not occurred to the Government during the passage of the Bill. We always intended to comply with our legal obligations under that directive and to bring in a new system of annual testing by 1 January 1983. That means that we must get the first tests going by January 1982.
      The only change of policy indicated by the clause is that, following representations made by the hon. Members for Holborn and St. Pancras, South (Mr. Dobson) and for Newcastle upon Tyne, Central (Mr. Cowans) in Committee, we looked at the possibility of using the Bill, while there is parliamentary time, as the appropriate vehicle for bringing in a system for the annual testing of vehicles.
      Given that we are all agreed that this is a desirable innovation, I think it is a pity that the right hon. Gentleman—though I understand that he will advise his hon. Friends to support the idea—feels it necessary to hedge that agreement about with qualifications concerning the chosen method, the precise way it will be

      949
      introduced and its enforceability thereafter.
      Let me explain why, on the face of it, new clause 1 is expressed in rather obscure language and does not provide in terms that the annual inspection of public service vehicles will begin in January 1982. The wish was expressed repeatedly in Committee that the legislation could be framed in language of that kind. However, upon examination it will be found that the, clause is adequate to pave the way for the regulations. That will be the most appropriate means of fulfilling the terms of the EEC directive. The new clause and the consequential Government amendments bring public service vehicles within the ambit of sections 43 and 44 of the Road Traffic Act 1972 from which they are presently excluded.
      That Act ensures the annual testing of heavy goods vehicles. At the moment public passenger vehicles are excluded from those testing arrangements. The amendments bring passenger vehicles within the terms of that Act, and pave the way for the necessary regulations spelling out the details of the arrangements.
      The alternative way of proceeding as a matter of law would have been to draw up regulations under the European Communities Act 1972 implementing the United Kingdom's Community obligations in respect of public service vehicles. That would have given rise to considerable drafting and other difficulties and probably, for a variety of reasons, would have been a less attractive course, given the present mood of the House, to adopt. We welcome the opportunity, therefore, of paving the way through this Bill to bringing passenger vehicles within the terms of the 1972 Act and then making the necessary regulations.
      There is no policy difference between us and, though the statute will not contain details of the annual inspection, it will pave the way for the regulations. I give the clearest possible undertaking on behalf of the Government that we shall produce the necessary regulations to bring the new system into effect at the required time.
      There is the problem of the enforceability of the new system of annual inspection once it has been put into effect. As
      950
      with the other safety requirements of the Bill, our view is that they are perfectly straightforward to enforce and that they can be enforced properly. It is obviously in the public interest that public safety regulations should be enforced as strictly as possible.
      Every operator will be required by regulations under this Bill to notify the traffic commissioners of the vehicles he owns and operates. Every vehicle which he possesses will be subject to inspection by the Department's vehicle inspectors. Inspection can take place in a wide range of circumstances and more or less at any place and any time to ensure that a vehicle is fit to be on the road.
      The means by which we shall make sure that an operator submits his vehicles for annual test are that, by bringing passenger vehicles within sections 33 and 34 of the 1972 Act, the test certificates to be issued under this procedure will be linked with vehicle excise duty. That means that the certificate will be producable at the time of paying the vehicle excise duty. There will thus be a ready means of ensuring that a vehicle has gone through the annual test to which it is liable.
      The other point of detail raised in debate was whether it would be possible to carry out these annual inspections on the premises of operators who had the right facilities or whether all buses would be required to go to an approved vehicle testing station elsewhere. I am happy to repeat the substance of what I said in Committee. The Government are quite happy to consider the possibility of operators' premises being designated as approved places for the test. The regulations will pave the way for that possibility. We anticipate that a number of testing centres will be the premises of some of the major operators.
      First, we shall need to consider—and the right hon. Gentleman anticipated this—whether the facilities at particular premises are adequate for the rigorous tests required. I believe that only the major operators will have the kind of depot, garage and maintenance facilities appropriate for the tests. My only caveat is that the adequacy of the facilities will not in itself be the only decisive factor. We must look at various other matters, including the cost of sending our examiners to obscure parts of the country or

      951
      endless testing centres to chase up specific vehicles. We must have some economy of organisation.
      There must be a proper geographical spread of testing centres to ensure that the bus industry as a whole is properly served and is not inconvenienced. There must be a testing station within easy range of an individual operator. Although we have not proposed these particulars in our discussions, it is possible that, if an operator wants his own premises to be used as a testing station, approval may depend upon the facilities being available to other operators so that their vehicles may be tested at that same station. A station will thus serve a fairly wide geographical area and be of advantage to the bus industry as a whole.
      We are prepared to discuss all these matters. We do not anticipate any difficulties in practice and we envisage that when the system is set up some of the approved centres will be operators' own premises.
      I was asked about the standards of the tests, and how they would be achieved. The standards will be the equivalent of the present rigorous ones that we attempt to apply to heavy goods vehicles and to passenger vehicles as well. We have indicated a policy intention to return the testing of heavy goods vehicles to the private sector. We are still considering the position with respect to passenger vehicles. However, whoever carries out the testing, it is the Minister who bears the responsibility for ensuring that it is of the right standard and adheres to the policy of the Bill. That policy is to ensure that the best possible protection is afforded to the travelling public by way of a regular enforceable system of testing and inspection. We can thus ensure that, once tested and inspected, the bus fleet will be as safe as reasonable regulations can secure.
      4 pm
      Mr. Booth: With the leave of the House, may I say that I cannot understand why the Parliamentary Secretary insists that this matter must be left with the Minister. I understand that he has agreed that there should be an annual inspection of public service vehicles and that that should be prescribed in regulations. Why, then, will he not support me in recommending new clause 8, which seeks to provide precisely that?
      952
      New clause 1 removes an impediment in the 1972 legislation. That impediment is the specific exclusion of public service vehicles from test certificate requirements. However, that is not good enough. I have no objection to removing that part of the 1972 Act so as to leave the regulation-making powers in the Bill as they stand. That may serve some useful purpose, but it does not impose a specific requirement under the Bill, as we seek, to ensure that the Minister provides for full annual inspection of public service vehicles. The requirement was not in the 1972 Act, but we should take the chance to put it in the Bill. There is nothing in new clause 8 to prevent the Minister from taking the time that he needs to prepare the regulations properly; nothing to prevent him from taking account of all the considerations which the Parliamentary Secretary has very fairly laid before us.
      Mr. Kenneth Clarke: New clause 8 is confined to public service vehicles. In our proposals we are taking wider powers than that, and our regulations will apply to all large passenger vehicles. The powers that the right hon. Gentleman is offering us in new clause 8 are narrower than those that we propose to take in the regulations.
      Mr. Booth: I do not accept that. I do not see one new clause as an alternative to the other. If the Parliamentary Secretary will support our new clause we shall happily join him in recommending both new clauses, but the House has an absolute right to demand regulations requiring an annual inspection.
      The Parliamentary Secretary does not need to tell me, given all our debates in Committee, when we pressed upon the Government the need for a wider definition of public service vehicle, that there are vehicles outside that definition which should be covered by it. As my hon. Friend the Member for Holborn and St. Pancras, South (Mr. Dobson) pointed out, there are buses conveying children to school which could be outwith the definition. However, conscious though we are of the public service vehicle definition in the Bill, that is not the point at issue.
      If my hon. Friends want the House to recommend an annual inspection by regulation rather than leaving the matter to the Minister, they must vote for our new clause. I ask them to support new clause 1 and new clause 8, and that is a perfectly

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      proper approach because none of us would want to stand in the way of the Minister making wider regulations than those we propose. If, in his wisdom, the Minister decides that other larger passenger vehicles not within the public service vehicle definition should also be subjected to annual fitness tests, we would not wish to be seen, by anything that we said or did, to be opposed to that. We are not. However, we insist that the House should decide whether there should be such annual inspections and whether they should be written into the Bill at this stage.
      Question put and agreed to.
      Clause read a Second time, and added to the Bill.
      Mr. Speaker: We shall have a Division on new clause 8 when we come to it.

    New Clause 6

      CARRIAGE SERVICES COMPETING WITH OPERATORS HOLDING ROAD SERVICE LICENCES
      "No express service or contract carriage service shall operate on a route which is served by public service vehicles operating under a Road Service Licence and supported by a transport supplementary grant and/or cross-subsidised under a passenger transport policy network agreement unless in the cases where cross-subsidy applies the agreement of the Traffic Commissioner is obtained and in the cases where transport supplementary grant applies the agreement of the local authority is obtained.".—[Mr. Booth.]
      Brought up, and read the First time.
      Mr. Booth: I beg to move, that the clause be read a Second time.
      The clause deals with a matter which is at once complex and far-reaching and relates to one fundamental issue. That issue is whether it is possible, within the combined effects of the Bill in terms of its delicensing, its definition of express service, its opening up of contract carriage, for local authorities to carry out their statutory duty to promote and coordinate efficient public transport systems within their areas.
      We hold that these combined effects will prevent local authorities from doing that. We also believe that, in order to rescue something from the devastating effects of the Bill, our new clause is necessary to inject into the much wider system of free enterprise operation a method of
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      check and agreement as between local authorities and operators, and as between traffic commissioners and operators about what is necessary to maintain network and individual services where they are being supported by transport supplementary grant.
      As the Bill is now drafted, it would be possible for someone to set up a contract carriage operation within an area covered by a networking agreement. Even though the public are making their contribution to that agreement through the transport supplementary grant, and even though major operators in the area are making their contribution by cross-subsidisation as between their profitable and unprofitable routes, along could come another operator who could cream off certain of the profitable routes without regard for the effect that that would have on the public transport service, which is a statutory concern of the local authority, or for the public interest which is at the root of the statutory duty imposed on traffic commissioners.
      A great many services in local authority areas are making a valuable contribution to maintaining other services within those areas. Urban services are making a contribution towards rural services. Monday to Friday services are making a contribution towards Sunday services. Peak hour services are making a contribution towards slack hour services.
      The whole of our public transport network is based upon a complex balancing of financial factors that allow services to run on the basis of a mixture of considerations. There is the consideration of how much should be properly taken from one route to support another. There is the complicated consideration of how much taxpayers' and ratepayers' money should be provided to operators through supplementary grants for them to operate services that the local authorities consider necessary if they are to carry out duties laid upon them by Parliament to promote and co-ordinate efficient public transport systems.
      Many hon. Members are aware that the emphasis on the promotion of services needs to be highlighted. There are still too many areas which, several years after the introduction of transport supplementary grants, have not succeeded in promoting services on a considerable number of routes. There are still many people

      955
      who complain bitterly about their difficulties in getting to work or attending social functions because of the absence of public transport in their areas.
      It is our experience that even after a few years of those statutory duties and of local authorities receiving transport supplementary grants, far from having an over-provision of public transport services, we are still suffering an under-provision. Those local authorities, shire county authorities and metro-county authorities that have been successful in bringing about an expansion of public services by promoting and co-ordinating the various transport operations are in a minority. Many have been struggling to hold together an existing system.
      Under the provisions of the Bill, a contract carriage operator will be able to take advantage of a lucrative end-to-end route that is being served by a stage carriage service for which a road licence has been obtained, and will be able to operate only at peak hours, and on Mondays to Fridays, or possibly Saturday mornings. He will be able to do so only on those identifiable occasions when it is profitable, and he will be able to cream off money from the route and leave the existing operator to carry out that part of the networking operation that is essential if it is to stand as an operation that can be fairly described as a co-ordinated, efficient public transport system.
      If that happens, we predict that we shall be presented with a number of unpleasant options. Local authorities may tell the Government that they can sustain the operation of bus services—in some cases train services that are supported under the transport supplementary grant system—only if considerably greater contribution can be made. They may tell the Government that they cannot continue sustaining services at the required rate.
      4.15 pm
      Another possibility is that the network operators will tell local authorities that they can no longer make the network agreement or the contribution from cross subsidy required to sustain the network. They will say that they are not prepared to work on that basis. Some local authorities are prepared to play the game by either set of rules. However, at present, operators cannot use one service to cross-
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      subsidise another and simultaneously compete with that service. They can do one or the other.
      Having talked to a number of operators, I suspect that in those circumstances they will pull out of the non-profitable routes. They will say that the TSG support is about one-third of the subsidy that is required, and that they are having to find two-thirds or more by cross subsidy. They will not be prepared to give up the routes where they are now making a profit, even though they are using the profit largely for cross-subsidy purposes. They will pull out. They will cut fares on the few routes that are profitable—10 per cent. of the routes at most—and the overwhelming majority of services will close down. That type of contract carriage operation has not been envisaged previously. Up to now all contract carriage law has covered specific types of operation.
      Another threat that looms large is that of the new definition of the express services. Any operator who is prepared to run a 30 mph or faster service can do so without road service licensing approval. There is much argument about the length of express operation—25 miles, 30 miles, 35 miles or 40 miles—that will affect the ability of the major operators to make a contribution from their carriage operations to other services. The National Bus Company estimated that a difference of five miles would affect its income by about £5 million.
      Under new clause 6 we are pressing for a minimum that is required to bring about reasonable protection of the operations. We are not saying that a new operator should not be able to operate on a cross-subsidised route. There may be cases—this will appeal particularly to the Minister—where local authorities will welcome a new operator on a cross-subsidised route. They may find that a new operator is prepared to operate a substantial part of the service with a lower degree of subsidy. That will be welcomed with open arms. However, where the route is at present subsidised under the TSG arrangements, the local authority concerned must be consulted. Public money is being used to provide a service, and if a new operation can lead to the use of that public money in such a way as to provide as good or better services, with no more, or possibly, less

      957
      subsidy, it is to be welcomed. However, it is feared that in many cases a new operator will not want to discuss that with the existing company, the traffic commissioners or the local authority, because he will want to operate in a way that does not take into consideration this major factor, which the House has decided must be a responsibility for local authorities.
      I cannot believe that Members of Parliament would seriously wish to pass legislation which would require the majority of operators on stage carriage routes within their constituencies to go through a road service licensing procedure which took account of the public interest through reference to the traffic commissioner and the considerations which he would apply to road service licences, as well as the local authority's careful regard to the provision of taxpayers' and ratepayers' money to operators in order to maintain a network, and at the same time wish to make it possible for a number of others to operate with total disregard for those major factors. To do that would be to make nonsense of the whole business which we are about.
      The Bill is an unhappy mess in this respect. It aims at two completely different objectives, and one so badly conflicts with the other as, in my view, to threaten the destruction of a good passenger transport system in a large number of areas.
      I believe that this new clause provides a mechanism which allows a fair balance of the considerations involved, allowing an operator who is carrying out a desirable cross subsidisation—which was desirable in the view of the traffic commissioner and was taken into account in the determination of his road service licence—to say to the traffic commissioner that he believes that the effect of having contract carriage operation over certain parts of his routes at certain times, would not only be detrimental to his maintaining those routes but would in fact require him to withdraw.
      A traffic commissioner who has granted a road service licence, having looked carefully and in detail at how far that licence and its form and conditions met the public interest, is, I believe, in a better position than are others to judge the effect of
      958
      having contract carriage operation on such a route.
      It could be held that the operator is biased about it. It could even be held in certain circumstances, though I would not so contend, that local authorities may be somewhat partial in their attitude towards certain routes, having run their own services or having made arrangements with particular operators. But that cannot be said of the traffic commissioner.
      I believe, therefore, that the new clause is of great importance. It offers, as it were, a last chance for us to try to inject some logic, common sense and balance as between the express or contract carriage operations which at present are totally outwith road service licensing and the role of the traffic commissioner. It gives an opportunity to local authorities which have the statutory duty to try to promote good public services and which are spending public money for that purpose to be involved in agreements with those who will operate on routes which, under the proposals in the Bill, can be operated without any regard to these major considerations of the public interest.
      Mr. Iain Mills: During the 110 hours of our work in Committee, when the right hon. Member for Barrow-in-Furness (Mr. Booth) and his hon. Friends spoke in those grindingly long debates, this question emerged, to a large extent, as the greatest divide between us.
      As I understand it, the right hon. Gentleman's argument is summed up in the belief that cross subsidisation is somehow a beneficial system which will result in the provision of services which otherwise would not be provided. In examining that argument, one has to look at the reality of services in Britain today. I find it strange that the right hon. Gentleman did not remind the House that in every county, every district and every area public bus services are declining.
      Mr. John Prescott: This is the second time that the hon. Gentleman has made that assertion, and it is not true. Let him make the comparisons and look at the facts, especially in the metropolitan bus authorities compared with the counties or, indeed, look at the facts even in Tory metropolitan areas. He will see that both the South

      959
      Yorkshire and Newcastle areas, for example, have been increasing the number of people travelling on their buses.
      Mr. Mills: I hope that the hon. Gentleman will recognise that I did not speak of the number of people travelling on buses. I referred to the services offered, and this is an important distinction. It is vital to have services offered which are relevant to people's needs. I can only tell the hon. Gentleman that, right in the middle of our lengthy Committee stage, Midland Red, in my constituency, cut services. I hope that the hon. Gentleman will forgive me, therefore, if I find his remarks strange when my constituents tell me that right in the midst of this argument, in which he and his right hon. Friend have argued that cross subsidisation will somehow continue the magic of public bus services, in my constituency those very services were declining.
      Mr. Prescott: Take an example from a Labour area.
      Mr. Mills: My constituency is not the only one where that has happened. This brings me back to the real divide between us. Cross subsidisation and directed traffic under the present system just does not work. I re-emphasise that in North Warwickshire, Solihull and the rest of my area in the Midlands this need has now become a prime priority. There are old-age pensioners, disabled people and families who are abandoned and marooned by the lack of bus services. So we are not starting from the basis of an ideal situation which is beneficial to all.
      Secondly, is it right to define cross subsidisation as a necessity for the provision of bus services? What is cross subsidisation? It is the use of finances generated from one set of services to support another set of services. Is this genuinely sacrosanct? Is it not part of the duty of an elected authority, or of a non-elected authority—even a non-elected authority such as the traffic commissioners —to recognise that if socially needed services should be provided they should in fact be provided? Is it not a better financial discipline to recognise that by defining, without cross subsidisation, what each service provides in terms of its benefits to the customer?
      We are not talking about politics here. We are talking about people who want
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      transport services to take them from one point to another. Could people not have a better service if we allowed ourselves to make judgments? I am sure that many passenger transport executives and bus companies would accept the argument that if they are there to provide services it is up to the elected authorities, whether Members of Parliament, county councillors or district councillors, to decide where and how the public money should be spent. I find it difficult, therefore, to understand why cross subsidisation should be regarded as sacrosanct.
      The right hon. Gentleman said that we should have to face some unpleasant options. Why should they be unpleasant? Under the Bill we are for the first time embodying in law opportunities which in many of our constituencies have already been shown to be genuine opportunities. Private enterprise can often provide at lower cost better services than those provided by public enterprise. This also is part of the great divide which took us over, as I recall it, 130 Divisions in the Standing Committee. By energising the forces of private enterprise we shall get people working at a cost lower than that shown by the passenger transport executives or the nationalised bus companies in the provision of services at times when people want them and in vehicles as they want them.
      We must all be familiar with the sight of huge buses with three people sitting in them. I am not so unsophisticated as to make that point without recognising that at peak times those very buses may well be full. But I put it to the Opposition that there could well be a place for buses run by private enterprise at certain times of the day to provide services which will make a profit for an entrepreneur, providing services for local residents, while at other times of the day on the same routes we could still achieve services in different buses for those of the population who require them. I believe that a complex mixed economy of transport provision, both private buses and public buses, is the only answer.
      Under the Bill, without new clause 6, which I sincerely hope we shall not pass, we have for the first time innovatory legislation which allows entrepreneurs to do just that. Many of us have in our constituencies entrepreneurs who have

      961
      already battled through the lengthy process of arguing with the established bureaucracies of the National Bus Company, the passenger transport executives and the local authorities in order to get their services going. They are already providing services. In Committee I gave three examples from my own constituency where they are providing excellent services where the institutionalised public provision would just not succeed. I therefore urge the House to reject the new clause.
      4.30 pm
      Mr. Sydney Bidwell: I did not sit through the long, weary and tortuous hours in Committee, but I took part in the Second Reading debate. In looking at the new clause, I can imagine that it somewhat counters the substance of the Bill itself. However, it does not entirely throw out of the window the main purpose of the Bill.
      In endorsing the argument of my right hon. Friend the Member for Barrow-in-Furness (Mr. Booth), it seems to me that the wording of the new clause—which I imagine has been drawn up very carefully indeed, and at first sight appears to be somewhat complex—can be the means of ushering in an element of planning in order partially to accept the fact that the Bill is now going through Parliament because of the inbuilt Conservative majority.
      The Government have applied their mind to transport according to their own light, and they genuinely believe that out of their proposals will emerge a much better service for the people and a much more efficient one than we have had hitherto. I do not think that that is the case at all. Without new clause 6, I believe that the Bill could rapidly lead to a state of anarchy on our roads.
      Like many other hon. Members on both sides of the House, I foresee the time rapidly approaching when more and more car owners will have to look to the passenger services of various kinds in order to get to work. If that is the case, it means that more workers will be involved in those services. There is real fear, particularly on the part of members of the Transport and General Workers Union, that an anarchistic situation will arise from the Bill's central provisions.
      962
      It is up to the Minister to allay those fears, because it is upon the good will of transport workers and the way in which they go about their daily lives that at the end of his period the right hon. Gentleman will be judged to have been successful or to have failed.
      In addition, there is the question of road slaughter. If efficient public services are used by more people than use our existing services, obviously the question of slaughter on the roads diminishes a great deal, because it arises precisely from the various kinds of transport which at present use our roads.
      These questions are interlocked. I believe that as a result of the requirement in the new clause, whereby local authorities will be under the discipline of a cross-subsidisation system, local authorities will be able to play a greater role in the localities, and throughout the county complex, to ensure that the changes envisaged by the Government and the Minister are successful. I respect the Minister's views, but only the test of time will tell whether the basic Socialist philosophy as applied to public transport is better than his. The proof of the pudding will be in the eating. I believe that at the Tory Party conference the Minister described his proposals as somewhat revolutionary. In so far as his proposals spell out considerable changes, I suppose that they could fall into that category, although we are not accustomed to Tories talking about revolution.
      Nevertheless, the proposals spell out considerable changes that must be ushered in with a good deal of caution. I am open-minded about certain aspects of the proposals, because, as I said, the proof of the pudding will be in the eating. However, as my right hon. Friend said, there is a fear that there will be a wholesale creaming off.
      The trade unions which represent road passenger service workers in the public sector are well organised, but there is a fear that the wages and conditions of those workers will be put in jeopardy as a result of their being left with the Cinderella services. There is a fear that they will be left with the empty vehicles while the fly-by-night operation, which will pass under the sunny title of "private enterprise", will cater only for rush-hour periods or times when the vehicles are

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      likely to be fully used. The danger is that if such an operator gets fed up, if someone goes sick or if a man's son does not wish to carry on with the service, many people will be bereft of any service whatever. That is a real fear.
      There is a need for a balance, and I believe that the terms in which new clause 6 is drawn will ensure that that balance is steadily applied and arrived at.
      Mr. Peter Fry: I begin by declaring an interest in this matter. Having heard about the length of the Committee proceedings, I am not sorry that I missed them. However, there is one relevant question that should be asked, not only in regard to this part of the Bill but in relation to the new clause. Will what is proposed either halt the decline in services in some parts of the country or improve them? Surely, that is the only relevant question that we should ask this afternoon.
      My right hon. Friend the Minister has put forward what have been claimed to be far-reaching proposals, and the right hon. Member for Barrow-in-Furness (Mr. Booth) has rightly expressed certain fears about what could happen. I am sure that all of us would accept that the present situation is unsatisfactory. Indeed, I remind the right hon. Member for Barrow-in-Furness that over the years the Labour Government introduced new legislation because they realised that what was happening was totally unsatisfactory. For example, bus services were declining and more and more people in various parts of the country, particularly in the rural areas, were finding themselves without public transport.
      I do not entirely agree with what my hon. Friend the Member for Meriden (Mr. Mills) said about cross-subsidisation, because bus service operations are somewhat more complex than many people appreciate. It is not just a question of a driver starting off at point A, driving to point B and back to point A, and doing that throughout the day. Because of the complication of drivers' hours and other legislation which applies, it is often necessary for that driver to make two or three journeys from B to C, or even from C to D, before he reverts to B to A. That may confuse the House. I confess that I have
      964
      always found the matter confusing. However, it means that in employing that bus and driver we are not dealing with just one service. If anything happens which undermines or removes the need for the service while the driver is operating, the coherence of the whole of the service is undermined. As I understand it, that is the main point that the right hon. Member for Barrow-in-Furness put forward.
      How does my right hon. Friend see the role of the local authorities and the county councils which have the responsibility for the co-ordination of public transport and, indeed, the job of subsidising public transport in the event of that type of situation arising? What will happen if, because of the creation of new contract carriage services, services that are subsidised are undermined? For example, what will happen if the local operator who is perhaps part of the National Bus Company says "It is not just a question of my doing away with the route from B to C. I must do away with the routes from C to D, D to E and E to F because they will no longer pay. On the other hand, in order to maintain those services I require a considerable amount of money from the ratepayer and the taxpayer"?
      Therefore, we must carefully examine the role that the county councils are expected to play. They have been anxious to take on the responsibility in the past. I remember my right hon. Friend and myself arguing vociferously that they should be given the right to control public transport, particularly in rural areas. If they have this responsibility, they should be consulted and have a strong say before we introduce a whole series of new services which could damage what already exists.
      There is one fear that niggles me about this part of the Bill. I do not doubt my right hon. Friend's intention to try to bring new services and life into public transport. For that he deserves every commendation. My fear is that the freedom to be given is likely to bring into public transport not just the fly-by-night operators—I do not go all the way with the hon. Member for Ealing, Southall (Mr. Bidwell)—but those who have not done their sums too carefully, who may think that they can operate an express service and then find that the economics are not going too well.

      965
      The temptation to break the law—the temptation to try to get extra revenue—which existed before there was legislation on bus services could happen again. Because of that, there is a danger that these new services may siphon off passengers from existing services rather than create more passengers and services. If that happens, it will undermine the real purpose of the Bill—the creation of new services and help for people who are without public transport at the moment.
      I hope that, in reply to this short debate, my right hon. Friend will try to spell out for me and satisfy me that the Government are aware of this danger and that they have consulted the Association of County Councils on how they are to meet this need. The danger may not be immediate. It may not be next year or the year after. The real danger is that many of the new services may come in and prove unprofitable and that, in about 1983 or 1984, we shall find ourselves with less public transport than we have today.
      Mr. Harry Cowans: I listened as carefully today to the hon. Member for Welling-borough (Mr. Fry) as I did during the transport debates in 1978. I do not agree with everything that he said, but he introduced a note of realism into the debate today. Without doubt, the new clause tries to put a note of realism into the Bill. One could argue that it is a conservative clause, because it introduces a note of caution.
      Having heard the hon. Member for Meriden (Mr. Mills), one would have thought that entrepreneurs were queueing up to take over these services. The clause makes it abundantly clear that we are talking about rural services—the unprofitable parts of the transport empire. That is the fundamental difference between us.
      I turn to the cross-subsidisation argument. Whether we like it or not, people outside sometimes make the accusation that in this place A votes "Aye" and B votes "Nay" and never the twain shall meet. Put another way, Conservative Members vote "Aye" and Labour Members vote "No" and realism goes out of the window. I hope that that will not transpire in this debate, because there is real worry about this matter.
      966
      As the hon. Member for Welling-borough said, the worry is not immediate. It will not happen the day after the appointed day. The worry goes beyond that point. It would appear that many people hidden away in many constituencies have suddenly discovered that they can run the transport system. One could argue that the opportunity is available to them now. Conversely, it can be argued, as no doubt Conservative Members will argue, that the transport commissioners grind exceedingly slow. But in the pursuit of profit, even when the rules of the game grind exceedingly slow, has anyone who can make that profit been put off before? The answer must surely be "No".
      4.45 pm
      There has been no queue of people to operate these rural services. This matter goes beyond party politics. We are talking about people in rural areas who rely on transport. There has been no queue of people to provide these services.
      The clause is carefully worded. It is cautionary. It urges us to look at the systems which have previously been subsidised before we introduce another system which may not exist for a very long time. One would think that a local authority would look into rural transport before pouring good money into it. Successive Governments have supported the view that rural transport should be subsidised.
      The fundamental issue between us is cross-subsidisation. I appreciate that to Conservative Members the National Bus Company is poison. However, it exists. There is also another clause on this matter, which, for fear of incurring your wrath, Mr. Deputy Speaker, I shall not mention. However, there is the prospect of £5½ million being lost, a percentage of which could be used in cross-subsidisation. If that percentage is taken away, that cross-subsidisation will not exist. It can be likened to a tree. The National Bus Company does not cross-subsidise out of the goodness of its heart. It cross-subsidises in the form of a tree. If the branches feeding into the trunk make the trunk profitable, it makes sense to support the branches.
      Our worry is that, not in the first instance but over a period of time, rural transport will be non-existent because people who have not done their homework will move in. Everything in the

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      garden will look rosy for a short time, but they will kill off existing services, because of the cross-subsidisation agrument, and then move out. What will fill the gap? Perhaps the Minister, in replying to the debate, will take us beyond the appointed day, when this free-for-all is to transpire. If it does not work, will he tell us what he proposes to put in its place by way of rural transport? That is always assuming that the Minister and his hon. Friend are still in the positions that they now occupy.
      Mr. Fowler: The essential point about the debate was put forward by my hon. Friend the Member for Wellingborough (Mr. Fry). He asked whether the new provisions would benefit the travelling public. I agree that, above all, that is the litmus test. It is about not what the lobbies, the operators or the unions want —all these bodies have a right to put their arguments—but what is in the best interests of the travelling public. Therefore, I should paint in the background to what we are doing.
      The aim and purpose of the Bill is to remove unnecessary restrictions on the bus industry and, at the same time, provide the opportunity for new services to develop. As my hon. Friend the Member for Meriden (Mr. Mills) rightly pointed out, some of the new services will undoubtedly be provided by private operators. The obstacles now put in the path of operators wishing to run long-distance coach services do not serve any worthwhile purpose. It is right to remind the House that essentially we are talking about express services which, by definition, are services covering more than 30 miles.. Such obstacles in the long-distance area restrict the choice of the public.
      There are those who want to travel by express bus and who prefer that option either to driving or to catching a train. If a man travels from Bristol to Birmingham he may want to travel by air, rail, car or coach, and the Government see no justification for seeking to restrict this choice of method of travel. That sums up my philosophy, but, what is even more significant, it sums up the philosophy of the Labour Government. In their White Paper on transport policy they said:
      "Provided the terms of competition are fair, if people choose to travel by coach rather than rail or air because lower fares are more im-
      968
      portant to them than speed, they should not be prevented from doing so."
      That is a sentiment that I support entirely.
      Mr. Stanley Cohen: The problem is whether those people will have the right of choice. I remind the Minister that there was an occasion during the Beeching era when the rail service between Scarborough and Whitby in Yorkshire was terminated as the result of an investigation by the traffic commissioner, who was assured that private bus operators would provide an alternative service. But within 12 months that alternative service no longer existed because it was totally unprofitable, and the people who lived in those rural areas were isolated from public transport as a consequence.
      Mr. Fowler: I shall come to those points. We are dealing with contract carriage, but essentially we are talking about express services. In other words, we are dealing with services that are more than 30 miles in distance. That is the aim and purpose of what I am about to say.
      In the area of express services, it is fair to remove the present licensing restrictions that prevent bus operators from competing on equal terms. In other words, contrary to what has been said, there is a demand for travel which at the moment is not being met. I believe, further, that that new demand, and the fact that resctrictions can and will be removed, will lead to new operators coming forward in this area.
      I was attacked on the ground that new operators would not come forward and that there was no great demand for intercity coach services of for new coach services at all. But there are signs at present that exactly what I am predicting is taking place. An article in The Daily Telegraph on 21 January said:
      "New private enterprise companies are planning to challenge the National Bus Company on key express coach routes when unrestricted competition returns to the business later this year for the first time in half-a-century".
      Surely, that is in the interests of the public.
      Mr. Cowans rose—
      Mr. Fowler: What was the response of the National Bus Company? To do it justice, its express division controller

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      was quoted in the same report as having said:
      "Competition is a spur; it is not a threat."
      That is surely exactly the approach and feeling that there should be in the bus industry.
      The first point that I make in refuting much of what has been said today, which I believe is not only alarmist but totally wrong, is that in this important area—this point was conceded by the right hon. Member for Barrow-in-Furness (Mr. Booth) in Committee—of inter-city travel there will be more opportunity and more providers. That will be in the interests of the public. Not one word that I have heard this afternoon challenges that.
      Mr. Cowans: If the Minister reads new new clause 6 carefully, which I assume he has done, he will see that the key words are
      "under a passenger transport policy network."
      The fear is that, as with a jigsaw puzzle, many local authorities and the NBC have subsidised a number of branches of the tree in the overall network. If we take out one or two of those branches the network will collapse. That is the main point of new clause 6.
      Mr. Fowler: I shall come to the points made by the hon. Member for Newcastle upon Tyne, Central (Mr. Cowans).
      Basically, the Opposition are still concerned about the freedom that will be provided here. They wish to reimpose restrictions on these services. Indeed, they now wish to go further and extend those controls to services that are not even licensed at present. If the hon. Member for Newcastle upon Tyne, Central refers to the clause, he will see that those services are the private coach parties or contract carriers.
      The Bill does not change greatly the position of those services except in one small but important way. The Bill will make it easier for people to club together to solve their own transport problems. I am thinking especially of commuter clubs which are currently prevented from hiring coaches for journeys to work by the restrictions on the making of regular journeys. This restriction will go, but those which protect the ordinary local bus service will remain.
      970
      Concern for the local bus network—I fully appreciate what the hon. Member for Newcastle upon Tyne, Central is saying—is at the heart of the clause. I have sought to make clear all along that it is no part of our desire to destroy that network. That is why I have retained licensing for all services which are part of the local network. The distinction that I have drawn in the Bill between express on one side and stage carriage services on the other does that. In other words, it preserves the distinction between the express services that are outside the licensing restrictions and the local services where I believe there is a need for control. Although we have changed the presumption of proof, we have accepted that.
      What I do not see is why a non-stop express bus from, say, London to Manchester should damage the local bus network. Contract carriages also serve quite a different market. They are privately run and are organised voluntarily. That is not unfair commercial competition. That kind of commuter coach service will supplement regular services at peak periods and will not damage the network.
      I believe that the Bill makes a proper distinction of the local network. My purpose is not simply to maintain and protect that network in its present form. The public would not be satisfied with that, just as they are not satisfied—as my hon. Friend the Member for Meriden rightly pointed out—with the present level or standard of local bus services. The Bill will change the balance of licensing in favour of the operator wishing to run new or better services. It will be for the established operator to prove that the competition will be detrimental to the public interest.
      Cross-subsidisation may be an important issue here. But the operator will be required to satisfy the traffic commissioners that it is of overriding importance. I understand, obviously, the arguments about cross-subsidisation, but I believe that it is necessary for those who claim that cross-subsidisation is taking place to justify the patterns of that subsidy. That is a healthy discipline for the operators themselves. When it comes to the local services—the services within the 30-mile threshold—as I have said, there is no question but that they will have to go to

      971
      the traffic commissioners. The commissioners will have to judge whether that is an overwhelming argument.
      5 pm
      It seems to me, therefore, that the thrust of the Opposition's new clause is to protect the present pattern of cross-subsidisation and local authority support. The thrust of the Bill is to encourage a new look at those patterns to allow competition to be a spur to improving services and efficiency instead of placing an automatic and ever-increasing reliance on subsidy paid for by the ratepayer and the taxpayer.
      When the hon. Member for Kingston upon Hull, East (Mr. Prescott) intervenes and tells me that South York shire is now the model upon which the Opposition's policy is based, I am bound to tell him that for three years I sat on the Opposition Front Bench and heard from the then Secretary of State for Transport in the Labour Government how iniquitous the policy of South Yorkshire was at the time and how it was that the right hon. Member for Stockton (Mr. Rodgers) wanted nothing else but to change that policy. Now we understand, with the change of management on the Benches opposite, that South Yorkshire, rather than being the villain of the piece, has become the hero of the piece.
      We learnt many things during the Committee stage. The great differences in policy that have emerged between the Labour Party in Government and the Labour Party in Opposition have been some of the most dramatic.
      Mr. Prescott: The right hon. Gentleman is being less than fair to my right hon. Friend the Member for Stockton (Mr. Rodgers). Whatever the differences of attitude about bus policies, certainly when my right hon. Friend was Minister he was concerned about the proportion of rates that South Yorkshire might be getting, but he was also concerned about the same argument for Oxford. At that time it was a very difficult argument. Nevertheless, he reached agreement the following year with South Yorkshire, which maintained the very principle that it has today, which has gone from strength to strength in passengers and in the provision of services in that area, to a far greater extent than any other metropolitan authority.
      Mr. Fowler: That strains the matter a bit. I think that anyone with any
      972
      objectivity who had listened to what the former. Secretary of State said over the previous two or three years about the policies of South Yorkshire could not conceivably come to the conclusion that those were policies that he supported.
      Basically, however, I cannot accept the new clause to reintroduce controls in the way that it sets out. It would introduce new restrictions on contract carriage services, which under the present system are not licensed. The Opposition want to protect the local network. I understand that. I have made it clear—and I say this again to my hon. Friend the Member for Wellingborough, who made a thoughtful and critical speech—that I am in no way out to destroy that network. That is why I have retained licensing for all the services which are part of that network. But I am confident that the distinction that I have drawn between the express and the stage carriage services does just that. I see no reason why the express services should be a challenge to that, nor do I believe that contract carriages, which are serving a different market, should be a challenge to that. In other words, I believe that services such as commuter coach services will supplement regular services at peak periods and not damage that network.
      Mr. David Penhaligon (Truro): On a point of information, will the Minister let me know whether the sort of holiday excursions organised in parts of the country such as mine, where people offer services in a number of picturesque areas —say 10, 15, 20 or 40 miles away from the passengers' main residence during a holiday—are derestricted under the express licence regulations? Clearly, it could not be described as "express", but certainly the passengers, at one time on the trip, may be more than 30 miles away wrom where they started. Will that sort of service be derestricted under the Bill?
      Mr. Fowler: The short answer is that if the journey itself is over 30 miles, an express service, it would be outside the restrictions, but there are different derestrictions in the case of excursions and tours. I should need to look at the question in detail if the hon. Gentleman has a particular point, but my straight answer is that I believe that what he is saying would be outside the powers of the traffic commissioners.

      973
      Therefore, it is for operators and county councils to take an objective look at the patterns of cross-subsidisation that occur. I think, however, that it is not right to become obsessed with the subject of cross-subsidisation.
      Mr. Penhaligon: I am sorry to persist, but it is clearly stated in the regulations outlining the provisions that a person must be set down 30 miles from where he started. The irony of these particular trips is that the passenger is set down precisely where he started from, in exactly the same spot. I am wondering, therefore, whether that is covered by the express service definition.
      Mr. Fowler: As long as any point from which the passenger is taken is 30 miles away, that would take him ouside the ambit of the commissioners.
      Mr. Penhaligon: It does not say that.
      Mr. Fowler: With respect, it does say that. Also, with respect, the hon. Gentleman served on the Committee on the Bill and we have been debating it for about 110 hours. I shall not embarrass the hon. Gentleman by pointing out the time he spent on it during the Committee stage.
      Therefore, the greater competition that I hope to see within local services will be a better spur to improving the services and efficiency than automatic and ever-increasing reliance on subsidy. But I beg the House to understand that, when it comes to the question of express services, I hope that there is now, as I believe there was, the start of an agreement, when we were talking in Committee, and that the fact that we are derestricting these important inter-city services—the services between London and Birmingham, and between London and Manchester, intercity services of that kind—is something that is totally in the interests of the public. We look forward to new operators coming forward on these routes and providing low-cost transportation for the public.
      That, I believe, is in the interests of the travelling public. That is what we judge the criteria of the Bill to be.
      Mr. Dobson: As a new Member, it strikes me that the response of Oppositions faced with Government measures falls into two categories. They either
      974
      denounce them as being likely to have the most far-reaching and disastrous effects or, alternatively, they say that the Minister concerned is leading people on into believing that what he is introducing will have a dramatic effect, when it will have practically no effect at all.
      In an effort to resolve that problem for myself today, I think I can say that the delicensing provisions of the Bill will probably achieve both of those things, because it seems fairly likely that there will be parts of the country which will be very adversely affected by the delicensing measures and parts where there are scarcely any effects at all. I am prepared to concede that on a certain number of what may be described as privileged routes there will be services that will be improved as a result in an increase in the number of operators and, consequently, an increase in the number of services.
      I had not intended to speak until I heard the Minister refer to the boss of the express division of the National Bus Company saying that such competition was a spur, not a threat. Prior to that, I heard the Minister say that we should consider not the interests of various pressure groups, such as the management, unions and so on, but those of the travelling public. I can understand why the man from the express division does not regard the delicensing of the express services as a threat to that part of the company for which he is responsible. It is likely that the National Bus Company will respond to the new situation by concentrating a great deal of effort on the profitable express services.
      I do not know what the NBC will do with the services that are not on express routes and are no longer profitable and no longer capable of being subsidised from the profits of the express services. The manager of the express division may loom larger in the hierarchy of the National Bus Company as a result of the proposals.
      Mr. Fry: Is not the hon. Gentleman aware that the National Bus Company operates under various headings? It is hardly likely that express services will subsidise the operations of one of the company's sub-divisions. Although we can talk about the overall profitability of that company, the hon. Gentleman's recent remarks tend to mislead the House.
      Mr. Dobson: I had not intended to mislead the House. I rely on the clause put forward by my right hon. and hon. Friends. It refers to the element of cross-subsidisation with transport supplementary grant or to a route upon which there is a cross-subsidy under a passenger transport policy network agreement. Perhaps I did not make clear that some areas may benefit from the Government's proposals. However, others will not. I tried to make a distinction. The clause seeks to protect those which are affected by the transport supplementary grant and by cross-subsidies under the passenger transport policy network agreements. I therefore do not accept the hon. Gentleman's point.
      Mr. Fry: If the hon. Gentleman refers to Hansard, he will discover that he said that it was the express services of the National Bus Company that would subsidise other bus services. As I said in my speech, it is possible that some express services may affect more services, but the National Bus Company operates through separate companies and those companies are accounted as such. As a result, the hon. Gentleman's forecast will prove incorrect.
      Mr. Dobson: I accept that technical point. Nevertheless, the express services of the constituent parts of the National Bus Company will probably loom larger in the activities of the National Bus Company. The provision of rural services by that company will probably loom much smaller. Those waiting in country lanes for a bus to appear in the distance will probably have to wait much longer as a result of the proposal. Services will become less frequent.
      The same applies to the new contract carriage services. The Minister upbraided my right hon. Friend for wishing to extend coverage to contract carriage services. He would be right to upbraid us if we had wished to extend the limitation to contract services of the type already discussed. However, if one considers the contract carriage services that are to be provided by clubs or by those who club together allegedly to look after themselves, we can see that they will have an impact on those services. It is a matter of dispute whether that impact will be favourable or adverse.
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      On Second Reading and in Committee we were concerned about protecting the bus network, particularly in rural areas. The Minister said that he would retain licensing in rural areas as that would help to preserve the network. If that is what he means, logic requires him to maintain a licensing system, or consultation with traffic commissioners, on those parts of the express system that are covered by TSG or provide an element of cross-subsidy for the rural network. The Minister conceded that that network needed protection in the form of licensing. However, he will chuck away part of that licensing. As a result, part of the provision of cross-subsidy from the express services into the rural services will be taken away. That is plain daft. It does not follow the logic of maintaining licensing for rural services.
      5.15 pm
      We therefore return to the fundamental question of whether a free-for-all in certain parts of the country will benefit the bulk of customers. We do not believe that it will. The Minister and his colleagues apparently hold a different view. However, there is little evidence that this burst of free enterprise on profitable routes will favourably affect the provision of services in rural areas. Those networks are already thin on the ground. We repeated one point ad nauseam in Committee. I hope that I shall not nauseate too many hon. Members if I repeat it this evening. The existing network of rural services is, on the whole, maintained by one form of subsidy or another. Such subsidies come from the taxpayer, the ratepayer or other users of the bus routes that pay. Rural networks cannot pay. Anything that lessens these subsidies to rural networks will damage them.
      The categories of express service and contract service that are mentioned in new clause 6 are involved in the cross-subsidy system. They should remain there. That provision should continue, to the benefit of the most deprived areas. We all accept that some routes may have four or five express coaches travelling on them each day. As a result of competition or of an additional operator, such routes may be used by five, six or seven coaches a day. Perhaps that would benefit those travelling on such routes. Such an occurrence may not prevail for long. However, it may pay and benefit the users on that

      977
      limited number of high-paying express routes. If the clause is not accepted, that change—which may be beneficial in the area concerned—will damage rural networks.
      Mr. Cowans rose—
      Mr. Deputy Speaker (Mr. Bernard Weatherill): The hon. Gentleman has already spoken. He cannot speak twice on Report.
      Mr. Booth: I am greatly concerned, because the Minister has totally misunderstood the new clause. He has opposed it on the ground that it will tend to defend and maintain the existing system and he envisages a superior system emerging as a result of the Bill. We can have many arguments about the effects of the new clause, but it cannot be argued that it will maintain the existing system. It will not. If we had wanted to put down a new clause to maintain the existing system, we should have done so. We have not chosen to do that.
      We recognise that the Minister has a majority in the House and that he can therefore introduce a different type of contract carriage operation that will enable operators to run bus services over short distances within urban and rural areas on a regular basis—for example, every Monday to Friday at nine o'clock in the morning and five o'clock at night. That will be possible under the contract carriage provisions in the Bill.
      The new clause does not take that power away. It does not change the definition of "contract carriage". It provides only that a test—not a prohibition—shall be applied where a new type of service is introduced into an area not currently served under networking agreements or TSG support. Where the service is introduced on a route presently served under a road service licence, a test should be applied by the traffic commissioner who previously decided to grant a road service licence. When granting the licence, he believed that it would enable a service to be operated in the public interest. He decided that without any knowledge of any new contract carriage operations being introduced.
      If somebody proposes to introduce a new service, a new decision must be made by the traffic commissioner about
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      whether it is in the public interest. That should operate only in cases where the traffic commissioner has to take into account whether that licence affects the degree of cross-subsidy in his area. The Minister cannot deny that the commissioner may have specified special conditions on the licence to maintain a certain level of public service within the area. The licence should be issued subject to those conditions.
      When the new contract carriage service is introduced those conditions may not apply, because there may no longer be any need for a degree of cross-subsidy. That is what the Minister and his colleagues want. Someone may be prepared to operate a contract carriage system that will relieve the need for a cross-subsidy.
      We think that such operators will come forward only on the highly profitable routes to cream off the profits. However, we do not know that that will be the case. We are speculating and making intelligent judgments about a service that has not existed for the past half century.
      We are not trying to change the provisions in the Bill. We are saying that where a contract carriage operator wishes to operate on a route where a road service licence has been issued and a cross-subsidy exists, the commissioner should consider the case. It is a matter of establishing protections for the road service licence holder.
      Mr. Leslie Spriggs: How would my right hon. Friend advise the Secretary of State to divide the services between the new operators, or the express operators, and the present licensed carriers? It is likely that a new operator will pick the most lucrative routes in the network. How can an unfair distribution of routes in the network be avoided?
      Mr. Booth: I shall try to answer those points later. At this stage I shall deal only with the one affected by contract carriage. If I were seeking to advise the Minister, I should tell him that the new system should operate only in those areas where its introduction would not damage the public interest, namely, where people were already operating subject to conditions of road service licence or with the aid of a cross-subsidy or TSG. In those areas the matter should be considered by the responsible authority. In the case of a cross-subsidy, it should be considered

      979
      by the traffic commissioner. In the case of a TSG, it would be a matter for the local authority which made the grant.
      Mr. Fry: I understand the intention behind the new clause. I am not unsympathetic to it. Does the right hon. Gentleman accept that the way in which it is phrased will give rise to an enormous number of applications to the traffic commissioners, because a large number of routes are subsidised? For example, let us consider an express service between London and Manchester. For part of its journey it would run over part of the London Transport ordinary bus system. To refer that application to the traffic commissioner would create an enormous amount of bureaucracy and do nothing to help the freeing of public transport from bureaucratic interference, which many of us feel is necessary.
      Mr. Booth: It will lead to a great deal of additional work for traffic commissioners only if people seek to run contract carriage operations on routes that are presently subject to road service licences, to either cross-subsidy or TSG, or to a combination of both. It is my fear that some new operators will cut across those elements of the road service licence routes that provide substantial cross-subsidies. They may cover parts of routes at times that are profitable, leaving the remainder to be covered by an operator who is complying with a public interest requirement. The House gave the traffic commissioners the job of judging whether issuing a licence subject to certain conditions was in the public interest.
      On the contract carriage aspect of the new clause, the Minister is not entitled to claim that he is defending the existing position. We are attempting to write into the legislation a check on the first phase of a new type of operation but one that does not preclude its introduction.
      5.30 pm
      Mr. Kenneth Clarke: I am not sure what the right hon. Gentleman's policy is. His new clause reads as if it refers to giving protection, against the new contract carriages, either to those services supported by transport supplementary grant or to those which are cross-subsidised. Therefore, on the face of it, I thought that his new clause said that the traffic commissioners should be consulted if a new work service or a school bus under
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      contract carriage arrangements competed with a loss-making service which was either receiving revenue support or being cross-subsidised. Now, he seems to be changing his mind and extending the new clause to a great extent. He seems to be claiming that a service should be referred to the traffic commissioners if it is receiving revenue support—that is, if it is loss-making—or if it is profit-making and is cross-subsidising other services. It seems as if the right hon. Gentleman, in his beguiling way, wants to go to the traffic commissioners over every bus service that one can imagine. If that is the case, he is seeking to undermine the whole policy of the Bill.
      Mr. Booth: It could be that certain operators who wanted to operate contract carriage services would have to go to a commissioner or to a local authority if they wanted to operate on a route already covered by either a loss-maker or a profit-maker. That is true. The limitations are such as to safeguard the wider public interest.
      It might well be that a contract carriage operator could persuade a local authority, and the local authority could quite reasonably agree, that he should cover part of an operation. In fact, the operator could persuade the local authority that considerable public good could result from having another operator on the route at a particular time. It would be for the local authority to judge whether the contract carriage operator was undermining an element of its profit, so that it would have to put back a large part of what he was taking out in order to sustain the route.
      I am not evading the issue. Under the terms of the clause it could well be that a certain operator might have to go to a local authority because he was seeking to operate on a profitable route, and in other circumstances an operator might have to go to the authority because he was seeking to operate on an unprofitable route. However, I stress that in those two cases the local authority's response would not necessarily be the same. It might welcome certain arrangements being made in certain circumstances.
      In Committee it was pointed out that one of the complaints that one received from certain authorities about the running of their services was that they had to maintain an unduly large fleet in order

      981
      to cover certain peak hours. There might well be a case in the minds of those authorities for having another operator lifting some of the peak load from their shoulders so that the rest of the service load was capable of being covered by a smaller fleet.
      There are many aspects of this matter that must be considered. These things cannot be determined by the House. They must be determined by local authorities, the operators and, in some cases, the commissioners with their detailed and intimate knowledge of the problems of the area concerned.
      The other issue that is covered by the clause is that of express bus services. Here again, there is room for reappraisal. I agree with the Minister that there are some cases in which people may be better served by two or three operators competing for a bus service running from A to B. However, that would be in circumstances which paid no regard to those living in areas between A and B which were currently being served by a single operator who was prepared to stop at various points between A and B. On a 30-mile journey at present, many operators are prepared to stop 10 or 12 times at places where they can pick up or put down passengers.
      The issue at stake is whether that service could be sustained if, at certain times, another operator ran a service which went straight from A to B without stopping but took part of that route's traffic. In an ideal world where no financial considerations applied and there was as much money to support public transport services as operators could wish for, we would love to have an express operator from A to B alongside another operator stopping a dozen times between A and B. That would mean that both needs would be served. But the reality of the financial position of many operators is such that in certain parts of the country there is a genuine fear that such an ideal might not be possible. If there is competition between A and B, where the express operator is subject to no licensing procedure whatsoever, and at the same time a stopping service operator between A and B is subject to the ruling of the commissioners, who have to decide in terms of public interest, the commissioners' role becomes unrealistic. It
      982
      is unrealistic for a commissioner to judge upon a situation in which there is no possible choice.
      It is possible that someone will come to a commissioner for a variation of the conditions of his road service licence in order to cut down the number of places at which he stops between A and B because he can no longer compete with the express merchant. He may seek a variation of the conditions of his licence so that he has to stop at only two places. That may well be the kind of decision that will come to the traffic commissioner. Under the terms of the Bill, the traffic commissioner cannot have any opportunity of considering the effects on that service and on the public interest. Therefore, it is proper for the new clause to say that where the effect of introducing new express carriage operations is such as to impinge—and only where it is such as to impinge—on network agreements or cross-subsidy arrangements, the commissioner should have a chance to look at the issue again. That is an important proposition.
      I urge one further consideration. We do not have a rigid, inflexible system in this country. Traffic commissioners do not meet week in week out, and month in month out, in order to turn down new applications. All the evidence that I have shows that there is a considerable degree of flexibility in the present situation. Many new road service licences are granted from year to year for all sorts of different services. Also, up and down the country there are a number of county authorities which are only too willing to look at alternative arrangements for passenger transport services in their areas if by any change there is a chance of improving the service or introducing new services. Therefore, the position is not rigid or sterile.
      There is great possibility for improvement or change, given a realistic appraisal of the delicate balance between the amount of public money that is put in and the extent to which those who are operating are prepared to do so in a way that will maximise the service rather than individual profit. It was basically to try to combine those considerations, and bearing in mind the Government's determination to introduce new services, that the clause was tabled.
      Mr. Penhaligon rose—
      Mr. Deputy Speaker: Order. It will be in order for the hon. Member for Truro (Mr. Penhaligon) to make a speech, but, as the Minister has replied to the debate, the hon. Gentleman may get an answer.
      Mr. Penhaligon: That is a disappointment. I thank the right hon. Member for Barrow-in-Furness (Mr. Booth) for this interest in rural areas, but I wish to rebut much of what he said.
      It is not true that rural transport survives on a system of cross-subsidies. Tragically, virtually no bus routes in rural areas make a profit. The question facing the Government, in considering whether there is to be a transport system in those areas over the next five or eight years, is how much money they are prepared to pour in.
      We face a desperately difficult problem on which some difficult decisions will have to be made. I hope that the Government will put in money, otherwise a ludicrous number of people will be more isolated in their home communities than they have been at any time in the past 100 years.
      Mr. Fowler: The hon. Gentleman's opening remarks were correct, and it is right that the House should be reminded of the situation that he outlined, but does he not agree that it is a matter not just of the amount of money but of getting value out of the investment that local authorities make?
      Mr. Penhaligon: I accept that. Value for money is always a major concern, but I warn the Minister that it will cost quite a lot of money, whether he gets value for it or not, to keep going rural bus services in a county such as Cornwall where there are 100 recognised routes of which only two make a profit. Five or six routes break even—and on the slide rule aproach might make a small profit or loss—while many routes lose a lot of money.
      M. Prescott: I took a particular interest in Cornwall during the Committee proceedings. It is clear that only one or two of the NBC routes are profitable and that the non-profitable routes are subsidised from the transport supplementary grant.
      Of course, when the bus company approaches local authorities for assistance
      984
      from the grant, the authorities usually require that money made on the profitable routes should be ploughed back into non-profitable routes before the deficit on operating costs is made up from the grant.
      Mr. Penhaligon: I do not deny that. There is some significance in that point, but it does not carry the weight that the hon. Gentleman and his right hon. Friend the Member for Barrow-in-Furness attached to it.
      There is only one profitable bus route in Cornwall, that between Camborne and Redruth, neither of which is in my constituency. Those towns are about four miles apart and a single bus travelling endlessly from one to the other could be quite a profitable operation. I can think of no other bus route of which that could be said.
      The right hon. Member for Barrow-in-Furness argued that the end-to-end merchants—a good description—on the 30-mile routes would take passengers from the stage carriage routes. I doubt that. The Bill refers to 30 miles in a straight line. No one could claim that the roads in Cornwall are anything approaching a straight line, and a 30-mile distance as the crow flies would involve a stage carriage route of about 35 miles.
      I should be interested to know how many people in Cornwall, Devon or other rural areas use stage carriages for journeys of 30 miles in a straight line. I suggest that it is incredibly few. Anyone contemplating such a journey would need to have an enormous amount of time to spare.
      For example, the journey from Penzance to St. Austell is more than 30 miles as the crow flies and the journey time is about three hours. Fortunately, there is still a train service between those towns and anyone making that trip takes the train.
      The amount of business that will be taken away by the end-to-end merchants will be remarkably small, though I must tell the Minister that the number of people who will operate such 30-mile routes in my area will also be remarkably small. I cannot think of a single such route on which a profit is made.
      I am concerned about one form of cross-subsidy in the South-West which may be ended. Many private operators in

      985
      counties with a large tourist industry survive because of the lucrative trade for 10 or 12 weeks in the middle of the summer when they take thousands of visitors to seaside resorts and places of interest. There is no doubt that, as the Minister said, those who go beyond the 30 miles in a straight line from where they started will operate on an unlicensed basis. A number of operators in Cornwall point out that they survive because of the business of those few weeks, which, by chance, come at the time when there is no school transport business.
      5.45 pm
      For those few weeks they can operate profitably and keep a substantial fleet on the road, and that enables them to keep in business for the rest of the year a fleet of a size that they would not otherwise be able to operate. Under the present licensing system, all the coaches that flood into the South-West bringing tourists from Birmingham, London, Manchester and elsewhere are not allowed to operate journeys over 30 miles in my area unless they have a licence. In effect, the coaches cannot be used during the week and cannot ply for business on a trip from, say, New-quay to Land's End—a trip that tourists always insist on taking, though I cannot understand why.
      The operators in my constituency are worried that they will lose that sort of business to the tourist coaches, because they will ply for hire on the few routes that are more than 30 miles as the crow flies from the starting point.
      Mr. Fry: Surely, coaches from Manchester which deposit people in Cornwall usually take back the holidaymakers whom they left there the week before. Is not the hon. Gentleman exaggerating the risk?
      Mr. Penhaligon: I am not making the point that strongly, but what the hon. Gentleman says is not wholly true. I could take him to car parks in Cornwall in the middle of the week where he could see an apparently endless sea of coaches. I am sometimes amazed at how many coaches there are in this country, judged on the evidence of a few weeks in the summer.
      Newquay is the main tourist resort in Cornwall. The native population is no more than 14,000, but in the middle of
      986
      August there are perhaps 180,000 people in the town. In mid-week periods, there are coaches in Newquay with nothing to do and the local operators, who keep the private end of our transport system in being, are worried that the operators of those coaches will ply for hire in competition with the local operators in trips from Newquay to Land's End. The driver of the tourist coach is paid for the week and the coach has been hired for that time. The marginal operating costs of such a coach would be small and its operator would be able to undercut local services, at least on longer day excursions. I should be disappointed if that happened. The new clause would be a sledgehammer to crack a nut, and I believe that the substitution of 40 miles for the 30 miles in the Bill would remove many of the problems.
      Operators in the South-West have continually put the problem to me. I did not foresee it when the Bill was published. On the whole, the proposals outlined by the Government are reasonable and will do no harm, though only time will tell what good they will do. I mention that isolated example of cross-subsidy in the South-West because it can make a useful contribution to the transport system of the area. I shall not vote for the new clause, because it is too complicated to be true, but I ask the Minister to look at the problem that I have raised and consider whether there is some way of protecting that small industry.
      Mr. D. N. Campbell-Savours: I had hoped to be allowed to serve on the Committee that considered the Transport Bill, but I was put on the Competition Bill Committee and was therefore unable to take part in the Committee's consideration of the Bill before us.
      My right hon. Friend the Member for Barrow-in-Furness (Mr. Booth) adequately argued certain aspects of the matter covered by the new clause and referred in Committee to a problem in his constituency. I wish to draw attention to a problem in my constituency stemming directly from the passage of the Bill through the House. The problem is causing considerable disquiet in West Cumbria among the travelling public, among the trade unions, which recognise the dangers embodied in the Bill, and among the employees of Cumberland

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      Motor Services, who are worried about the passage of the Bill. The problem relates to the trial area aspects of the Bill, although this matter is to be dealt with in a further new clause, and the operation of new licences.
      I cannot understand why great armies of lion. Members are not manning the Conservative Benches. Without the new clause that we wish to insert, the Bill will have a major effect on Conservative constituencies that enjoy cross-subsidised rural transport. I am at a loss to understand why only nine or a dozen Conservative Members are present. Following the defeat of a certain clause in the Education (No. 2) Bill in the House of Lords, one wonders whether those same noble Lords who joined together to defend the interests of the constituents of Conservative Members—namely, those in rural areas—will join together to defeat this aspect of this Bill. The same people will be affected by the absence of the new clause if the House fails to carry it.
      In my constituency of Workington, Cumberland Motor Services operates in the area of Allerdale and Copeland. My constituency covers a number of rural communities and small towns. In my conversations with officers of the transport authorities and members of trade unions involved in transport in West Cumbria, I have established that only 50 per cent. of routes in the area are profitable. I wish to draw to the attention of the House those routes that are profitable. I want the Government to inform the county authority what is to happen to the rural routes that do not produce a profit. The authority has a legitimate right to know from where the money is to come to fund those routes. The public also have a right to know what services will be available to ensure their safe passage to major conurbations for shopping.
      The Whitehaven-Workington, Workington-Maryport, Whitehaven-Carlisle and Keswick-Whitehaven routes, which pass through my constituency, are profitable, but all the public transport provision between the villages and small towns of Aspatria, Brigham, Broughton Moor, Ireby, Bothel, Lamplugh, Deanscales and a number of small communities and villages is losing money. We want to know what action the Government will take to ensure that those routes are pre-
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      served. We do not believe that it is possible that any enterprising young operator will move in and put some transport—
      Mr. Kenneth Clarke: An Adjournment debate would probably be more suitable for what the hon. Gentleman has in mind. We have had the pleasure of meeting the Cumbria county council. Its nonprofit-making rural routes will be supported, like others, by revenue support and transport supplementary grant. They are not adversely affected by the Bill. The county council, like other shire counties, was reassured by the generous treatment which, even in these difficult times, we were able to give to shire counties in the award of transport supplementary grant for this purpose this year.
      Mr. Campbell-Savours: The hon. Gentleman seeks to reassure me. I am told that for 1981 the transport undertaking in West Cumbria is having to bid £600,000, in conjunction with profits, through cross-subsidisation, to subsidise the routes that are not making a profit. Is the hon. Gentleman suggesting that additional money will be made available through the subsidy system to ensure that those rural routes are preserved? I am asking the hon. Gentleman to tell the House and my constituents that all those rural routes will be 100 per cent. protected under the provisions of the Bill.
      We are basically talking about whether the Government are willing to underwrite any added losses that may stem from the loss of profitable routes by the semi-municipal undertaking. It seems that the county Conservatives are on the horns of a dilemma. They have to decide whether to back their political prejudice and carry the Bill through all its stages, ensuring that the ratepayers, or the taxpayers, are asked to pick up the ticket at the end of the day, or to fight the Bill by impressing on noble Lords the need for their support for amendments to the Bill.
      I must appeal to my constituents from this Chamber. I am informed that the districts of Allerdale and Copeland in West Cumbria are under consideration as trial areas, to which I referred. This may be a matter to be dealt with under the next new clause, but I can adequately refer to it now. It is part of the general argument. I am told that meetings are to be convened in the near future. I say to

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      my constituents from the Floor of the House that once again, in the spirit of previous petitioning, they must petition the county authority to ensure that Copeland and Allerdale are not designated as trial areas.
      Mr. Deputy Speaker: Order. The hon. Gentleman is now moving on to the next amendment. He must relate his remarks to new clause 6. This may be an important matter, but the House is debating new clause 6.
      Mr. Campbell-Savours: I shall therefore move on, Mr. Deputy Speaker—
      Mr. Booth: If it is the case that the Cumbria authority, in which both my hon. Friend and I have an interest since it is the area in which our constituencies are situated, was reassured by the allocation of transport grant, has the county informed my hon. Friend—it has not informed me—of the extent to which it is alarmed by the provision in the local Government, Planning and Land (No. 2) Bill that gives the Minister power to withdraw the transport supplementary grant?
      Mr. Kenneth Clarke: Before the hon. Member for Workington (Mr. Campbell-Savours) leaves this matter, may I put a point to him? He is obviously addressing his constituents, and there is a danger that some of his old buck will appear in local newspapers. Will he also inform his constituents that, at the moment, services are supported by revenue support backed by transport supplementary grant? This Government have dealt generously with the shire counties and will, within the limits of financial circumstances, continue to do so. The effect of a trial area will be not to remove that revenue support but to facilitate new operators coming in, if such new operators are available, and to extend the variety of services that might be available in rural and other areas of the county. It is a balanced judgment. I
      do not believe that the hon. Gentleman has gone into the matter sufficiently to make a balanced judgment.
      Mr. Campbell-Savours: Is the hon. Gentleman seeking to reassure my constituents that those rural services will not be affected by the introduction of trial area designation to West Cumbria?
      Mr. Deputy Speaker: Order. Let us stick to new clause 6. It has nothing to do with trial areas.
      Mr. Campbell-Savours: I should like to discover from the Minister what will happen to undertakings in counties such as Cumbria if certain routes are removed from the municipal undertakings and given to private enterprise.
      Mr. Kenneth Clarke: They will not be removed.
      Mr. Campbell-Savours: The Minister says that they will not be removed. Is he suggesting that the advent of new competition on the profitable routes will have no effect on the revenue of Cumberland Motor Services? If so, will he give us this undertaking once again? I am trying to establish the effect of the clause on the transport services in my constituency.
      Is the Minister also aware that many transport undertakings are asking what will happen if these new entrepreneurs find that they cannot effectively manage routes or maintain the services required? Will the municipal undertakings then be required to move in and re-establish their services? Has the Minister thought out the implications for municipal undertakings if that be the case? Will he answer that question in the light of the problems that he knows exist in my constituency?
      Question put, That the clause be read a second time:—
      The Committee divided: Ayes 151, Noes 194.
      Question accordingly negatived.

    New Clause 7

      EXEMPTION FROM DUTY TO CO-OPERATE IN TRIAL AREAS
      '(1) Within a trial area the duty of public passenger transport operators to co-operate with one another and with local authorities and to provide information in respect of their operators shall not apply.
      (2) The duty referred to in subsection (1) is that specified in—

      (a) section 24 of the Transport Act 1968 (in passenger transport areas);

      (b) section 151 of the Local Government (Scotland) Act 1973 (in Scotland otherwise than in a passenger transport area);

      (c) section 1 of the Transport Act 1978 (in non-metropolitan counties in England and Wales).

      (3) Section 3(5) of the Transport Act 1978 shall not have effect within a trial area.'.—[Mr. Prescott.]
      Brought up, and read the First time.
      Mr. Prescott: I beg to move, That the clause be read a Second time.
      We come to the debate on trial areas. The clause is limited to the specific aspect of the duties imposed by other legislation on bus service operators in trial areas. The Transport Act 1968, the Local Government Act 1973 and the Transport Act 1978 impose upon transport operators certain duties which the Opposition believe are in conflict with the concept of the bus services that will be operated in designated trial areas. The purpose of the clause is to consider those duties and suggest to the Government that the acceptance of these duties in a trial
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      area will impose considerable difficulties upon the remaining bus service operators in that area. It is a matter of judgment what kind of bus service will remain in trial areas, and there is a distinctive and qualitative difference of opinion between Conservative and Labour Members about the consequential effect on bus services of the designation of trial areas.
      We must wait to see what happens, but our judgment is that the imposition of these duties in trial areas will be detrimental. Bus operators are being asked to compete rather than to co-operate, and we seek reconsideration of the duties to be imposed. Bearing in mind all the obligations in this legislation, which changes fundamentally the nature of obligations and systems in bus service operation, it is our view that the whole of Britain will become a trial area. However, I shall keep primarily to the definition of "designated trial areas" as contained in the Bill, the general conditions that will apply and the conditions of competition that form part of the experiment.
      6.15 pm
      The concept of experiment is at the heart of the trial areas scheme. Almost by definition, a trial area is one in which one seeks to impose different criteria in an attempt to assess the consequences. We should make it clear from the start that the attitude of the Opposition—as of previous Labour Governments —is that we recognise that experiments are necessary in areas where it has been difficult to maintain regular passenger bus services. At the heart of the 1978

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      Act lay the case for introducing experiments. In 14 or 16 areas they became known as the Routex experiments. Experiments were tried out that were not allowed under the existing licensing arrangements. Those experiments included the sharing of cars and minibuses, under which there were certain exemptions on driver conditions and bus operation conditions.
      I want to make it clear that we are not against experimenting with new methods. However, the difference in our approach from that of the Government is that we wish to maintain what exists while carrying out experiments. The system that we envisaged under the 1978 legislation—despite its limitations and the criticism that it attracted—provided a public transport network. It provided services in rural areas while allowing experiments to take place. We felt that the safeguard of commissioner licensing, the maintenance of public service licensing, cross-subsidisation, the transport supplementary grant and the development of transport plans—and now the duties related to legislation as outlined in the new clause—all helped to maintain a service on which people could rely. Experiments in those areas were possible at the same time.
      I visited a number of those areas, particularly in North Yorkshire, where experiments were attempted, and it is not clear what conclusions to draw from those experiments. I have seen a report produced by the Transport and Road Research Laboratory. It offers no conclusion. If anything, it says that we had better maintain the public service system because there is insufficient information on which to recommend an extension of experimental systems at present. The Opposition have been in favour of experiments from the outset, but only alongside the provision of a public service as well.
      The definition of a trial area is spelt out in the Bill. Such an area is one where there is no requirement for licensing and where the full force of competition will apply. I presume that it is the kind of free enterprise area that is spoken of in the Government's economic policies. However, the full force of competition will not apply. The competition will be organised because, to an extent, there is a desire to see some elements of coordination. Timetables and a notice
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      clause will be provided. That means that one cannot immediately begin or end a service under the terms of the Bill. I assume, however, that if a firm goes bankrupt overnight no one will insist that that firm carries on because it has an obligation.
      I understand the Bill to provide that where a service is to cease it will not be allowed to do so immediately but will have to continue for a specified period. I am not sure how long that period will be. The designation order refers to three weeks, and I believe that the regulation will spell that out in detail. Will the Minister tell us what sort of time span he has in mind in respect, for example, of existing bus services in a designated area? The burden of our approach is that operators will seek to pull out because the services will prove uneconomic, given that they will cease to receive transport supplementary grant and the benefit of cross-subsidisation.
      This is not an academic point. I believe that 80 or 90 per cent. of the rural services operated by the National Bus Company are likely to come into this category. Indeed, the restriction of TSG by the county authority has led in the areas affected to a direct reduction of services. The economic pressures of operating costs may well therefore lead to bus companies taking the inevitable commercial decision that they cannot maintain services with restricted support.
      If the service were to be forced to operate for a month or two after it wished to cease, that would impose a further penalty on the bus company, since it would have to operate for that period without compensation. It is interesting to see how the Bill will apply when a designated area is discontinued. If the Government felt after two years that the system was collapsing and that services were not being maintained, the Minister could state that the designation order would be revoked or altered. If it were revoked, operators who were still maintaining services in the designated area would presumably be compensated by the automatic award of a road service licence on the ground that if they had invested in bus services on the basis of trial area schemes they should not be penalised by being put out of business just because they did not have road service licences before the schemes were

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      introduced. The aim should surely be not to disadvantage operators.
      That is not the attitude adopted towards the nationalised sector, which will be required to maintain services in these areas without compensation in that way. But that is probably not the only way in which the Bill treats the private and public sectors differently. The trial areas seem to involve the development of organised competition, with order being introduced by way of timetables and the giving of notice.
      It would be easier for us to address specific arguments on this issue if we knew which areas were likely to apply for trial area status. We have to rely on the general information given by the Minister, who said only that there had been 12 applicants. We do not know whether those applicants are in respect of whole areas or parts of them. We do not know whether Tory councils want to designate Labour districts. All that is possible under the Bill. Our job of assessment would be easier if we knew which type of county authority was applying and the transport demands upon it. The publication the Surveyor looked at the 12 areas likely to apply to become trial areas and found that they were the very authorities that spent less per head of the population on transport than the county authority average. They were the authorities that gave a low priority to a public transport system. That factor causes us concern and alarm.
      In Committee the Minister made it clear that his policy did not necessarily mean that if eight or nine authorities survived the various checks and balances they would all necessarily be granted this new status. His attitude was that he would not grant trial area status just because they wanted it. Instead, only two or three of the applicant areas would succeed. Transport operators and transport planning officers in county authorities have often explained to me that the distinctive factor in transport is that no two areas are alike. Therefore, if trial areas were allowed on a broader basis, the scheme could be more effectively monitored. With more areas, the quality of the data used to make an assessment would be higher. However, I do not press that argument too hard, because if, as I believe, the trial areas scheme is a disaster, it would
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      be better if the disaster were restricted to only two or three areas.
      Has the Minister decided whether two or three areas will be designated, and will he name the areas that have applied? It is important for us to know that, so that we may see whether our individual county authorities are among them. I have asked my authority on Humberside whether it has applied, but it has quickly run away from the whole idea. Some authorities were attracted to the scheme because they thought that they would become licensing authorities in the way that the commissioners are. They soon learnt, however, that that was not to be. Their only role was to be in designating part or all of their areas as trial areas—that is, areas in which a road service licence was unnecessary.
      The scheme will inevitably lead to controversy, especially since only the county authority will be eligible to apply. The authority may consult a number of bodies, and is requested to do so. I understand that within three weeks of notice having been given in the press all evidence received is to be attached to the designation order so that the Minister can determine how much opposition there is to the scheme.
      The district authorities are incensed by the whole business. The Minister said in Committee that he would not be put off by the district authorities which have a vested interest and which might not necessarily know what was good for them.
      Mr. Fowler: I did not say that.
      Mr. Prescott: No, the Minister did not say that, but his words were to that effect. He said, however, that the experiment would require a courageous approach and that he would bear that in mind in deciding on the applications. Forty of the 50 or so county authorities are themselves bus undertakings and they have a great deal of expertise in the business. They are well aware of where their own best interests lie. Tory and Labour districts alike agree that they do not want trial area status imposed upon them against their wishes by the county authority, with the Minister's endorsement. To that extent it is a controversial argument.
      It will help the House if the Minister will indicate which county authorities he is likely to designate. Who are the favourite runners? Which counties are

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      likely to be chosen to lead the way into this new era of free enterprise? We need that information so that we can make a proper assessment of the problem.
      The Minister is aware that some county authorities have no transport operating abilities. Some Conservative-controlled authorities—for example, in the North—will have responsibility over a number of Labour-controlled district authorities. Their attitudes to subsidies and support are clearly different and will lead to controversy. The local authority in my area is a classic example. The Government gave a TSG to the county authority, but my district authority has not received a penny of it. To be correct, it received £40,000 that was left over out of £1 million. The county authority was embarrassed by that sum and gave it to the corporation's largest district operator. An application was made by the district, but the county authority disagreed with its bus policy and, therefore, did not allow it the TSG. There is a recipe for considerable controversy on strong political lines between county and districts, of whatever political colour, and certainly between districts of different political colours within a county authority.
      6.30 pm
      We fear that that will have a disastrous effect on the trial areas. It is a matter of judgment whether that will happen, but it is common criticism that this attack will affect the cross-subsidisation argument. Cross-subsidisation is an essential feature of the network concept. There was much discussion in Committee and on new clause 6 about the concept of cross-subsidisation. It is an important economic means by which responsibility is matched to the duties imposed on local authorities. New clause 7 refers to legislation that imposes duties on local authorities.
      Cros-subsidisation is a means by which a network system is maintained. It does not necessarily mean that the difference between costs and revenue is met out of the TSG. As a means of maintaining the network system, county authorities ask transport operators to provide a service from A to B, which they know is not remunerative, but they then help them by granting a bus service from C to D. That is a means by which county authorities—Tory or Labour—have attempted to main-
      1000
      tain a network service. Cross-subsidisation must be regarded not only as money from the Government but as money that is derived from profitable routes, with the counties making up the difference by means of the TSG.
      The idea of a network concept and cooperation is essential to this clause. It refers to duties imposed by previous Acts of Parliament. The Transport Act 1968 states that where any area has been designated under section 9(1) of the Act it shall be the duty of the bus companies to cooperate with one another in the reorganisation of bus services within, from and to that area, and for that purpose to enter into agreements as to the services to be provided by the company or group or the subsidiaries in or in connection with that area, and as to the terms on which those services are to be provided. Clearly, certain onerous duties are laid on the National Bus Company.
      The Local Government Act 1972 makes clear that it is the duty of the county council
      "To promote the provision of a co-ordinated and efficient system of public transport to meet the needs of the county and, for that purpose, to take such steps to promote the co-ordination, amalgamation and re-organisation of road passenger traffic transport undertakings in the county as appear to the county council to be desirable."
      Those words about responsibilities, duties and co-ordination are included in all the Acts referred to in the new clause.
      Under the Transport Act 1978 the metropolitan county councils were given further duties:
      "To develop policies that would promote the provision of a co-ordinated and efficient system of public passenger transport to meet the county's needs, and … to take such steps as the council think appropriate for promoting the co-ordination, amalgamation and re-organisation of road passenger transport undertakings."
      It further provided that all public transport service operators in the county and district were required
      "To co-operate with one another in the exercise and performance of their respective functions for the purpose of co-ordinating public passenger transport services."
      Those duties are specific, and it is the basic claim of transport operators that if they are expected to co-operate in the way suggested in the Bill and to provide information in the way requested in the Bill, they will be put at a disadvantage.

      1001
      We feel that the new Clause is realistic and that the duties embodied in previous legislation shoud be removed. Under that legislation, an operator is required to give information to the local authorities which could be used directly or indirectly against and to the detriment of the first operator. Can we really expect competition to be complementary to cooperation? Are they not antitheses of each other? Is competition the requirement to co-operate, or to compete against? I think that it is to compete against. If those factors are complementary to each other, it is because it is in the commercial interests of the operator who makes the decision and not because of any basic principle of cooperation that is imposed as a duty on operators.
      The Government seem to take the view that co-operation is against the public interest and that competition is the means by which the best co-operation is achieved. Therefore, we feel that the legislation referred to in the new clause should be repealed, since considerable difficulties will be imposed on the operators.
      In our view, the trial areas are the antithesis of the present policy, in which co-operation is a requirement and a duty, and the traffic commissioners have considerable powers to ensure that there is co-operation and integration. Competition will very much undermine that.
      We must consider carefully whether the imposition of a trial area will be against the interests of the people involved. One has to bear in mind here the opposition that one hears. Certainly the operators seem to be against it to a man. I recall what the Minister said in Committee:
      "When it comes down to it, the crucial people in the transport debate are not the operators but the travelling public."
      That is a fair point. It is said that the public are the best placed to judge in this case. But they cannot make their judgment until something has happened. The operator, at least, has a good idea of what is likely to happen and what the consequences may be. Perhaps a dispute between the two sides of the House will not be a matter of common knowledge to the public. In the main, the public tend to react when faced with the con-
      1002
      sequences of legislation rather than before.
      In these circumstances, one hopes that the electorate will look for protection to their elected representatives, in which case, presumably, in a district they will look to their district councillors. But, as we know, the views of the district authorities are likely to be overridden. I think that the Minister has now agreed, through certain amendments, that the views of districts may be taken into account in a context rather more important than just consultation. But when the thing has collapsed, when an order is to be revoked or varied, the district council may be dragged in and all it will be able to say will be "We told you what would happen." Perhaps that is some consolation, but it will not amount to much, I believe for the district authorities.
      The 50 municipal authorities to which I have referred are one important source of democratic opinion and, speaking through their association, they are to a man against the designation of trial areas, as I understand it. Perhaps we see here an overriding of the democratic expression of opinion. We have seen much the same in regard to school transport under the Education (No. 2) Bill. I cannot say that I am very happy to see another place determine what the democratic decision of this place should be, but we have to recognise that there was an overriding of the Government by their own supporters on the question of transport provision for education.
      The Government are trying to override the power of local authorities in education, and now we see the same being done in transport. In all these respects Conservative authorities are expressing considerable alarm, and they are at one with their Labour counterparts in the district authorities against the imposition of trial areas.
      There may well be an overriding of people's choice. I am sure that the Minister will say that people in the districts have representatives on the county authorities and we have now said that the authorities, and we have now said that the county authority should have respon-systems. That is a fair argument but for the fact that the counties, especially the shire counties, where the authorities are

      1003
      Tory-controlled, will overwhelmingly outvote any representations from district representatives, so there is no guarantee in that sense that people who have come to expect a level of service in district areas can be certain that that service will continue.
      We have heard Ministers attack the districts on occasion as being inefficient, but they have never specified any authority as being particularly inefficient and over-protected. The Parliamentary Secretary was directly challenged to name one and refused to do so, and one can readily understand the political reasons which move him to keep away from that. But one cannot then say that the district authorities do not provide a good and comprehensive system overrall, as they are required by the legislation to do. That is what they have been asked to do by the House under both Labour and Conservative Governments.
      The question of taking account of whole areas to be designated as trial areas is causing considerable concern, especially in the light of the political bias which is sensed by district areas such as my own. But the feeling is the same in Conservative areas, too.
      The Minister has said that he believes that the power of decision should be as near to the grass roots as possible. We have quoted what he said on the subject of trial areas during debates on previous legislation when he was in Opposition. He made clear his concern that decisions should be taken as near to the grass roots as possible. I remind him of what he said in Committee on this Bill:
      "But what I must emphasise again is that a trial area will not be imposed on the local population."—[Official Report, Standing Committee H, 5 February 1980; c. 966.]
      I presume that by his reference to the local population the Minister meant, for example, that if a county authority designated a district area as a trial area to see what it would be like, the county authority would be imposing that will on the district authority, but all that the Minister could do in such a case would be to say "I do not think that you are near enough to the grass-roots decisions, and I therefore ask you to reconsider it." Or, I suppose, he could refuse to confirm the designation order. But that gives very little protection to the district authorities, so to that extent we are at one with them
      1004
      and have sympathy with much of the argument advanced by the district authorities.
      6.45 pm
      Although I have put the emphasis of my remarks on the district bus transport areas, they are not really the ones likely to feel the most disastrous effects of these experiments. If these experiments are introduced in rural areas, the rural services that are maintained by an element of cross-subsidisation will begin to be reduced even more than they are at present.
      In this connection, I have in mind the studies done by the Transport and Road Research Laboratory. They have made clear that while the majority of people in rural areas have cars—a greater proportion than in the urban areas, to the extent of about 80 per cent. to 65 per cent.—the remainder of the population in the rural areas is heavily dependent on public transport for journeys for medical and hospital purposes and for shopping. That comes very clearly out of the studies which have been done.
      Mr. Dobson: Does my hon. Friend recognise that even the figure that he has given can be misleading, because they refer to car ownership by family? If the breadwinner in a rural area is out with the car, quite frequently neither his children nor his wife will have access to any form of transport at all.
      Mr. Prescott: Yes, I agree. I was taking what I regarded as a more limited approach to the matter, and I accept that one could put the argument much more strongly in that way. Nevertheless, for the minority of low-paid people who cannot afford a car and who are heavily dependent on some form of public transport for education and other services a serious problem will remain.
      The need has now been recognised for school purposes, but the argument is the same for medical and hospital services. By the reorganisation of the Health Service, we have assumed that there will be encouragement of the provision of public transport services so that people may have medical attention. The same applies to schooling, but it is equally important, if not more important, for National Health Service facilities. But under the Government's scheme it will be the rural

      1005
      areas that will have to carry the brunt of the experiments.
      The Minister should be a little more honest with the House tonight. Perhaps I should withdraw the word "honest" and say that he should give the House more information about which authorities he has in mind. Which are the key leading authorities? Let him tell us so that we may make a better assessment of the effect of his legislation.
      Duties are imposed. The advice of the operators is overruled. The elected representatives, certainly at district level, feel that they will be ignored. The logic of the argument for our new clause is that competition and co-operation are not synonymous but are the antithesis of each other. Our new clause recognises that and would provide that existing public transport operators which have duties imposed on them by the House should not be disadvantaged. The trial area policy is in contradiction to the duties imposed on these operators, and we therefore urge that the new clause be adopted.
      Mr. Fowler: Perhaps I may interpose briefly at this stage and allow my hon. Friend the Parliamentary Secretary to reply to the debate in due course. I wish to give some guidance to the House on what we are about in this matter, and perhaps that may be of help and convenience to hon. Members at this stage.
      The hon. Member for Kingston upon Hull, East (Mr. Prescott) is a rather difficult man to reply to, because at one stage he accuses me of being revolutionary in my approach and at the next he accuses me of being far too cautious.
      Clearly, the debate on trial areas, both inside the House and outside, has been a vigorous one, but it has not shed very much light on the present situation. This is not a plot to destroy the National Bus Company. The purpose of the trial areas is quite simple. We believe that the 1930 licensing system is outdated. We have made it clear that generally our preference is for decontrol and freedom. For example, we are convinced that the licensing of leisure services or excursion tours is utterly unnecessary. We also believe that the licensing of long-distance coach services, which we debated on the last series of amendments, is unnecessary. We also take the view that, if a local
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      authority or a county council believed that such a provision would help its area, it would be wise to allow that authority to be designated as a trial area in which no licensing should take place.
      I emphasise what I have emphasised at every stage—that the Government are not forcing a solution upon the county council in question. We are offering a further option in those cases where no licensing applies. If the local authority believes that it is in its interests, it is an option that we are prepared to offer to it.
      Mr. Ted Leadbitter: The right hon. Gentleman is saying something in which he does not really believe. He is saying that if the local authority so desires, it should be given an option. But no option is given to a district council which runs its own public service operations. It will not even be consulted. The practice under local government reorganisation, as a result of the 1972 Act, shows that that is what happens now. If a district authority has invested a large amount of ratepayers' money in its successful bus operations in order to support certain profitable routes to the advantage of the community as a whole, will it ever be given the option to protect its investment?
      Mr. Fowler: I am about to come on to that point. That is exactly why I intervene at this stage. If the hon. Gentleman will forgive me, I shall come on to the position of district councils a little later. Nevertheless, the point that I am making is right, and it is one which I stand by.
      The hon. Gentleman may believe that county councils should not be the transport authority. If that is his belief, it is not a policy that is accepted by the Conservative Government, and it was not accepted when the Labour Party was in Government. All these issues were gone into in some detail, as my hon. Friend the Member for Wellingborough (Mr. Fry) will remember, during our debates on the Transport Act 1978, and there was very little light from the then Government at that stage.
      Obviously, the greatest difficulty about the licensing relates to local services, which we are anxious to encourage and to see flourish. I fully understand the cross-subsidisation and network arguments for protection. Many people

      1007
      genuinely believe that licensing is essential in the public interest, and the Bill accepts that, with some loosening of the burden of proof which, I think, has been generally welcomed. However, I do not believe that we must uncritically acquiesce in something which is a restriction on the undoubted freedom of competition and choice simply because everyone has grown up with it and the industry is used to it.
      That is the purpose of what I said in Committee. Again, I underline it. What we are talking about in regard to transport policy is not something that is necessarily in the interests of a particular lobby. The crucial test, as with the last series of amendments, is what is in the interests of the consumer or traveller.
      I believe that we should take up the challenge. When county councils want it, that being their judgment, and if they see advantages that we also see, they should be allowed to take part in one of the trial areas.
      We are currently in discussion with a number of county councils about the trial areas. As I said in Committee, I would expect there to be probably only two or three trial areas within the country. We are not talking about the whole of Britain becoming a trial area. That is the scale about which I am thinking.
      The initiative must come from the county councils themselves. There will be proper monitoring by the Transport and Road Research Laboratory. The trial areas will have to last long enough to enable the results to be significant. Therefore, we hope that they will consist of substantial areas—not necessarily whole counties, but perhaps towns and even suburban and urban services. Those discussions are continuing at present, and it will be as a result of those discussions that we shall come forward later and make our announcement about what areas have been designated as trial areas. However, while discussions are continuing, I do not think that it is reasonable to talk about those counties that are in discussion with us.
      Mr. Dobson: There are two points that I should like to make. First, is the Minister satisfied that the necessary reporting system will exist in the trial areas for the monitoring to be carried out properly? Secondly, in advance of the introduction of any trial areas, does not
      1008
      he agree that it would be rather unwise to assess the whole of the country on the basis of a few trial areas? In the nature of things, trial areas are likely to be introduced only in parts of the country where they are most likely to succeed. It does not necessarily follow that even if they work in one area they can be more widely applied.
      Mr. Fowler: I do not agree with the hon. Gentleman's second point. I do not think that it is right to talk about these areas as experimental, in the sense in which the hon. Gentleman referred to them. It may well be that in certain areas it will work to the benefit of the public, and it may be that that is an example that other counties will want to follow. That is the way in which I look at it. The information which the TRRL will collect will, I believe, be of use. I foresee no difficulties in the reporting system. I believe that it is a reasonable step forward.
      I agree with the hon. Gentleman that this is a cautious step forward. We are not simply saying that the licensing system should be brought to an end. We are saying that if county councils feel that a no-licensing policy will be of benefit they should be allowed to carry it out. I regard that as a significant step forward in the provision of transport, and I do not go along with the fears that are being expressed.
      I do not believe that the new clause will make any practical difference to the operation of trial areas. I appreciate that there is a difference between the philosophy of the Transport Acts of 1968 and 1978 and the philosophy of the Conservative Party as enshrined in the Bill. However, I believe that the provisions of the new clause are unnecessary. For example, there is no proposal to take away the duty of county councils to coordinate public transport in their areas. They will still be able to exercise that duty through discussion with operators and through their revenue support powers. Therefore, it would be wrong to suggest that operators should not co-operate with local authorities in trial areas.
      7 pm
      At this stage I should like to advise the House on the way in which I propose later to proceed on the issue of revocation of trial areas, on which there was

      1009
      a great deal of debate in Committee. I agree that the original Bill was inflexible and that some county councils might have been discouraged from beginning an experiment by fear of the cost of reinstatement after possibly three years of unsuccessful trials. I also agree, as was urged on me in Committee by my hon. Friend the Member for Meriden (Mr. Mills), that district councils have an interest in trial area experiments and that their role should be recognised. Therefore, at a later stage we propose to move a group of amendments which will give flexibility in the minimum period of a trial area. Instead of being three years for all, it will be whatever period between two and five years is specified in the original designation order. That will be a matter for discussion between the Government and the county council in question.
      The balance may be struck differently in different cases between the need to assure would-be operators that the trial will continue for a reasonable period and the desire of some counties not to be locked into an experiment for too long.
      The later amendments will also involve local authorities more in the revocation procedure than was envisaged in the original Bill. That comes back to the point that was raised in Committee. Revocation, like the original designation, will be left to the initiative of county councils. The county will have to consult the district councils and notify widely before applying to the Minister for revocation. The difference in nature between designation and revocation is such that consultation will not have the same delaying effect as in the case of a designation order. Therefore, if the initiative to start experiments comes from local authorities, so should the initiative to bring them to an end. That is the second change that we shall be making.
      There is one further change, which is designed to encourage new operators to undertake the investment in vehicles which will be necessary for new stage carriage services. New operators might be put off by a fear that there could be revocation before they had recouped their investment and that, after revocation, the licensing procedure would be exploited or used by competitors to deprive them of their routes. Therefore, there will be an auto-
      1010
      matic right to a road service licence for anyone who provided an established service while the area was a trial area. What is meant by "established" may vary according to cases, but a service will have had to be run for at least three months.
      We hope in this way, first, to provide more flexibility by having a period between two and five years; secondly, to involve the local authorities and district councils more than was originally planned; and, thirdly, to give an assurance—this is of the utmost importance—to new operators who want to come in and who clearly want to invest in new buses—and we want them to invest in new buses, because it is in the public interest that they should—that the fact that a trial area is revoked will not leave them in the lurch. They will have an automatic right to road service licences if the situation reverts to road service licensing and traffic commissioner control.
      Mr. Prescott: Will that be a priority right over and above the existing service —for example, if the National Bus Company pulled out because it could not afford to run it?
      Mr. Fowler: The operator would have an automatic right to continue the service that he was operating in the unlikely event of the trial area being revoked. We do not expect this to take place, but we are anxious to give as many assurances as we can in this area. It is important to give assurances not only to district councils but to the new operators whom we hope will come forward. Therefore, what we are doing is right. We are giving an assurance and encouragement to them. I hope that the message that will go out from the House after the Bill becomes law will be that there is an opportunity here for new operators to come forward.
      I thought it right to intervene at this stage to give the House this indication of future policy. My hon. Friend the Parliamentary Secretary will sum up the debate.
      Mr. Leadbitter: I listened with considerable care to what the Minister said, and I have fleetingly cast my eye down the Official Report of the Committee proceedings dealing with trial areas and found that, far from the option principle propounded by the Minister suggesting a process in which consultation could

      1011
      help to put his clause into practical operation, the right hon. Gentleman removed himself from that stance. My right hon. and hon. Friends placed an amendment before the Minister in Committee. That amendment sought to give district councils the right to raise objections. If the Minister has confidence in what he suggested, I cannot understand why he objects to the elected representatives of a district council, whether in a metropolitan or non-metropolitan county, seeking to put forward matters about which they know better than he does.
      It follows that if we are to have competition and co-operation, the principle must be carried forward. Therefore, the Minister should say something far more positive to the House of Commons than he said in Committee.
      The district council in Hartlepool is an outstandingly good transport undertaking, with a policy of renewal of its buses and an investment programme which has served the people well. If, by any chance, the Conservative-controlled Cleveland non-metropolitan county, in formal or informal discussions with the Conservative Minister of Transport, sought a designation order, my district council would have no say in the matter. No county councillor or officer at county level in Cleveland has the knowledge and experience of the transport management committee and councillors of my district council.
      Mr. Cowans: While my lion. Friend is pursuing the argument of the Hartlepool district council, will he cast his mind to a possible situation that could arise? Will he assume the Hartlepool district council not being able to express a view but running a transport undertaking, the Cleveland county council approaching the Minister for a designation order and people presumably waiting in the wings to move in during the trial period? During the trial period, the Hartlepool district council will possibly say "These people are running the transport services, so we shall not run ours". After the trial period, those who had been waiting in the wings may say "It is not economical". Therefore, it could be that, those people having said that it is not economical and the district council having no say and having disbanded its good services, we shall have
      1012
      no services at all. What would the Minister do in such a situation?
      Mr. Leadbitter: Experience shows that that is the consequence. What about circumstances in which someone actually contracts out? Transportation coverage has been based upon a policy of supporting non-profitable routes with revenue from profitable routes. Any new operator, albeit without a licence, unless he is a damned fool, will not take up the unprofitable routes. He will take the profitable routes of the already established operator. But the Minister is not prepared to see sense. Unless he wishes to avoid the charge of a dogmatic determination to set his mind against the experiences of others, he is running in the wrong direction.
      We want to persuade the Minister to try to understand that there will be grave consequences in urban areas. The new clause also asks for protection, through consultation, of boroughs and shires, where, I accept, there is great concern for the rural problem. The Bill will not help. Who will invest as an alternative operator, even without a licence, in the rural areas? It will not happen, so that provision might as well be taken out of the Bill.
      I ask the Minister how many applications he has had for trial areas. He will not answer. I suggest about three. Have any Labour-controlled councils applied? The answer is "No". Possibly, if we examined and scrutinised the three that have applied, we might find a couple of opportunists who would support what is in the Bill. We might discover that they have said "We would like to be a trial area, Minister". But we do not know the reasons.
      Mr. Fowler: Before the hon. Member for Hartlepool (Mr. Leadbitter) gets carried away, I should point out to him that, as I said earlier, about 10 or 12 county councils applied. Perhaps I had better repeat what I have said several times. We expect that there will be about two or three trial areas, but that is not the sum total of those who applied.
      Mr. Leadbitter: There is no need to worry about my being carried away. If anyone has been carried away on this subject it is the Minister. Indeed, he does not have many friends as regards

      1013
      this part of the Bill. If we assume that the principles of the House are based on a democratically supported constitution, I am sure that the Minister will agree that he is in the minority. There is no question of my being carried away. The right hon. Gentleman is on the Government Front Bench and is in a minority. He said that 10 applications had been received of which possibly three would operate. But the question that I was about to ask before the Minister challenged me so exuberantly was how many public service operators there are and how many of them will be affected. What is the extent of the clause?
      Wherever the Minister looks, he will find that nothing to the advantage of the people living in the rural areas will arise from the Bill. On the contrary. There is another answer to the problem, but this cannot be done by this clause. In the urban areas, anyone can see that, should there be operators who are given the opportunity to use buses without a licence, they will not go for the unprofitable routes. Those routes are sustained by a service provided by a public authority already licensed which uses the profitable services to provide overall coverage for the community. The Minister does not see that. But that is what will happen, I am sure that he is forcing this through because it is his own pet hobby-horse.
      7.15 pm
      Perhaps the Minister is lacking in transport experience. I served with a transport undertaking, and I know that the Minister did not. He should have the courage to remove this clause, because it will not work. In two or three years, or under amendments Nos. 14 and 16, which mention a trial Period of between two and five years—and we have not discussed revocation, which is another problem—the Minister will find that his clause has achieved the advantages that he has sought to persuade the House it will bring to communities.
      I hope that the Opposition will support the new clause put forward by my right hon. Friend the Member for Barrow-in-Furness (Mr. Booth) and divide the House on it.
      Mr. Fry: As a vice-president of the Association of District Councils, I appre-
      1014
      ciate the new thought that my right hon. Friend brought to this subject when he spoke. I sat here somewhat dumbfounded for about 35 minutes, listening to two or three sentences on the new clause and what appeared to be a long discussion which really belonged to the Committee stage.
      There is one main aspect only that is worth considering: will the new clause make any substantial difference to the idea of trial areas? The point that my right hon. Friend put forward, which I am sure is most significant, was that the powers of co-ordination of county councils still existed. Unlike the hon. Member for Hartlepool (Mr. Leadbitter), I should have thought that the most likely areas to be designated are not those in densely urban areas. Surely this is an attempt to try to tackle those parts of the country where public transport is either non-existent or sparse.
      Mr. Leadbitter: The hon. Member for Wellingborough (Mr. Fry) is trying to make a positive point and is entitled to a response. However, will he take into account that the rural areas with bus services are those that have highly subsidised bus services? How can an entrepreneur who wishes to make a profit on his investment achieve that when the established services have to be subsidised?
      Mr. Fry: I can answer that by saying that in an area of Northamptonshire that is exactly what happened. A service with which the company was not happy was operated by a subsidiary of the NBC. That service was taken over by a private operator. I am in no position to judge whether that service will be running three, four or five years from now, but, through the co-ordination of the county council, a new operator has been brought in and the service is now operating. Therefore, we must give the Minister and the Government the benefit of the doubt and the opportunity to tackle this problem.
      From what my right hon. Friend said, it is clear that he does not expect hundreds of applications from people who wish to run trial services, especially in the urban areas. But surely it is right to try to find ways of providing transport for those who are denied it at present. I am sure that the hon. Member for Hartlepool would be the first to agree

      1015
      with that. However, we can disagree about whether the idea of trial areas will work.
      There is one weakness in this whole approach, and it is not the fault of my right hon. Friend but is due to the peculiarity of the licensing system. Any scheme for dealing with public transport in rural areas which ignores the place of the rural taxi will not deal with the problem. We all know that there are many small villages and hamlets where only a handful of people need to move at any one time. In many of the rural areas, the rural taxi can cope. For some peculiar reason, through the processes of government over the years, taxis come under the Home Office and other public transport comes under the Department of Transport. If we are to move forward in trying to deal with the problem of parts of the country and talk about delicensing, for goodness sake let us look at what transport could be available in those areas. Many of the problems could be solved by a new look at the taxi service in rural Britain. I hope that that point will not be forgotten.
      There is a danger, and, surprisingly enough, it is totally the opposite to the danger that has been advanced from the Opposition Benches. I do not think that it will be the large operators who may well suffer if there is no licensing. The people about whom I shall be worried are the small private operators, because the organisations with large resources will be able to subsidise their operations and run at a loss much longer than the man with one or two coaches or rural buses. He is the person who could be really vulnerable in this situation. Therefore, we must be aware that there is this other side to the picture, as distinct from that put forward by the Opposition.
      I am in favour of experimentation. In his contribution tonight, my right hon. Friend has already answered nearly all my queries. It is the last one that remains. We must be careful that we are not undermining some of the other services that are being provided, particularly by the small operator. In any case, the county council has a serious responsibility and a chance to help here, because it is the county council which co-ordinates not only public transport but the schools service. Therefore, I hope that when they are looking at this matter the county councils will be very sympathetic to those
      1016
      who are trying to supply a bus service and will certainly continue to bear them in mind when they are awarding school transport contracts.
      Mr. Cowans: I always listen to the hon. Member with great interest. However, it seems that the case that he has made is equally true in respect of the National Bus Company. Basically, what he is saying is that small operators could suffer because of operators moving in on the more profitable routes. That seems to be a reasonable case to argue. But is it not also the same case to say that the National Bus Company should withdraw from rural transport and that the subsidy that it was putting into rural transport should be galvanised into its long-route services to make them more competitive? Therefore, rural services, whichever way the hon. Gentleman has the argument, will suffer.
      Mr. Fry: As the hon. Gentleman knows, I feel that that is a possible danger. However, my right hon. Friend is not considering making the whole of rural England the designated area. He is deliberately asking for one or two areas in which experiments can take place. Surely it is right to try to have one or two areas where these experiments can take place. I shall be joining in watching very closely indeed how the experiments are taking place and seeing what dangers may befall them. My right hon. Friend will be looking to one interest and I shall be looking to another. But we have one thing in common: we shall be considering the public interest above all else.
      Mr. David Marshall: I should like the Minister to tell the House how many Scottish local authorities have made application to be designated as trial areas. My own authority, Strathclyde regional council, which covers some 5,000 square miles and encompasses large urban areas as well as very large remote rural areas, might well be thought of as an ideal example of an authority which could be considered fit to be designated as a trial area. Yet, when we examine the figures for subsidies paid to transport operators, we find that in Strathclyde regional council in the 1979–80 financial year the local authority will be paying transport operators a subsidy of £23·9 million, and that at present it subsidises about 25 bus and post bus

      1017
      operators as well as seven ferry service operators.
      As far as I am aware, no rural bus operator in the Strathclyde region operates at a profit, and many of these operators would simply cease to exist without this subsidy from the local authority. There is no rush by entrepreneurs in Strathclyde to set up in business as transport operators, because there is simply no profit in it in the rural areas. If there were, the local authority could well save some of the £24 million that it pays in general subsidies.
      The Scottish Bus Group, which is far and away the largest bus operator in Scotland, made the following comment on trial areas:
      "The idea of trial areas where road service licensing for all bus operators would be temporarily waived, is viewed with some trepidation unless bus operators are well represented in the discussions and organisation of such a scheme. The danger foreseen is that if abstraction results from established services during the trial period and these services are consequently reduced or withdrawn, it is unlikely that on the termination of the experiment passengers will return in sufficient numbers to justify restoration of these facilities. Generally the industry is not against positive experimental schemes but doubt must be cast as to whether operators would be prepared to make the necessary investment in vehicles and plant for a trial period only with no guarantee of continuity. Finally it must be said that transport in any area is a product unique to that area reflecting peculiar local circumstances and the results obtainable from one area do not necessarily become applicable to any other part of the country without modification."
      The present road service licence system ensures that in general only companies with serious intentions to run a viable and efficient service will make application. There is no evidence to support the Government's claim that the system is daunting to new entrants or difficult to understand. Under the present arrangements, very few applications for new licences are ever refused. It is not bus licensing that hampers initiative or restricts competition. It is simply the inability to make a profit.
      I agree with my hon. Friend the Member for Holborn and St. Pancras, South (Mr. Dobson) that there is little doubt that in the short term the public interest would be served by having State-sponsored trial areas free of road service licensing, but only if some public money is used to initiate them. We have seen nothing of
      1018
      lasting value under the experimental areas legislation of 1977, and nearly all of these schemes have financial and staffing problems.
      It is in the long term that the real danger of trial areas exists. The damage that could be done to the existing service could never be repaired except possibly at considerable public expense. I should have thought that that was not something for which the present Government would like to be responsible.
      Mr. Kenneth Clarke: The hon. Member for Glasgow, Shettleston (Mr. Marshall) sums up the views of all those with fears by a defence, largely, of the existing licensing system, with a distinct reluctance to contemplate any change and a dismissal of recent experiments which, in his opinion, have not got very far, as such under the 1977 Act. I concede to those who have raised the matter that that is the reaction of quite a lot of people in the passenger transport business, which has become quite accustomed to 50 years of rigid licensing and is somewhat worried to contemplate change of any kind. But we are contemplating change generally and change particularly in the trial areas. It is right that hon. Members should express their further fears about it in this debate.
      First, I think that the comparisons with the 1977 Act and Routex and so on rather put the trial area concept into the wrong context as an experiment, a very limited project. As my right hon. Friend emphasised, our approach to the idea of trial areas is a cautious one. The Bill is riddled with caution so far as the mechanics for consultation and so on are concerned. Nevertheless, we are envisaging something much more significant than the 1977 Act experiments. We are in the hands of the local authorities. Where local authorities agree with us that the time has come for change, we think that very considerable change in passenger transportation could come from these experiments.
      Our approach to trial areas and what led us to look at the possibility of trial areas free of quantity road service licensing altogether was an underlying belief that a great deal of the licensing system in many parts of the country had probably outlived any useful purpose. Perhaps we shall discover—if enough trial areas are designated—that the licensing

      1019
      system exists because it has existed for 50 years but that it serves no worthwhile purpose. Trial areas provide a way of challenging that in an adequate number of diverse circumstances.
      Mr. Dobson rose—
      7.30 pm
      Mr. Clarke: That belief is partly based on a study of present circumstances. People agonise about the delicate network arrangements that now exist, that cross-subsidise and support rural services and help outlying areas of municipalities. It is surprising to hear such arguments. The real background is one of continuous decline in the passenger transport networks of Britain.
      The hon. Member for Truro (Mr. Penhaligon) reminded us of the disasters that had hit parts of Cornwall. My hon. Friend the Member for Meriden (Mr. Mills) pointed out that rural parts of his constituency were losing the services of a National Bus Company subsidiary. It is no good saying that the present system supports a viable network in all rural areas or that it is fulfilling all passenger needs. It is very much in need of change. We shall, therefore, make that change.
      Trial areas must be contrasted with the position that will exist in the country as a whole. We shall change the burden of proof, whether in trial areas or not, in attempts to resist new operators seeking new services. The traffic commissioners will be enjoined to give licences, unless those licences are against the public interest. Express services that travel more than 30 miles without setting down a passenger will be free from licensing throughout the country. The commuter coach will be given priority. Regular contract services serving works and schools will be a reality throughout the country outside road service licensing. Within that context, county councils may ask my right hon. Friend to designate the whole or part of the county as a trial area. Such councils may share our belief that in practice road service licensing serves no purpose.
      About a dozen councils have expressed interest. I am told that two regional councils in Scotland have expressed interest. That information may be of benefit to the hon. Member for Shettleston. However, as yet no one has formally applied. Many councils are consulting. Some have
      1020
      not yet reached the consultation stage. We hope that two or three will put it into practice. We would like variety. However, we are in the hands of local authorities. The question of how many trial areas and how big they are will depend upon local authorities. They are the transport authorities. It would be nice to have a trial area in a large city or town as well as a rural one.
      Mr. Leadbitter: The hon. Gentleman has stressed the word "consultation" and the phrase "in the hands of local authorities". Perhaps he will heed his own remarks. In Committee he said:
      "Such procedures will certainly be demanded by those district councils which are flatly against the whole idea of trial areas in their or any other district. Some of those councils are controlled by people who are as hostile to the whole idea of competition in transport, as well as trial areas, as many members of the Committee are, and who will use the statutory consultation procedures deliberately to delay and obstruct the implementation of the county council's intentions."—[Official Report, Standing Committee H, 5 February 1980; c. 938.]
      In other words, he has said that there will be no consultation. He distrusts district councils. He is saying that they are prejudiced.
      Mr. Clarke: I am glad that the hon. Gentleman reads my speeches. I remember well what I said. If the hon. Gentleman has read the whole of that speech, he will know that earlier in it I answered the questions that he has posed. He asked how local authorities could set up trial areas. He wanted to know the position of district councils. He said that we did not want to know the views of district councils. He queried the position of areas such as Hartlepool. He said that if the county council had considered designating a trial area its representations would not be made known. He knows that I made those remarks about a demand that there should be formal statutory consultation when the Bill is enacted, even if consultation has already been held. I pointed out that it would give an opportunity to those districts that are hostile to the idea as a matter of principle to delay the proposals indefinitely. However they will have information and be able to make representations.
      The hon. Gentleman will also know that I referred to schedule 2. I made clear that when a county council wishes to designate a trial area it must begin

      1021
      by informing many bodies about its intention to apply to my right hon. Friend. It must inform all district councils. The district councils may then make representations to the county council. If the county council still wishes to persevere with the desire to be a trial area, its application to my right hon. Friend must be accompanied by all the representations that have been received.
      Before designating a trial area, the Minister will consider all the representations that a district council may choose to make. The hon. Gentleman is merely prodding at a passage in Committee that he has taken out of context. In that passage I dismissed the idea of going beyond the adequate arrangements that I have already described and of writing statutory consultation into the Bill in addition to all the requirements of information and of representations. He knows that formal statutory consultation will provide opportunities for delay.
      Of course, we appreciate the position of district councils. That position was pressed upon us by Conservative district councils and by my hon. Friends in Committee. Indeed, my hon. Friend the Member for Wellingborough (Mr. Fry) again stressed it tonight. My right hon. Friend has dealt with the changes that we made concerning the revocation of trial areas and a district's desire to be consulted. That will be accommodated in later amendments.
      The apparent desire to write out the duty to co-operate was merely a means of obtaining a debate. The Opposition proposed to wipe out large portions of the 1968 and 1978 Acts, to which they are so wedded. The hon. Member for Workington (Mr. Campbell-Savours) jumped the gun and asked what would happen in these trial areas. He wanted to know how we could be certain that they would not be of great disadvantage to the areas concerned. That is the main point.
      I stress that we are not advocating trial areas because we believe that there will be a collapse of public transport as we know it. By that I mean that which is urged upon us by the most cautious of operators, by all trade unions and by the ideological opponents of the Bill. We do not envisage dramatic overnight changes in trial areas. Those who find
      1022
      themselves within a trial area will wake up the morning after their area has been designated and find that nothing has changed. The same bus service will be operating. However, the climate may change because the traffic commissioners' road service licensing powers will have gone.
      What might happen? The hon. Member for Workington put his case succinctly. He spoke of the rural areas in his constituency and of the profitable urban parts. I shall not go into detail about Cumbria as that is a matter for Cumbria county council and for local operators. Let us take an imaginary county.
      Mr. Cohen: We are concerned not so much about ideological changes but about the effect of those changes upon community life in certain areas.
      Mr. Clarke: I accused my opponents of being interested in ideological changes.
      I wish to return to the practical arguments put forward by the hon. Member for Workington. In an imaginary county, half of the services need to be profitable and half unprofitable. It may be thought that the profitable ones generally subsidise the unprofitable ones and that the county council chips in a bit of revenue to support the network. That is a fairly typical set-up. If the traffic commissioners' arrangements are withdrawn, what will happen? There will be no dramatic change unless the National Bus Company, or one of its subsidiaries, starts behaving in a foolish and precipitate way—as they have said that they might. However, I do not think that the subsidiaries will take such action in practice. The hon. Member for Workington dwelt on the first thing that might happen. People might move in on the profitable services. The first sign of change will be that a proportion of the better services will have more buses and reduced fares. Operators will move into the better routes—
      Mr. Leadbitter rose—
      Mr. Clarke: The hon. Member for Hartlepool (Mr. Leadbitter) flits in and out of the debate like Fairy Blackstick without listening to the parts in between. All his right hon. and hon. Friends have referred to pirates moving in to cream off the profitable routes. A profitable route is vulnerable to competition. Somebody might move in and provide more buses or lower fares, or do other wicked and

      1023
      heinous things to those who live along the route. No one is arguing with that except the hon. Member for Hartlepool. We are told to consider the consequences to the rest of the network. Those who live along the routes will discover that they have been paying high fares and tolerating a poor service to cross-subsidise the network—to use the jargon of the passenger transport industry.
      What happens to the unprofitable services where there is a defined public need for operators? Revenue support is given to subsidise the network as a whole. Very few counties give revenue support to specific services. An operator with a certain piece of territory asks the county for a subsidy and probably receives it. It is possible to move away from that system with the MAP—market analysis project—arrangements, but it is the norm. Counties must realise that trial areas are not a substitute for revenue support. There is nothing wrong with revenue support. However, trial areas will provide counties with an opportunity to use revenue support in an intelligent, creative and better way.
      Trial areas will identify not only the present routes, who operates them, what are their losses and how much finance is required to keep them running—most of the present networks are a combination of history and chance—but which routes the county council, as the transport authority, considers to be fulfilling a public need but which are not being served or which might not be served if there were change to a more commercial regime. The county councils must identify the routes and the public need, and decide how to make intelligent use of their revenue support to provide the necessary services.
      I know of a council that has invited tenders for revenue support for certain routes, to discover who will come forward, what services and vehicles such operators can provide and at what price to meet the county council's desire. That option is open to the National Bus Company because there is no bias in the Bill as between the public sector and the private sector.
      Mr. Cowans: The Minister's remarks read like something from Hans Christian Andersen. There is no need to look into a crystal ball when one can read the book. We heard similar remarks during the Beeching era. We were told that
      1024
      there would be no change and that the only difference was that one would ride on a bus instead of a train. Lo and behold, the fairy descended and the buses started. But the fairy's wand rusted and there were no buses and no trains. What will the Minister do in that context?
      7.45 pm
      Mr. Clarke: The hon. Gentleman has said a lot about fairies, Beeching and trains, but I do not see the analogy with what I have described. The revenue support given by the public service obligation to the railways is not for specific routes. The Beeching operation predated the PSO by some years and was a national attempt to stop the deliberate closure of routes. We are not closing any routes. We are indicating that counties can, if they so wish, take away the restrictions on road service licensing where they can make better use of revenue support. Once the restrictions have been lifted, there will be a wider choice of operators and types of service. It is for the county councils to use the purse strings that are in their possession and their duties as transport co-ordinating authorities to make the best use of the moneys provided.
      Mr. Fry: Does my hon. Friend believe that the same principle should be applied to British Rail? Surely, it is unfair to treat road transport in one way and rail transport in a completely different way.
      7.45 pm
      Mr. Clarke: We are not responsible for the present financial arrangements for British Rail. I am biting off my tongue before launching into the analogy of British Rail. It should be run on the basis of the subsidy being applied to certain services where an accepted public need is defined by the Government. Sir Peter Parker is fond of talking about the contract between British Rail and the Government to provide certain passenger services at a certain price. That is a system that bus companies could arrive at with their county councils. Nothing within a trial area system would prevent them from doing so.
      Mr. Cohen: The Minister has announced certain concessions for private operators. Will there be a degree of compulsion to ensure that they provide the service required by the rural communities and do not opt out if they find that it is not profitable?
      Mr. Clarke: I emphasised that there was no concession to private companies. The public sector and the private companies are left on precisely the same footing. Each sector can take advantage of the Bill in whichever way suits it best. Each can lose out if it is uncompetitive and is forced to give way to more efficient competition.
      My hon. Friend the Member for Wellingborough made it clear that many private companies were cautious about the proposals. Operators must give notice to serve routes, and must give notice if they seek to withdraw from those routes. A bus company cannot be compelled to provide a service that will lose money and for which the county councils will not pay. Under the present licensing system, rural village after rural village is losing its services. We are not doing away with a system that protects the small operator in the rural areas or removing an unqualified success. We are altering the terms under which revenue support and other assistance is given. We hope that counties will use that support more intelligently.
      We accept the importance of rural taxis, mentioned by my hon. Friend the Member for Wellingborough. In many of the smaller communities we must find alternatives to the traditional bus service. Other parts of the Bill deal with shared cars, community bus services, post buses and other experiments that we wish to encourage.
      Taxis are the responsibility of my right hon. Friend the Home Secretary. Nevertheless, parts of the Bill touch on that subject. We have consulted those with taxi interests to ensure that we shall not damage them by our proposals. Other new clauses, tabled in the name of the hon. Member for Newcastle upon Tyne, Central (Mr. Cowans), refer to the provincial taxi service. I believe that the hon. Gentleman discussed his new clause with those concerned. We hope to meet the legitimate fears of taxi owners.
      Other parts of the Bill provide for revenue support for shared car schemes, which is a matter of some doubt in rural areas at present. We have not lost sight of the fact that taxis will have a part to play in rural areas. We must move away from the half-empty large bus rumbling through the leafy lanes. Some claim that it is subsidised by profitable services
      1026
      elsewhere. Others claim that it is supported by the county through the network but argue that it is not supported sufficiently. Nobody really knows the cost of the service or whether it serves the needs of the area. It is provided only because it has always been provided and because the operator has held a licence since goodness known when. Nobody else has been allowed to apply to the commissioners to service the route. We think that that must change considerably. That is the purpose of this part of the Bill, and it certainly would not be helped by the addition of the new clause.
      Mr. Prescott: The Parliamentary Secretary has made a number of interesting statements, some connected with the clause and some not. Certainly we were interested in the reply to the hon. Member for Wellingborough (Mr. Fry)—whether there is any new Government thinking about the financial obligations of British Rail and whether a different principle has been considered since the Minister met the chairman immediately after Question Time last week. The Parliamentary Secretary was clearly pointing out that there is a difference between British Rail as it is at present financed and a future approach to that financing. We await with interest further developments in the Conservative approach to the financing of British Rail.
      The new clause is largely concerned with showing the contradictions in the obligations and duties placed upon the authorities in relation to trial areas. The legislation gives a rather lax interpretation of the word "duty". I always thought that duty had something to do with responsibility. This is not a recommendation; it is a duty clearly imposed by the legislation. I cannot accept that it can be dismissed in such a cavalier manner.
      The trial area argument will be judged by experience. It is a matter of judgment between the two sides of the House. The unfortunate thing is that if we on these Benches are right, it will have been at considerable expense to many people in those areas, and that is our major fear.
      When I accused the Minister of being somewhat timid and cautious, I was referring to the fact that he was not prepared to experiment with the system

      1027
      beyond two or three areas. Undoubtedly, the implementation of the trial area scheme is a considerable and fundamental change in our transport system, and I would be the last to condemn a really challenging fundamental change. In fact, I hope to see a great deal of such change in the future.
      Nevertheless, our concern about the trial areas is based on the judgment of the consequences. I note that a considerable amount of praise has already been given to the existing licensing system. There is a reliance on the licensing system to maintain in other areas outside trial areas, within the 30-mile area, a basically similar transport system to the one we have at present. It might be a good idea to maintain the licensing system with commissioners and so on until we have witnessed the achievements of the experiments in the trial areas. It could be an extension of the previous Government's ideas of having experiments in certain areas but maintaining them against the background of commission control. To a great extent, that is the difference between us in our approach to the experiments. We like to have the safety of the backdrop.
      The services in rural areas are far from satisfactory and tend to reflect the competition aspect that has crept in during the last 20 years under a number of Governments. This has led to an unfortunate reduction in the extent of services. That must be seen against the background of the increase in the number of cars. The problem with the rural areas is that only a few people are dependent on the transport system and, whether these transport services are private or public, there is no way in which they can pay commercially.
      All sorts of minibuses and different kinds of vehicles have been tried, and the reports of the experiments conducted so far have not necessarily shown them to be a considerable financial success. Indeed, a number of them show quite clearly that if these services are breaking even at present, that is happening without the money for investment. The recommendation is that the Government should provide money for investment in vehicles and then have a kind of break-even system on the operation of the vehicles. That is clearly not envisaged in the trial
      1028
      area experiments, and to that extent we feel strengthened in our view.
      We have concentrated a considerable amount of time on the rural areas—and rightly so—but I am still a little confused about the position of rural taxis. I understood that taxis outside London were not controlled by the Home Office. I might be wrong, but I thought that we had a Bill not so long ago which gave control of taxis outside London to local authorities. I thought that the Home Office's jurisdiction applied only to the London area.
      Mr. Kenneth Clarke: In so far as there is a sponsoring Department, the Home Office is the relevant Department, just as the Ministry of Transport is the sponsoring Department for bus services even though it does not run any.
      Mr. Prescott: Then, presumably, any kind of policy for rural taxis would be determined not by the Home Office but by the Ministry of Transport, which has established the experimental areas under the 1978 Act.
      Mr. Cowans: The fact of the matter is that the Home Office is now fully responsible for taxi drivers in the cab service in London, and local authorities are now responsible for taxi drivers in their areas. While it is true that the Home Office is the overall sponsoring body, in effect the Home Office supervises London cabs but it does not supervise provincial cabs.
      Mr. Prescott: Yes, and the Home Office is not very effective at that. The demands for changes in that area have come over a period of time from the taxi drivers themselves.
      Nevertheless, we are convinced about our case in making the judgment by the fact that there is a combined alliance of opposition. All the established operators appear to be against the trial area principle. Also, the districts are very much against the imposition of a trial area.
      We note the point made by the Minister that money will be available for these services and, therefore, there will not be a difference in that sense. The operator may be different. He may no longer be the network public transport operator; he may be "Jones the Bus" or whatever.

      1029
      The Minister may find that he may be able to produce a service more cheaply under the present economics, but that may not necessarily be so when the new National Bus Company and the new operators adjust to the changes which will inevitably mean fewer buses, and these will be concentrated on profitable areas.
      We have made great play of profitable routes, because we do not believe that bus operators will want to look for unprofitable routes. The Minister answered that by saying that money will be provided by subsidies. Therefore, presumably, the competition will now be between companies for the subsidy, and the one that applies for the lowest amount of subsidy will get the bus. That begs the question as to the fare policy in those areas. There is a considerable correlation between fares and the number of journeys that people make by bus.
      The point was made earlier in the debate that if the Hartlepool authority found that cowboy operators were coming in and undermining the present network system of the district authority, this would be extremely disadvantageous. Whether that is right or wrong, it is clear that if the scheme were to collapse the licence presumably would go to the existing operator. Therefore, we are likely to replace the old-established operator, for one reason or another, and to remain with the one-man company or the two- or three-bus companies which come in to take these routes. These are not the people who co-ordinate transport services, nor are they the people who provide network services.
      Mr. Leadbitter: My hon. Friend has mentioned the objections of the district councils, but will he confirm that the Association of District Councils, the official representative of all district councils, has protested and proclaimed its opposition to the proposal and that that formal opinion represents the great body of local authority opinion, as well as public opinion?
      8 pm
      Mr. Prescott: We have constantly made that point to the Minister in representations and debates.
      The Minister mentioned the case of a new operator receiving subsidies but, pre-
      1030
      sumably, offering cheaper fares. He will have to agree that, if companies are prepared to operate services and profit from them, though they may need a subsidy in order to do so, the profits of "Jones the Bus" will presumably not be used to subsidise the overall service.
      The Parliamentary Secretary seemed to indicate that if new operators started up with two or three buses they might be able to offer a network service, and the local authority could say that although it would not subsidise one route it would be prepared to give subsidies on the basis of three or four routes. That is basically the system that we have at present. Is the Minister saying that the profits made on the profitable route will be used, as the NBC uses the gains from its profitable routes, as a contribution towards revenue and as part of the information given to local authorities when the operator applies for a subsidy? If so, that is similar to the existing situation, except that we should be exchanging one operator for another. It is a matter of judgment. We shall have to see what happens. The question before us is whether we should repeal the duties imposed on operators in trial areas.
      The Minister said that the co-ordination role of local authorities would remain the same and, therefore, there was no need to remove that. There are a number of arguments on that matter, particularly if we take into account the definition of integration of public services. We dealt with that in Committee, and the question turns on the interpretation of "network" and "integration".
      A requirement under the Transport Act 1978 makes clear that the NBC and other operators have an obligation to provide such information concerning their services, including the cost of providing them, as may be reasonably required by the local authority. That causes considerable concern to the operators, and we share that concern. The operators feel that they will be severely disadvantaged by that requirement and they ask us to put the issue of those obligations and duties before the House. We intend to do that by voting on the new clause.
      Question put, That the clause be read a Second time: —
      The House divided: Ayes 144, Noes 189.

      Division No. 237]

      AYES

      [6 pm

      Adams, Allen

      Bradley, Tom

      Cook, Robin F.

      Allaun, Frank

      Brown, Hugh D. (Provan)

      Cowans, Harry

      Archer, Rt Hon Peter

      Buchan, Norman

      Cryer, Bob

      Ashton, Joe

      Callaghan, Rt Hon J. (Cardiff SE)

      Cunlitle, Lawrence

      Benn, Rt Hon Anthony Wedgwood

      Callaghan, Jim (Middlelon & P)

      Cunningham, George (Islington S)

      Bennett, Andrew (Stockport N)

      Campbell-Savours, Dale

      Cunningham, Dr John (Whitehaven)

      Bidwell, Sydney

      Carmichael, Neil

      Dalyell, Tam

      Booth, Rt Hon Albert

      Cartwright, John

      Davidson, Arthur

      Boothroyd, Miss Betty

      Cocks, Rt Hon Michael (Bristol S)

      Davies, Ifor (Gower)

      Bottomley, Rt Hon Arthur (M'brough)

      Cohen, Stanley

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

      Dean, Joseph (Leeds West)

      Jones, Barry (East Flint)

      Rees, Rt Hon Merlyn (Leeds South)

      Dempsey, James

      Jones, Dan (Burnley)

      Richardson, Jo

      Dewar, Donald

      Kilroy-Silk, Robert

      Roberts, Ernest (Hackney North)

      Dixon, Donald

      Leadbitter, Ted

      Robertson, George

      Dobson, Frank

      Leighton, Ronald

      Rodgers, Rt Hon William

      Douglas, Dick

      Lewis, Ron (Carlisle)

      Ross, Ernest (Dundee West)

      Dunwoody, Mrs Gwyneth

      Litherland, Robert

      Rowlands, Ted

      Eadie, Alex

      Lofthouse, Geoffrey

      Sandelson, Neville

      Eastham, Ken

      McCartney, Hugh

      Sever, John

      Edwards, Robert (Wolv SE)

      McElhone, Frank

      Shore, Rt Hon Peter (Step and Pop)

      Ellis, Tom (Wrexham)

      McGuire, Michael (Ince)

      Silkin, Rt Hon John (Deptford)

      Evans, Ioan (Aberdare)

      McKay, Allen (Penistone)

      Silkin, Rt Hon S. C. (Dulwich)

      Evans, John (Newton)

      McKelvey, William

      Silverman, Julius

      Ewing, Harry

      MacKenzle, Rt Hon Gregor

      Soley, Clive

      Faulds, Andrew

      Maclennan, Robert

      Spearing, Nigel

      Flannery, Martin

      McMillan, Tom (Glasgow, Central)

      Spriggs, Leslie

      Fletcher, Ted (Darlington)

      McNally, Thomas

      Stewart, Rt Hon Donald (W Isles)

      Foot, Rt Hon Michael

      McWilliam, John

      Stoddart, David

      Foultas, George

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

      Stott, Roger

      Fraser, John (Lambeth, Norwood)

      Marshall, Dr Edmund (Goole)

      Strang, Gavin

      Garrett, John (Norwich S)

      Marshall, Jim (Leicester South)

      Summerskill, Hon Dr Shirley

      George, Bruce

      Maxton, John

      Taylor, Mrs Ann (Bolton West)

      Golding, John

      Meacher, Michael

      Tinn, James

      Gourlay, Harry

      Mellish, Rt Hon Robert

      Urwin, Rt Hon Tom

      Graham, Ted

      Mitchell, Austin (Grimsby)

      Wellbeloved, James

      Grant, George (Morpeth)

      Mitchell, R. C. (Solon, Itchen)

      Welsh, Michael

      Hamilton, James (Bothwell)

      Morris, Rt Hon Charles (Openshaw)

      White, Frank R. (Bury & Radcliffe)

      Hamilton, W. W. (Central Fife)

      Moyle, Rt Hon Roland

      Whitehead, Phillip

      Hardy, Peter

      Newens, Stanley

      Whitlock, William

      Harrison, Rt Hon Walter

      Oakes, Rt Hon Gordon

      Williams, Rt Hon Alan (Swansea W)

      Haynes, Frank

      Ogden, Eric

      Williams, Sir Thomas (Warrington)

      Heffer, Eric S.

      O'Neill, Martin

      Wilson, Rt Hon Sir Harold (Huyton)

      Holland, Stuart (L'beth, Vauxhall)

      Orme, Rt Hon Stanley

      Wilson, William (Coventry SE)

      Home Robertson, John

      Owen, Rt Hon Dr David

      Winnick, David

      Homewood, William

      Palmer, Arthur

      Woolmer, Kenneth

      Hooley, Frank

      Park, George

      Wrigglesworth, Ian

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

      Parker, John

      Wright, Shella

      Hughes, Robert (Aberdeen North)

      Powell, Rt Hon J. Enoch (S Down)

      Jay, Rt Hon Douglas

      Powell, Raymond (Ogmore)

      TELLERS FOR THE AYES:

      John, Brynmor

      Prescott, John

      Mr, George Morton and

      Johnson, James (Hull West)

      Race, Reg

      Mr. Donald Coleman.

      Johnson, Walter (Derby South)

      Radice, Giles

      NOES

      Adley, Robert

      Costain, A. P.

      Hooson, Tom

      Alexander, Richard

      Dover, Denshore

      Hordern, Peter

      Ancram, Michael

      du Cann, Rt Hon Edward

      Howell, Ralph (North Norfolk)

      Aspinwall, Jack

      Dunn, Robert (Dartford)

      Hunt, John (Ravensbourne)

      Atkins, Robert (Preston North)

      Dykes, Hugh

      Hurd, Hon Douglas

      Atkinson, David (B'mouth, East)

      Eggar, Timothy

      Johnston, Russell (Inverness)

      Beaumont-Dark, Anthony

      Faith, Mrs Sheila

      Jopling, Rt Hon Michael

      Bendall, Vivian

      Faulds, Andrew

      Kershaw, Anthony

      Benyon Thomas (Abingdon)

      Fletcher, Alexander (Edinburgh N)

      King, Rt Hon Tom

      Berry, Hon Anthony

      Fletcher-Cooke, Charles

      Kitson, Sir Timothy

      Best, Keith

      Fookes, Miss Janet

      Knight, Mrs Jill

      Bevan, David Gilroy

      Fowler, Rt Hon Norman

      Knox, David

      Biggs-Davison, John

      Fox, Marcus

      Lang, Ian

      Blackburn, John

      Freud, Clement

      Latham, Michael

      Blaker, Peter

      Fry, Peter

      Lawson, Nigel

      Boscawen, Hon Robert

      Gardiner, George (Reigate)

      Le Marchant, Spencer

      Braine, Sir Bernard

      Garel-Jones, Tristan

      Lennox-Boyd, Hon Mark

      Bright, Graham

      Gorst, John

      Lewis, Kenneth (Rutland)

      Brinton, Tim

      Gow, Ian

      Lloyd, Ian (Havant & Waterloo)

      Brittan, Leon

      Grant, Anthony (Harrow C)

      Lloyd, Peter (Fareham)

      Brocklebank-Fowler, Christopher

      Gray, Hamish

      Loveridge, John

      Brooke, Hon Peter

      Grieve, Percy

      Luce, Richard

      Brown, Michael (Brigg & Sc'thorpe)

      Griffiths, Eldon (Bury St Edmunds)

      Lyell, Nicholas

      Bruce-Gardyne, John

      Griffiths, Peter (Portsmouth N)

      Macfarlane, Neil

      Bryan, Sir Paul

      Grimond, Rt Hon J.

      MacGregor, John

      Buchanan-Smith, Hon Alick

      Grist, Ian

      MacKay, John (Argyll)

      Buck, Antony

      Grylls, Michael

      McNair-Wilson, Michael (Newbury)

      Burden, F. A.

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

      McQuarrie, Albert

      Butcher, John

      Hannam, John

      Marlow, Tony

      Cadbury, Jocelyn

      Haselhurst, Alan

      Marshall, Michael (Arundel)

      Carlisle, John (Luton West)

      Havers, Rt Hon Sir Michael

      Mather, Carol

      Carlisle, Kenneth (Lincoln)

      Hawkins, Paul

      Maude, Rt Hon Angus

      Chalker, Mrs Lynda

      Hawksley, Warren

      Mawby, Ray

      Chapman, Sydney

      Hayhoe, Barney

      Mawhinney, Dr Brian

      Clark, Hon Alan (Plymouth, Sutton)

      Heddle, John

      Maxwell-Hyslop, Robin

      Clarke, Kenneth (Rushcliffe)

      Henderson, Barry

      Mellor, David

      Clegg, Sir Walter

      Hicks, Robert

      Meyer, Sir Anthony

      Colvin, Michael

      Higgins, Rt Hon Terence L.

      Miller, Hal (Bromsgrove & Redditch)

      Cope, John

      Hill, James

      Mills, Iain (Meriden)

      Corrie, John

      Hogg, Hon Douglas (Grantham)

      Mills, Peter (West Devon)

      992

      993

      Miscampbell, Norman

      Rhodes, James, Robert

      Temple-Morris, Peter

      Moate, Roger

      Rhys Williams, Sir Brandon

      Thomas, Rt Hon Peter (Hendon S)

      Montgomery, Fergus

      Ridsdale, Jullian

      Thompson, Donald

      Morrison, Hon Charles (Devizes)

      Rifkind, Malcolm

      Thorne, Neil (Ilford South)

      Morrison, Hon Peter (City of Chester)

      St. John-Stevas, Rt Hon Norman

      Townend, John (Bridlington)

      Murphy, Christopher

      Scott, Nicholas

      Townsend, Cyril D. (Bexleyheath)

      Myles, David

      Shaw, Michael (Scarborough)

      Trippier, David

      Neale, Gerrard

      Shelton, William (Streatham)

      van Straubenzee, W. R.

      Needham, Richard

      Shepherd, Colin (Hereford)

      Vaughan, Dr Gerard

      Nelson, Anthony

      Shepherd, Richard (Aldridge-Br'hills)

      Viggers, Peter

      Neubert, Michael

      Silvester, Fred

      Waddington, David

      Page, John (Harrow, West)

      Smith, Cyril (Rochdale)

      Wakeham, John

      Page, Rt Hon Sir R. Graham

      Speed, Keith

      Walker-Smith, Rt Hon Sir Derek

      Parris, Matthew

      Speller, Tony

      Waller, Garry

      Patten, John (Oxford)

      Spicer, Michael (S Worcestershire)

      Watson, John

      Penhaligon, David

      Sproat, Iain

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

      Percival, Sir Ian

      Squire, Robin

      Wheeler, John

      Peyton, Rt Hon John

      Stainton, Keith

      Wickenden, Keith

      Pollock, Alexander

      Stanbrook, Ivor

      Wilkinson, John

      Porter, George

      Stanley, John

      Williams, Delwyn (Montgomery)

      Prentice, Rt Hon Reg

      Steel, Rt Hon David

      Wolfson, Mark

      Proctor, K. Harvey

      Steen, Anthony

      Raison, Timothy

      Stevens, Martin

      TELLERS FOR THE NOES:

      Rathbone, Tim

      Stradling Thomas, J.

      Lord James Douglas-Hamilton and

      Rees-Davies, W. R.

      Taylor, Teddy (Southend East)

      Mr. Tony Newton.

      Renton, Tim

      Tebbit, Norman

      Division No. 238]

      AYES

      [8.03 pm

      Adams, Allen

      Grant, George (Morpeth)

      Park, George

      Allaun, Frank

      Hamilton, W. W. (Central Fife)

      Parker, John

      Archer, Rt Hon Peter

      Hardy, Peter

      Powell, Rt Hon J. Enoch(S Down)

      Ashton, Joe

      Harrison, Rt Hon Walter

      Powell, Raymond (Ogmore)

      Benn, Rt Hon Anthony Wedgwood

      Haynes, Frank

      Prescott, John

      Bennett, Andrew (Stockport N)

      Heffer, Eric S.

      Race, Reg

      Booth, Rt Hon Albert

      Holland, Stuart (L'beth, Vauxhall)

      Radice, Giles

      Bottomley, Rt Hon Arthur (M'brough)

      Home Robertson, John

      Rees, Rt Hon Merlyn (Leeds South)

      Bradley, Tom

      Homewood, William

      Roberts, Albert (Normanton)

      Bray, Dr Jeremy

      Hooley, Frank

      Roberts, Ernest (Hackney North)

      Brown, Hugh D. (Provan)

      Horam, John

      Robertson, George

      Buchan, Norman

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

      Rodgers, Rt Hon William

      Callaghan, Jim (Middleton & P)

      Janner, Hon Greville

      Ross, Ernest (Dundee West)

      Campbell-Savours, Dale

      Jay, Rt Hon Douglas

      Ross, Wm. (Londonderry)

      Cartwright, John

      John, Brynmor

      Rowlands, Ted

      Clark, Dr David (South Shields)

      Johnson, James (Hull West)

      Sever, John

      Cocks, Rt Hon Michael (Bristol S)

      Johnson, Walter (Derby South)

      Shore, Rt Hon Peter (Step and Pop)

      Cohen, Stanley

      Jones, Barry (East Flint)

      Silkin, Rt Hon John (Deptford)

      Coleman, Donald

      Jones, Dan (Burnley)

      Silverman, Julius

      Cowans, Harry

      Kilroy-Silk, Robert

      Snape, Peter

      Cryer, Bob

      Leadbitter, Ted

      Soley, Clive

      Cunliffe, Lawrence

      Leighton, Ronald

      Spearing, Nigel

      Cunningham, George (Islington S)

      Lestor, Miss Joan (Eton & Slough)

      Spriggs, Leslie

      Cunningham, Dr John (Whitehaven)

      Lewis, Ron (Carlisle)

      Stewart, Rt Hon Donald (W Isles)

      Dalyell, Tam

      Lofthouse, Geoffrey

      Stoddart, David

      Davidson, Arthur

      McElhone, Frank

      Stott, Roger

      Davies, Ifor (Gower)

      McGuire, Michael (Ince)

      Strang, Gavin

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

      McKay, Allen (Penistone)

      Summerskill, Hon Dr Shirley

      Dean, Joseph (Leeds West)

      McKelvey, William

      Taylor, Mrs Ann (Bolton West)

      Dempsey, James

      MacKenzie, Rl Hon Gregor

      Thomas, Dafydd (Merioneth)

      Dixon, Donald

      Maclennan, Robert

      Thomas, Dr Roger (Carmarthen)

      Dobson, Frank

      McMillan, Tom (Glasgow, Central)

      Tinn, James

      Douglas, Dick

      McWilliam, John

      Urwin, Rt Hon Tom

      Dunnett, Jack

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

      Weetch, Ken

      Dunwoody, Mrs Gwyneth

      Marshall, Dr Edmund (Goole)

      Wellbeloved, James

      Eadie, Alex

      Marshall, Jim (Leicester South)

      Welsh, Michael

      Eastham, Ken

      Maxton, John

      White, Frank R. (Bury & Radcliffe)

      Edwards, Robert (Wolv SE)

      Mellish, Rt Hon Robert

      Whitehead, Phillip

      Ellis, Tom (Wrexham)

      Mitchell, Austin (Grimsby)

      Whitlock, William

      Evans, Ioan (Aberdare)

      Molyneaux, James

      Williams, Rt Hon Alan (Swansea W)

      Ewing, Harry

      Morris, Rt Hon Charles (Openshaw)

      Williams, Sir Thomas (Warrington)

      Faulds, Andrew

      Morton, George

      Wilson, William (Coventry SE)

      Flannery, Martin

      Moyle, Rt Hon Roland

      Winnick, David

      Fletcher, Ted (Darlington)

      Newens, Stanley

      Woolmer, Kenneth

      Foot, Rt Hon Michael

      Oakes, Rt Hon Gordon

      Wrigglesworth, Ian

      Foulkes, George

      Ogden, Eric

      George, Bruce

      O'Neill, Martin

      TELLERS FOR THE AYES:

      Golding, John

      Orme, Rt Hon Stanley

      Mr. James Hamilton and

      Gourlay, Harry

      Palmer, Arthur

      Mr. John Evans.

      Graham, Ted

      NOES

      Adley, Robert

      Chalker, Mrs Lynda

      Griffiths, Eldon (Bury St Edmunds)

      Alexander, Richard

      Chapman, Sydney

      Griffiths, Peter (Portsmouth N)

      Alton, David

      Clarke, Kenneth (Rushcliffe)

      Grimond, Rt Hon J.

      Ancram, Michael

      Clegg, Sir Walter

      Grist, Ian

      Aspinwall, Jack

      Colvin, Michael

      Gummer, John Selwyn

      Atkins, Robert (Preston North)

      Cope, John

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

      Atkinson, David (B'mouth, East)

      Corrie, John

      Hamilton, Michael (Salisbury)

      Beaumont-Dark, Anthony

      Dover, Denshore

      Hannam, John

      Bendall, Vivian

      du Cann, Rt Hon Edward

      Haselhurst, Alan

      Benyon, Thomas (Abingdon)

      Dunn, Robert (Dartford)

      Havers, Rt Hon Sir Michael

      Berry, Hon Anthony

      Dykes, Hugh

      Hawkins, Paul

      Best, Keith

      Eden, Rt Hon Sir John

      Hawksley, Warren

      Bevan, David Gilroy

      Eggar, Timothy

      Heddle, John

      Blackburn, John

      Faith, Mrs Sheila

      Henderson, Barry

      Blaker, Peter

      Fenner, Mrs Peggy

      Hicks, Robert

      Body, Richard

      Fisher, Sir Nigel

      Higgins, Rt Hon Terence L.

      Boscawen, Hon Robert

      Fletcher, Alexander (Edinburgh N)

      Hill, James

      Braine, Sir Bernard

      Fletcher-Cooke, Charles

      Hogg, Hon Douglas (Grantham)

      Bright, Graham

      Fookes, Miss Janet

      Hooson, Tom

      Brinton, Tim

      Fowler, Rt Hon Norman

      Hordern, Peter

      Brocklebank-Fowler, Christopher

      Fox, Marcus

      Howell, Ralph (North Norfolk)

      Bruce-Gardyne, John

      Freud, Clement

      Hunt, John (Ravensbourne)

      Bryan, Sir Paul

      Fry, Peter

      Hurd, Hon Douglas

      Buchanan-Smith, Hon Alick

      Gardiner, George (Reigate)

      Johnston, Russell (Inverness)

      Buck, Antony

      Garel-Jones, Tristan

      Jopling, Rt Hon Michael

      Butcher, John

      Gorst, John

      Kaberry, Sir Donald

      Cadbury, Jocelyn

      Gow, Ian

      Kershaw, Anthony

      Carlisle, Kenneth (Lincoln)

      Gray, Hamish

      King, Rt Hon Tom

      1032

      1033

      Kitson, Sir Timothy

      Murphy, Christopher

      Spicer, Michael (S Worcestershire)

      Knox, David

      Myles, David

      Sproat, Iain

      Lang, Ian

      Neale, Gerrard

      Squire, Robin

      Latham, Michael

      Needham, Richard

      Stainton, Keith

      Lawson, Nigel

      Nelson, Anthony

      Stanbrook, Ivor

      Le Marchant, Spencer

      Neubert, Michael

      Stanley, John

      Lennox-Boyd, Hon Mark

      Newton, Tony

      Steen, Anthony

      Lester, Jim (Beeston)

      Nott, Rt Hon John

      Stevens, Martin

      Lewis, Kenneth (Rutland)

      Page, John (Harrow, West)

      Tebbit, Norman

      Lloyd, Peter (Fareham)

      Page, Rt Hon Sir R. Graham

      Temple-Morris, Peter

      Loveridge, John

      Page, Richard (SW Hertfordshire)

      Thomas, Rt Hon Peter (Hendon S)

      Luce, Richard

      Parris, Matthew

      Thompson, Donald

      Lyell, Nicholas

      Patten, John (Oxford)

      Thome, Neil (Ilford South)

      Macfarlane, Neil

      Penhaligon, David

      Townend, John (Bridlington)

      MacGregor, John

      Percival, Sir Ian

      Townsend, Cyril D. (Bexleyheath)

      MacKay, John (Argyll)

      Peyton, Rt Hon John

      Trippler, David

      McNair-Wilson, Michael (Newbury)

      Pollock, Alexander

      Taylor, Teddy (Southend East)

      McQuarrie, Albert

      Porter, George

      van Straubenzee, W. R.

      Marshall, Michael (Arundel)

      Prentice, Rt Hon Reg

      Viggers, Peter

      Mather, Carol

      Proctor, K. Harvey

      Waddington, David

      Maude, Rt Hon Angus

      Raison, Timothy

      Wainwright, Richard (Colne Valley)

      Mawby, Ray

      Rathbone, Tim

      Wakeham, John

      Mawhinney, Dr Brian

      Rees-Davies, W. R.

      Walker, Rt Hon Peter (Worcester)

      Maxwell-Hyslop, Robin

      Renlon, Tim

      Walker, Bill (Perth & E Perthshire)

      Mellor, David

      Rhodes James, Robert

      Walker-Smith, Rt Hon Sir Derek

      Meyer, Sir Anthony

      Ridsdale, Julian

      Waller, Garry

      Miller, Hal (Bromsgrove & Redditch)

      Royle, Sir Anthony

      Watson, John

      Mills, Iain (Meriden)

      Scott, Nicholas

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

      Mills, Peter (West Devon)

      Shaw, Giles (Pudsey)

      Wheeler, John

      Miscampbell, Norman

      Shaw, Michael (Scarborough)

      Wickenden, Keith

      Moate, Roger

      Shelton, William (Streatham)

      Wilkinson, John

      Montgomery, Fergus

      Shepherd, Colin (Hereford)

      Wolfson, Mark

      Morgan, Geraint

      Shepherd, Richard(Aldridge-Br'hills)

      Morris, Michael (Northampton, Sth)

      Silvester, Fred

      TELLERS FOR THE NOES:

      Morrison, Hon Charles (Devizes)

      Speed, Keith

      Mr. Peter Brooke and

      Morrison, Hon Peter (City of Chester)

      Speller, Tony

      Lord James Douglas-Hamilton.

      Mudd, David

      Question accordingly negatived.

    New Clause 8

      ANNUAL INSPECTION OF PUBLIC SERVICE VEHICLES
      'The Minister shall prescribe in regulations arrangements for the annual inspection of public service vehicles at either official public service vehicle testing stations or, if the equipment provided is adequate, the operator's
      premises, but no such regulations shall be made until a draft thereof has been laid before, and approved by a resolution of, each House of Parliament.'.—[Mr. Booth.]
      Brought up, and read the First time.
      Question proposed, That the clause be read a Second time.—[Mr. Prescott.]
      Question put:—
      The House divided: Ayes 147, Noes 183.

      Division No. 239]

      AYES

      [8.15 pm

      Adams, Allen

      Dixon, Donald

      Haynes, Frank

      Allaun, Frank

      Dobson, Frank

      Heffer, Eric S.

      Alton, David

      Douglas, Dick

      Holland, Stuart (L'beth, Vauxhall)

      Archer, Rt Hon Peter

      Dunnett, Jack

      Home Robertson, John

      Ashton, Joe

      Dunwoody, Mrs Gwyneth

      Homewood, William

      Benn, Rt Hon Anthony Wedgwood

      Eadie, Alex

      Hooley, Frank

      Bennett, Andrew (Stockport N)

      Eastham, Ken

      Horam, John

      Booth, Rt Hon Albert

      Edwards, Robert (Wolv SE)

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

      Bradley, Tom

      Ellis, Tom (Wrexham)

      Janner, Hon Greville

      Brown, Hugh D. (Provan)

      Evans, Ioan (Aberdare)

      Jay, Rt Hon Douglas

      Buchan, Norman

      Evans, John (Newton)

      John, Brynmor

      Callaghan, Jim (Middleton & P)

      Ewing, Harry

      Johnson, James (Hull West)

      Campbell-Savours, Dale

      Faulds, Andrew

      Johnson, Walter (Derby South)

      Cartwright, John

      Flannery, Martin

      Johnston, Russell (Inverness)

      Clark, Dr David (South Shields)

      Fletcher, Ted (Darlington)

      Jones, Barry (East Flint)

      Cocks, Rt Hon Michael (Bristol S)

      Foot, Rt Hon Michael

      Jones, Dan (Burnley)

      Cohen, Stanley

      Foulkes, George

      Kilroy-Silk, Robert

      Coleman, Donald

      Freud, Clement

      Leadbitter, Ted

      Cowans, Harry

      George, Bruce

      Leighton, Ronald

      Cryer, Bob

      Golding, John

      Lestor, Miss Joan (Eton & Slough)

      Cunliffe, Lawrence

      Gourlay, Harry

      Lewis, Ron (Carlisle)

      Cunningham, George (Islington S)

      Graham, Ted

      Lofthouse, Geoffrey

      Cunningham, Dr John (Whitehaven)

      Grant, George (Morpeth)

      McElhone, Frank

      Dalyell, Tarn

      Grimond, Rt Hon J.

      McGuire, Michael (Ince)

      Davidson, Arthur

      Hamilton, James (Bothwell)

      McKay, Allen (Penistone)

      Davies, Ifor (Gower)

      Hamilton, W. W. (Central File)

      McKelvey, William

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

      Hardy, Peter

      MacKenzie, Rt Hon Gregor

      Dempsey, James

      Harrison, Rt Hon Walter

      Maclennan, Robert

      McMillan, Tom (Glasgow, Central)

      Powell, Raymond (Ogmore)

      Strang, Gavin

      McWilliam, John

      Prescott, John

      Summerskill, Hon Dr Shirley

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

      Race, Reg

      Taylor, Mrs Ann (Bolton West)

      Marshall, Dr Edmund (Goole)

      Rees, Rt Hon Merlyn (Leeds South)

      Thomas, Dafydd (Merioneth)

      Marshall, Jim (Leicester South)

      Roberts, Albert (Normanton)

      Thomas, Dr Roger (Carmarthen)

      Maxton, John

      Roberts, Ernest (Hackney North)

      Urwin, Rt Hon Tom

      Mellish, Rt Hon Robert

      Robertson, George

      Wainwright, Richard (Colne Valley)

      Mitchell, Austin (Grimsby)

      Rodgers, Rt Hon William

      Weetch, Ken

      Molyneaux, James

      Ross, Ernest (Dundee West)

      Wellbeloved, James

      Morris, Rt Hon Charles (Openshaw)

      Ross, Wm. (Londonderry)

      Welsh, Michael

      Morton, George

      Rowlands, Ted

      White, Frank R. (Bury & Radcliffe)

      Moyle, Rt Hon Roland

      Sever, John

      Whitehead, Phillip

      Newens, Stanley

      Shore, Rt Hon Peter (Step and Pop)

      Whitlock, William

      Oakes, Rt Hon Gordon

      Silkin, Rt Hon John (Deptford)

      Williams, Rt Hon Alan (Swansea W)

      Ogden, Eric

      Silverman, Julius

      Wilson, William (Coventry SE)

      O'Neill, Martin

      Snape, Peter

      Winnick, David

      Orme, Rt Hon Stanley

      Soley, Clive

      Woolmer, Kenneth

      Palmer, Arthur

      Spearing, Nigel

      Wrigglesworth, Ian

      Park, George

      Spriggs, Leslie

      Parker, John

      Stewart, Rt Hon Donald (W Isles)

      TELLERS FOR THE AYES:

      Penhaligon, David

      Stoddart, David

      Mr. James Tinn and

      Powell, Rt Hon J. Enoch (S Down)

      Stott, Roger

      Mr. Joseph Dean.

      NOES

      Adley, Robert

      Hamilton, Michael (Salisbury)

      Myles, David

      Alexander, Richard

      Hannam, John

      Neale, Gerrard

      Ancram, Michael

      Haselhurst, Alan

      Needham, Richard

      Aspinwall, Jack

      Hastings, Stephen

      Nelson, Anthony

      Atkins, Robert (Preston North)

      Havers, Rt Hon Sir Michael

      Neubert, Michael

      Atkinson, David (B'mouth, East)

      Hawkins, Paul

      Newton, Tony

      Beaumont-Dark, Anthony

      Hawksley, Warren

      Nott, Rt Hon John

      Bendall, Vivian

      Heddle, John

      Page, John (Harrow, West)

      Benyon, Thomas (Abingdon)

      Henderson, Barry

      Page, Rt Hon Sir R. Graham

      Berry, Hon Anthony

      Hicks, Robert

      Page, Richard (SW Hertfordshire)

      Best, Keith

      Higgins, Rt Hon Terence L.

      Parris, Matthew

      Bevan, David Gilroy

      Hill, James

      Patten, John (Oxford)

      Blackburn, John

      Hogg, Hon Douglas (Grantham)

      Percival, Sir Ian

      Blaker, Peter

      Hooson, Tom

      Peyton, Rt Hon John

      Body, Richard

      Hordern, Peter

      Pollock, Alexander

      Boscawen, Hon Robert

      Howell, Ralph (North Norfolk)

      Porter, George

      Braine, Sir Bernard

      Hunt, John (Ravensbourne)

      Prentice, Rt Hon Reg

      Bright, Graham

      Hurd, Hon Douglas

      Proctor, K. Harvey

      Brinton, Tim

      Jopling, Rt Hon Michael

      Raison, Timothy

      Brocklebank-Fowler, Christopher

      Kaberry, Sir Donald

      Rathbone, Tim

      Bruce-Gardyne, John

      Kershaw, Anthony

      Rees-Davies, W. R.

      Bryan, Sir Paul

      King, Rt Hon Tom

      Renton, Tim

      Buchanan-Smith, Hon Alick

      Kitson, Sir Timothy

      Rhodes, James, Robert

      Buck, Antony

      Knox, David

      Ridsdale, Juliian

      Butcher, John

      Lang, Ian

      Royle, Sir Anthony

      Cadbury, Jocelyn

      Latham, Michael

      Scott, Nicholas

      Carlisle, Kenneth (Lincoln)

      Lawson, Nigel

      Shaw, Giles (Pudsey)

      Chalkor, Mrs Lynda

      Le Marchant, Spencer

      Shaw, Michael (Scarborough)

      Chapman, Sydney

      Lester, Jim (Beeston)

      Shelton, William (Streatham)

      Clarke, Kenneth (Rushcliffe)

      Lewis, Kenneth (Rutland)

      Shepherd, Colin (Hereford)

      Clegg, Sir Waller

      Lloyd, Peter (Fareham)

      Shepherd, Richard (Aldridge-Br'hills)

      Colvin, Michael

      Loveridge, John

      Silvester, Fred

      Cope, John

      Luce, Richard

      Speed, Keith

      Corrie, John

      Lyell, Nicholas

      Speller, Tony

      Dover, Denshore

      Macfarlane, Neil

      Spence, John

      du Cano, Rt Hon Edward

      MacGregor, John

      Spicer, Michael (S Worcestershire)

      Dunn, Robert (Dartford)

      MacKay, John (Argyll)

      Sproat, Iain

      Dykes, Hugh

      McNair-Wilson, Michael (Newbury)

      Squire, Robin

      Eden, Rt Hon Sir John

      McQuarrie, Albert

      Stainton, Keith

      Eggar, Timothy

      Marshall, Michael (Arundel)

      Stanbrook, Ivor

      Faith, Mrs Sheila

      Mather, Carol

      Stanley, John

      Fenner, Mrs Peggy

      Maude, Rt Hon Angus

      Steen, Anthony

      Fisher, Sir Nigel

      Mawby, Ray

      Stevens, Martin

      Fletcher, Alexander (Edinburgh N)

      Mawhinney, Dr Brian

      Taylor, Teddy (Southend East)

      Fletcher-Cooke, Charles

      Maxwell-Hyslop, Robin

      Tebbitt Norman

      Fookes, Miss Janet

      Mellor, David

      Temple-Morris, Peter

      Fowler, Rt Hon Norman

      Meyer, Sir Anthony

      Thompson, Donald

      Fox, Marcus

      Miller, Hal (Bromsgrove & Redditch)

      Thorne, Neil (Ilford South)

      Fry, Peter

      Mills, Iain (Merlden)

      Townend, John (Bridlington)

      Gardiner, George (Relgate)

      Mills, Peter (West Devon)

      Townsend, Cyril D. (Bexleyheath)

      Garel-Jones, Tristan

      Miscampbell, Norman

      Trippier, David

      Gorst, John

      Moate, Roger

      van Straubenzee, W. R.

      Gow, Ian

      Montgomery, Fergus

      Viggers, Peter

      Gray, Hamish

      Morgan, Geraint

      Waddington, David

      Griffiths, Eldon (Bury St Edmunds)

      Morris, Michael (Northampton, Sth)

      Wakeham, John

      Griffiths, Peter (Portsmouth N)

      Morrison, Hon Charles (Devizes)

      Walker, Rt Hon Peter (Worcester)

      Grist, Ian

      Morrison, Hon Peter (City of Chester)

      Walker, Bill (Perth & E Perthshire)

      Gummer, John Selwyn

      Mudd, David

      Walker-Smith, Rt Hon Sir Derek

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

      Murphy, Christopher

      Waller, Garry

      1036

      1037

      Watson, John

      Wickenden, Keith

      TELLERS FOR THE NOES:

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

      Wilkinson, John

      Lord James Douglas-Hamilton and

      Wheeler, John

      Wolfson, Mark

      Mr. Peter Brooke.

      Question accordingly negatived.

    New Clause 9

      DUTY TO EXHIBIT OPERATOR'S DISC
      '(1) A vehicle shall not be used on a road as a stage, express or contract carriage unless there is fixed and exhibited on the vehicle in the prescribed manner an operator's disc.
      (2) In this section "operator's disc" means a disc in the prescribed form issued to the holder of a PSV operator's licence by the traffic commissioners by whom the licence was granted and containing particulars of the licence, which shall include the serial number, the name of the holder and the address of his operating centre.
      (3) Traffic Commissioners on granting a PSV operator's licence shall supply the person to whom the licence is granted with a number of operators' discs equal to the maximum number of vehicles which that person may use under the licence in accordance with the condition or conditions attached to the licence under section 21(1); and if that maximum number is later increased on the variation of one or more of those conditions, the traffic commissioners on making the variation shall supply the holder of the licence with further operators' discs accordingly.
      (4) Regulations may make provision—

      (a) with respect to the custody and production of operators' discs;

      (b) for the issue of new operators' discs in place of those lost, destroyed, or defaced;

      (c) for the return of operators' discs on the revocation or expiration of a PSV operator's licence or in the event of a variation of one or more conditions attached to a licence under section 21(1) having the effect of reducing the maximum number of vehicles which may be used under the licence.

      (5) Subject to subsection (6), if a vehicle is used in contravention of subsection (1), the operator of the vehicle shall be liable on summary conviction to a fine not exceeding £200.
      (6) In any proceedings for an offence under subsection (5) it shall be a defence for the person charged to prove that he took all reasonable precautions and exercised all due diligence to avoid the commission of such an offence.'.—[Mr. Prescott.]
      Brought up, and read the First time.
      Mr. Prescott: I beg to move, That the clause be read a Second time.
      Mr. Deputy Speaker: We may discuss at the same time Government amendments Nos. 71 and 72.
      Mr. Prescott: Like the earlier new clauses, this one is designed to provoke a debate on a principle—in this case, the
      1038
      duty to exhibit an operator's disc. The new clause is almost exactly the same as the clause which the Government removed from the Bill. On Second Reading, in Committee and in the consultative document, they were apparently convinced by the argument that, as part of the enforcement of the operating licensing system, a vehicle should exhibit such a disc. We seek to put that requirement back into the Bill.
      There is probably a balance of judgment here, but our view is that without the display of such a disc the licensing system for buses will be less enforceable. That was apparently the Government's view until the Committee stage. Their argument for removing this provision was that the commissioners would have less clerical work and bureaucracy would be reduced.
      This shift to "quality control", from an emphasis on the vehicle itself to an emphasis on the operator's conditions, was clearly recommended in EEC legislation and was already embodied in the 1968 legislation. The report of the Foster committee into road haulage operating licensing was much concerned with certification and display of discs in the operation of this licensing system.
      The lorry licensing system has been a trail blazer for bus licensing. Licensing was first imposed on lorries and buses in the 1930s to ensure safety, fair competition and the provision of services. The first departure from that principle was with denationalisation in 1953, but it was the 1968 Labour legislation which emphasised the safety aspect and the quality of the vehicle, not only by more stringent tests on the vehicles themselves but by improving the quality of the operators. The emphasis was, therefore, placed more firmly on the operator who was considered to be of good repute, was of good financial standing and possessed certain qualifications laid down by legislation covering the road haulage industry.
      8.30 pm
      The disc was retained as evidence of the enforcement system. It is interesting to note that Professor Foster—in view of criticisms—looked at the operation of the system and the avoidance of enforcement

      1039
      techniques by a number of cowboy operators. He made certain recommendations that I believe are relevant to this debate.
      One matter of immediate concern—and perhaps the Minister can reassure us—is this. If we are to retain the disc for heavy goods vehicles as part of our system of ensuring safety, why is it not considered necessary for the passenger transport service? Obviously, the carrying of great numbers of passengers demands greater safety precautions than those needed for heavy goods vehicles. That may be a cynical point to make, because only one or two cowboy lorry drivers are involved, but we should be stricter where greater numbers are involved.
      Concern for safety should be an important part of our deliberations. The disc system is not the most essential part of our safety control mechanisms. Other control features have been developed. Nevertheless, the Foster report considers the disc system to be important in relation to safety and operator licensing. That inquiry was concerned with cowboy operators.
      In Committee we said that we wished to tighten the procedure, and we considered the possibility of the vehicle registration number being included on the disc. We considered restricting the flexibility of use of the disc because of the possibility that an operator might have 15 buses and only 10 licences. That situation might be decided by his operating centre and other factors determined by the commissioner. The industry did not necessarily agree with that point but it concerned me when I considered those operators who had more buses than they had licences. That situation tends to encourage the avoidance of the control intended to be exercised by the disc system.
      After all, the commissioner decides the number of discs issued to a company. If a company is using more vehicles than it is licensed to use, that is an avoidance we seek to prevent. In the face of our desire to tighten up the procedure, the Government removed it completely. That took the Opposition by surprise. A pattern seemed to have developed in Committee. Every time we pointed out a difficulty or expressed a desire to tighten up the procedure in an attempt to follow the logic of a clause, the Government immediately dropped it.
      1040
      I have in mind car sharing and the cost involved. We pointed out the difficulties about car insurance in relation to those who shared a car. The Government's response was to remove the provision on car sharing. We are still not satisfied with that response. Nevertheless, passenger service appears to be following the path established by the road haulage industry in the matter of safety procedures, enforcement procedures and licensing controls.
      It is relevant to bear in mind what Professor Foster had to say in his recent report to the Department about operator licensing in the road haulage industry. In the light of what has happened, it seems that Professor Foster is, on balance, recommending in the 90-odd provisions of his report—not all of which are devoted to discs—that there should be a tightening up of the procedures and not a loosening of them. He points out how some operators can get round the licensing procedures and he indicates to the Government how the system might be tightened up.
      We are concerned—and I trust that the Parliamentary Secretary will address his mind to this—that if the duty to display a disc is not to be imposed upon passenger service operators, that may mean that the Government will also remove that obligation from heavy goods vehicle operators. What are the Government's reasons for not imposing that duty on the passenger service operators? Some reasons have been given in the report, and it is to those reasons that we address our minds. Foster was concerned only with minorities, so that we are concerned here not with mass evasion but with creating a system that can bring to order the minority who wish to break the law or disregard their obligations under operator licensing. Any administrative system involves bureaucratic control, and safety administration requires some form of bureaucracy. Its extent must be a matter for judgment.
      In Committee the Government took the view that the same purpose could be achieved by a different means. Instead of operators having to apply for a licence by filling out a form and getting a disc, they would rely on the name and licence number being painted on the side of the vehicle. That idea is not new. Regulations already use that arrangement. The Public Service Vehicles (Conditions of

      1041
      Fitness, Equipment and Use) Regulations 1972 state in paragraph 40:
      "Every vehicle shall be marked in readily legible characters not less than 1 inch in height and painted in a conspicuous position on the near side of the vehicle in colours which contrast with their background, with the name and address of the authority, company, firm or individual to whom or to whose representative the public service vehicle licence under Part III of the Act was granted in respect of the vehicle".
      The Government said that if all that information were painted on the side of the lorry, that would be sufficient; There was no need for a disc to be displayed.
      Certain problems arise out of the procedure that the Government propose. The obvious difficulty is of getting a sign-writer. Advice to me from the industry states that that is difficult, but that claim is not conclusive. Past practice has tended to throw up problems in that respect. A considerable amount of evidence shows that the writing is not kept up to date. It is not easy to change the painting on the side of a lorry that is in regular use. I am told that a number of lorries are currently in contravention of the regulation. It is much easier to amend the informaon a disc, which would be prominently displayed, than to change a painted sign.
      The other point concerns the number of vehicles that an operator can run. Under the previous proposals, if an operator had 20 vehicles he would have to have 20 discs. But now the possession of 20 discs does not mean that an operator has 20 vehicles. He can own more vehicles than he has discs as long as the number of vehicles actually in operation does not exceed the number he is registered to operate. It is much easier to transfer a disc from one lorry to another than to transfer a door. Those are the sort of practical difficulties which could lead to evasion. It is much easier for an operator to plead difficulties in getting information painted on the door of a lorry than to plead difficulties over a disc which is available for all to see. The problem is how to check that and how to enforce the system. On balance, there is a better argument for using the disc system. I hope that the Minister will say why he feels it is necessary to retain it for lorries but not to exempt buses. The question is whether the disc indicates more clearly that the operator is licensed to carry out his duties.
      1042
      It is interesting to recall the words of Professor Foster. In chapter 8.90 of his report on the enforcement of safety, he says:
      "In our judgment, the first and by far the most important step to check illegal operation is to require all vehicles to carry a visible licence plate in a conspicuous place, and we recommend that this should be done as soon as possible."
      He continues in paragraph 8.95:
      "These changes should make it far easier to detect illegal vehicles. If, as we recommend in Chapter 13, they are backed up by a computer record system immediately accessible to policemen and vehicle and traffic examiners in order to check quickly on a particular vehicle, it would become much harder for individual vehicles or whole fleets to operate illegally through falsification … of plates."
      Police computers are impressive when they are used to check cars. On one occasion I was stopped by the police and asked whether I owned the car that I was driving. It was checked by a police computer in a few seconds. To that extent, Foster recommended an important law enforcement procedure. The Government should give better reasons why they think it is necessary for information to be painted on the sides of vehicles.
      The industry and the operators prefer the disc system. I am also informed that they cannot accept that the chairman of the traffic commissioners would be able to devise an acceptable system of sign-writing.
      In Committee, the Minister said that the burden of evidence was that we should do away with the disc system. I challenged him on that. I said:
      "Apart from the traffic commissioners and the Government, I wonder whether there are other organisations which … are strongly for retaining this disc or symbol—organisations such as the police or other authorities."
      The Minister replied:
      "I take the hon. Gentleman's point. We considered and consulted on the matter. I examined the clause, having seen the system, and asked whether it was necessary. We decided that it is not."—[Official Report, Standing Committee H, 7 February, 1980; c. 1280.]
      Can the Parliamentary Secretary say how that decision was reached? Presumably, when discussions started, the commissioners agreed with it. The Minister must have had consultations with the commissioners and with the operators, who apparently wish to retain the disc system. What was the new insight? Surely it was not bureaucracy. That was clearly

      1043
      known before publication of the Bill. Will the Parliamentary Secretary also confirm that the commissioners are prepared to abandon the disc system for buses but presumably to retain it for lorries?
      I think that the balance of the argument both by Foster and by others concerned is that the disc should be retained to help in enforcement. It would make it more difficult for the minority of cowboy operators to continue their practices. We must make a judgment on the balance between bureaucracy and the enforcement of standards. In our view, it would be better to maintain the disc as a helpful contributory factor, as in the road haulage industry, for the enforcement of both safety and other standards in the industry.
      8.45 pm
      Mr. Kenneth Clarke: There were two occasions in Committee when we shot the Opposition's fox on two rather difficult points. One was the regulation-making power which we were proposing to take to govern the costs of car sharing, and the other was the requirement to display a disc on public service vehicles.
      On both those matters, the Opposition tabled a number of amendments and pointed out the considerable difficulties which might arise in practice from the Government's suggestions as they then stood. We looked at both those points and, after reconsidering them, we decided that in both cases the best answer to the difficulties was not to go ahead with what we were proposing. I shall not deal with the regulation-making power in respect of car sharing costs because we have an amendment about that.
      On the question of discs, we came to the conclusion, after further consideration, that there was no substantial reason for having a disc inside the vehicles at all. The hon. Member for Kingston upon Hull, East (Mr. Prescott) asked how we reached that conclusion. Plainly, we had a change of mind. We told the Committee that we had. Obviously, I cannot give blow-by-blow details of what went on within the Department and the Government—although I was fairly frank with the Committee quite often—but it was more or less as I have put it.
      We had a second look at the matter, prompted by the amendments put down in Committee, and we asked ourselves
      1044
      the fundamental question of why bother with discs at all before we went on to think of assembling arguments to answer amendments about what might or might not have to be on them.
      It seemed to us that there was no sensible answer to that question, and the enforcement problems at which the requirement was aimed were not such as to need the disc, and certainly not such as would justify the immense bureaucracy involved in issuing thousands of them.
      One was led to reflect that probably the reason why we had the clause in the Bill at all was that public service vehicles had always carried discs in the past. Such vehicles have had a PSV licence disc exhibited in the cab for perhaps as long as 50 years, and no one had actually thought of buses going around in modern circumstances without these little pieces of paper or some up-to-date equivalent in the corner of the cab.
      That was really how we arrived at our decision. I do not want to give the impression that we arrived at it lightly. I realise that there is considerable concern in the industry. The Opposition remain concerned about the enforcement problems if there are no discs in vehicles, and I know that the Confederation of Passenger Transport feels strongly on the point. It feels that enforcement of the safety provisions of the Bill will be difficult without discs.
      In fact, the representations which I have received from the Confederation of Passenger Transport are pretty close to the new clause now before us. The Opposition have changed their view compared with their position in Committee, when, as I recall it, their amendment was designed to ensure that there was a disc for every vehicle. What we have now is a proposal which is in agreement with the Confederation of Passenger Transport—
      Mr. Prescott: It could not be the same if we were to have it selected.
      Mr. Clarke: I know that it had to be a different proposal if it was to be selected, but the point of what we now have before us is that each operator will be issued with a given number of discs, and on any given day he will be able to put those on whatever vehicles he wants to use, while making sure that

      1045
      he does not have more out on any day than his operator's licence would allow.
      Having considered this matter seriously, my conclusion is that I still cannot see what the point is that so troubles the Opposition and the CPT. I have looked at the matter carefully and done my best to be sure that I am not missing some obvious safety point. I ask the House to consider the safety provisions and to think of precisely what the discs are supposed to achieve.
      Mr. Campbell-Savours: I had left the Chamber for a minute or two in order to telephone a colleague of mine who is a haulier and has an operator's licence. I was interested in the procedure whereby people applied for MoT certificates in the case of private vehicles and, in the case of commercial vehicles, the certification about which my hon. Friend the Member for Kingston upon Hull, East (Mr. Prescott) had spoken to me privately. Is it not possible that, in the event of someone removing the disc which is provided by an authority, operators will misuse the system when they apply for licensing, as in the case of MoT certificates? Perhaps the Minister will comment on that, because that was the instant response of my colleague when I telephoned him. He said that the system was open to abuse.
      Mr. Clarke: I am not sure whether the hon. Gentleman's colleague is engaged in road haulage or passenger transport. Perhaps as a relevant aside I can deal with the point raised by the hon. Member for Kingston upon Hull, East with regard to lorries. The Government will produce soon their response to the Foster report, which lays heavy emphasis on plating as an enforcement procedure in heavy goods vehicles. That is slightly different, but it aims at roughly the same point.
      Without anticipating what we shall say about Foster, there are clear reasons for distinguishing between heavy goods vehicles and passenger buses. Indeed, the systems have always been different in the past. Obviously, there are vastly more lorries than there are buses. There as vastly more operators. Lorry operators do not have the same contact with the licensing authority as is envisaged in the case of buses, where in most areas the bus operators will have regular contact with
      1046
      the traffic commissioners to whom they apply for the licences or services and to whom they notify all their stage carrying services. However, such operators also provide a service even if they are no longer involved in road service licensing—for example, if they are involved in excursions or tours. In that case, they advertise the availability of their tours to the general public. Therefore, there are reasons for distinguishing between the two.
      Nevertheless, we must be satisfied about the safety requirements for passenger buses. I agree that they are no less important than lorries. Indeed, it could be argued that they are even more important because of the number of people they carry.
      As I have emphasised, the safety provisions in the Bill depend on three features. First, there is the system of operating the licensing itself, whereby an operator has to be of good repute and sound financial standing and to have someone who is competent to manage the business and so on. In giving an operator a licence, the traffic commissioner has regard to his facilities, experience and competence, and he may attach conditions to the licence which may affect the number of vehicles which a person operates because of the limitation of his premises, his experience and his work force.
      In addition to operator licensing, there is the power of the vehicle inspectors to inspect the vehicle at any stage in a wide range of circumstances, and penalties can be imposed on the operator if the vehicle turns out to have defects. Certainly a prohibition can be put on any vehicle which proves to be defective.
      The third feature relates to the annual inspection of vehicles. For the first time, it will be carried out at a prescribed place by either our own inspectors or people under their supervision, so that annually every passenger vehicle carrying more than eight passengers will have a certificate saying that it has got through its annual inspection. That inspection will be much more rigorous than, for instance, the MoT test as applied to cars, which is a quite different system that is much more akin to HGV testing.
      What is it that a disc on a vehicle, whether it describes the particular vehicle or the operator, is designed to achieve?

      1047
      So far as I can see, there are two main purposes. The first is to ensure that at all times when a vehicle is on the road, someone is saddled with the responsibility for it. Someone, as it were, acts as the operator who carries the can for safety defects and who is liable for the penalties that will arise if he is not operating it safely. I suppose that the only slight footnote is that whoever is the operator on any given day should not be operating more vehicles than he is supposed to do if the main operator has a condition attached which limits him to a given number of vehicles.
      Let us deal with the first rider: that at any given stage somebody should be saddled with the responsibility for having the bus on the road. Perhaps I should say that someone has to be fixed, rather than saddled, with the responsibility for having the bus on the road. It is an obligation that we do not want people to shrug off. I cannot see how it is inadequate to have the name and address and licence number of the operator painted on the side of the bus. I cannot see the additional quality that a disc would have over and above the name and address painted on the side of the bus that would fix the operator with liability.
      If the operator hires out his bus and driver to another tour operator, that will not affect liability. If the operator has hired out his coach or bus with the driver, his employee, it remains the operator's liability. He is responsible for the driver's hours, the condition of the vehicle and so on. His name and address remain on the side of the bus.
      If by any chance the operator hires out his vehicle to another operator—sometimes another operator will use a vehicle, the property of another establishment in the same industry, but using his own drivers and routes—there will be a sign indicating that the vehicle is on hire to that other operator. Therefore, it will still be possible to identify who is fixed with responsibility at any given time if the vehicle is stopped by the police or by a vehicle inspector.
      That leads to the second rider: how does one know that an operator has more vehicles on the road than he is supposed to have if he has that condition imposed upon him?
      We propose by regulations—and the Bill gives the power—to provide that the
      1048
      operator must furnish to the traffic commissioners a list of the vehicles that he proposes to operate. There will be penalties for failure to comply with that regulation. Therefore, the traffic commissioners will have a complete list of the vehicles that an operator proposes to run. If, upon annual inspection of the vehicles, stopping the vehicles or any infringement arising from their use, it appears that an operator is operating a vehicle which is not on the list notified to the traffic commissioners, he will be liable to penalties. He will also incur the wrath of the traffic commissioners, who retain wide powers over the renewal of operators' licences and so on.
      I suppose that it will be possible on any one day, if we do not have the disc system, for someone to try to get away with it. I do not shut my mind to the possibility of the cowboy operator——to use the favourite phrase of the hon. Member for Newcastle upon Tyne, Central (Mr. Cowans), who has disappointed me by not using that phrase today—trying to get away with operating more vehicles than he has licences to operate. It will be difficult to detect.
      Mr. Prescott: That is the whole point.
      Mr. Clarke: The problem will arise only when he is caught operating a vehicle about which he has not notified the traffic commissioners.
      Mr. Prescott: The policeman will only need to look for the disc.
      Mr. Clarke: I am not blinding myself to that possibility. We have to consider the possibility of that occurring in practice. It is not inconceivable that there might be such an operator. Ultimately, he will be detected, and the traffic commissioners will take appropriate action. The Opposition and the CPT suggest that operators should be issued with paper discs to be displayed on all vehicles that they operate every day of the week to guard against that eventuality. The bureaucracy, the time and the cost involved would be out of proportion to the risk involved.
      Mr. Cowans: I shall not disappoint the Parliamentary Secretary, because what we are talking about is the cowboy operator. There are two questions here. First, whose is the responsibility? Is it

      1049
      the responsibility of the policeman stopping the bus, presuming that the operator has his name and address and telephone number on the side? What kind of bureaucracy is that? But there is a more important question. There is a fundamental difference here. Though I am not suggesting for one minute that everyone does it, the man or woman boarding the bus can look at the disc and make sure that it is a licensed bus. Under the Government's system the potential passenger cannot do that.
      9 pm
      Mr. Clarke: The last point put forward by the hon. Member for Newcastle upon Tyne, Central was not his strongest. He is a rare passenger who, before boarding a bus or coach, studies the PSV disc to make sure that he is safe and knows where he is going. If it is envisaged that when such a new system comes into effect a generation of passengers will study the operator's disc before they board the bus, I shall be very surprised. The only people likely to do so are the members of the Standing Committee who have had to listen to the debates about the disc. I do not think that any ordinary members of the public would do so. If the bus crashes, is stopped for speeding or an infringement of driver's hours or is involved in an accident with another vehicle, what is needed is not a disc, a paper or any regulations backing up that paper, or the issuing of thousands of bits of paper all over the place. I suggest that a passenger should be able to look on the side of the vehicle where he will see the name and address and any other features that may be required to discover who is involved in the infringement.
      Mr. Cohen: In this country we run a series of programmes to help people with problems of illiteracy. There are many old people whose eyesight is such that they cannot see. How does the Minister suggest that they cope with what he is proposing?
      Mr. Clarke: First, I insist that all my vehicle examiners are literate. Secondly, I am led to believe that a high proportion of the police are literate. If an illiterate member of the public has difficulty reading the name and address on the side
      1050
      of a bus, I suggest that he may have difficulty reading what is on the disc which the clause suggests should be on the bus.
      Mr. Prescott: The Parliamentary Secretary well knows that we are concerned that it should be recognised in the Bill that a bus company can have more buses than it has discs. Our point is that though the operating centre may have determined that an operator shall operate no more than 10 buses, he may ignore that and begin to operate more vehicles and offend against the conditions laid down in the Bill. The law enforcement agencies will not be able to ascertain that too easily, because the company will have its name and address painted on the side of all its vehicles but will be licensed for only 80 per cent. of those vehicles. With a disc it will be easier to,identify which bus is operating officially on the day. That is the point to which the Parliamentary Secretary should address his remarks.
      Mr. Clarke: I accept that enforcement is the only point about which we are concerned. An operator who has a condition on his licence that he should operate a given number of buses may for some reason buy more buses than he is licensed to operate. An operator has to be a really strange man to put money into buying more buses than he is allowed to operate, though that can happen sometimes. I accept that if that condition is attached to a licence, penalties should accrue if it is broken. Such an allegation will require investigation by the traffic commissioners.
      The traffic commissioners tend to look with more care at the operations of operators whom they suspect to be at the risky end of the business or whose activities do not often come to their attention because those operators do not go in for any business activity that requires road service licensing. But in the end someone will be required to check the vehicle.
      If that person sees a vehicle with a certain registration number or name and address on the side, it will be for him to check that the traffic commissioners have that name on their records. That could be done by the police or by the traffic commissioners.
      At present I am still not persuaded—although I agree that the disc is a more

      1051
      foolproof system—that what we are talking about is such a serious aspect of our safety requirements, such a serious risk, that it justifies this provision being imposed on every single operator licence, for every vehicle that an operator has on the road, every day of the week, to cover it.
      With respect, the Opposition, as their first amendment in Committee showed, are just shying back to the tradition of having discs in buses, which we always had under the PSV system, which is no longer required because of our new arrangements for annual inspections. They are now trying to find new details to put on new discs. I shall continue to consider the matter carefully. There are responsible bodies that are convinced that somehow this is necessary. We have taken many soundings on this matter and we continue to do so. It has not been established to our satisfaction that there is a serious enforcement problem here which justifies this quite out-of-proportion bureaucracy. In a Bill which is designed to get rid of a great deal of the unnecessary bureaucracy and control in an area which has had far too much of it for years and years, it seems that we should concentrate on the essentials. The Bill without the disc achieves the essentials of having safe passenger vehicles on the roads.
      Mr. Booth: The Parliamentary Secretary's analogy between the power to make the car-sharing cost regulations and the disc clause is not one that I can accept. We had amendments down to both of these provisions, but in the case of car-sharing costs from the outset, right from Second Reading, we were showing just how difficult it would be, if not impossible, to make effective regulations in that area. It was a point that was finally somewhat grudgingly conceded by the Minister in Committee and withdrawn. That was the end of that.
      The position is not the same in relation to the initial proposition in the Bill about operators' licence discs, because there it was the view, and still is the view, of the Opposition that if that original clause was at fault it was because it was not sufficiently stringent. There was no question of our ever suggesting that such objections as we had to the clause would be solved in any way by taking the clause away.
      1052
      As my hon. Friend the Member for Kingston upon Hull, East (Mr. Prescott) has pointed out, we are concerned about two aspects of this matter. It is fair to say that we have changed our position from what it was at the Committee stage. I shall explain why—quite apart from needing a different amendment in order to have a discussion on the matter. One reason is that we were convinced after discussions with people about the original clause that the way in which we were proposing to change it—namely, by requiring the disc to be coupled with the registration number—had a considerable drawback, namely, the lack of flexibility. People working in the industry are of the view that the original clause had a considerable advantage over the present law—namely, that by merely limiting the number of discs to the operator there would be the possibility of the operator switching the disc from one vehicle to another, where it was advantageous and sensible to do so. Provided that he switched the disc to another vehicle, which was sound, safe and properly maintained and which had its certificate of fitness, it would be better that he did that than to run a vehicle which was doubtful in any way as to the purpose of its operation.
      What the Minister has done in seeking to meet our objections between the Committee stage and the present time has destroyed that one advantage of the system originally proposed. By relating the number of discs to a list of registration numbers of vehicles, the flexibility has again gone. It has entirely disappeared. The Minister has rejected our proposition in Committee and the one aspect of the original clause that operators had favoured. He is therefore right to say that a policeman or an inspector could check a vehicle. He could then get in touch with the traffic commissioner and ask whether the vehicle was on the list. If it were not on the list, he could go ahead with a prosecution.
      In order to attain that limited degree of enforceability, flexibility will be lost. As there is a limitation on the number of vehicles that can be operated under a particular operator's licence, it will be impossible to enforce the provision by a quick visual roadside examination. That has been pointed out several times. If an operator is licensed to run 20 vehicles, the police must catch him operating not

      1053
      one but 21 vehicles. If he is licensed to operate 25 vehicles, the police must simultaneously catch the operation of 26 vehicles if they are to prosecute.
      We have already mentioned bureaucracy. However, another danger is that enforcement costs may become prohibitive. Which of my hon. Friends has a big enough police force in his constituency, suitably equipped with cars, to chase every vehicle that is simultaneously being run by a public service operator? The police would need to contact each other by telephone in order to count and see whether the operator was in breach of his licensing conditions.
      The condition relating to numbers is important. It involves the question of safety. If a traffic commissioner, in issuing an operator's licence has said that a particular operator should be allowed to operate only 10 vehicles, he has done so for a reason. Perhaps he is not satisfied that he can supervise more than 10. Perhaps he feels that the operator does not
      have a repair and maintenance contract that is suitable for more than 10 vehicles.
      We are therefore discussing something that may have a direct effort on the safe operation of vehicles. Some bureaucracy may be involved in the printing and issuing of discs. However, that is nothing like the problem that will result if we seek to enforce effectively a system without discs. If an operator has 20 discs and puts 21 vehicles on the road, one will be running without a disc. The police would have to catch only that vehicle in order to enforce the law. That is a major reason behind pressing this issue.
      I am sorry that the Minister, in so far as he has sought to meet the enforcement problem, has chosen to set up a list. It will take away from the operator the one advantage that had originally existed, that of flexibility. I therefore urge my hon. Friends to vote in favour of the new clause.
      Question put, That the clause be read a Second time:—
      The House divided: Ayes 134, Noes 184.

      Division No. 240]

      AYES

      [9.12 pm

      Adams, Allen

      Foulkes, George

      Mellish, Rt Hon Robert

      Allaun, Frank

      George, Bruce

      Mitchell, Austin (Grimsby)

      Archer, Rt Hon Peter

      Golding, John

      Mitchell, R. C. (Soton, Itchen)

      Ashton, Joe

      Gourlay, Harry

      Morris, Rt Hon Charles (Openshaw)

      Benn, Rt Hon Anthony Wedgwood

      Graham, Ted

      Moyle, Rt Hon Roland

      Bennett, Andrew (Stockport N)

      Grant, George (Morpeth)

      Newens, Stanley

      Booth, Rt Hon Albert

      Hamilton, James (Bothwell)

      Oakes, Rt Hon Gordon

      Brown, Hugh D. (Provan)

      Hamilton, W. W. (Central Fife)

      Ogden, Eric

      Buchan, Norman

      Hardy, Peter

      O'Neill, Martin

      Callaghan, Jim (Mlddleton & P)

      Harrison, Rt Hon Walter

      Orme, Rt Hon Stanley

      Campbell-Savours, Dale

      Haynes, Frank

      Palmer, Arthur

      Cartwright, John

      Heffer, Eric S.

      Park, George

      Clark, Dr David (South Shields)

      Hogg, Norman (E Dunbartonshire)

      Parker, John

      Cocks, Rt Hon Michael (Bristol S)

      Holland, Stuart (L'beth, Vauxhall)

      Powell, Raymond (Ogmore)

      Cohen, Stanley

      Home Robertson, John

      Prescott, John

      Coleman, Donald

      Homewood, William

      Race, Reg

      Cowans, Harry

      Hooley, Frank

      Rees, Rt Hon Merlyn (Leeds South)

      Cryer, Bob

      Horam, John

      Roberts, Albert (Normanton)

      Cunliffe, Lawrence

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

      Roberts, Ernest (Hackney North)

      Cunningham, George (Islington S)

      Hughes, Roy (Newport)

      Robertson, George

      Cunningham, Dr John (Whitehaven)

      Janner, Hon Greville

      Rodgers, Rt Hon William

      Dalyell, Tam

      Jay, Rt Hon Douglas

      Ross, Ernest (Dundee West)

      Davidson, Arthur

      John, Brynmor

      Rowlands, Ted

      Davies, Itor (Gower)

      Sever, John

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

      Johnson, James (Hull West)

      Shore, Rt Hon Peter (Step and Pop)

      Dean, Joseph (Leeds West)

      Johnson, Walter (Derby South)

      Silkin, Rt Hon John (Deptford)

      Dempsey, James

      Jones, Barry (East Flint)

      Silverman, Julius

      Dixon, Donald

      Jones, Dan (Burnley)

      Snape, Peter

      Dobson, Frank

      Leadbitter, Ted

      Soley, Clive

      Douglas, Dick

      Leighton, Ronald

      Spearing, Nigel

      Dunnett, Jack

      Lewis, Ron (Carlisle)

      Spriggs, Leslie

      Dunwoody, Mrs Gwyneth

      Lofthouse, Geoffrey

      Stewart, Rt Hon Donald (W Isles)

      Eadie, Alex

      McElhone, Frank

      Stott, Roger

      Eastham, Ken

      McGuire, Michael (Ince)

      Strang, Gavin

      Edwards, Robert (Wolv SE)

      McKay, Allen (Penistone)

      Taylor, Mrs Ann (Bolton West)

      Ellis, Tom (Wrexham)

      McKelvey, William

      Thomas, Dafydd (Merioneth)

      Evans, Ioan (Aberdare)

      MacKenzie, Rt Hon Gregor

      Thomas, Dr Roger (Carmarthen)

      Evans, John (Newton)

      Maclennan, Robert

      Urwin, Rt Hon Tom

      Ewing, Harry

      McMillan, Tom (Glasgow, Central)

      Weetch, Ken

      Faulds, Andrew

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

      Wellbeloved, James

      Flannery, Martin

      Marshall, Dr Edmund (Goole)

      Welsh, Michael

      Fletcher, Ted (Darlington)

      Marshall, Jim (Leicester South)

      White, Frank R. (Bury & Radcliffle)

      Foot, Rt Hon Michael

      Maxton, John

      Whitehead, Phillip

      Whitlock, William

      Winnick, David

      TELLERS FOR THE AYES:

      Wigley, Dafydd

      Woolmer, Kenneth

      Mr. George Morton and

      Wilson, William (Coventry SE)

      Wrigglesworth, Ian

      Mr. James Tinn.

      NOES

      Adley, Robert

      Haselhurst, Alan

      Page, Richard (SW Hertfordshire)

      Alexander, Richard

      Hastings, Stephen

      Parris, Matthew

      Ancram, Michael

      Hawkins, Paul

      Patten, John (Oxford)

      Aspinwall, Jack

      Hawksley, Warren

      Pattie, Geoffrey

      Atkins, Robert (Preston North)

      Heddle, John

      Penhaligon, David

      Atkinson, David (B'mouth, East)

      Henderson, Barry

      Percival, Sir Ian

      Beaumont-Dark, Anthony

      Hicks, Robert

      Peyton, Rt Hon John

      Bendall, Vivian

      Hill, James

      Pollock, Alexander

      Benyon, Thomas (Abingdon)

      Hogg, Hon Douglas (Grantham)

      Porter, George

      Berry, Hon Anthony

      Hooson, Tom

      Powell, Rt Hon J. Enoch (S Down)

      Best, Keith

      Hordern, Peter

      Prentice, Rt Hon Reg

      Bevan, David Gilroy

      Howell, Ralph (North Norfolk)

      Proctor, K. Harvey

      Blackburn, John

      Hunt, John (Ravensbourne)

      Raison, Timothy

      Body, Richard

      Hurd, Hon Douglas

      Rathbone, Tim

      Boscawen, Hon Robert

      Johnston, Russell (Inverness)

      Rees-Davies, W. R.

      Braine, Sir Bernard

      Jopling, Rt Hon Michael

      Renton, Tim

      Bright, Graham

      Kaberry, Sir Donald

      Rhodes James, Robert

      Brinton, Tim

      Kershaw, Anthony

      Rhys Williams, Sir Brandon

      Brooke, Hon Peter

      King, Rt Hon Tom

      Royle, Sir Anthony

      Bruce-Gardyne, John

      Kitson, Sir Timothy

      Scott, Nicholas

      Buchanan-Smith, Hon Alick

      Knight, Mrs Jill

      Shaw, Giles (Pudsey)

      Buck, Antony

      Knox, David

      Shaw, Michael (Scarborough)

      Butcher, John

      Lang, Ian

      Shelton, William (Streatham)

      Cadbury, Jocelyn

      Latham, Michael

      Shepherd, Colin (Hereford)

      Carlisle, Kenneth (Lincoln)

      Le Marchant, Spencer

      Shepherd, Richard (Aldridge-Br'hills)

      Chalker, Mrs Lynda

      Lester, Jim (Beeston)

      Skeet, T. H. H.

      Chapman, Sydney

      Lloyd, Peter (Fareham)

      Speed, Keith

      Clark, Hon Alan (Plymouth, Sutton)

      Loveridge, John

      Speller, Tony

      Clarke, Kenneth (Rushcliffe)

      Luce, Richard

      Spence, John

      Clegg, Sir Walter

      Lyell, Nicholas

      Spicer, Michael (S Worcestershire)

      Colvin, Michael

      Macfarlane, Neil

      Sproat, Iain

      Cope, John

      MacKay, John (Argyll)

      Squire, Robin

      Corrie, John

      McNair-Wilson, Michael (Newbury)

      Stainton, Keith

      Dover, Denshore

      McQuarrie, Albert

      Stanbrook, Ivor

      du Cann, Rt Hon Edward

      Marshall, Michael (Arundel)

      Stanley, John

      Dunn, Robert (Dartford)

      Mather, Carol

      Steen, Anthony

      Dykes, Hugh

      Maude, Rt Hon Angus

      Stevens, Martin

      Eden, Rt Hon Sir John

      Mawby, Ray

      Stewart, John (East Renfrewshire)

      Eggar, Timothy

      Mawhinney, Dr Brian

      Taylor Teddy (Southend East)

      Faith, Mrs Sheila

      Maxwell-Hyslop, Robin

      Tebbit, Norman

      Fenner, Mrs Peggy

      Mellor, David

      Thompson, Donald

      Fisher, Sir Nigel

      Meyer, Sir Anthony

      Thorne, Neil (Ilford South)

      Fletcher, Alexander (Edinburgh N)

      Miller, Hal (Bromsgrove & Redditch)

      Townend, John (Bridlington)

      Fletcher-Cooke, Charles

      Mills, Iain (Meriden)

      Townsend, Cyril D. (Bexleyheath)

      Fookes, Miss Janet

      Mills, Peter (West Devon)

      Trippier, David

      Fowler, Rt Hon Norman

      Moate, Roger

      van Straubenzee, W. R.

      Fox, Marcus

      Molyneaux, James

      Waddington, David

      Freud, Clement

      Montgomery, Fergus

      Wainwright, Richard (Colne Valley)

      Fry, Peter

      Morgan, Geraint

      Wakeham, John

      Gardiner, George (Reigate)

      Morris, Michael (Northampton, Sth)

      Walker, Bill (Perth & E Perthshire)

      Garel-Jones, Tristan

      Morrison, Hon Charles (Devizes)

      Walker-Smith, Rt Hon Sir Derek

      Gorst, John

      Morrison, Hon Peter (City of Chester)

      Waller, Garry

      Gow, Ian

      Mudd, David

      Watson, John

      Gray, Hamish

      Murphy, Christopher

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

      Greenway, Harry

      Myles, David

      Wheeler, John

      Griffiths, Eldon (Bury St Edmunds)

      Neale, Gerrard

      Wickenden, Keith

      Griffiths, Peter (Portsmouth N)

      Needham, Richard

      Wilkinson, John

      Grist, Ian

      Nelson, Anthony

      Wolfson, Mark

      Grylls, Michael

      Neubert, Michael

      Gummer, John Selwyn

      Newton, Tony

      TELLERS FOR THE NOES:

      Hamilton, Hon Archie (Eps'm&Ew'H)

      Nott, Rt Hon John

      Mr. John MacGregor and

      Hamilton, Michael (Salisbury)

      Page, John (Harrow, West)

      Lord James Douglas-Hamilton.

      Hannam, John

      Page, Rt Hon Sir R. Graham

      Question accordingly negatived.

    New Clause 5

      SIGNS ON PRIVATE HIRE. CARS AND CARS GIVING LIFTS FOR PAYMENT
      '.—(1) Notwithstanding anything in any enactment:

      (a) no passenger vehicle of less than eight seats which carries passengers for hire or reward, or for payment of any kind, other than
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      a hackney carriage licensed to ply for hire under the several enactments in force within the United Kingdom for licensing such hackney carriages, shall have affixed to the roof, thereof, a sign of any kind or description.

      (b) nothing in subsection (a) of this section shall prevent a District Council from requiring, or allowing, an idenification sign, or mark, on a Private Hire Vehicle licensed under Part II of the Local Government (Miscellaneous Provisions) Act 1976, provided always that any such sign, or mark, so required or allowed, shall have no means of illumination and shall be fitted, or affixed,

      1057
      on the side doors, and, or, rear of the vehicle and below the window line of the said vehicle;

      (c) no vehicle being used to give lifts for payment under this Act, or the Transport Act 1978, will carry any sign of any kind or description on any part of the vehicle indicating that the vehicle was being, or is used, to give lifts for payment.

      (2) If any person contravenes the provisions of this section he shall be guilty of an offence and liable to a fine not exceeding two hundred pounds and to a daily fine of twenty pounds.'.—[Mr. Cowans]
      Brought up, and read the First time.
      Mr. Cowans: I beg to move, That the clause be read a Second time.
      When debating a Bill of this nature, it is always wise to look at previous legislation to consider whether we can put right the mistakes of that legislation. I do not wish to lecture the House—I have not been an hon. Member long enough to do that—but sometimes legislation does not achieve the intended objectives.
      The problem dealt with by the new clause is not a new one. A number of attempts have been made to solve it. The effort made in the Local Government (Miscellaneous Provisions) Act 1976 was a dismal failure, partly because it was no deterrent. We seek to differentiate between the hackney carriage licensed to ply for hire and the private hire car. Many hon. Members will have been grateful for the taxi with its light on which they have been able to flag down on their weary way home.
      We have to consider the interests of the public, on which great emphasis has been laid during our debates. Not long ago, a friend of mine dashing from Heathrow airport spied a vehicle with an illuminated sign and jumped into the vehicle. He asked the driver how much he would charge to take him across London and was told that the cost would be £5. Also in the car was another passenger who was being taken to London for £5.
      The driver was not breaking the law, because he was driving a private hire cab. When a passenger takes a private hire cab, he makes a contract with the driver to be conveyed to a destination at an agreed price. The fares of taxis are registered by local authorities in the provinces and by the Home Office in London. On entering a taxi one can ascertain the fare.
      We have to consider what is the neces-
      1058
      sity for an illuminated sign. The answer is self-explanatory in the case of hackney carriages. When its sign is lit, the driver is plying for hire. When the sign is not lit, the driver may be going for his tea or be on his way to pick up a fare.
      When a member of the public sees an illuminated sign, he will, nine times out of 10, associate it with a taxi cab. The new clause attempts to solve the problem by saying that the only vehicle that may show an illuminated sign on the top of the vehicle is a taxi cab plying for hire.
      Some of the signs on private hire cars are like hire-purchase agreements. One sees the sign lit up, but only later does one notice in small print "private hire". A taxi cab plying for hire is obliged to pick up a member of the public, and such vehicles should be clearly identified and should be the only vehicles allowed to show an illuminated sign. The only reason for the illuminated sign on private hire cars is to advertise.
      We are not opposed to advertising. Subsection (1)(b) of the clause would allow a district council to continue to permit an identification sign on a private hire vehicle under the Local Government (Miscellaneous Provisions) Act 1976. A sign could be placed anywhere on the cab door but it could not be illuminated. This would protect the public. It would also protect large private hire firms that wanted only to carry on their business. If, however, a driver is returning from a journey and someone jumps into the vehicle, is it realistic to expect the driver to refuse to accept that passenger? This is why previous attempts have fallen down. There was no deterrent. It is no good the House passing legislation that merely reads nicely. If there is no deterrent, no one will take any notice of it.
      Subsection (2) of the new clause lays down for anyone guilty of an offence a penalty of a fine not exceeding £200 and a daily fine of £20 if he continues to contravene the new clause. That is not unreasonable when one considers the fares that can be obtained illegally when people wish to use cabs.
      9.30 pm
      The hon. Member for Wellingborough (Mr. Fry) mentioned the demise of the taxi trade. The clause is concerned with

      1059
      one of the reasons why the taxi trade is failing. It seems reasonable, in the interests of the public, that someone seeing a vehicle with an illuminated light should know that it is a taxi cab plying for hire and not a private car in which he can be "ripped off" without knowing. The new clause seeks to make clear the difference between cabs plying for hire and private hire cars that can go about their business and advertise but will not be mixed up with cabs.
      Several Hon. Members rose—
      Mr. Jim Marshall: I apologise to my colleagues who have sat through long hours in Committee and today's Report stage.
      I should perhaps declare an interest since the new clause refers to the Local Government (Miscellaneous Provisions) Act 1976. I was the principal author of part II of the Act and was responsible for getting on to the statute hook the present legislation concerning hackney carriages and private hire vehicles. I was able to get part II into the 1976 Act because it was supported in Committee by the members of the then Opposition. I hope that Government members tonight will extend the same hands across the sea to my hon. Friend the Member for Newcastle upon Tyne, Central (Mr. Cowans) when it comes to a vote.
      I should like to remind the House of the hornets' nest across which I stumbled, perhaps unwittingly, in 1976. As soon as I put down amendments to the Local Government (Miscellaneous Provisions) Bill, I was inundated with vehemently angry letters from hackney carriage drivers complaining of the activities of private hire operators, private hire owners and private hire drivers. Their first criticism was that the licensing system operated at that time for hackney carriages but did not operate for private hire vehicles. That was overcome in the 1976 Act.
      The second main source of anger was the restriction upon fare rates that hackney carriages could charge and the complete freedom—Conservative Members would call it the entrepreneurial spirit—of private enterprise operating private hire cars. On the one hand, restricted rates were set down by local authorities for hackney carriages and, on the other, there was complete freedom of
      1060
      the market for private hire vehicles. That remains the position.
      The third main source of anger is that the signs used by private hire vehicles are intended to convince the public that they are hackney carriages. Private hire operators have the same rights as anyone to advertise their business, but the purpose of an illuminated sign on the roof of the vehicle is to convince the public that it is a hackney carriage.
      The results are obvious in the correspondence in my local newspaper, in which irate members of the public have complained about private hire vehicles displaying a lighted sign late at night—when perhaps more policemen are around in the centre of Leicester—and driving past those seeking to hire them. The sign is solely intended to deceive the public.
      I wish that we could have done this in 1966, but I have mentioned the concordat which operated in Committee between the then Government and the Opposition. One reason was that the then Opposition were not prepared to support the restrictions that my hon. Friend now seeks to introduce.
      I fully agree with the words in subsection (1)(b) of the clause that private hire vehicles may have signs, although not illuminated,
      "on the side doors, and, or, the rear of the vehicle below the window line of the said vehicle".
      That would enable the operator legitimately to advertise but without misleading the public.
      I congratulate my hon. Friend on the new clause and I hope that Tory Members will support it.
      Mr. Leadbitter: I detect an agreeable disposition in the Government's approach which seems likely to end today's debate in a satisfying way.
      There is a good deal of sense in the clause. We should have regard to the investment of taxi drivers. I can only go by what London taxi drivers tell me, but I think that it costs about £7,000 to finance a new London taxi. We have a responsibility to protect those whom we license to ply for hire and who provide a community service. The habits of licensing authorities differ, but generally taxi drivers in the provinces are obliged to

      1061
      wait on agreed taxi ranks. To that extent, they are not plying for hire in the fullest sense.
      Mr. Jim Marshall: Yes, they are.
      Mr. Leadbitter: I said that this happens in some places. It happens in my constituency.
      Mr. Marshall: "Plying for hire" does not apply simply to vehicles in motion. It also applies to stationary vehicles. When the hackney carriage is on the rank, it is still plying for hire.
      Mr. Leadbitter: That confirms my point—that the efforts of taxi drivers are negatived by private hire cars which drive around town creaming off the trade of the licence holder, whether he is plying from a mobile or a static position. A man who invests to satisfy the licensing conditions of a local authority about the standard and maintenance of his vehicle and about his compliance with passenger safety requirements is at a disadvantage when compared with the private hire operator who uses his private car supplemented by a temporary, illuminated sign showing his telephone number on the top of his car. That sign indicates to the innocent passer-by that he is possibly a taxi driver. The private hire operator has invested much less than the taxi owner.
      I think that my hon. Friend the Member for Newcastle upon Tyne, Central (Mr. Cowans) dealt adequately with the provisions of the clause. The clause seeks not to change the law but simply to make it more enforceable and effective. The Opposition do not say that the private hire car is illegal. We are simply saying "Horses for courses". Let us make it abundantly clear that "private hire" means exactly what is suggested by the clause and that the community realises the difference between the private hire operator and the man who has been licensed by a local authority and is plying for hire. That being so, the common sense of the clause should satisfy the purposes and interests of both private hire operators and the owners and drivers of taxis as well as those of the community. I detect a sense of agreement from the Government Benches on this issue. I hope that my sense of the matter is correct.
      Mr. Vivian Bendall: I represent a considerable number of taxi
      1062
      drivers in the London area who are concerned that they should be protected. Taxi drivers who are licensed should be able to continue their work. I am particularly concerned about what will happen with vehicles with a passenger capacity of eight or fewer people which are able to move between London stations such as Victoria and Charing Cross.
      Under the proposed legislation, people can be carried in such vehicles. That gives little chance to the licensed trade to operate in the way that it has done for many years. I make that vital point because we are talking about the livelihood of the licensed operators. They provide an important and specific service as part of London's transport system, and I ask my hon. Friend the Minister to give serious consideration to that point.
      Mr. Bidwell: My hon. Friend the Member for Newcastle upon Tyne, Central (Mr. Cowans) is to be congratulated on taking the opportunity to enlist the sympathy of the Government, through the medium of the Bill, to remove an anomaly in the 1976 Act. That is the best way to describe the situation. I do not believe that what has gone on since 1976 in the car hire business was intended.
      In my capacity as a sponsored member of the Transport and General Workers Union, apart from looking after the interests of those in my union who work in the passenger carrying business, I have also been asked to look at the position of taxi drivers who are still members of the Transport and General Workers Union. I believe that in London most of them are now in the owner-drivers' organisation, the Licensed Taxi Drivers Association. I have met members of that association and have conferred with the hon. Member for Ilford, North (Mr. Bendall) on more than one occasion. Recently he and I took part in a London Weekend Television programme which highlighted some of the questionable activities of some of those engaged in the car hire business. This applied particularly to London, with the charging of extortionate fares and so forth.
      9.45 pm
      At one stage the hackney cab drivers did not like the growth of the minicab trade. They have learnt to live with it now and accept the role of the legitimate

      1063
      car hire business. However, hackney cab drivers have to carry overheads and maintain standards under the law in London, supervised by the Home Office. They are not allowed to charge what they like. Their fare increases are negotiated and they have to undertake continual negotiations to obtain recognition of the extent of their overheads in an attempt to secure improvements in their conditions. These requirements do not apply to the car hire business.
      Something has, therefore, gone out of balance. The hackney cab drivers are owed something. They provide great support for the tourist industry. They seek only fair play, and the clause goes some way towards that. If the Minister accepts it, he will be the pin-up boy of the cab trade tonight.
      Mr. Kenneth Clarke: I am grateful to the hon. Member for Newcastle upon Tyne, Central (Mr. Cowans) for initiating this short debate on this important point. It has shown that there is widespread interest in the problems of taxi drivers. My right hon. Friend the Minister and I have not forgotten the interests of the taxi drivers in bringing forward the Bill. We have had regular meetings with various representatives of the taxi trade. They have voiced considerable fears about the implications of the Bill, and we have gone out of our way to try to reassure them that Ministers in the Department and the Government generally do not intend to damage the interests of the taxi trade.
      We all respect the part that the cabs play in the transport system. At any time of day or night a taxi can be hoarded by a passenger, who can have complete confidence that the driver is a respectable and reputable person and that the fare that he will charge will be strictly related to the mileage covered. These drivers operate under rigorous conditions which would put them in some ways at a disadvantage with other sectors of the trade were unfettered competition to be allowed.
      No one disputes the right of the private hire car operator to pursue his business. But the taxi drivers are full of complaints, as the hon. Member for Leicester, South (Mr. Marshall) said and as has been brought to my attention by my hon. Friend the Member for Word, North (Mr. Bendall) on at least one occasion,
      1064
      about the unfair basis upon which they often find themselves competing with hire cars.
      The issues in the new clause cover one of the problems that taxi drivers say that they face repeatedly at the moment. In many cities it is difficult to distinguish between taxis and hire cars because hire car operators have developed the practice of putting illuminated signs on the roofs of their vehicles. That is particularly so in provincial cities where hire cars are not distinctive large black vehicles but are saloon cars of the same kind as those used by hackney carriage operators.
      I shall not allow myself to be drawn into what the hon. Member for Leicester, South said about private car hire operators deliberately intending that their signs should look like those of taxis. However, that is a firmly-held belief among members of the taxi trade. The Act with which the hon. Member was involved allowed local authorities to restrict roof signs. However, it also allowed for an appeal to the magistrates against the decision of the authority. In a number of cases recently private hire car operators have appealed and have been successful in two-thirds of the appeals. The result is that the legislation passed by the previous Parliament does not give the protection to the taxi drivers that they feel they deserve.
      As I said earlier, this is largely a matter for my right hon. Friend the Home Secretary, but we have consulted the Home Office because this new clause has considerable appeal to my Department. We are anxious to try to give some indication to the taxi drivers that our aims are not hostile to them and that we accept their distinctive place in the passenger network. Therefore, it is possible that we may be able to meet the main purposes of the new clause. However, the hon. Member for Newcastle upon Tyne, Central will not be surprised if I say that the drafting of it is defective and needs to be improved.
      Mr. Jim Marshall: Does the Minister recognise that the Bill applies only to areas outside London? Will the clause apply to the metropolis as well as to areas outside London?
      Mr. Clarke: I undertake to consult my right hon. Friend the Home Secretary on

      1065
      that point, and I shall draw his attention to it. It is a point that is strongly felt by my hon. Friend the Member for Ilford, North and the hon. Member for Ealing, Southall (Mr. Bidwell). Subject to those consultations, the Government propose to move amendments in another place that will meet the objects of paragraphs (a) and (c)—to restrict roof signs on vehicles capable of carrying fewer than eight passengers and used to carry passengers for hire or reward, and to make sure that vehicles used for car-sharing exercises do not carry similar offending signs.
      Paragraph (b) is sweeping in its possible application, and at least one hon. Member has said that we are attempting to stamp out signs for private hire cars. Illuminated signs, so long as they are of a kind that would not be confused with a hackney carriage sign, would be perfectly legitimate. I am not anxious to adopt the spirit of paragraph (b), but, subject to further discussions with my right hon. and hon. Friends, and subject to the advice of those involved, the Government hope to meet the substance of the new clause in another place.
      Mr. Cowans: Until now the Minister has ignored subsection (2). It is no good passing legislation unless there is some form of deterrent. If the Minister accepts the spirit of the Bill, does he also accept the spirit of deterrence?
      Mr. Clarke: If we proscribe signs on vehicles, it follows that there must be some sort of penalty when that directive is not obeyed. There have been references to previous declaratory statements in the Transport Act 1968 which proved to be ineffective in practice because they were not enforceable. We seek to avoid that. The final form of the Bill must be the responsibility of the Ministers who are involved. I give an undertaking that the Government will seek to meet the spirit of the new clause in another place. I hope that in the light of that assurance the hon. Member for Newcastle upon Tyne, Central will seek to withdraw his clause.
      Mr. Cowans: In view of the helpful words of the Minister, and on the assurance that wisdom has not fallen upon stony ground, I beg to ask leave to withdraw the motion.
      Motion and clause, by leave, withdrawn.
      Further consideration of the Bill adjourned.—[Mr. Newton.]
      Bill, as amended (in the Standing Committee) to be further considered tomorrow.

COAL INDUSTRY
Motion made, and Question proposed,
That the draft Mineworkers' Pension Scheme (Limit on Contributions) Order 1980, which was laid before this House on 11 March, be approved.—[Mr. John Moore.]
Mr. Deputy Speaker (Mr. Bernard Weatherill): It will be for the convenience of the House to discuss with this the second motion.
9.54 pm
Mr. Alex Eadie: It is not the intention of the Opposition to retard the progress of the two orders. However, a number of my hon. Friends feel that it might have been better if we had discussed the outstanding progress that the mining industry has made. Productivity is increasing and absenteeism has been substantially reduced. Also, the great investment in technology has paid off, in that it has been a good investment for the nation and for the miners.
As I have said, we do not intend to impede the progress of the two orders. However, I should like to ask the Under-Secretary one question. We are cooperating in facilitating the business of the House. That is why we are trying to exercise the utmost expedition. Even though the Minister moved the order formally, I appreciate that it was not because he was reluctant to argue the case.
My question relates to the payment of the increases. Perhaps the hon. Gentleman can write to me on it. I hope that in no way will the increases be related to what we have heard recently about the Government's views on various methods of payment. If the hon. Gentleman has anything to convey about that, perhaps he will write to me.
9.56 pm
The Under-Secretary of State for Energy (Mr. John Moore): I thank the hon. Member for Midlothian (Mr. Eadie) for his comments. I endorse entirely what he said about the splendid progress towards profitability in the coal industry

1067
and the excellent increases in productivity. I shall, of course, write to him on the detailed point that he raised.
I commend the orders to the House.
Question put and agreed to.
Resolved,
That the draft Mineworkers' Pension Scheme
1068
(Limit on Contributions) Order 1980, which was laid before this House on 11 March. he approved.
Resolved,
That the draft Redundant Mineworkers and Concessionary Coal (Payments Schemes) (Amendment) Order 1980, which was laid before this House on 11 March, be approved.—[Mr. John Moore.]

EUROPEAN COMMUNITY (CONVERGENCE AND BUDGETARY QUESTIONS)
[Relevant Commission document: No. 11028179.]
9.56 pm
The Financial Secretary to the Treasury (Mr. Nigel Lawson): I beg to move,
That this House takes note of Commission document No. 4845/80 on convergence and budgetary questions, and fully supports the Prime Minister in her efforts to secure agreement at the next European Council to action which will bring about a substantial, immediate and lasting reduction in the United Kingdom's net contribution to the Community Budget and furthermore to ensure that there is a commitment by the Council to long-term restructuring of the Budget which would bring about a significant reduction in the proportion of spending on the Common Agricultural Policy, particularly by reducing the production of surpluses, and a more equitable distribution of expenditure over the whole Community.
Mr. Deputy Speaker (Mr. Bernard Weatherill): I should tell the House that Mr. Speaker has selected the amendment standing in the name of the Leader of the Opposition. That amendment will, however, be moved in a slightly amended form. It involves the insertion after the word "surpluses" of the words
"and creating a more equitable distribution of expenditure".
I should also tell the House that Mr. Speaker has selected a manuscript amendment to the amendment of the Leader of the Opposition tabled by the hon. Member for Caithness and Sutherland (Mr. Maclennan). That amendment is to leave out from second 'Community' to the end of the amendment. Copies of the Leader of the Opposition's amendment in its amended form, together with the manuscript amendment of the hon. Member for Caithness and Sutherland, are available in the Vote Office.
At the end of the debate, the motion and the two selected amendments will be put together to the House in the following order—first, the manuscript amendment of the hon. Member for Caithness and Sutherland, secondly, the amendment of the Official Opposition and, thirdly, the Government motion.
Mr. J. Enoch Powell: On a point of order, Mr. Deputy Speaker.
1070
While appreciating and accepting the Chair's absolute discretion on the acceptance of amendments, may I make two representations? The first relates to the extreme difficulty for hon. Members which arises from an amendment being accepted which is not able to be within the knowledge of hon. Members until shortly before the statement which you have made. That makes it very difficult for an orderly debate upon a major topic to take place.
My second point is that, although this matter does not involve the vexed and major question of two amendments to Government motions on matters of policy, nevertheless if the selection of an amendment to an Official Opposition amendment were to become a regular procedure, the position of the Official Opposition in regard to securing debates of their propositions, as opposed to those of the Administration, would be radically altered.
It is difficult to make this submission, especially in the absence of Mr. Speaker. Nevertheless, I submit that the matters which his decision raises are of considerable moment, and no doubt there will be another opportunity for raising them.
Mr. Deputy Speaker: I thank the right hon. Gentleman for putting it in that way. He will understand that I have no authority to comment upon or alter Mr. Speaker's selection of the sub-amendment.
Mr. Lawson: I have considerable sympathy with the point of order raised by the right hon. Member for Down, South (Mr. Powell).
The motion refers to the next European Council meeting which had been planned to open in Brussels a week today. As the House will be aware, the Italian Prime Minister has announced this afternoon that he felt the meeting of the European Council should be postponed because, as a result of the Italian domestic political situation, he has not been able to devote himself to the preparation for the meeting. We entirely understand and sympathetic with Signor Cossiga's difficulties. But the budget problem is a serious and complex one, affecting the future of the Community, which all members have to resolve as soon as possible. We were and remain ready to tackle that matter next week. But, in the new circumstances which have arisen today, we have made

1071
it clear to the Italian Government and to our Community partners that the Council should be convened at the earliest possible date.
The House will not expect me to say more on a matter which is still under discussion between the Governments concerned, except to confirm, as I do, that we remain determined to bring this difficult matter to a satisfactory conclusion as soon as possible so that a substantial reduction in our net contribution takes effect this coming financial year.
Mr. Denzil Davies: What will be our net contribution in the next financial year? I think that it is important that we should know that in view of the amendments.
Mr. Lawson: Our net contribution, unless we can get the redress that we are seeking—which is what I assume the right hon. Gentleman is talking about—will be over £1,000 million. If the right hon. Gentleman will allow me to develop my speech, I shall be dealing with all these matters. He should be a little less impatient. If he is, it will enable me to get through my opening remarks sooner, and that will give more time to right hon. and hon. Members on both sides of the House to make their contributions to what is a short debate on an important subject.
This is the third occasion in the few months since the present Government took office that the House has debated this important matter. By now, the whole House will be well aware of the explosive growth in the United Kingdom's net contribution to the Community budget that has occurred over the past few years.
Mr. Denzil Davies: How much?
Mr. Lawson: The right hon. Gentleman keeps saying "How much?" I am coming to that. From a level of about £150 million in 1976 it had risen to £900 million in 1979. Unless something is done to reverse the trend, the figure this year, as I said, is likely to be well over £1,000 million. It is impossible to give a precise figure, because there are many imponderables. As I told the right hon. Gentleman, who is muttering from a sedentary position, whether it is £1·1 billion, £1·2 billion or £1·5 billion, or whatever, it
1072
makes no difference to the importance of the matter that we are discussing or to the principles which are at stake.
Mr. Nigel Spearing: Does the hon. Gentleman recall that on 25 February, in col. 442 of the Official Report, he gave a written answer to his hon. Friend the Member for Northampton, North (Mr. Marlow) in which he estimated the figure of the net budget transfer in 1980 to be £1,310 million? Does he not now stand by the figure that he gave on 25 February?
Mr. Lawson: The hon. Member for Newham, South (Mr. Spearing), who is expert in the affairs of the Community, knows that we have to rely to a considerable extent on the estimates made by the Commission. The Commission is in the habit of revising those estimates from time to time. The figure that I gave at that time was based on the latest estimates by the Commission. It now looks as though the figure may be a shade less than that, but it will be between £1 billion and £1·3 billion.
Mr. Russell Johnston rose——
Mr. Lawson: I will gladly give way, but I do not think that this is assisting the progress of the debate.
Mr. Johnston: According to the Commission paper produced today, the figure is 1,683 million units of account.
Mr. Lawson: That is correct, and that is precisely the range that I was indicating in pounds. I assumed that hon. Members would prefer pounds sterling, but I can talk in units of account if that is the desire.
Wherever the figure is within this range, the point is that it would make the United Kingdom far and away the largest net contributor to the budget, with a net contribution almost double that of West Germany, which is the only other significant net contributor. It is the contention of the Government, for which we have already received the full backing of the House on each of the two previous occasions to which I have alluded, that this state of affairs is neither equitable nor sustainable.
If the European Community is to thrive, and we believe it to be in the interests of the West as a whole that it

1073
should, it simply cannot impose this manifestly unacceptable burden on this country. Like any other organisation, the Community must show itself to be alive to the interests and needs of its members, and that means all its members. Like any other organism, it must adapt if it is to survive.
Indeed, that was clearly acknowledged by the six original members of the Community during the accession negotiations in 1970. Even at that time the United Kingdom had been expressing concern that the incidence of Community revenues, together with the predominance of agriculture in Community spending, might well result in this country being called upon to make very large net contributions to the Community budget once the transitional arrangements ended in the late 1970s. At that time the Community contested this and argued that changes in the pattern of Community spending would ensure that the problem never arose in that form. But it did explicitly agree—and I quote as I have before the ipsissima verba—that
"should unacceptable situations arise within the present Community or an enlarged Community, the very survival of the Community would demand that the institutions Lind equitable solutions."
When the present Government took office we made two things absolutely plain to our Community partners. First, we made plain our total commitment to United Kingdom membership of the Community and our determination to make the Community work. Secondly, we made plain our resolve to achieve that equity in the Community's finances which the Community itself, in the quotation that I have just read to the House, had acknowledged to be essential.
Inevitably this has not been easy. The very idea of examining the distributive effects of the Community budget was a novel one for a Community which is reluctant to encourage member States to expect to get out of the budget exactly what they put in, and which never before has been confronted with such a totally inequitable outcome from the implementation of its policies: and of course if Britain pays less inevitably others will have to pay more. No Government welcome that prospect, however compelling the arguments in logic and equity for their doing so.
1074
So it has been hard going. But we have made considerable progress.
Mr. Denzil Davies: Come on.
Mr. Lawson: Yes, we have, and the document that we are discussing is evidence of that progress. It may be helpful for the benefit of the few hon. Members present who may not have read the document in its entirety if I briefly summarise its contents.
The Commission begins by emphasising once again the need for changes in the balance of Community expenditure. It then goes on to propose that an adapted financial mechanism
"should be part of the solution to the probe lems of the United Kingdom over the Community Budget."
Lastly, the Commission suggests that the Community should establish a special fund under a regulation based on article 235 of the Treaty. Money thus made available would be used to help to finance public expenditure programmes designed to improve this country's economic and social infrastructure, and thereby to promote what is described as a convergence of economic performance within the Community.
Mr. Alan Clark: Do not these sums, in many cases, have to be matched by equivalent sums from our side?
Mr. Lawson: No, that is not so.
The document before us is a direct result of the European Council held at Dublin last November. That Council was very far from being the fiasco that it is sometimes presented as by the press and, indeed, by some of the less perceptive Opposition Members. In Dublin the Community Heads of Government established the framework for a solution to this country's problem which the Commission has elaborated in the document before us.
The House may find it easier to understand why it was so useful to establish this framework if I quickly recall the causes of the United Kingdom's budget problem. Only about one-third of our net contribution arises from our high level of payments to the Community. Two-thirds result from the low level of Community spending in this country. In 1980 the Community will, on present policies, spend less than half as much per head of the population in the United Kingdom

1075
as it does in the Community as a whole. Our meagre share of Community expenditure, less than 10 per cent. of the total, reflects the continued domination of the Community budget by expenditure on agricultural support.
The common agricultural policy still absorbs over 70 per cent. of the budget, the bulk of which, as the House knows, is attributable to the cost of storage and disposal of surplus production. This country, with its small farming sector, can never benefit to any great extent from such expenditure, as indeed the Community itself appreciated as far back as 1970.
The Dublin Council recognised the need for action on all these fronts if this country's problem was to be satisfactorily resolved.
As regards our excessive gross contribution—that is, the money that we pay in—the Council agreed that the Commission's proposals for adapting the existing financial mechanism—the much-vaunted but pathetically ineffectual outcome of the previous Government's so-called renegotiation"—could form the basis of a solution. Removal of all the restrictions and limitations which at present castrate the financial mechanism, so as to transform it into an effective instrument for redressing this country's excessive gross contribution, would yield us a refund of about £350 million in 1980, or roughly one-third of our likely net contribution [Interruption.] Opposition Members who are muttering from sedentary positions would surely have settled for that themselves, representing, as it does, a vast improvement on what they were in practice prepared to settle for in 1975.
As my right hon. Friend the Prime Minister told the House on 3 December, after Dublin, she was not prepared to accept an offer that was so patently inadequate to meet this country's needs. She insisted that any solution should take account of the other larger part of the problem, which stemmed from the low level of Community spending in this country.
Under pressure from my right hon. Friend, the European Council at Dublin agreed to see what could be done on this front as well. To deal with the immediate problem, it asked the European Commis-
1076
sion to find ways of increasing Community spending in this country which would contribute to the Community's declared objective of promoting economic convergence. The result is the document that we are debating this evening. For the longer term, too, it expressed its determination to
"reinforce those policies most likely to favour the harmonious growth of the economies of the member States and to reduce the disparities between these economies."
In other words, it endorsed the Commission's suggestion that the Community should spend less on blanket agricultural support and more on its structural policies.
The Commission's document identifies a series of means by which the Community can help to improve Britain's social and economic infrastructure. Since the document was presented to the Council, the Commission has discussed the various possibilities with us. In a new document that we have just received and which will be laid before the House shortly in the usual way, the Commission says that it is already evident—
Mr. Peter Hardy: The hon. Gentleman mentioned the new document and the views of the Community. Will he tell us whether people in the Community are happy that this Government seek to obtain larger funds from the European Community, although we are already being criticised for failing to take advantage of substantial opportunities to obtain Community funds for a variety of purposes?
Mr. Lawson: There are no opportunities that we have failed to take advantage of. I think that the hon. Gentleman is mistaken.
The Commission's new statement is an important step forward towards the solution of our problem. It will also help the Government to achieve the reductions in public expenditure and public borrowing that are central to our economic strategy. It is, of course, at present too early to say what programmes and projects the Community may help to finance. The Commission has put forward some ideas which we shall pursue with it.
The key questions concern the amount and duration of the assistance that is to be provided. On those points our position

1077
is absolutely clear. We seek a solution that will, in the words of the motion,
"bring about a substantial, immediate and lasting reduction in the United Kingdom's net contribution."
By "immediate" we mean one that will be fully operational as from the financial year 1980–81, now only a fortnight away. By "lasting" we mean a solution that will ensure that the problem does not recur. Neither we nor the Community can afford to have to return to this problem year after year.
As for the scale of the substantial reduction that we seek, and about which the right hon. Member for Stepney and Poplar (Mr. Shore) has shown so much concern, we have indicated that we are prepared to join the search for a genuine compromise. However, it must take full account of the seriousness of this country's problem. As my right hon. Friend the Prime Minister reminded us only last Thursday, we have little room for manoeuvre.
Mr. Eric Deakins: Will the hon. Gentleman confirm that the lasting solution that the Government seek is one that will take account of the vastly increased costs of the CAP, and hence of our budget contribution, when the three new members are admitted in the next few years?
Mr. Lawson: A lasting solution clearly means one that lasts as long as the problem lasts. If the result of enlargement is as the hon. Gentleman suggests—and this is a speculative issue depending on agreements not yet reached—that will be one element in deciding the scale and duration of the solution. In the longer term, of course, there can be no doubt that the Community needs to achieve a better balance of expenditure within its budget, and not just for the sake of resolving this country's problem. It is vital that the Community budget should be subject to the same discipline as all member States apply to their domestic budgets. Expenditure must be constrained by the money available. The open-ended character of the CAP, as it now operates, must be modified and new priorities established.
Let there be no illusion that these long-term reforms can be in any way a substitute for the measures expressly designed to correct the United Kingdom's
1078
budget problem that are needed here and now.
Mr. Eldon Griffiths: My hon. Friend earlier spoke of a new document from the Commission. I think that he said that it could represent an important step in solving our problems. I appreciate my hon. Friend's problem. However, how long will it be before the House sees that document and can make its own judgment?
Mr. Lawson: We shall lay that document before the House as soon as possible. I thought that it would be for the convenience of the House if I alluded to it now. Because of the postponement of the European Council, it will be laid before the House before that meeting takes place.
Mr. J. Enoch Powell: On a point of order, Mr. Deputy Speaker. The Minister has quoted, and intends to continue to quote, extracts from a State paper which is in the Government's possession. Is it not a requirement of the House that that paper should be laid if it is to be quoted during the course of a debate?
Mr. Lawson: The right hon. Gentleman, for once, has nodded. At no time did I quote from the document. I merely referred to its existence and to the subject matter.
Mr. Bob Cryer: Further to that point or order, Mr. Deputy Speaker. The Minister specifically alluded to the document. It is a convention of the House that if a document is alluded to by a Minister it is laid on the Table for hon. Members to receive. Similar points have been raised on many occasions, and the documents have been laid on the Table following requests from Back Benchers. Surely that precedent should be followed.
Mr. Robin Maxwell-Hyslop: Further to that point of order, Mr. Deputy Speaker. The rulings from the Chair on the matter invariably have been the same, namely, that it is only if the document is quoted that it must be laid upon the Table.
Sir Derek Walker-Smith: Further to that point of order, Mr. Deputy Speaker. I rise merely to assist you. The custom of the House derives from a legal principle in the courts that a person cannot give oral evidence from a written document. If my hon. Friend the

1079
Minister does not give oral evidence of what is contained in the document, he is within the rules.
Mr. Hardy: Further to that point of order, Mr. Deputy Speaker. Did not the Minister go further than alluding to the document? Did he not refer to the contents of the document and, therefore, should not that document be laid?
Mr. Deputy Speaker: I am grateful to the House for so much assistance. The hon. Member for Tiverton (Mr. Maxwell-Hyslop) anticipated my ruling. It would be necessary for the Minister to lay the document on the Table if he intended to quote directly from it. If he merely alluded to it—as I understand he did—it was not necessary for the document to be laid.
Mr. Lawson: Thank you for that ruling, Mr. Deputy Speaker. I assure the House that the document will be laid at the earliest possible moment. I thought that it would be of assistance to the House to allude to it in the debate.
The Government have no doubt that the Commission's proposals could, given the political will among the member States, form the basis of an adequate and acceptable solution.
I turn to the amendment in the name of the Leader of the Opposition, and to the amendment to the amendment which Mr. Speaker has selected. One is to correct a drafting error in the Opposition's amendment. That sort of bumbling approach is characteristic of all their actions in this area. We are prepared to accept, without demur, that their drafting error should be corrected.
The other amendent is that in the name of the hon. Member for Caithness and Sutherland (Mr. Maclennan), which concerns matters that are dealt with in the Opposition amendment. The internal quarrels within the Opposition should be left to fester unaided by right hon. and hon. Members on either side of the House.
The Opposition amendment is in two parts. The first part seeks to reaffirm the position taken by the House on the two previous occasions on which we debated the matter, namely, that the United Kingdom net contribution to the Community budget should be zero. The
1080
two previous debates took place before the European Council met at Dublin. As I have already made clear, very important positive progress was made at that Council for which the document—[Interruption.] Opposition Members do not like to see the Government finding a solution to the problem. They know that no progress whatever was made when they were in office.
The document that we are debating today bears clear witness to the progress that has been made. At the time we moved from a position of seeking the total elimination of our net contribution to the acceptance, in a spirit of genuine compromise, of a modest United Kingdom net contribution. There is no secret about this. The Prime Minister has made the position quite clear to the House and to our European partners ever since the Dublin summit.
That means equally clearly that I must advise the House to reject the Opposition amendment. Indeed, I hope that the Shadow Foreign Secretary will not seek to press his amendment. The Leader of the Opposition himself told the House on 11 March—and I quote his precise words:
"I hope that the right hon. Lady will go to Brussels knowing that she has the full support of everyone in the House for a substantial reduction in the amount of the payment."—[Official Report, 11 March 1980, Vol. 980, c. 1150.]
The difference between a substantial reduction in this country's net contribution and its total elimination is logically quite distinct. The Leader of the Opposition, on 11 March, quite clearly—and sensibly—gave his support to the very words embodied in the motion before the House.
It is therefore my profound hope that at a time when the Prime Minister will, before long, embark on an international negotiation which is as difficult as it is vital to our country's interests, the Opposition will not press their opportunist amendment but instead will remain true to the position expressed by the Leader of the Opposition as recently as 11 March, and allow the Prime Minister to go to Brussels with the backing of a unanimous House of Commons.
Mr. Roger Moate: In recommending that the Opposition amendment be rejected, or not even

1081
moved, can my hon. Friend tell us that the Government will not oppose the last part of that amendment—the part that is dealt with by the amendment of the hon. Member for Caithness and Sutherland (Mr. Maclennan)? Can my hon. Friend be explicit about this, because it is an important point?
Mr. Lawson: It is important. As my hon. Friend has pointed out, the second part of the amendment deals with the possibility that in the last resort we might withhold part of our net contribution to the Community budget. This aspect, too, was mentioned by the Leader of the Opposition in the important utterance that he made on 11 March, although it is true that the precise words of the amendment echoed the early-day motion tabled by my hon. Friend the Member for Bury St Edmunds (Mr. Griffiths) on 18 March and now supported by 136 of my right hon. and hon. Friends.
Of course, the Prime Minister is aware of the strength of feeling on this matter on both sides of the House, and I am sure that she will convey it to her fellow Heads of Government in her own inimitable manner. Needless to say, the Government have no wish to follow this course and we hope that it will not come to that. We are negotiating for an equitable outcome and will consider this possibility only in the last resort.
Mr. Dick Douglas rose—
Mr. Lawson: No, I will not give way.
Mr. Douglas rose—
Mr. Lawson: No, I will not give way, so there is no point in the hon. Member jumping up and down like a jack in the box.
Mr. Douglas rose—
Mr. Deputy Speaker: Order. The Minister is not giving way.
Mr. Lawson: We have said that we will consider the possibility of withholding part of our contribution only as a last resort. The Prime Minister made this clear as recently as last Thursday. In the light of that, I see no difficulty in the second part of the Opposition's amendment concerning withholding. However, for the reason that I have already given
1082
concerning the first part of the amendment—a reason which was implicitly accepted by the Leader of the Opposition on 11 March—I hope that the Opposition will not press their amendment. If they do, I repeat that I shall have to advise my right hon. and hon. Friends to reject it. How much better it would be for the House to give its unanimous support to the motion; and, as my right hon. Friend the Prime Minister prepares to go to Brussels, before long, to fight for our country's interests, I believe that she has a right to expect no less.
10.30 pm
Mr. Peter Shore: I beg to move, to leave out from first "Council" to the end of the Question and to add instead thereof:
'so that, as the House unanimously resolved on 16th July and 22nd November 1979 Great Britain's contribution to the Budget is at least not greater than the receipts, and furthermore to ensure that there is a commitment by the Council to long-term restructuring of the Budget which would bring about a significant reduction in the proportion of spending on the Community Agricultural Policy, particularly by reducing the production of surpluses and creating a more equitable distribution of expenditure over the whole Community; and will support the Government should it as a last resort find it necessary to withhold part of the United Kingdom contribution in order to achieve a satisfactory settlement.'
We shall sustain our amendment in the Lobbies if the Government, for the weak reasons advanced by the Financial Secretary, find it necessary to oppose us.
The amendment seeks to make two additions to the motion. The first is to reintroduce the resolutions passed unanimously by the House on 16th July and 22nd November in which the House stated its view that the British contribution should not exceed the receipts that we obtain. The second part of the amendment adds:
"and will support the Government should it as a last resort find it necessary to withhold part of the United Kingdom contribution in order to achieve a satisfactory settlement."
With characteristic effrontery, the Financial Secretary attempted to attribute to my right hon. Friend the Leader of the Opposition an interpretation that his words do not sustain. When our support was keenly asked for by the Government in the debate on 22 November, I said:
"The Chancellor has asked for the support of the House as a prelude to the opening of the Dublin summit. He has that support in

1083 s
full measure. He will lose that support only if he or the Prime Minister were to retreat from the meaning and value of their own words."—[Official Report, 22 November 1979; Vol. 974, c. 607.]
Mr. Lawson: The right hon. Gentleman has accused me of misrepresentation. That is a serious charge. If he will look at Hansard for 11 March, he will see that the Leader of the Opposition said:
"I hope that the right hon. Lady will go to Brussels knowing that she has the full support of everyone in the House for a substantial reduction in the amount of the payment."—[Official Report, 11 March 1980; Vol. 980, c. 1150.]
That view is embodied in the motion. I hope that the right hon. Gentleman will not charge me with any misrepresentation.
Mr. Shore: The Financial Secretary cannot get away with attempting to state the considered position of my right hon. Friend, which is embodied in our amendment, on the basis of an abbreviated version of an exchange in Question Time in the House. It does the hon. Gentleman no good to try to wriggle out of it in that way.
Before commenting on and commending the amendment, I should like to refer to the debate itself. We heard this afternoon that the meeting of the European Council had been postponed and that no new date had been set. I heard the news with surprise and regret—surprise because, although we are aware of the difficulties of the Italian Government, I understood that an interim Administration was to be formed by Signor Cossiga, and regret because it means that the matters that were supposed to be settled at Dublin—no later—are to be delayed for months longer.
We do not know when the next summit is to be held.
Mrs. Peggy Fenner: How then can the right hon. Gentleman say that matters will be delayed for months?
Mr. Shore: I shall be pleased to hear that the summit is coming forward in the next few weeks. Nevertheless, it has again been delayed. This must be a matter of regret, because there is no status quo in the situation. Money is pouring out of
1084
this country into Europe. We need immediate action to arrest the outflow.
This debate contrasts strangely with the debate on 22 November. It has only been possible to open the debate, even at this hour, thanks to our colleagues on the Transport Bill, and it will last, I suppose, for no more than three hours at a time when little public attention can be focused upon it. Previously we had a full day and the debate was opened, far more appropriately, by the Chancellor of the Exchequer. We regret the absence of the Chancellor. His absence is particularly unwelcome precisely because he will be presenting his Budget on Wednesday.
As the Financial Secretary knows, there is a crucial link between Britain's contribution to the EEC budget and the United Kingdom Budget to be presented on Wednesday. That link—or should I say "heavy golden chain"?—represents an amount of the order of £1,000 million.
The Chancellor spelt out the connection on 22 November when he said:
"Our forecast net contribution in 1980 is equal to the entire planned expenditure on national roads, all educational buildings, and all hospitals and other health buildings, put together. It significantly exceeds our programme of overseas aid, and already in 1979 it has been a major factor in eliminating the invisible surplus".
The right hon. and learned Gentleman also said:
"Our 1979–80 contribution is already equivalent to 11 per cent. of the United Kingdom PSBR".—[Official Report, 22 November 1979; Vol. 974, c. 592–3.]
There is not much doubt about the connection and relevance in the mind of the Chancellor as recently as 22 November. I can well understand why he insisted that new arrangements must operate in respect of 1980 as well as in subsequent years.
This brings me to a major question. What has been the basis of the Government's calculation of our EEC contribution in this year's United Kingdom Budget?
What figure for our net contribution to the EEC has been entered in the national accounts? Are the Government working on the assumption of success and that the £1,000 million will be retained by the United Kingdom? Or are they working on the assumption of failure and for a

1085
further £1,000 million cut in United Kingdom public expenditure or a further £1,000 million increase in taxation?
This issue cannot be evaded. I hoped that the Financial Secretary would give us a straight answer. If he speaks, with your permission, Mr. Deputy Speaker, at the end of the debate, he will perhaps address himself to it. We shall, I suppose, know, in any event, in two or three days' time; it will have to come out. It is crucial to the whole plan of the Budget for this year.
I turn now to the major anxieties expressed in the first part of the Opposition's amendment—the anxieties that the Government are retreating from the position they accepted with the full support of the House, first on 16 July and again on 22 November. The motion that the House passed called for two things: first, for a fundamental reform of the budget arrangements, and, secondly, an outcome in which the words are familiar—Britain's contribution to the budget
"is at least not greater than the receipts."
On both these main fronts, there is, unhappily, evidence of a serious retreat. I turn first to the question of fundamental reform.
Mr. Tony Marlow: The right hon. Gentleman says in his amendment that the contribution to the budget
"is at least not greater than the receipts."
Would he accept that in any organisation such as the Common Market there is a headquarters overhead cost towards which everyone has to contribute? In that case, we are bound to make a slightly greater contribution than we receive.
Mr. Shore: I understand that, and I shall come to that point in a moment, because we must see that against the actual contributions that other countries are paying. It is not apparent to me that they are bearing any part of the overheads at all.
I see evidence of a retreat. The case for fundamental reform is unanswerable. The latest estimate of losers and winners—and I turn directly to the hon. Gentleman's point—was published by the Commission last Friday. I do not know why the Financial Secretary was so coy about
1086
this. This reinforced what was already an overwhelming British case.
The figure of £1,000 million of last November—the net figure of our contribution—has now become £1,125 million. That is almost twice as large as the West German contribution of £665 million. West Germany has, as we know, a national income which is roughly twice our own. All the rest are gainers. France gains £62 million, Luxembourg gains £178 million, Holland gains £244 million, Denmark gains £265 million, Belgium gains £297 million, Ireland gains £335 million and Italy gains £410 million. What indeed would they do without us?
It is indeed an amazing situation that reflects equally the bizarre cluster of taxes that make up the so-called "own resources" of the Community and the great imbalance of Community expenditure in sustaining what must be the most protected and costly agricultural system in the world.
It was my hope that, armed with the resolution of the House, the Government would open up the whole question of the structure and composition of the EEC tax system, and that it would insist that "own resources" should give way to a progressive and redistributive tax system and that since a major CAP reform cannot realistically be met—if at all—except over a period of years the simple and immediate solution would be found in a straight refund of excess British contributions.
That has not happened, and as far as I can see the "own resources" system has not even been challenged during all these weeks. Indeed, in her post-Dublin statement on 3 December the Prime Minister had only this to say:
"Fundamental reform may be desirable—I happen to think that it would be—but fundamental reform would change all the existing mechanisms, all the existing basis, of the budget".
Yes indeed; that is the point. The right hon. Lady went on to say:
Therefore, one goes not to fundamental reform but to what we did—to using the existing Community mechanisms. Those were two: to diminish the contributions and to increase the receipts".—[Official Report, 3 December 1979; Vol. 975, c. 33–34.]
I regret this very much for two solid reasons that I now put to the House. First, the present tax system is not only absurd in its incidence and composition

1087
but it has the effect of putting the United Kingdom permanently in the position of seeking to claw back what has already been conceded. We are, therefore, always in the position of a demander with a status quo operating powerfully against our interests. That was the situation when the previous Labour Government argued for the first corrective mechanism. It is the same with the revised version of the corrective mechanism that the Government are seeking today.
The second objection is no less powerful. By seeking to secure increased Community expenditure in Britain we are allowing the EEC increasingly to determine our own public expenditure priorities and to increase its influence and competence over Government decisions in Britain.
The other area of retreat with which we are concerned is the aim and the target of the whole negotiations. We armed the Government with the words
"Britain's contribution to the budget should be at least not greater than the receipts".
We needed to make it abundantly plain that in any modern and acceptable tax regime some regard must be paid to taxable capacity and that since we stand in seventh place in the national income league of the Nine the question of Britain contributing to others should not arise at all. That was why those words were chosen. I thought that we were at one on this.
I believed that we were on 22 November when the Chancellor of the Exchequer, commenting on comparative GNPs and calling for a broad balance that we were prepared to accept as being very near our aim, said that he was amazed at his own moderation. So broad balance it was until Dublin.
Dublin was a clear failure and the Prime Minister came back with a new formula. She was ready, or so the House was told on 3 December, to search for a genuine compromise, although her room for manoeuvre—the Financial Secretary has recalled the words—was limited. So in spite of the Prime Minister's assertion last Thursday that we had very little room for manoeuvre, there has been movement—and in the wrong direction.
Meanwhile, the scale of Britain's contribution has risen, according to the latest
1088
estimates, by no less than £124 million. The Government's motion now refers not to broad balance but only to a "substantial" reduction. I think that the House has every reason to think carefully and sceptically about what that word means.
I warned the right hon. Lady before Dublin, and after that not only was her own credibility at stake but, more important, that of this country. If, in the event, we are out-bluffed, out-manoeuvred and out-faced on this issue deliberately and carefully chosen as the main battlefield for redress—and there are many other issues on which we shall need redress—we shall lose all credibility in our future dealings with the EEC.
That brings me to the last part of our amendment, that the House will support the Government should they
"as a last resort find it necessary to withhold part of the United Kingdom contribution in order to achieve a satisfactory settlement."
Mr. Hugh Dykes rose—
Mr. Shore: All right. I have often given way to the hon. Member, but he generally makes his normal speech during his intervention.
Mr. Dykes: There is no need for the right hon. Gentleman to get panicky about that tonight. Will he say what are the other issues on which the Opposition want redress?
Mr. Shore: There are very many matters. There are matters concerning State aid, the general course of economic policy and the loss of rights by this House to the EEC. There should be no doubt that there are many matters that will need to be put right.
I said that the House will support the Government should they
"find it necessary to withhold part of the United Kingdom contribution in order to achieve a satisfactory settlement."
The House will recognise the words. They are taken from the closing lines of the motion in the name of the hon. Member for Bury St. Edmunds (Mr. Griffiths) and a number of his hon. Friends. It is supported by 136 Conservative Members of Parliament. They will be pleased to hear that the Financial Secretary, speaking on behalf of the Government, has no objection to their words. Indeed, as I understand it, that is not the reason

1089
that he is seeking to invite the House to oppose our amendment. Nevertheless, it is an amendment of the utmost importance. It rightly refers to a remedy of "last resort", and it is a last resort that I believe we are rapidly approaching.
The words contained in paragraph 96 of the famous 1971 White Paper—if I may re-quote what the Financial Secretary said—stated:
"Should an unacceptable situation arise, the very survival of the Community would demand that the institutions find equitable solutions."
Those words were also quoted by the Chancellor of the Exchequer on 22 November. I assume that those words carried no weight at the Dublin summit, or in any subsequent discussions. Those words were the so-called safeguards which the House was offered six years ago to ease the anxieties which were then so strongly expressed by many right hon. and hon. Members on both sides of the House.
I said at the time that I did not believe that they had any binding force, and that if they had been binding they would have appeared, if not in the Treaty of Accession itself, then in one of the large numbers of protocols, joint declarations and declarations that were attached to it. But they did not appear there.
I gather that the Government now share that view. I assume that they have had advice from the Law Officers, otherwise I assume that they would take the matter to the European Court, along with the other alleged breach of agreement relating to promises that agricultural support expenditure would fall steeply in the total of Community expenditure.
I assume also that the Government have considered the wider question whether in the operation and the effect of the "own resources" system the Council and the Commission are in breach of the Treaty of Rome, and, in particular, of article 6 (2), which states:
"The institutions of all the Community shall take care not to prejudice the internal and external financial stability of the member States."
I take it that those remedies are closed. If that is so, we are faced with an obstinate refusal to right a manifest wrong. Against the incomprehension of the Seven and the wilful and arrogant opposition of France, the options before us are either meekly to surrnder our claim, or to take
1090
direct British action to sustain it. The Government have no reason to cavil at our resolution on this account.
Last Thursday the Prime Minister told us:
"in the last resort we shall have to consider withholding our value added tax contribution. Let there be no doubt about that."—[Official Report, 20 March 1930; Vol. 981, c. 636.]
The Government and their advisers must by now have decided what needs to be done. The House would welcome a statement, both on the present law in relation to the withholding of Britain's budget contributions, and on the amending legislation which in my view will be necessary if we are to exclude the payment to Brussels either of VAT or the agricultural levies and customs duties.
I am surprised at the attention and focus that have been placed upon VAT rather than upon the other two components of "own resources". Because of the pattern of Britain's expenditure, VAT, while it still operates adversely, at least has some basis, reason and common sense. It relates to the actual expenditure on goods and services in the different countries. It can therefore be taken to be some surrogate of ability to pay. But the other two components in "own resources" are entirely uncertain and arbitrary in their effect. We know, and the Commission knew when it decided to cement this system upon the Community as a condition of opening negotiations with Britain in 1970, that in putting a tax on trade with countries outside Europe, and in putting a tax on imports of food with countries outside Europe, they were taxing the whole history of Britain's trade, particularly its food trade.
Sir Ronald Bell: The right hon. Gentleman knows that I regard this discussion as a ritual dance, masking the inevitable. Is not the difference between VAT and the other components that the other components are appropriated specifically, whereas VAT is simply an amount of money equal to the yield of a 1 per cent. value added tax?
Mr. Shore: I note what the hon. and learned Gentleman has said, but I am not sure that that constitutes a major difference in terms of Community law or in terms of the Treaty, or that it should govern our approach to the three taxes

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which we are discussing. Under the European Communities Act 1972 those three taxes are the legal property of the Community. I quote again from a speech by the Chancellor of the Exchequer on 22 November. He said:
"Nobody in his right mind would contend that the legal tail should be allowed to wag the economic and political dog,"—
whatever that may mean. However, it sounds encouraging to me, and therefore I put it to the House to encourage all hon. Members.
Tonight, on behalf of Her Majesty's Opposition, I place on record our support for direct action to obtain relief from the Community budget. We agree with the Prime Minister that we are in fact talking about "our own money." While Britain has never been slow to contribute to others if the need is established, we cannot and will not tolerate arrangements which, due to the weakness, folly and obsession of the right hon. Member for Sidcup (Mr. Heath), backed by a complaisant Conservative majority, allow the British people to be exploited by countries more prosperous than we ourselves.
In conclusion, I repeat the pledge that we gave on 22 November: that the Opposition will give every facility to amending legislation that the Government may need to bring forward to the House to secure the objectives that we all seek.
Several hon. Members rose—
Mr. Deputy Speaker (Mr. Bryant God-man Irvine): We now have just over two hours left for the debate. I am already aware of 12 right hon. and hon. Members who wish to catch my eye, plus the wind-up speeches. I can leave the arithmetic to the House.
10.56 pm.
Sir Derek Walker-Smith (Hertfordshire, East): As you have just said, Mr. Deputy Speaker, this is a short debate, the length of which is in inverse ratio to its importance. Therefore, I shall seek to be as brief as possible.
I am wholly in favour of the Government's motion in the terms in which it is tabled. I have to depart from the Opposition's amendment, though for reasons rather different from those put forward by my hon. Friend the Financial
1092
Secretary to the Treasury, as I shall make clear later.
The Government's motion comprises two facets: first, support for the reduction of Britain's net contribution, and, secondly, support for a policy of restructuring the Community budget so as to reduce spending on the common agricultural policy. These two objectives are, of course, linked. While the first may seem the more urgent, the second is certainly the more important.
A rationalisation of the CAP will automatically benefit Britain and reduce our net contribution. Complementarily, whatever temporary amelioration or arrangement can be achieved for Britain in the short term, in the long term only rationalisation of the CAP can secure an improvement in our position.
It follows that the short-term objective must be presented and pursued in the context of the longer-term objective. The improvement of Britain's position must be seen as a consequence of the restructuring of the budget and the CAP, which is itself a logical and necessary exercise for the improved working of the Common Market in the interests of the Community as a whole. On no other basis is Britain likely to secure a lasting improvement in her position.
The short term plea of poverty can never be completely convincing, any more than it can ever be a dignified posture for a great nation. It is bound to stick in the gullets of a proud people and is not one that we should wish to make. Nor can it carry much conviction indeed, coming from the uncovenanted beneficiaries of North Sea oil. It is bound to evoke the response that, if we have to rely on a plea of poverty, it is our own fault, as indeed, to a large degree it is.
No more convincing is reliance on the so-called principle of a juste retour. Nowhere in the Treaty is such a principle enshrined. Indeed, it would be odd if it were so in an economic community whose basic concept is the efficacy and desirability of free and unfettered competition.
Mr. Tom Ellis: Will the right hon. and learned Gentleman give way?
Sir D. Walker-Smith: There is no one in the House to whom I would rather give way than the hon. Member, but I think

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that I would be better advised to resist the temptation. We will talk about it later.
It follows, therefore, that the emphasis must be on the long-term objective, with any immediate ad hoc amelioration of Britain's position ranking only as something on account in the necessary interval before the long-term improvement can be made.
As to the present workings of the CAP—I say "present workings" because the workings are not enshrined in the Treaty—I spoke on this in more detail in November last and I respectfully remind the House of my conclusion on this point. I said:
"It is not, therefore, a matter of having to amend the Treaty, with its practical and constitutional difficulties. It is a matter of presenting and winning an outstandingly clear case in the Council of Ministers by persuasion and advocacy."
I said then:
"I do not say that it will be easy, but reform is necessary and will in the long run benefit not only Britain…but also those who may be minded to oppose it now."—[Official Report, 22 November 1979; Vol. 974, c. 612–13.]
My second point concerns the relationship between contribution and expenditure. I do not believe, as some may be tempted to do, that Community spending in the United Kingdom can, of its nature, ever be a satisfactory alternative to a restructuring of the CAP. [Hon. Members: "Hear, hear."] There are two main reasons for this. First, it is at best a palliative. That is admitted in paragraph 9 of the Commission document, which says:
"In its proposals…the Commission also stated any measures on the expenditure side of the budget relating to United Kingdom should be special, temporary and ad hoc. The Commission reaffirms the views."
The second reason is that the proposed procedure by way of a Council regulation under article 235, with the procedures and controls summarised in paragraph 20 of the Commision document, would inevitably entail a step in the direction of detailed centralised Community control—a step towards what is usually, though loosely, termed in the House a Federal Europe.
For both these reasons, therefore, I conclude that compensation by way of increased expenditure in the United Kingdom is not a satisfactory substitute for the basic restructuring of the CAP.
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My third point relates to method. The motion seeks support—and properly—for my right hon. Friend the Prime Minister's efforts at the Council. It does not specify methods. But not so long ago at Question Time the Prime Minister proclaimed—again properly, in my view—her determination to act in accordance with the rule of law. There are now suggestions in the Opposition proposal and in early-day motion 513, that the United Kingdom should unilaterally withhold some of its contribution to the Community own resources.
Mr. Stanley Orme: Tell us what the Prime Minister said.
Sir D. Walker-Smith: I am telling the House what I say.
Mr. Cryer: We are not criticising the hon. and learned Member for Hertfordshire, East (Sir D. Walker-Smith), but he should tell us what the Prime Minister said.
Sir D. Walker-Smith: I was sent here by my constituents to express my views. I was doing so when some of the Opposition Members who are now making sedentary remarks were still in their political nappies. Maybe some of them still have not grown out of them. This is a serious debate and we want to make our serious points shortly.
We have to ask ourselves: would such action be within the law? Time forbids tonight a detailed analysis of the legal position. Basically, however, article 201 of the Treaty envisaged the replacement, following a unanimous decision of the Council, of the original method of financing the Community under article 200—that is to say, by way of prescribed percentages from the member States, by a system of Community "own resources".
This system was duly specified in the Council decision of 21 April 1970. Articles 2 and 3 of the decision specified respectively customs duties from non-member countries and agricultural levies as part of the "own resources" for the Community, and article 4 specified a third element as a yield from VAT not exceeding 1 per cent. Therefore, prima facie at any rate, payment of the prescribed VAT contribution is a Treaty obligation imposed in 1970, accepted by Britain in its Act of Accession and not sought to be altered in the so-called renegotiation of 1975.

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If and in so far as it is a treaty obligation, it would be a violation of international law to breach it. I am bound respectfully to caution my right hon. Friends in regard to such a course. Bad behaviour by another member State in flouting the rule of law would be a bad precedent for Britain to break the law. Law and the treaties are the cement of the Community's constitution. If that cracks, the edifice must crumble and collapse.
But it would not be only the Community that would be damaged. The high standing of Britain in the world rests in no small measure on the belief that we honour our bond and abide by the law. Lose that, and we lose much—perhaps all. [Interruption.] Those who do not mind whether the Community collapses—which is one thing—must nevertheless still have regard for Britain's standing and her reputation. In Shakespeare's words,
"Who steals my purse steals trash… But he that filches from me my good name Robs me of that which not enriches him, And makes me poor indeed."
Therefore, I ask this question: if our partners in the Community will not see reason, is there no alternative other than to break the law?
Mr. Eric S. Heller rose—
Sir D. Walker-Smith: There is an alternative, and I shall spell it out. It would be better—far better than to seek to continue nominal membership of a crumbling Community in an atmosphere of competitive and cumulative law-breaking and evasion—to seek an honourable way out, an honourable exit from a Community in which, in its unreformed state, we could not usefully play a part.
There is such a way. It is, of course, true, as I indicated to the House in the previous Parliament, that unilateral repudiation of a treaty and its obligations is a breach of international law, and that is not what I would advocate. But there is another way. Under article 54 of the Vienna Convention on the Law of Treaties, ratified by the United Kingdom only 10 years ago,
"the termination of a treaty or the withdrawal of a party may take place…at any time by consent of all the parties after consultation with other contracting States."
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That is the course that we would have to pursue—to sit round the table with our partners, not in a spirit of recrimination or hostility but in amity and understanding, to seek that honourable solution, and to say then—
Mr. Anthony Beaumont-Dark rose—
Hon. Members: Give way.
Sir D. Walker-Smith:—that if they unwisely insist on a continuance of the common agricultural policy in its present form, in the words of Sir Winston in another context, we can have no part or lot in the thing they seek to do. It would be a sad thing, after 10 years of conscientious endeavour to assist the working of the Community—but not so sad as to seek to continue on a basis of sham or evasion of the law.
There would remain those various possible forms of friendly and meaningful association with our European friends that some of us put forward 10 years ago and, indeed, 20 years ago, as an alternative to membership of the European Economic Comunity.
But we are not yet faced with that position. Our hope must be that the Community will listen to the voice of reason and see that in the long run and, indeed, as a matter of urgency, the rationalisation of the CAP and the budget is vital not only in Britain's interests but in the real interests of the Community as a whole. My right hon. Friend the Prime Minister will go to the Council with the voice of reason and with our hopes that it will prevail.
11.9 pm
Mr. Robert Maclennan: The House meets tonight against a background of crisis in the European Community and in the economy of the United Kingdom. The two issues are not unrelated. It is right that even in so short a debate we should reaffirm the country's deep concern that the budgetary arrangements of the European Community constitute an unacceptable burden on the British people.
It is right that the Opposition should have the opportunity of reaffirming their support of the Government in their attempts to rectify a wholly inequitable and unjust burden at the forthcoming summit. The House has done this before.

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It did so with a unanimity that no doubt supported the Prime Minister in her efforts. I deeply regret that it is not possible to voice that same unalloyed unity tonight. I regret that that is due in no small measure to the part played by the Prime Minister and to the way that she has conducted these negotiations.
The motion commended by the Financial Secretary to the Treasury spoke only in terms of the Government's objectives. Had that been the only issue before the House, we might have supported the Government without cavil. Regrettably that is not the only issue before us. The Prime Minister, in the course of two interventions last week, took us beyond the Government's objectives to consideration not only of how the Government would seek to fulfil their objectives but of their response if our fellow members of the Community should fail to accept our proposal.
In an earlier debate on the Government's conduct in their negotiations about Rhodesia, I voiced some doubt to the Lord Privy Seal about whether it was appropriate for the House not merely to give its assent to objectives of diplomacy but to be asked to approve the methods and techniques. I voice that doubt again tonight. It cannot help the Government, either in their diplomatic negotiations with the Community or in their understanding of such issues, to seek to obtain our support for the proposition that Her Majesty's Government should illegally withhold the Community's own resources should those negotiations fail.
It may be argued that the Government have not put that proposition to the House. I accept that that is so. However, the triviality of the Financial Secretary's speech might have been lessened if he had addressed himself to the issue. That issue was put before the House by the hon. Member for Bury St. Edmunds (Mr. Griffiths) and 135 of his colleagues. It bore all the marks of being an inspired motion. The name at the top of the motion led some of us to believe that that was so. Whether that is the case or not, it has not been repudiated by the Government. In so far as there has been any comment on it, it must be taken that the Government are not displeased by that expression of view. The Financial Secretary spoke of the proposal that stands in the names of my right hon.
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Friends. He said that he had no objection to the part of it that had been drawn from the terms of the early-day motion in the name of the hon. Member for Bury St. Edmunds. We can therefore take it that the Government accept, in broad terms, its sentiments.
Mr. Eldon Griffiths: I did not engineer the early-day motion. It was the product of a uniting among those on this side of the House who had different views on the matter. I, like the hon. Gentleman, have been an ardent supporter of the European Community, and I shall continue to be so. I ask him to accept that the early-day motion was an expression from the many voices of opinion on this side of the House.
Mr. Maclennan: I may be naive, but I am not as naive as the hon. Gentleman wants the House to believe. I did not suggest that he had inspired the motion. I suggested that it was inspired by the Government. It received from the Financial Secretary the imprimatur of official approval. If we were able to focus exclusively on the inequity of the budgetary arrangements, those like myself who fought long and hard for entry to the European Community—and to ensure that we played a constructive role in it which would bring about a more equitable distribution of the Community resources—would have given our unalloyed support to the Government. That, alas, we cannot do. The Prime Minister made it plain that she intends, as a last resort, to act illegally.
Mr. Heffer: Does not my hon. Friend agree that my right hon. Friend the Leader of the Opposition made it clear a week ago that the Government should refuse to pay VAT contributions because it was necessary to reach a settlement with the EEC? Is not my hon. Friend arguing the case that he argued when he broke the ranks of the Labour Party—[Interruption.] I am sorry if hon. Members do not like my remarks, but he broke the ranks of the Labour Party—[HON. MEMBERS: "What about devolution?"] My hon. Friend broke the ranks—
Mr. Deputy Speaker: Order. The hon. Member knows that interventions should be brief.
Mr. Heffer: My hon. Friend broke the ranks of the Labour Party when it was totally opposed to entry to the EEC, and many of my right hon. and hon. Friends voted with the Conservative Party. Is not my hon. Friend continuing that argument, although we have made it clear that we shall support the Government if they make a real attempt to protect our interests?
Mr. Maclennan: My argument is not with my hon. Friend whose long-term opposition to the EEC is well known. If my lion. Friend is as willing to extend the hand of comradeship to me as I am to him—
Mr. Heffer: I have no intention of doing that.
Mr. Maclennan: If my hon. Friend were to do so, we would find ourselves in an harmonious party.
Mr. Heffer: I shall not do so. It is a disgraceful matter.
Mr. Maclennan: The Prime Minister raised the issue in its sharpest form. The suggestion comes from a Government who made one of their principal planks at the general election the importance of sustaining law and order.
There can be no worse posture for a Government to take in that battle—and it is a battle in this modern world to sustain law and order—than deliberately to announce the intention to depart from law and order if certain political objectives are not achieved.
I am moved to comment on this matter tonight because this is not the first time that the present Government have, in pursuit of political objectives, shown somewhat scant regard for the law. In fact, Ministers have, on more than one occasion of late, come before this House to announce policy decisions for which it appears they can make a colourably strong legal case, but which, if pressed, they would find hard to justify as the appropriate legal action.
I refer to the case of the revision of the immigration rules. The Home Secretary, in announcing them, said that they were probably defensible, but he refused to invite the Attorney-General to give us his authoritative view that they were not
1100
in breach of the European Convention on Human Rights.
The second example is the case of the Secretary of State for Social Services, who—
Mr. Michael McNair-Wilson: On a point of order, Mr. Deputy Speaker. Can the argument about immigration have anything to do with the EEC budget?
Mr. Deputy Speaker: I think that the hon. Member must have not heard the last few words of the hon. Member's previous sentence.
Mr. Maclennan: As I was saying, the second example is the case of the Secretary of State for Social Services, who showed scant regard for the law in his instructions to an area health authority, and once again the Government appeared to find a political objective more important than the upholding of the rule of law.
But undoubtedly the issue which faces us tonight is by far the most serious indication of the Government's willingness to depart from the rule of law, because on this occasion there is no pretension that the Government would not be acting illegally if they withheld from the Community their own resources. Under the Council's decision of 21 April 1970, which was quoted by the right hon. and learned Member for Hertfordshire, East (Sir D. Walker-Smith), the provisions were laid down for the establishment of the payments to the Community by the "own resources" method. His speech has saved me from going over the legal arcana in support of the view which has not been challenged, that to withhold own resources, to withhold VAT levies or customs, would be an infringement of the law.
Indeed, the Prime Minister herself has not sought to deny that it would be an infringement of the law. She was interviewed on the "Panorama" television programme by Mr. Robin Day, who asked her whether she was prepared to withold some of our contributions, such as the VAT-related elements, if this country did not get more than half a loaf. The Prime Minister answered:
"There are two things that you could do, one of which would be to consider withholding, which I would be very loth to do because it means going against the Community law".

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In an earlier incarnation the Prime Minister was a barrister, and therefore she understands the meaning of the law. She knows perfectly well that what she is doing is a political choice to defy the law of the Community. That is to invite contempt not only for the Community, but for the very institution of the law of which this House is the prime safeguard. I hear my right hon. Friend the Member for Battersea, North (Mr. Jay) suggest under his breath that the law of the Community is not real law. That argument is not one that the Prime Minister would seek to sustain and it is not one that is sustainable by the House of Commons, which passed the Act that makes this Community law the law of our land. It also incorporated into our domestic law the provisions that my right hon. Friend so much dislikes, and that the House accepted when, following further consideration of these matters, the renegotiation of the very financial mechanisms that are at issue tonight, and the referendum of the people of this country, we determined by a clear majority to maintain our membership of the European Community.
He who attacks the law by which this country lives goes much further than damaging our membership of the European Community. He undermines our respect for what holds society together. The Government's failure to recognise that, and their propagation of the notion that because the political objective is reasonable that entitles us to disregard our freely entered into international legal commitments and the law of the land, put at risk much that this House has fought for since it was first elected as a representative and guardian of the free people of this country.
Mr. Deputy Speaker: Do I take it that the hon. Gentleman is not moving his amendment?
Mr. Maclennan: I beg to move, as a manuscript amendment to the proposed amendment, to leave out from second "Community" to the end of the admendment.
Mr. Heffer: On a point of order, Mr. Deputy Speaker. On another occasion 46 Members supported an amendment of mine on the Olympic Games. It was not accepted by the Chair. How is it that a manuscript amendment can be accept-
1102
ed at this stage, when I was told quite clearly by the Chair that only one amendment could be accepted? I should like to know exactly what is the position.
Mr. Deputy Speaker: The matter was determined before I came into the Chair. I am only carrying out the instructions that I gather have already been announced to the House.
Mr. Heffer: Further to that point of order, Mr. Deputy Speaker. [HON. MEMBERS: "Wasting time."] I may be wasting time, but this is a matter of importance. I trust that when on future occasions other Members try to move further amendments on issues of the type that I tried to raise on the Olympic Games they will not be ruled out of order on the basis of your decision tonight, Mr. Deputy Speaker.
Mr. Deputy Speaker: Decisions of Mr. Speaker are not matters for the hon. Gentleman, or for me, to question.
11.28 pm
Sir Brandon Rhys Williams: The House is approaching the subject of our relationship with the European Community rather as if my right hon. Friend the Prime Minister had today returned from the summit completely empty-handed. I think that we are being a little too pessimistic if we assume that the forthcoming summit, whenever it is held, will result in a total defeat for my right hon. Friend's campaign.
I was rather pleased when we heard today that the summit meeting had been postponed, because that gives us a little longer to make known how very strong public opinion in this country is and to study the positions that are being taken up by the other member States. They are by no means all as hostile to this country's interests as certain hon. Members' speeches might have us believe.
My right hon. Friend goes into the negotiation, I believe, with the good will of the whole House. We are not helping her tonight by taking the fractious tone that we are taking and appearing to be disunited, when a
"lasting reduction in the United Kingdom's net contribution to the Community Budget"
and
"a commitment by the Council to long-term restructuring of the budget"

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must be objectives shared equally strongly on both sides of the House.
My right hon. Friend has considerable strengths in the negotiations. I do not want to make too strong a party point, but the Treaty of Rome is really the free enterprise manifesto. On the Tory side of the House our deep-seated convictions go along with the essence embodied in the Rome Treaty. On the Opposition side of the House, from the very start, there have been right hon. and hon. Members who were opposed to our adherence to the treaty because its entire philosophy was hostile to the brand of socialism which they preached.
My right hon. Friend is not opposed to the essence of the Rome Treaty and that is recognised on the Continent and it is much in her favour. North Sea oil, which appears to be a millstone or embarrassment, is undoubtedly an enormous source of strength to this country in our dealings with the other member States. It is only fair to pay a certain tribute to the right hon. Member for Deptford (Mr. Silkin), a former Minister of Agriculture, Fisheries and Food, because he succeeded in awakening the interests of consumers, not only in this country but throughout the Community, in the future course of food prices. There are, no doubt, many people on the Continent who are afraid of inflation, just as we are, and who do not welcome the way the common agricultural policy seems all the time to be pressing food prices up without bringing about the basic restructuring of Continental agriculture which is needed if ultimately Continental agriculture is to solve its problems.
We also have the strength that Great Britain is a very important market for the other member Stales. Indeed, it is too important, and I shall come to that in a moment.
Certainly, we have also to admit that my right hon. Friend enters the negotiations with two major disadvantages. One of them is that the renegotiation of the Treaty, carried out by the former Labour Government, was totally bungled. It was recognised that problems just such as we have encountered this year would arise. But the way in which the renegotiation was handled was bungled and the mechanism incorporated in the agreement has not
1104
operated as it ought to have done this year.
Mr. Cryer: The hon. Member is not alone, on the Conservative Benches, in talking about bungling the renegotiations. Could he explain what view he took in the referendum, following renegotiations, and say whether he advocated that people should vote "No" or "Yes"?
Sir B. Rhys Williams: It was recommended to the House, after weeks of negotiations, that the problems had been solved. I think that hon. Members on both sides of the House wanted to believe, and did believe, that the advice the House received was right. I should have liked to have the wisdom and insight of the hon. Gentleman. Acceptance was strongly commended to us by his right hon. Friend. As things turned out, his right hon. Friend was wrong and he was right. No doubt that will help his advancement in his party in due course.
I do not expect that my right hon. Friend will be able to come back having achieved in the current year a complete readjustment of the imbalance between Britain's contribution and what we receive. I do not consider that it is possible, in the context of the annual budget, especially as time goes by, to snatch all the bones out of the dog's mouth and achieve a fairer redistribution in the current year. That does not mean that my right hon. Friend's mission will have failed. It does not mean that she must attack on particular lines which will ultimately lead to success and to the
"long-term restructuring of the Budget".
It is helpful to try to increase our comprehension of the bargaining positions of the other member States and not merely build up an attitude of confrontation. We have problems with redundancies and overmanning in the steel, textile and other industries that are in difficulty or decline. On the Continent, they have problems with their agriculture. We should sympathise with their problems, just as much as we ask them for their sympathy for ours.
It is necessary to aim at the restructuring of the CAP, and not just at its destruction or the abandonment of its principles. We should recognise that it has social purposes and we should insist that those purposes are not achieved simply

1105
by setting agricultural prices inordinately high.
There are ways of achieving the social purposes, and farm workers on the Continent deserve our sympathy just as much as do redundant textile or steel industry workers in this country. We should work with the other member States to solve the problems in a realistic and human spirit. It is not impossible to obtain support for the reform of the CAP that would take the social element out of the series of arrangements that have grown up over the years and place far more emphasis on the responsibility of national Governments to deal with the social problems of their own agriculture industries.
We need to shift the balance in our thinking about agriculture from short-term to long-term policy making. One of the basic problems of Continental agriculture is still a shortage of capital. Producers on low incomes go out for the milk and dairy sector, where they can get two crops in a single day, and do not put enough effort into, for example, long-term crops such as timber, where they get only a single crop in a lifetime. The fundamental problem is shortage of capital—which brings me to an important point.
The Community will not be able to solve its problems within the context of an annual budget. We are still living in the Stone Age in relation to the Community budget. We can look ahead only from one year to the next. Until we know what the next crop is to yield, we cannot look further than one year into the future.
While we are working from hand to mouth in that primitive way, the problems of Western Europe will not solve themselves. We need to introduce a system of budgeting that runs over several years at a time and even takes in long-term investment as part of the deliberate projects of the Community. That is a matter which my right hon. Friend should stress, because this country has so much need for major capital investment in order to restructure our industries and to improve our electricity supply, our transport systems and many other aspects of our industrial base.
We also need to take a long look at the significance of the 1 per cent. contribution which next year will prove inadequate to finance even the CAP, let
1106
alone any other aspects of the Community budget, such as social policy and the rest.
The problem facing us will have to be solved next year, and as members of the Community we should be bending our minds to the right way to find a solution to it, just as the other member States are seriously considering the same problem. We should work with them and see that the solution that we find together brings about the restructuring of the budget in this country's interests. I should like to see far more emphasis on capital expenditure and less on redistribution of income within the context of the Stone Age, one-year-at-a-time budget.
I promised that I would come back to the rate of exchange and the balance of imports and exports between this country and the other member States. I am not one of those who think that the Bank of England has handled our affairs well since the war, or indeed during the whole of my lifetime. It has been obsessed with the prestige of the pound and has not given enough attention to the interests of manufacturing industry.
It would have been better if Hugh Dalton, instead of nationalising the Bank of England, had relocated it in Birmingham. We might then have had the character in our central bank that the Germans have in theirs, a major preoccupation of which is the profitability of German exports. It does not seek to turn Frankfurt into an international finance centre. The Bank of England, in contrast, has not been concerned to promote the profitability of British exports. Its obsession has been to make London into a profit centre for international finance, regardless of the long-term effect on the British economy. Today, we are seeing this policy in the extraordinarily high rate of exchange for sterling, which has resulted in floods of manufactures from the Common Market and the rest of the world coming into the British home market and the difficulties of our exporters sending goods abroad in exchange.
If it was not for the fluke of North Sea oil, our balance of payments would be exceedingly sick. It is possible to blame the richness of North Sea oil for the exchange rate situation. I recommend that my right hon. Friend should send a message to the governor of the Bank of England instructing him to arrange his affairs in such a way that there is a

1107
reduction in the sterling rate of exchange at the rate of 1 per cent. a week against the Smithsonian average until the autumn when the matter could be looked at again. If we could achieve a better balance on our trade with members of the Common Market, we should be able to restore the broad balance for which we are looking through the activities of the private sector.
Although I do not believe that we shall be able to achieve a readjustment of the public sector element in the budget overnight, or even within the next 12 months, we do not have to suffer, as we are now doing, from floods of imports from the Common Market into this country and the weak performance of our exporters in sending our goods into the Common Market to achieve a balance.
We can achieve through export profits a return to this country far greater than the amount we are spending in our official transactions with the Community through the present operation of the budget—but only if the rate of exchange can be adjusted to make that possible. This is why I believe it lies within our own hands to a great extent to restore our balance of advantage with the Common Market.
I would deeply regret a situation in which we found ourselves put to the point where we had to breach the Treaty or to repudiate our debts. I do not believe that we should make the possibility of that a part of our negotiating posture. Our object should be to achieve a better understanding of the attitudes of the other member States and to put our own affairs in order.
11.42 p.m.
Mr. J. Enoch Powell: Anyone who studies the document before the House and referred to in the Government motion, as well as the preceding document relating to the Dublin summit, must be struck by the references to "convergence". Indeed the emphasis on that concept finds a place in the title of this document. Further study will show that the idea of "convergence" is meant differently, indeed, in an opposite sense, by this country and by the rest of our partners in the Community.
For Britain, "convergence" means, and always has meant, the attainment of a roughly equal standard of economic performance between the member States
1108
of the Community. Indeed, that prospect was held out to this country as one of the inducements to agree to our membership eight years ago. But that is not the meaning of "convergence" as that term is understood by the Commission or by the Continental members of the Common Market. They mean by it the increasing amalgamation of the economies of the different States until the Common Market, in effect, functions as a single economy.
The contrast is brought out strikingly and, indeed, is proved by the different methods by which Britain and the Community wish to solve what is called Britain's problem. We call for a radical alteration of the Common Market that is bound permanently, by its nature, to involve the large deficit—the large net payment—that this country has to make to the rest of the Community. We call for the removal of that part of the institution that was essential to the member States of the Six before we joined. What is more we clearly have in our minds—and this is present in the terminology used in both the Government's motion and the amendment of the Opposition—the notion of a quid pro quo. One pays in and one roughly gets out what one has paid in. That is appropriate to the retention of our individual national sovereignties and of our individual national economic entities, but it is repudiated in express terms by the EEC, which instead proposes a series of measures which are temporary.
The most striking clash between the objectives of the Government and the proposals put forward by the Community is that the Government insist that the solution must be lasting—the Government insist that whatever rearrangement there is must be lasting in its effects—whereas the Community insists that these are to be temporary measures. They are envisaged by the Community as essentially regional policies which will be applied for a time until gradually we learn to see ourselves, and learn to fit into the economy of the Community as a whole, as a province within a larger State.
Our Community partners might well adapt the celebrated American claim that we have "lost an empire and not found a role" and accuse the British of having ceased to be a nation and of not being

1109
prepared to admit that they were a province. It is a fundamental divergence, not a convergence, that has now emerged, and it is only right that we should recognise its fundamental nature and that we should insist on that fundamental nature being recognised by the rest of the Community.
The Government are, of course, right in saying that our problem, as we see it as a national economy, is one which calls for a permanent remedy. But then they are looking in the opposite direction to that in which—
Mr. Tom Ellis: Will the right hon. Gentleman give way?
Mr. Powell: I am sorry, but we must all try to be brief and I hope that the hon. Member will forgive me if I develop my arguments as briefly as I can.
The Community is looking in the direction of increasing economic unification. I think that whatever the state of opinion was eight years ago the experience of the last eight years has proved that the constitutional and economic divergence and incompatibility of the United Kingdom with the rest of the Community has not diminished. It has become more conscious and, as experience has evolved, more and more of the people of this country have understood and grasped it.
What we must do, therefore, is to seek not a patching-up and glossing-over of what is a radical divergence but a fundamental alteration of our relationship with the rest of the Community. There is no question of going back upon 10 years of our history. There is no question of the United Kingdom turning its back on the Continent, economically or politically. But unless we are to be in a jangling, warring and incompatible stance, one towards another, we must find a means whereby our constitutional and economical incompatibilities with the present system are recognised and met.
That raises the question of how we are to approach the matter. I do not believe that we should approach it by what I call "the French method". It is easy in our frustration to say that we have seen how successful the French were in imposing their will upon the Community by staying away, by not playing the game, and by breaking the law and inviting the Community to see what it
1110
would then do. I do not believe that those are measures for Britain. Apart from other considerations, they are measures which imply the integration of the Community, and which play upon the integration of the Community. They lie within the ambit and concept of French stataecraft. They are not measures that meets our requirements and the reality of our economy and constitution.
I intend to support the amendment of the hon. Member for Caithness and Sutherland (Mr. Maclennan) because I do not believe that we can adequately measure the gravity and the fundamental nature of the conflict in which we now find ourselves simply by saying that we shall stop paying.
I am in accord, to my pleasure and not to my surprise, with the speech of the right hon. and learned Member for Hertfordshire, East (Sir D. Walker-Smith). It is not to my surprise, because eight years ago, without any deviation from principle, he led the opposition to Britain's entry into the EEC. There is one correct and honourable way whereby we can secure the fundamental change and reorganisation of our relationship with the rest of the Community.
When we were considering joining the EEC we first had to make a declaration of intent that it was our intention, given a successful negotiation, to join. Until that declaration was made no negotiation could take place. We must learn a lesson from what happened then. The course we must take is to state our intention, if the Community remains in its present form and structure—incompatible with our economy and constitution—to withdraw from it in due form and at due time. That statement would not be the beginning of a quarrel. It is not intended as a breach. It is intended as the necessary base and beginning of a genuine negotiation whereby our relationship with the rest of the Community would be transformed to mutual benefit.
Mr. Heffer: The right hon. Gentleman argues that he will support the amendment tabled by my hon. Friend the Member for Caithness and Sutherland (Mr. Maclennan). His logic is that at no time should any country refuse to pay taxes of any kind that are an imposition on that country. But would he agree that the Americans were wrong in their action regarding the tea tax at Boston? Were

1111
the Americans right or wrong to take that stand in the interest of the American people, and is it not right that we should take the stand that we are now taking in relation to VAT?
Mr. Powell: If I thought that there was no other way available in which to regain our national independence and the sovereign legislative power of the House, I would take any step. But I do not believe that we are thus destitute of means, and I do not believe that the adoption of those methods at this stage would result in the kind of relationship that should exist between Britain and Europe in the future.
We have a method in our hands. We have the right, in proper and due form, if we think fit, to withdraw from the Community. But we must do so in proper and due form. By making the announcement of that will the basis of a genuine negotiation, it will prove whether the European Economic Community as it is now—of which the parameters are incompatible with the economy as well as with the constitution of this country—can be transformed into the link and co-operation which should exist between the United Kingdom and Western Europe.
11.55 pm
Mr. Selwyn Gummer: We are this evening discussing the budget of the European Community and Britain's reaction to it. It is sad that when we come to discuss weighty matters of this kind, we so often return to the old battles and arguments that we have had in the House on many occasions. I hope that we can concentrate, as, indeed, the Government's proposition does, on the particular matter of the budget and on the fundamental problems which it poses to us.
It is not satisfactory for anybody to suggest that the way in which the budget contribution falls upon this country can continue or ought to continue. As hon. Members will know, those of us who have supported the whole concept of the European Community publicly and clearly all our political lives are taking the very clear stance which the Prime Minister, in her efforts in Europe, has taken to ensure that there is a more sensible way of running the Community and a more equitable way of financing it.
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We have done so within the context of believing that the Community ought to work, and we wish to make it work.
The sadness of tonight's debate is that we have listened to a speech from the right hon. Member for Stepney and Poplar (Mr. Shore)—although he has not heard much of the debate which has subsequently taken place—which has the difficulty behind it that he speaks as one who has never believed in the European Community. Therefore, it is difficult to take seriously his recommendations of the changes which would bring about the kind of improvements which we seek. I listened to his speech with the same care and distrust with which I would listen to the speeches of Communists or Fascists seeking to defend a change in the democratic way in which we run our country. They do not believe in the system to start with and, therefore, it is difficult to take seriously their proposals for alteration.
That is the first reason why I believe that the Government's recommendation, and not the amendment, ought to be accepted. The Government are making a proposition from the standpoint of believing in the Community and wanting to make it work. Indeed, one of the problems that we face is that for the earliest years in which Britain was part of the EEC we were represented in Brussels largely by Ministers who did not believe in that Community, who had voted against our accession and who did little or nothing to improve the situation. Yet they now have the effrontery to come to this House and complain about what this Government are doing.
It is sad that the right hon. Member for Stepney and Poplar did not do a great deal more when he was in a position to change the Community. It is sad that the CAP, which presented many opportunities for change, had a straight, flat "no" from the right hon. Member for Deptford (Mr. Silkin), who had in his hands a whole range of changes which would now be beneficial to us but the chances for which are now past. It is a heavy burden which will be laid at the door of the right hon. Member for Deptford for his handling of Britain's relationship with the Common Market through the CAP, as I am sure history will demonstrate.
We have been asked to show our support for the Government by going further

1113
than the Government proposal. The Opposition have pointed out that the amendment simply makes more clear and sharp that which the Government have proposed. Yet the very nature of their proposition is false at its heart, because it suggests that the real mistake with the Common Market is that it does not provide a simple payment-in and payment-out equation.
The problem with the Common Market at the moment is that the mechanism does not work satisfactorily. Too much of the resources is concerned with agriculture and too little with other matters. The resources demanded from agriculture are increasing every day and, as my right hon. and learned Friend the Member for Hertfordshire, East (Sir D. Walker-Smith) reminded us, will increase so much that next year it will be impossible under present arrangements to pay for them in any event.
The problem with the budgetary system is that it does not work and that it must be changed. Those of us who fought for our entry into the Common Market and believed in the growing unity of Europe have said all along that one of the major changes which must take place is in the common agricultural policy. Anyone who looks at the speeches in those early days, when we argued for our entry, will see that is true. But, if we are to make those changes, we must do so in the context of believing that the Common Market ought to work and that we are going to try to make it work. We must also accept our own blame for the reasons for its present failure.
The right hon. Member for Stepney and Poplar, in a throw-away line, mentioned that we were seventh in the league of Nine. That should be laid not at the door of the European Community but at our own door.
When I first started to fight for growing unity in Europe, I used to argue on doorsteps and at meetings throughout the country that we should join. The immediate reaction of many of the audience was "Why should we join? We are the richest country in Europe." We were then unable to join. Eight or nine years later we were arguing the same points again. We had not been members in the meantime. Then the main argument from the floor was "We are one of the poorest
1114
nations in Europe. How can we possibly afford to join?"
That change took place not because of our membership of the European Community but because, as a nation, we failed to find a way of protecting the prosperity of our people in the world in which we now live. As a nation, we have been so concerned with our internal arguments and policies about nationalisation and similar programmes and with the belief that the world still owed us a living—that somehow or other we still had a place in the world without having to work for it—that we failed to face the real issue of how to put our own house in order. That has been part of the British character over these past 10 years.
I fear that the European Economic Community is being used by many as yet another excuse for the failure of our own nation. It is another excuse for getting out of the real issue of how Britain can put her own house in order and find her own place in the world.
I turn to my last point: how can we, with honour, debate this matter this evening and not face the real issue whether our inability to make the European Community work is basically because of what the right hon. Member for Stepney and Poplar called the wilful and arrogant opposition of France or whether it was because, unlike Eire, we did not start from the beginning with the enthusiasm and determination to make our association work? We did not do that because we did not from the beginning see that Britain has no future in the world unless she is prepared to build it for herself and to take the opportunities as they come.
There are opportunities within the European Community. There are many which we missed. We missed them because we failed to seize the whole concept of Europe. We have shown ourselves unable to raise the argument from the day-to-day argy-bargy about "You have got more than we have and you are taking more from us than we take from you." We have failed to raise the level of the debates in Europe and in the House. So often debates that should have been about the future of this nation and the great society that we could build in the growing Community have tended to be at the level of cat-calling others because they happened to be foreigners.

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If we really want to make the change, our only answer is for my right hon. Friend the Prime Minister to go to the summit and to have discussions there with three objectives in mind. First, there must be a determination by the House and the nation to remain a member of the Community and to make of that Community the kind of society in which we and our children want to live. Secondly, there must be a strength of argument which comes not only from the necessity but the clear logic that the present structure and payments cannot be defended and should be changed. Thirdly, we must make clear to our fellow members in Europe that we can succeed only if the Community takes itself more seriously and is not willing to be forced back to old and forgotten battles but wants to make the new start which the accession of the other three member States made possible.
It is our fault that we have wasted five years making such a start. My right hon. Friend goes to the summit with our support not only for a more equitable arrangement for this country but, more important, for the restructuring and the recreation of the greatest ideal of our time.
12.8 am
Mr. Douglas Jay: I strongly support the amendment tabled by my Front Bench. I say to the right hon and learned Member for Hertfordshire, East (Sir D. Walker-Smith) that I am all in favour of withdrawing from the Common Market in the most amicable and constitutional way possible, so long as we withdraw.
Tonight, for the sake of brevity, I want to make one point only, which is strictly relevant to the EEC budget that we are supposed to be discusssing but which hon. Members have not appreciated so far. There is no way of substantially altering the burden on the United Kingdom Budget by variations on the expenditure side of the EEC budget.
Some weeks ago the Prime Minister showed that at that time—I do not think that the Financial Secretary will disagree with me—she did not understand the facts when she talked of relieving the United Kingdom public sector borrowing requirement and eliminating the notorious £1,000 million or £1,100 million, or what-
1116
ever it is, net United Kingdom deficit by higher EEC expenditure here.
The facts, as I understand them, are as follows: If, by some magic, an extra £1 billion a year were spent in the United Kingdom from the EEC budget our balance of payments would be relieved. But the effect on the United Kingdom Budget and the PSBR is surely quite different. The crucial point is that either the extra EEC budget expenditure—say, on regional or social policy—is additional to what the United Kingdom Government would have spent or it is not, and the EEC is then paying for what otherwise would have been paid for out of the United Kingdom Budget.
If the EEC expenditure is additional there will be no effect on the United Kingdom Budget or the PSBR, one way or the other. All that will happen is that extra money will be spent by the EEC in the United Kingdom. If, however, the EEC expenditure is not additional, but merely replaces what would have been spent here anyway, I agree that to that extent the United Kingdom Budget is relieved.
Two other consequences follow if we make that assumption. First, only minor relief to the United Kingdom Budget is possible, measured perhaps in tens of millions of pounds rather than in hundreds of millions, for the simple reason that the total regional spending out of the EEC budget is so small as compared with that on the common agricultural policy and the total EEC budget that unless the CAP is drastically cut down in a way that is simply not practical politics there will have to be enormous increases in EEC regional expenditure if the United Kingdom Budget is to be relieved by hundreds of millions of pounds. I think that the Financial Secretary will agree that that is simply not practical politics at present.
Even if it were practical politics, a second consequence would follow if the EEC simply took over what otherwise would have been British Budget expenditure. In that case, existing regional or social expenditure now controlled by the United Kingdom Budget would be taken over by the EEC Commission or perhaps the Council of Ministers. The real consequences then of the operation would be the transfer of control over social and other priorities in this country from the

1117
United Kingdom Parliament and Government to Brussels. That is what is bound to happen if the expenditure is not additional but the EEC simply takes over the control that would otherwise have remained here.
I suppose that if this really happened we should be building a Channel tunnel instead of acutely needed houses, and motorways instead of hospitals, and so it would be all along the line. I do not think that many hon. Members would wish to do that if they understood what it would really mean, if it were possible. In any case, I do not think that it is quite the prospect that has been held out to people living in Scotland and Wales and other needy areas—that what is proposed is not that there should be additional spending on regional policy but simply that the control of it should be transferred from the British Parliament to Brussels, and that they should get no more in total.
The conclusion is, therefore—I hope that the Financial Secretary will tell us if I am wrong—that one cannot, even if one wanted to, significantly ease the United Kingdom Budget and PSBR problem by increasing EEC budget expenditure in this country without creating other consequences that would be unacceptable to almost all of us, namely, losing our own control of the priorities. The only way to remove the present intolerable burdens on the United Kingdom is for the United Kingdom to withdraw altogether from the EEC or to make drastic changes in the EEC system—changes which are too drastic to be politically possible, at least as long as France remains another member of the EEC.
If anyone thinks that we can get out of this difficulty simply by manipulating EEC expenditure and increasing it rather than reducing our contribution he is really following an illusion and we are brought back to the fact that to my mind is now proved up to the hilt—that there is no relief for this country from these economic burdens as long as we remain a member of the EEC.
12.14 am
Mr. Peter Lloyd: I think that all hon Members will agree that we are paying too much into the EEC budget. I am glad that this evening's argument has not been couched in whining terms, complaining of the United King-
1118
dom's poverty. That argument is undignified and irrelevant. Either our membership during the coming year will be worth the estimated £1.3 billion or it will not. The value of net contribution will remain unaffected by our relative poverty or riches.
When the Prime Minister goes to the summit meeting to negotiate a reduction she will certainly have the support of the majority of hon. Members and the overwhelming support of our people. As my hon. Friend the Member for Kensington (Sir. B. Rhys Williams) pointed out, she will receive some understanding and sympathy from our European colleagues. Nevertheless, it will be a struggle to reduce our contribution to the budget.
Our basic budgetary problems spring from the very structure of the EEC and our traditional trading patterns. It is not just a question of the CAP or of food levies. Indeed, we contribute about 19 per cent. of the total Community food levy. We contribute 27 per cent. of the tariff on trade. That figure shows that our extensive trading with the rest of the world punishes us. It is not true that we are in such a position purely because we have not taken advantage of the Community. If we had been more successful in our economic policies we would have faced a greater problem. If we had been more successful, we would have sold more to the rest of the world, we would presumably have bought more from them, and therefore our tariff contributions would be even greater.
The CAP is rightly seen as a bête noir. It makes food very expensive for consumers in Britain. If subsidising farmers is a way of justifying high food prices, we get little back. Many in Europe see the strength of the argument against the CAP. They would probably agree with many of the remarks that we have made. However, we must remember that the CAP is about the only full-blooded Common Market institution. It suits many EEC members. Contrary to some of my hon. Friends, I believe that it will prove surprisingly durable.
I concentrate on these difficulties because I wish to establish how hard it will be to change the existing structures. All eight of our colleagues must agree. They have to agree not that it would be nice if something were done but on what should be done. Five countries may

1119
think one thing but the other three may disagree, and prefer something else. That is a recipe for paralysis. That is why the Commission proposed special ad hoc aid promoting convergence—so often discussed—along lines congruent with existing EEC policies.
The Comission made no mention of the basic structures of the Community. No changes to the existing budgets in the regional and social policies were suggested. They remain undeveloped. That is a dangerous avenue. EEC aid is usually dependent on extra spending by the recipient Government. It has been argued that this would not be so. I am glad to hear such optimism. The right hon. Member for Battersea, North (Mr. Jay) also argued convincingly that any aid that we receive is unlikely to replace precisely the expenditure in train.
Perhaps Opposition Members will see that additional spending as a desirable element. However, they may agree that any expenditure that is limited and controlled in its nature, timing and priorities should not be welcomed. The greatest danger of the Commission's approach results from the fact that projects are temporary. They will come to an end. Our European colleagues may say that the United Kingdom could have claimed that it was poor, but that that is no longer so. They may say that Britain is awash with oil revenues. At that time special arrangements will cease. We will have forgone yet another opportunity to tackle the basic problems.
Another set of overriding dangers in the proposed approach is that concessions will be demanded in return for the temporary hand-out. We shall be asked to agree to agricultural price increases, even though they will exacerbate our long-term problem. We shall be invited to compromise over fish and North Sea oil. It may be suggested that now is the time to join the EMS. There are many hon. Members who want Britain to join the EMS to prove that we are good Europeans and that we can be trusted. They hope that that will depress the pound and increase exports. It will not do so. It will increase inflationary pressures in Britain. That is another argument.
The only way in which the EMS can work in the long term is if it is converted into a full-bodied monetary union. That
1120
is a large step along the road to a federal Europe. It is not a decision that should be lurched into as a package of other policies, when those negotiating it do not have their minds on the EMS and its implications but on reducing the budget.
Immense pressures will be put upon us to accept a settlement with some or all of those undesirable features. I know that my right hon. Friend the Prime Minister is determined to stand up for our longterm interests, but the best that she can achieve is a budget rebate with a promise that the basic structures will be reconsidered. I doubt whether those basic structures can be changed. If I am right, it would be better for the Eight to continue their present arrangements while Britain established a different association.
There is nothing humiliating or second-rate in that suggestion. It is appropriate to our different history and our different institutions. It would be far better for the EEC to work out how to accommodate its new connections and to prepare for the entry of Greece, Portugal and Turkey, whose economies cannot be readily integrated with the Eight.
There is a fear that that would split the West at a time when Russia is proving unpredictable and aggressive. I do not believe that those fears are well founded. NATO was at its zenith before the EEC was established. We are being distracted from political co-operation in Europe. Friendships are being poisoned by discords produced by cramming Britain into an EEC straitjacket which it does not fit.
12.23 am
Mr. Russell Johnston: Many hon. Members have left the Chamber, which is one of the regrettable aspects of debating an issue at this hour of the night. I shall make my speech much shorter than I would wish.
I do not agree with the hon. Member for Fareham (Mr. Lloyd). I wish to quote from the two documents that we are discussing. Paragraph 3 of document 4845/80 states:
"In its communication to the Council of 21 November the Commission had already drawn attention to the need to strengthen structural and general investment policies within the Community."

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That earlier communication document 11028/79, states:
"the existing policies of the Community are insufficient to bring about the degree of convergence between the economies of the Member States which is necessary for the progress and cohesion of the Community."
That is the nub of the matter. The basic problems that we are discussing will not be improved or changed fundamentally without further integration within the Community. That is my view. It is not the view held by Back Benchers or Front Benchers on both sides of the House. The basic problem faced by Britain is that neither of the two major parties is proposing any policy or has any clear attitude to change in the Community. They have no views on economic and monetary union, energy policy, regional policy, social policy, the increased power of the European Parliament, or any such matters. Their view seems to be simply that we should sustain the status quo, and I do not think that that makes much sense.
Alternatively there is the view condemned by the right hon. Member for Down, South (Mr. Powell), no doubt having read the magazine "Now", which has a splendid Boadicea-like picture of the Prime Minister on the cover, in which he and the right hon. Member for Plymouth, Devonport (Dr. Owen) debated in print the question "Stay or quit? The decision we must face." I found it extremely depressing to read the former Foreign Secretary's remarks. He said:
"We should take decisive action by legislating in the United Kingdom Parliament to, withhold our VAT contribution"
He went on to say:
"We will be challenged in the European Court and they will find against us, as they did against French restriction of lamb imports. But, if we stand firm as France has done, there is little scope for retaliation."
The argument appears to be that if the French break little laws we can break big ones. What is the point in having laws at all? What is the point of having a Community at all? That is a most extraordinary attitude to adopt in the circumstances.
I wonder how many hon. Members remember the political and economic arguments about entry. The idea was that Britain would give great leadership to the Community. That was touted about all over the place, and even those hon.
1122
Members who opposed our entry could hardly gainsay the fact that Britain had a democratic record second to none, and we would show them how to do it. Then, of course, there was the famous British talent for compromise, and the splendid British record for diplomacy—the fact that we were legendary in our democratic and diplomatic skills. What if left of that? What is left of our diplomacy and our capacity for compromise?—very tattered remnants. We are isolated, and that is quite an achievement. We are totally isolated—one out of nine. That is not something to be proud of.
It is not that we do not have a case. We have an argument of substance. What is wrong is the way that we approach the argument. It is rather like trying to dance Swan Lake in tackety boots. The only objective voice in the Community—the Commission—agrees that our contribution is inequitable, but it, like all our friends, cannot go along with arguments that are based simply on special pleading and seem to neglect general principles. We will not solve this impasse unless this country can bring to the Community some sense of direction, and there does not seem to be a great deal of that.
It is worth remembering that our net contribution, about which we complain so bitterly, is £1,000 million, which is equivalent to, or probably less—certainly less according to Professor David Mar-quand—than what we would be paying in deficiency payments now to agriculture had we not joined the EEC. That fact cannot be repeated often enough.
Equally, those young Tories who rush to sign motions on the Order Paper should ask themselves whether a fortress Britain is really what they want. Is their economic concept of Britain that of a vassal of the United States?
I must ask the fundamental question—how can this be changed? The Financial Secretary said that the fundamental character of the CAP must be modified. I agree, but I must emphasise that I am very glad that we have heard little tonight of the nonsense of cheap food. There is no cheap food in the world today. [Interruption] There is no cheap food in a world that is expanding at the rate described by the Brandt commission. If there is cheap food on that basis it is

1123
exploited—the West is exploiting the under-developed world.
Secondly, if our problems stem from industrial and regional difficulties, there should inevitably be more spending in those areas. Does the Financial Secretary favour larger regional and social funds? Britain has been noteworthy as the country that has blocked enlargement of those funds in the past, under the previous Government. Is it the case that the present Government will not do so? Even on so minor a matter they are preventing the spending of the non-quota element of the regional fund and are blocking the expenditure on the steel industry proposed through the social fund. Have the Government any view about a redistributive element in the budget?
We are in a serious position. We are talking not only about the present but about the future. I do not think that Britain has any future in the Community if she continues to renounce all the concepts of co-operation upon which the Community is established. That would cut her off from the major potential for stability in the whole world political structure. We should not underrate that. It would weaken our influence and reduce our capacity to contribute constructively to the relationship between the developed and the under-developed world.
I pray that that is not a course that we shall follow.
12.31 am
Mr. Denzil Davies: This has been an important debate, as most of the debates about our contribution to the EEC have been. In fact, it is too important a debate to be held at this time of night, with a limit of three hours. Indeed, the Government tried to tack the debate and the related documents on to some very important agricultural documents, and tried to have the whole debate last Thursday. When we protested, we were grudgingly finally allowed these three hours, so late on a Monday evening. If the Government were so serious about the summit, I should have thought that they would give us at least half a day to debate the matter at a reasonable hour.
My hon. Friend the Member for Caithness and Sutherland (Mr. Maclennan), who moved an amendment to the Oppo-
1124
sition amendment, argued the case basically on the legal position over withholding payments. I do not wish to go into that, except to say that I am sure that no hon. Member, including my hon. Friend, would deny that this House has the legal right to repeal those sections of the European Communities Act under which the Government have the authority to make the payments. All the payments that we are complaining about are made under section 2 and possibly section 3 of the Act, which the House passed. I am sure that no one would argue that the House does not have the authority to repeal those sections if it wishes.
I can understand why the Government wanted to push the debate into the recesses of the late evening and the early morning. After they accepted our motion last summer—a motion that called for a balance in our contributions—and after all the fanfare that preceded the Dublin summit and then the total failure of the Prime Minister's negotiations in Dublin, I can well understand their desire to avoid a full debate.
This is the third occasion since last July that the matter has been debated in the House. Last July it was suggested that our estimated net contribution was about £1 billion. The Financial Secretary has been very coy about the figure for the next financial year but I should be very surprised if we learnt from the Chancellor of the Exchequer on Wednesday that it was much less than £1·3 billion. If that is so, the estimate of our net contribution has increased by almost 30 per cent. in nine months. During that period, despite the Prime Minister's huffing and puffing and the pious hopes of the Chancellor and the Financial Secretary, there has been not a penny reduction in our contribution across the exchanges to the EEC budget.
Indeed, the Prime Minister said in a lecture on 13 October last year:
"We seek a remedy which will restore a broad balance. We look for decisions at the European Council next month."
That was last November, and we all know what has happened since.
If the Italians can cobble together a Government, the Prime Minister will go again to the summit, cap in hand, to ask the Europeans to let us have back some of our own money. Even worse, and more pathetically, we have seen the British Prime Minister going on French

1125
television to beg the French to be nice to us at the forthcoming summit. The reasons for the Government's failure are clear. Their efforts have lacked credibility.
When the "Iron Lady" has spoken in the councils of Europe no one has really been very worried. Apparently the German Chancellor has gone to sleep and all the other Ministers have looked for an earlier train. It used to be said of the American President, Teddy Roosevelt, that he spoke softly and carried a big stick. Unfortunately, one can say to the right hon. Lady, in terms of these negotiations, that she speaks very loudly but carries a little stick.
One reason why the Government's negotiating position is not credible is that the Prime Minister and the Chancellor were the enthusiastic supporters of the very taxation system that is now the source of our problem. We are not debating, as the hon. Member for Fareham (Mr. Lloyd) said, simply payments across the exchanges, however important they are. We are debating a fundamental taxation system—a system that is enshrined in the treaties and that has been enshrined in the European Communities Act by, in the main, the votes of the Tory Party.
Mr. Spearing: My right hon. Friend said that the taxation system was enshrined in the treaties. Is he aware that the directive quoted by the right hon. and learned Member for Hertfordshire, East (Sir D. Walker-Smith) earlier gives the origin of the articles of the Treaty of Rome for levies and tariffs but fails to mention any article relating to VAT? I have yet to hear on which article it is based.
Mr. Davies: I hear what my hon. Friend says. I do not want to pursue that legal argument. These payments are enshrined in the whole of the treaty mechanisms leading from the Treaty of Rome, and they are included in the European Communities Act.
Sir. D. Walker-Smith: The right hon. Gentleman will find that it is in the decision of the Council of Ministers of 21 April 1970, taken in pursuance of article 201 of the EEC Treaty.
Mr. Davies: I am grateful to the right hon. and learned Gentleman. I have no doubt that the VAT contribution some-
1126
how arises from directives and provisions in these many treaties. The point that I seek to make is that these matters were enshrined in the European Communities Act with the help of the votes of the Prime Minister and the Chancellor of the Exchequer. Indeed, the Chancellor, for the benefit of those hon. Members who were not in the House at the time, was was the architect of the Act. The right hon. and learned Gentleman actually moved the guillotine motion, which allowed us only 45 minutes from these Opposition Benches to debate the issue of our contribution. During that debate, time and again, we warned the Conservative Government that our contribution was likely to be what it is, and time and again they denied that that would be the case.
It is no wonder that when the Chancellor now goes to the Council of Finance Ministers his protestations are met with complete silence. Such protestations, coming from this Government, must have a hollow ring in the capitals of Europe, bearing in mind the history of the Tory Party in this matter.
When the Prime Minister and the Chancellor, and most of the Tory Party, voted for this tax system they voted for something else. They voted for a regime that sought to deny this House the power to change that tax system. Someone referred to the American War of Independence. The slogan in that war was "No taxation without representation." What we have in the Common Market is taxation with one-ninth representation.
Mr. Dykes: Oh.
Mr. Davies: The hon. Member should not say "Oh." It is taxation with one-ninth representation. Indeed, ultimately it means nothing at all to have that representation.
Mr. Dykes: I am sorry to interrupt the right hon. Gentleman's ignorant tirade about the way in which the Community started. If this taxation system was so fundamental and so objectionable to the Labour Party when in government why did it not renegotiate it in 1975 and submit it to the British people?
Mr. Davies: The hon. Gentleman knows that an attempt was made to renegotiate these payments and that that attempt was not successful. No one is

1127
seeking to deny that. The point that I seek to make is that the hon. Gentleman and his hon. Friends voted for this tax system. Now they seek to resile—
Mr. Gunner rose—
Mr. Davies: I am sorry. Time is pressing. I cannot give way. The hon. Gentleman has spoken in this debate.
The Government's position is also not credible because the Tory Party has been the European party of British politics. [HON. MEMBERS: "Hear, hear."] Conservative Members confirm that the Tories still are the European party of British politics. In opposition, they criticised Labour Ministers time and again for not being "good Europeans". My right hon. Friend the Member for Deptford (Mr. Silkin), in particular, came in for virulent criticism when he tried to stand up for British interests.
That much-tattered fraudulent prospectus, the Tory manifesto, said on Europe:
"The frequently obstructive and malevolent attitude of Labour Ministers has weakened the Community as a whole".
If the Tory Party is gradually becoming, if I may borrow a phrase from Dylan Thomas, the "no-good boyos" of the European scene, we welcome that conversion, but having heard the "Hear, hears" a moment ago, I doubt whether that is so. The Tory Party is still the European party of British politics, and that is why the Prime Minister's negotiating position is not credible.
Mr. Tim Renton: I appreciate that it is necessary for the right hon. Gentleman to show his militant tendencies on the Common Market for his own political future, but he represents a Welsh constituency and I should like him to tell us whether he thinks that the Ford plant at Bridgend, which has been so important in bringing employment to South Wales, would have been built there if Britain had not been a member of the Common Market.
Mr. Davies: I am sorry that I gave way to the hon. Gentleman. I was not arguing against membership; I was arguing against the contributions that we are making, which I gather the Government do not agree with either.
1128
In the last analysis, the other member States, including the French, know that the Government do not have the guts to withhold contributions, whether of VAT, customs duties, or anything else.
Last week the Prime Minister got some bloodcurdling headlines about what she was going to do. In fact, she made a rather wet statement. All that she said was that after the summit the Government would consider the matter. Doubtless the Government will consider the "empty chair" policy, obstruction, withholding VAT payments and all sorts of things. The right hon. Lady's statement meant little and was merely an exercise of phoney brinkmanship by the Prime Minister, and it will be seen as such in the capitals of Europe.
The Foreign Secretary gave the game away. Reporting an interview that he gave on television, an article in The Guardian on the Friday after the Question Time in which the Prime Minister made her statement said:
"The situation was further confused last night by Lord Carrington"
—in fact, the Foreign Secretary did not confuse the situation; he made it clear, because the article went on:
"Although he confirmed that failure at Brussels would produce a grave situation he also said that it would be wrong to respond by saying: 'I'm going to do A, B, C, D, E, F.' He added: 'Of course you have got to consider them, but what we have got to do is to get a solution'."
Retrieving the situation later, the Foreign Secretary said:
"I mean, supposing we get nowhere…at Brussels…the Government has to consider all the measures…as the Prime Minister has said."
The threat is not a credible threat, because after what we have heard tonight, I do not believe that the Government would face up to the political and constitutional crisis involved in withholding payments.
My right hon. Friend the Member for Stepney and Poplar (Mr. Shore) dealt with the backsliding of the Government from the original motion that they accepted in July and that was reiterated in November, to the motion before us, which does not call for a broad balance in our contribution.
Whatever sum the Government get must be looked at not only in terms of the amount of money but of the rest of

1129
the deal that will be forced on the Government. No doubt the French will seek to link lamb imports and CAP prices and will seek to talk about energy prices and the EMS. I hope that the Government will treat those issues separately.
The hill farmers, fishermen and housewives of Britain must not be sacrificed to give the Prime Minister a spurious and phoney diplomatic triumph. In particular, I see no sense or purpose in linking the EMS to our budgetary contribution. I do not believe that even this Government, having got themselves entangled in the Treaty of Rome, will get themselves enmeshed in the EMS as part of the price for any deal.
The Government's negotiating tactics have been poor. That is why they have failed to obtain any money so far. The Sunday Times, in a searching article, this week, said:
"So what has gone wrong? 'Britain's negotiating tactics,' comments one highly placed Brussels observer, 'has been so grotesquely incompetent as to beggar belief.' This view is widely held."
The one reason that the negotiating tactics have been so poor is that the right hon. Lady and the Government have been arguing from a weak position. They have been making threats that have not been credible. Now that the summit has been postponed, why should the Chancellor of the Exchequer, on Wednesday, not announce that the Government intend to keep back the VAT contributions? Against that background, the Government's negotiating position would be much stronger. We could then negotiate from a position of strength. I do not know what the Government fear. We are one of only two contributors to the EEC. Seven countries pay nothing into the EEC. All receive something. Only two countries pay in money. We pay almost twice as much as the Germans.
What are we afraid of? They need our money. They need our markets. They need our trade. The Government should start negotiating from a position of strength. If the Government and the right hon. Lady fail again to achieve a satisfactory solution, and if the Government, at the end of the day, are not prepared to impose a just solution unilaterally, this House, one of these days, will take the matter out of the Government's hands. The House will determine the
1130
matter. If the matter is not resolved and it keeps coming back, this House will reassert itself and secure again for itself its traditional role as the only constitutional body with a moral and democratic right to impose taxation on the British people. I hope that the right hon. Lady makes this clear to other Common Market leaders.
The Government motion is too weak and too wet, and it fails to go far enough. If the Cabinet, at the end of the day, lacks the guts to act, this House will do so for it, and take the matter out of its hands.
12.49 am
Mr. Lawson: With the leave of the House, Mr. Deputy Speaker, I should like to reply. There is little time left. I hope that right hon. and hon. Gentlemen on both sides will forgive me if I do not deal with all the points made during this important debate. I have listened carefully to what has been said. I am sure that my right hon. Friend the Prime Minister will study carefully the report of the debate.
The right hon. Member for Llanelli (Mr. Davies) had the effrontery to talk dismissively of what the Government might achieve during the negotiations that are taking place. Anything that the Government achieve out of the negotiations will be an improvement on what the previous Government achieved. They achieved absolutely nothing in redress of this injustice. The right hon. Gentleman also said that we should withhold contributions now. I do not know whether that is official Opposition policy. It was certainly not the position rightly taken up by the Leader of the Opposition who, I suspect, speaks with a little more authority than the right hon. Gentleman.
A number of hon. Members, especially the right hon. Member for Battersea, North (Mr. Jay), asked about the expenditure route. My right hon. and learned Friend the Member for Hertfordshire, East (Sir D. Walker-Smith) also referred to this. The matter is made clear by the document before the House. There is no way in which our imbalance can be made good by expenditure through the regional and social funds or through any of the existing funds, for the reasons that the right hon. Member for Battersea, North rightly stated. It is appropriate to look at an expenditure route, if that

1131
will work. The greater part of the imbalance derives from the fact that we do not get the agriculture expenditure received by the other countries.
It has been suggested that a special fund should be set up under article 235 of the Treaty to direct expenditure to this country. The argument about the regional and social funds do not apply to this proposal.
Mr. Jay: Will the Financial Secretary make clear whether the expenditure from this special fund in this country will be additional to what the British Government were, in any case, spending here? If that is so, that does not relieve the British Budget.
Mr. Lawson: The point that the right hon. Member for Battersea, North was making was that if the expenditure is additional it does not affect the public sector borrowing requirement and if it is not additional it does affect it. That is absolutely correct.
The main speech from the Opposition was made by the right hon. Member for Stepney and Poplar (Mr. Shore). I would like to deal with some of the points that he made. He first asked how the United Kingdom contribution would be dealt with in the Budget. I can only ask him to contain his impatience and wait for the Budget on Wednesday and for the public expenditure White Paper that will be published at the same time.
The right hon. Gentleman also asked—this was a matter of concern to a number of right hon. and hon. Members, including my right hon. and learned Friend the Member for Hertfordshire, East, who made a powerful speech—about the legal steps that might be taken and the Government's interpretation of the legal position. The Government are concerned to uphold the rule of law, but the House will have noted with some interest the suggestion made by the right hon. Gentleman that article 6 of the Treaty placed certain obligations upon the Community institutions themselves. Those obligations are just as real as the obligations placed upon individual member countries.
I think it premature at this stage to talk about the legal technicalities. We have said quite clearly—this was the
1132
position of the Leader of the Opposition as recently as 11 March—that the question of withholding any part of the VAT contributions was very much a last resort. We hope that that last resort will not come about. We are seeking a solution that will not require measures of that kind.
Indeed, the right hon. Gentleman had the effrontery to complain bitterly about the whole of the terms under which we were members of the European Community. These were the terms that were renegotiated by the Government of which he was a member. They were the terms that they then put to the British people as being terms they could accept. The right hon. Gentleman did not resign from the Government; he accepted those terms. He cannot now tell the Government that the terms are no good after all.
Of course I accept the fact that the right hon. Gentleman has been a dedicated anti-Marketeer and a dedicated opponent of British membership of the Community throughout his political career, but that is not our position. His position is clear—though I do not know whether it is the official position of the Opposition; that is a mystery. He went back entirely on the helpful remarks of the Leader of the Opposition on 11 March, which I quoted earlier, deliberately to try to sabotage the efforts of the Prime Minister to secure justice for this country in the negotiations in Brussels.
Why does he wish to sabotage those negotiations? It is because their purpose is to secure a successful outcome within the framework of British membership of the European Community. That is what at all costs the right hon. Gentleman wishes to avoid. While we seek a remedy within the Community and the context of the EEC, he seeks to leave the Community.
There is a manuscript amendment in the name of the hon. Member for Caithness and Sutherland (Mr. Maclennan), supported, as I understand it, by the right hon. Member for Down, South (Mr. Powell). I advise my right hon. and hon. Friends to take no part in the bitter, internecine quarrel within the ranks of the Opposition that that amendment represents.
The official Opposition amendment is a more serious business. I still hope that

1133
even at this late hour they will not press it. I hope that they will adhere to the statesmanlike attitude demonstrated by the Leader of the Opposition on 11 March. But if they insist on pressing the amendment I must ask my right hon. and hon. Friends to reject it. It seeks to undermine the Prime Minister by committing her to a position that has already been overtaken by events and that would ensure the failure of the important negotiations that will shortly take place. Our purpose is to ensure that those negotiations are a success.
Mr. Tam Dalyell: Will the Financial Secretary clarify his remarks about additional expenditure?
Mr. Deputy Speaker: The hon. Gentleman has sat down.
Mr. Dalyell: Will the Minister clarify his remarks? It is not good enough—
Mr. Spearing: On a point of order, Mr. Deputy Speaker. When the Financial Secretary replied he complained of a
shortage of time. He deliberately and clearly refused to answer a question raised by my right hon. Friend the Member for Battersea, North (Mr. Jay), and in addition—
Mr. Tristan Garel-Junes: On a point of order, Mr. Deputy Speaker. The debate started at exactly five minutes to 10 o'clock.
Mr. Deputy Speaker: That is not a point of order, and if it were it would be a matter for the Chair.
It being three hours after the commencement of proceedings on the motion, Mr. DEPUTY SPEAKER put the Questions necessary for the disposal of the proceedings pursuant to Standing Order No. 3 (Exempted business).
Question, That the amendment to the proposed amendment be made, put accordingly and negatived.
Question put, That the amendment be made:—
The House divided: Ayes 71, Noes 125.

Division No. 241]

AYES

[12.56 am

Archer, Rt Hon Peter

Harrison, Rt Hon Walter

Park, George

Ashton, Joe

Haynes, Frank

Powell, Rt Hon J. Enoch (S Down)

Benn, Rt Hon Anthony Wedgwood

Heffer, Eric S.

Powell, Raymond (Ogmore)

Bennett, Andrew (Stockport N)

Hogg, Norman (E Dunbartonshire)

Prescott, John

Booth, Rt Hon Albert

Holland, Stuart (L'beth, Vauxhall)

Roberts, Ernest (Hackney North)

Campbell-Savours, Dale

Homewood, William

Robinson, Peter (Belfast East)

Carmichael, Neil

Hooley, Frank

Ross, Wm. (Londonderry)

Cocks, Rt Hon Michael (Bristol S)

Jay, Rt Hon Douglas

Rowlands, Ted

Coleman, Donald

Jones, Barry (East Flint)

Shore, Rt Hon Peter (Step and Pop)

Cryer, Bob

Leighton, Ronald

Silkin, Rt Hon John (Deptford)

Cunliffe, Lawrence

Lestor, Miss Joan (Eton & Slough)

Silverman, Julius

Dalyell, Tam

McCartney, Hugh

Smith, Cyril (Rochdale)

Davies, Rt Hon Denzil (Llanelli)

McElhone, Frank

Soley, Clive

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

McKay, Allen (Penistone)

Spearing, Nigel

Dixon, Donald

MacKenzie, Rt Hon Gregor

Stoddart, David

Douglas, Dick

McNally, Thomas

Stott, Roger

Dunwoody, Mrs Gwyneth

Marshall, Jim (Leicester South)

Welsh, Michael

Evans, John (Newton)

Mitchell, Austin (Grimsby)

Whitehead, Phillip

Flannery, Martin

Molyneaux, James

Winnick, David

Foot, Rt Hon Michael

Morris, Rt Hon Charles (Openshaw)

Woolmer, Kenneth

Golding, John

Moyle, Rt Hon Roland

Wrigglesworth, Ian

Graham, Ted

Newens, Stanley

Hamilton, James (Bothwell)

Orme, Rt Hon Stanley

TELLERS FOR THE AYES:

Hamilton, W. W. (Central Fife)

Paisley, Rev Ian

Mr. George Morton and

Hardy, Peter

Palmer, Arthur

Mr. James Tinn.

NOES

Alexander, Richard

Brooke, Hon Peter

Dunn, Robert (Dartford)

Ancram, Michael

Brown, Michael (Brigg & Sc'thorpe)

Dykes, Hugh

Aspinwall, Jack

Bruce-Gardyne, John

Eggar, Timothy

Beaumont-Dark, Anthony

Buck, Antony

Faith, Mrs Sheila

Berry, Hon Anthony

Cadbury, Jocelyn

Fenner, Mrs Peggy

Best, Keith

Carlisle, John (Luton West)

Fisher, Sir Nigel

Biggs-Davison, John

Carlisle, Kenneth (Lincoln)

Fletcher-Cooke, Charles

Blackburn, John

Chalker, Mrs Lynda

Gardiner, George (Reigate)

Blaker, Peter

Chapman, Sydney

Garel-Jones, Tristan

Boscawen, Hon Robert

Clarke, Kenneth (Rushcliffe)

Gilmour, Rt Hon Sir Ian

Bottomley, Peter (Woolwich West)

Colvin, Michael

Gorst, John

Bright, Graham

Cope,John

Gow, Ian

Brinton, Tim

Dover, Denshore

Griffiths, Eldon (Bury St Edmunds)

Brocklebank-Fowler, Christopher

du Cann, Rt Hon Edward

Griffiths, Peter (Portsmouth N)

Grylls, Michael

Mills, Iain (Meriden)

Sproat, Iain

Gummer, John Selwyn

Moate, Roger

Stainton, Keith

Haselhurst, Alan

Montgomery, Fergus

Stanbrook, Ivor

Hawkins, Paul

Morris, Michael (Northampton, Sth)

Stevens, Martin

Hawksley, Warren

Morrison, Hon Charles (Devizes)

Stewart, John (East Renfrewshire)

Heddle, John

Morrison, Hon Peter (City of Chester)

Stradling Thomas, J.

Henderson, Barry

Myles, David

Tebbit, Norman

Hicks, Robert

Neale, Gerrard

Thompson, Donald

Hogg, Hon Douglas (Grantham)

Needham, Richard

Thorne, Neil (Ilford South)

Hordern, Peter

Neubert, Michael

Townend, John (Bridlington)

Howell, Ralph (North Norfolk)

Page, Rt Hon Sir R. Graham

Taylor Teddy (Southend East)

Hurd, Hon Douglas

Page, Richard (SW Hertfordshire)

Viggers, Peter

Johnston, Russell (Inverness)

Parris, Matthew

Waddington, David

Jopling, Rt Hon Michael

penhaligon, David

Wakeham, John

Kershaw, Anthony

Percival, Sir Ian

Waldegrave, Hon William

Knight, Mrs Jill

Rathbone, Tim

Walker, Rt Hon Peter (Worcester)

Knox, David

Rees, Peter (Dover and Deal)

Walker, Bill (Perth & E Perthshire)

Lawson, Nigel

Renton, Tim

Walker-Smith, Rt Hon Sir Derek

Le Marchant, Spencer

Rhodes, James, Robert

Waller, Garry

Lloyd, Peter (Fareham)

Rhys Williams, Sir Brandon

Watson, John

Loveridge, John

Ridsdale, Juliian

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

Lyell, Nicholas

Royle, Sir Anthony

Wheeler, John

MacGregor, John

St. John-Stevas, Rt Hon Norman

Wickenden, Keith

McNair-Wilson, Michael (Newbury)

Shaw, Giles (Pudsey)

Wolfson, Mark

Major, John

Shelton, William (Streatham)

Young, Sir George (Acton)

Mather, Carol

Shepherd, Colin (Hereford)

Maxwell-Hyslop, Robin

Skeet, T. H. H.

TELLERS FOR THE NOES:

Mellor, David

Speed, Keith

Lord James Douglas-Hamilton and

Meyer, Sir Anthony

Speller, Tony

Mr. Tony Newton.

Question accordingly negatived.
Main Question put and agreed to.
Resolved,
That this House takes note of Commission document No. 4845/80 on convergence and budgetary questions, and fully supports the Prime Minister in her efforts to secure agreement at the next European Council to action which will bring about a substantial, immediate and lasting reduction in the United Kingdom's net contribution to the Community Budget and furthermore to ensure that there is a commitment by the Council to long-term restructuring of the Budget which would bring about a significant reduction in the proportion of spending on the Common Agricultural Policy, particularly by reducing the production of surpluses, and a more equitable distribution of expenditure over the whole Community.

NUCLEAR WASTE (TRANSPORT)
Motion made, and Question proposed, That this House do now adjourn.—[Mr. Newton.]
1.8 am
Mr. Anthony Grant: I am glad to have the opportunity of raising the subject of the transportation of nuclear waste, because this matter causes great concern, in particular to my constituents. There is also general concern about the matter in London as a whole. Indeed, I know that the hon. Member for Brent, South (Mr. Pavitt) sought an Adjournment debate on the same subject. I am sure that my hon. Friends in the London area are equally concerned.
1136
Concern about the transportation of this waste is felt not only by what I call the minority of anti-nuclear cranks but by a large number of ordinary citizens who reside near the railways in my constituency. My purpose in this debate is to bring the subject into the open, because I believe that fear arises largely from ignorance. I hope that my hon. Friend the Minister will be able to reassure those who are anxious.
First, I query whether the development of nuclear energy is necessary, and whether the consequences of not proceeding with such a policy would cause even greater misery than the transportation of waste. For example, what would be the effect of not having such a policy on our standard of living, our ability to trade in the world, and our defences? All these factors must be considered.
It is interesting that only today it was announced that Sweden, which is usually a cautious country, has decided to proceed with a fairly substantial nuclear energy programme.
If, as I happen to believe, it is necessary to proceed with the development of nuclear energy, we must ask—I hope that the Minister will reply—why this nuclear waste material has to be transported by rail as opposed to road or, indeed, by sea, as some have suggested. Can my hon. Friend tell us for how long this material has been transported in flasks by rail and what accidents or near misses have occurred during this period?

1137
I hope that it is not considered to be a selfish Harrow or London point, but what consideration has been given to the possibility of this waste being transported through less densely populated areas? What tests have been conducted in anticipation of accidents on the railways? What tests have taken place to determine what happens to these flasks in a high-speed impact? This is very important to my constituents. The Minister will understand why they are anxious, because in 1952 perhaps the most appalling accident occurred at Harrow and Wealdstone station, with enormous loss of life, and that accident is indelibly imprinted upon the memories of many of my constituents. Recently, on the same line, only a few miles away at Watford and Bushey, there was a further accident, though happily not as serious as the previous one, and there have been derailments in the North Wembley area.
If such an accident occurs and flasks containing nuclear waste are involved, will the Minister state whether they explode? I understand that there is no danger of their exploding, but to listen to some one would think that a great mushroom cloud was going to appear over the whole of Greater London. What happens if fire ensues? Are these flasks vulnerable to prolonged fire before the fire services can come to the rescue?
Are the drivers of trains carrying nuclear waste in radio contact so that they can communicate with the emergency services immediately something untoward occurs? Can my hon. Friend assure the House and my constituents that after an accident, a derailment or a fault with a train the wagons are not merely put into a siding to be left for several days where they can be at the mercy of vandals, children, or anyone else?
What would be the consequences of the escape of this material from the flask? How does nuclear waste compare with other radioactive material which is all about us? Would it not be a sensible idea to hold some sort of practical exercise, involving British Rail, the Central Electricity Generating Board and the emergency services, to test the procedures to be followed in the event of the escape of hazardous materials from a major rail collision or accident?
1138
On these procedures, how do we compare with those of other countries? I understand that regulations are of an international nature, but I would be interested to know whether in Great Britain we are observing these as scrupulously and as accurately—indeed, perhaps more so; I hope that the Minister will tell us —as other nations that have similar situations.
Have the Government, or British Rail or the CEGB, considered the possible risks of a terrorist attack, or other criminal attack? It is within the memory of nearly all of us that in 1962 the Great Train Robbery took place. That was an occasion on which British Railways were certainly caught napping. In that case only money was involved, but here much more dangerous substances and consequences could be involved, particularly if it were a terrorist attack.
Obviously, I do not expect for a moment, of course, that the Minister would explain the details of what precautions are being taken. However, I should like his reassurance that the Government and the railway authorities are alert to the possibility of a terrorist attack and are taking the necessary precautions.
The nub of the debate is the expression of the hope that the Minister can allay the fears of the people of Harrow and, indeed, of the whole of Greater London and no doubt of other parts of the country, through which these materials are routed. The last thing that we want is to get into such a situation and a state of panic that we have to have a man with a red flag walking in front of these trains. Some of the arguments that I have heard seem to suppose that that is the only way that we should handle this matter.
We need this matter brought out into the open. We need a great deal of information and reassurance in order to prevent the epidemic of hysteria, which can be so damaging, from developing in some ill-informed quarters.
Mr. Nigel Spearing: These trains are marshalled in Newham, which I represent. On the question of routes, I agree with the hon. Gentleman. Does he agree that we should be prudent even if the flasks are very safe? In addition, prudence might suggest the use not of the high-speed railways but perhaps

1139
other routes throughout the country, which might be more appropriate. Does he agree that answers to these questions might reassure the public?
Mr. Grant: I agree with the hon. Gentleman. I shall be interested to hear what the Minister has to say on that matter. I should like to feel that the authorities have considered all possible routes. I shall not be selfish and merely say that Harrow should be bypassed. I simply want to hear that the matter has been fully looked into. If the Minister tells me that the trains must go through Harrow, or the hon. Gentleman's constituency, I shall accept it, provided that we are satisfied that all safety precautions are taken.
1.18 am
Mr. Robert Maclennan: The hon. Member for Harrow, Central (Mr. Grant) has done the House a service in emphasising the importance of openness in the consideration of the transportation of nuclear waste. His debate is timely in a respect of which, perhaps, when he initiated it, he was not aware. That was the publication of the Health and Safety Executive's Nuclear Installations Inspectorate's report on the transfer of plutonium nitrate from Dounreay, in my constituency, to Windscale. I greatly welcome the report and the thoroughness with which the whole question has been examined.
I also congratulate the Government on the way in which they have handled the report and on the efforts that the Government and the United Kingdom Atomic Energy Authority have made to disseminate the report so that local authorities in the vicinity can understand its findings and more fully grasp the issues at stake.
As the hon. Member for Harrow, Central said, it is right that if the public's legitimate questions are to he answered there must be complete openness on such issues. Openness does not mean that all the questions that are raised will necessarily be answered to the satisfaction of a layman. It means that those who have genuine questions can put them to the test of the opinion and study of those most qualified to answer. If the Government continue their programme as they began it—particularly the Department of
1140
the Environment, which is responsible for nuclear safety—we can take satisfaction from that.
Perhaps the Minister will ensure that that policy of openness, frankness and the most thorough and full investigation of safety, will continue. The nuclear programme should not go ahead in advance of public acceptance of its absolute safety.
1.20 am
The Parliamentary Secretary to the Ministry of Transport (Mr. Kenneth Clarke): I am grateful to my hon. Friend the Member for Harrow, Central (Mr. Grant) for raising this subject. It has taken up much of my time since I took up this post. Once I discovered that one of my responsibilities was the transport of spent nuclear fuel by rail and road, I realised that a great deal of legitimate public concern existed.
I agree that part of that concern is generated by the anti-nuclear lobby. Some of that lobby deserve my hon. Friend's description of "anti-nuclear nuts". They put forward unfounded fears, allegations and rumours about how such substances are carried. The general lay public is happy to see the development of nuclear power, provided that is it is essential for our energy policies, but may wish to be reassured that proper priority is given to safety and that undue risks are not taken.
As a layman with no technical expertise in this subject, I had to discuss the issue with experts both inside and outside my Department. I had to satisfy myself that I could legitimately reassure the public that, to the best of my knowledge, these materials were being carried safely. So far, I have been able to do so. I am glad to have this opportunity of putting across what I have discovered about this subject. I am happy to answer some of the extremely silly rumours that have flown about. I go along with the policy advocated by the hon. Member for Caithness and Sutherland (Mr. Maclennan). The path of openness is the only path for a Government to take. We should use the best of lay language to describe this highly technical subject and we should state exactly what is happening. An informed and intelligent public can then decide for themselves. I hope that they will be reassured.

1141
It is a vital part of the energy programme to make the best use of nuclear power if that can be done in a safe and satisfactory fashion. Indeed, it is an important part of our energy programme to lessen our eventual dependence on fossil fuels and imported fuels. The Government must therefore look to the proper and safe development of nuclear power in order to maintain our living standards as an advanced Western industrial country.
It is well known that last December the Government announced a further 15 gigawatts of new capacity over 10 years from 1982—being our judgment of a safe and proper progress towards the greater use of nuclear power in Britain. There is a recycling plant at Windscale. It provides a valuable means of recycling spent nuclear fuel and of getting further energy out of that fuel. It is also a thriving industry. It has been subject to extremely close scrutiny in a full Windscale planning inquiry, which reported in 1977.
Turning to the question how to transport spent nuclear fuel materials round the country, from power stations to Windscale, or the plutonium nitrate that leaves Dounreay and travels by land and sea to Windscale, we should remind ourselves what was said by that inquiry as a result of its exhaustive investigations into the prospects of recycling spent nuclear fuel at Windscale.
I shall quote the conclusion expressed by the inspector, who said:
"I am satisfied on the evidence that the transport of spent fuel creates no significant risk and that such risks as may exist are less than those involved in the transport of other substances which cause no alarm to any substantial section of the public. The position appeared to me to be so clear that I say no more about it."
When I read some of the sillier allegations in the newspapers I wonder how the inspector reached that conclusion. There is a substantial basis for it. More effort has been devoted to the safe transport of nuclear material than to any other traffic. As a purely personal parenthesis, there are other forms of traffic which are taken by rail where it is necessary to carry out more work on their proper and safe transport.
The standards that we follow when transporting nuclear material are international standards, adhered to by all advanced countries that transport radioactive material on any scale. The stand-
1142
ards are laid down by the International Atomic Energy Agency, which is an agency of the United Nations. Our experts in Britain and in the Department are closely involved in drawing up the necessary regulations to meet those standards. They are among the most respected in the world, and they make a significant contribution to the constant revision of regulations.
The first IAEA regulations were devised in 1961, and since that time they have been revised regularly in the light of scientific advance's ever constant attempts to improve precautions. When considering the history of the transport of these materials it is worth noting that we have been transporting nuclear fuel in Britain for 18 years without any incident that has caused alarm. During that time about 9,000 tonnes of spent fuel have been carried on the railway, over 3 million rail miles. It is only recently that considerable public excitement has been aroused—not because there has been any serious incident but because more publicity has been given to the possibility of a further advance of the nuclear programme. Some anti-nuclear campaigners are turning to the transport of spent fuel by rail.
These irradiated nuclear fuels are carried under higher safety standards than any other material carried in Britain. It is worth making clear exactly what is the material that we are discussing. It is colloquially referred to as nuclear waste. It is mainly uranium fuel that has irradiated in a nuclear reactor to produce the energy to generate electricity.
The spent fuel contains a valuable mixture of uranium and plutonium. The uranium is extracted at Windscale for re-use in power stations. About 1 per cent of the material remains as actual waste after reprocessing. We move these irradiated fuel elements from the power stations to Windscale in massively constructed steel flasks. They weigh about 50 tonnes and incorporate massive shielding to reduce the radiation from the fuel to the levels laid down in the international regulations. They cost about £250,000 each, and are designed to meet the IAEA safety standards. They are transported only in accordance with detailed requirements.
I have seen the flasks, which are now appearing in photographs. I clambered

1143
over them when I visited Windscale to see how they were handled when they arrived there. To any layman they are a massive construction. Among the many myths that I hope I can dispel is the idea that if they are temporarily left in sidings they can be interfered with by passers-by. They weigh around 50 tonnes. The weight of the lead alone is substantial. The idea that some casually passing children might be able to clamber on to the equipment, unscrew the lid and play with the contents is one of the sillier myths that have been propagated by the newspapers.
The flasks are perfectly safe to go near, and require heavy, specially constructed lifting equipment to get inside by any legitimate means. The aim of their design is to make sure that they can not only withstand interference from passers-by but withstand impact in the middle of the most severe rail accident—far more severe than those they are likely to encounter on any ordinary railway used in this country. The whole design of these flasks is to ensure that they can withstand the most severe circumstances that one would reasonably contemplate.
My hon. Friend asked what would happen if one of these flasks failed to withstand pressure, or if we were wrong about them and one was smashed open or broken in the course of an impact or some other untoward event. Many people imagine a massive explosion taking place. There are bogus experts, some of whom I have met, who give the impression that a great explosion would take place. They ask me how I would evacuate many thousands of people in a short time.
I am glad that nothing so dramatic would occur. Making a hole might lead to some radiation within the immediate vicinity of the flask, as a result of radiation emitted through the hole and from possible leakage of contaminated water. This could lead to oxidation of the fuel elements, with substantial slow release over a period of hours of a small proportion of the flask contents. But appropriate measures could be taken to counter this. There would be no question of the immediate release of immense amounts of radioactivity on the scale that has been claimed. Far from there being a massive nuclear explosion, involving the evacuation of thousands of people in Newham,
1144
Harrow or Paddington, the effect would be a serious seepage of contaminated water on the ground, which would certainly involve sealing off part of the siding for some time thereafter. But that is a danger against which we take considerable precautions.
I deal now with the precautions, because they, too, have been attacked by people who claim expertise in this area. The regulations are very well tried internationally and are adhered to by the advanced countries, which, so far, have not had difficulties. It has been said that the regulations are not sufficiently severe. One common remark that has been repeated very often is that flask designs are tested for impact only up to 30 mph. That figure sounds rather low for rail transport, but it is not the right figure and it is deliberately misleading.
The point is that 30 mph is the terminal velocity in the IAEA nine-metre free fall drop test. But the tests are not intended directly to simulate accidents. By introducing other particular factors into the test it is possible to reproduce the sort of maximum damage effects that might be expected to occur in a more serious foreseeable accident. In the drop test the target must be assumed to be unyielding, which means that all the impact energy is absorbed into the flask itself. Additionally the flask is assumed to impact in what is considered likely to be its most vulnerable attitude. This would by no means be the case in a real accident. The combination of those features is such that one is simulating a far more serious accident than a nearly 30 mph collision and far more energy is being absorbed by the flask being tested than it would absorb in such a collision. Indeed the flasks have been tested at much greater speeds.
A great deal of fuss has been made about the fact that for much of the impact testing quarter-scale models are used rather than full-scale flasks. As the flasks cost £250,000 each, the idea of smashing them up regularly is one that would be adopted with reluctance and only if it were necessary. Anyone engaged in engineering design will know that scale model testing is recognised throughout the world as a valid design technique. Using models means that a repeated series of drops can be undertaken, from which a great deal of valuable information is

1145
obtained. Those model drops are then reproduced in occasional full-scale reproductions.
I have seen evidence of test crashes carried out in the United States with full-size flasks at speeds of over 80 mph, in which the flasks suffered only superficial damage. The evidence is easily intelligible to a layman such as myself, and I readily make it available to any hon. Member who wishes to see it. Films have been made of the tests, which were staged at considerable expense in the United States. They are spectacular films of full-scale locomotives driven by rockets crashing into the side of flasks. The scale of destruction seen by the layman is immense, but the flasks rise out of it and roll along, when all around is destroyed.
The flasks in the tests were designed to the same international standards as apply in this country. Those full-scale exercises were intended to show the correlation with previous scale model tests and calculative conclusions, and they bore out the results of the scale model tests.
The result is that what we are contemplating is a situation in which combined impact speeds might be in excess of 80 mph. I have explained the significance of the unyielding target and the other parameters in the international tests. We are talking about very high-speed accidents and other circumstances that the flasks can sustain.
I can assure the House that the tests adequately cater for the circumstances that my hon. Friend postulates. He talks about the terrible, once-in-a-lifetime accidents, such as that which took place in the lifetimes of us all, at Harrow and Wealdstone. I am told that the kinetic energy that would be absorbed by the flask in such accidents would be no greater than that which it would have to absorb in striking an unyielding target in the tests that we now carry out.
Mr. David Penhaligon: As an engineer, I can assure the hon. Gentleman that a combined impact of 80 m.p.h. is not very great. If two vehicles are each travelling at 60 mph, the combined impact velocity is 120 mph, and that is not the least unlikely on British Rail.
Mr. Clarke: We are dealing with traffic designed normally to be carried at speeds of up to 60 mph, being handled in those circumstances on freight trains. But in
1146
practice it rarely, if ever, travels at more than 45 mph.
I realise that there could be head-on collisions between trains travelling at those speeds, where the combined speed is 80 mph or more. But that does not involve a flask in the middle of one of the trains in a head-on impact with a solid target. A great deal of kinetic energy is absorbed in such a collision, and I am advised that any flask would be likely to survive.
I take the best advice available to me, which is corroborated by international experts. It is confimed to me not only by cross-questioning of those who give me the advice and comparisons with competing advice from other people's experts who have been brought along to challenge ours, but finally, in a simple layman's way, by the evidence seen with my own eyes of the spectacular crashes staged in the United States. The United States was reproducing the sort of crashes that do not occur even once in a lifetime in real-life railway activity.
The possibility of fire is also often raised, and the flasks must be tested for their resistance to this hazard, The fire risk is one of the principal aspects considered in design testing. The full fire test environment specified in the international regulations is designed to impose conditions more severe, in heat input terms, than those appropriate to a railway fire. In assessing the flask design against the fire test criteria one issumes that the flask has already been subject to the impact test. That constitutes a very severe combination of conditions. In the American studies that I mentioned earlier, a flask and wagon that had been involved in an 80 m.p.h. crash was subjected to the fire test environment for at least three times the duration of the IAEA test. The flask that has gone through the crash is then put through intense and prolonged heat, for three times the present required level, and still the flask design survives—
The Question having been proposed after Ten o'clock on Monday evening, and the debate having continued for half an hour, Mr. DEPUTY SPEAKER adjourned the House without Question put, pursuant to the Standing Order.
Adjourned at twenty-two minutes to Two o'clock.

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

THE UNITED KINGDOM: IRREDENTIST DEMANDS
Lord MONSON: 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 how they intend to respond to the increasingly strident demands, emanating from certain prominent politicians in supposedly friendly countries, that the Government should effectively declare themselves in favour of the break-up of the United Kingdom.
Lord TREFGARNE: My Lords, the Government are satisfied that their attitude is well understood internationally. We shall continue to make it clear that the internal affairs of the United Kingdom are a matter for the people of the United Kingdom, for the Government and for this Parliament.
Lord MONSON: My Lords, I thank the noble Lord for that reply. Would e not agree that a dignified and low-key response to the impudent demands that Britain abandons its guarantee to the people of Northern Ireland and declares itself in favour of a united Ireland, although superficially attractive, could be misinterpreted by ill-informed people in the world at large as indicating either weakness and indecision or, worse still, as indicating a guilty conscience? Would the noble Lord not agree, therefore, that a rather more robust response to these irredentist demands is indicated? Furthermore, would he not agree that public opinion poll after public opinion poll, as well as the Border Poll, has demonstrated that the proportion of Ulster men and women who want to be incorporated into a united Ireland is even smaller—
Several noble Lords: Speech!
Lord MONSON:—than the proportion of Austrians who welcomed the German Anschluss 42 years ago?
Several noble Lords: Order, order!
Lord MONSON: My Lords, would he not make it entirely plain, therefore—
The MINISTER of STATE, MINISTRY of AGRICULTURE, FISHERIES and FOOD (Earl Ferrers): My Lords, I think that if the noble Lord would be good enough to put his question fairly succinctly it would be for the convenience of the House.
Lord MONSON: My Lords, I will take the noble Earl's advice. Would he not make it quite clear to Mr. Haughey, to Mr. Leniham and to Senator Kennedy and his friends that there will be absolutely no question of a latter-day Anschluss?
Lord TREFGARNE: My Lords, the last sentence of the noble Lord's supplementary question revealed to me the gist of his remarks, which was most helpful. We have indeed noted the remarks of the Irish Prime Minister and the Saint Patrick's Day statement put out by some leading Irish-Americans.
With regard to the first of those, we keep the Irish Government informed of our Northern Ireland policies, but, as I said earlier, the responsibility rests with the people of Northern Ireland, with Her Majesty's Government and with this Parliament. As for the statement made by the leading Irish-Americans, we very much welcome their further condemnation of violence and the continuing efforts to curb the American support for terrorists, together with the recognition of the important efforts which the Government are making towards political progress in Northern Ireland.
Lord ELWYN-JONES: My Lords, is the Minister in a position to tell the House what progress is taking place in the constitutional conference? It may be a fast ball to bowl without notice, but it would be interesting to know whether he has any information.
Lord TREFGARNE: My Lords, I can help the noble and learned Lord. The

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conference, so I am told, is likely to adjourn today. The Northern Ireland Secretary will then be reporting to the Cabinet about the next steps to be taken. The conference, of course, is the first stage in a continuing process.

EXTENDED CREDIT AND GOVERNMENT DEPARTMENTS
2.40 p.m.
Baroness SHARPLES: My Lords, I beg leave to ask the Question which stands in my name on the Order Paper.
The Question was as follows:
To ask Her Majesty's Government whether they are aware that large public companies are seeking to justify up to ninety days' extended credit from small suppliers in the electronics industry on the grounds of delays in payment to them by Government agencies.
The MINISTER of STATE, MINISTRY of DEFENCE (Lord Strathcona and Mount Royal): My Lords, Government departments are under standing instructions to settle bills promptly and we were not aware that large public companies were seeking to justify such extended credit.
Baroness SHARPLES: My Lords, while thanking the noble Lord for that reply, which is not entirely satisfactory, may I say that I have other information? Can he find out whether it is the largest and the richest companies which are the worst offenders?
Lord STRATHCONA and MOUNT ROYAL: My Lords, if the noble Baroness has any evidence to support the suggestion that this is happening, naturally we should be very interested to have chapter and verse, and I can promise her that any such cases will be looked into carefully. I was not aware that it was the largest and richest companies that were acting in this way, as I said in my original Answer.
The Earl of HALSBURY: My Lords, is the noble Lord aware that for many years this has been standard practice? Whenever a credit squeeze has been
444
imposed by the Government bank credit dries up and industrial credit is created. If the noble Lord wants me to name a firm that was as bad as any in the business once upon a time, it was Rolls-Royce.
Lord STRATHCONA and MOUNT ROYAL: My Lords, I can confirm what the noble Lord is saying from personal experience of some years ago, but that is a slightly different matter from the particular question to which my noble friend alluded, when she was suggesting, I thought, that the large companies were using non-payment by the Government as an excuse for not paying their subcontractors.
Lord GLENKINGLAS: My Lords, will my noble friend, first, to give me pleasure, confirm to a leading Sunday newspaper that the penultimate letter of his name is "N" and not "M"? After doing that, will he bear in mind that in view of a great deal of experience the worst payer in the country is the Treasury, and the second worst and third worst, bracketed, are local authorities and Government Ministries? Since the Government are committed to trying to help small local businesses, will they do everything possible to see that credit is not extended for these very long periods? I agree with the noble Earl that in the old days Rolls-Royce were the worst.
Lord STRATHCONA and MOUNT ROYAL: My Lords, I am not familiar with the letter in the leading newspaper to which my noble friend referred, but I will take the opportunity of doing a little research on the question. I can only tell my noble friend that the normal practice is that hills are paid by Government departments within 15 days, and that is an instruction from the Treasury. However, I accept that there are sometimes rather protracted procedures before bills become liable for payment.
Lord BYERS: My Lords, when the noble Lord says that Government departments are under instruction to settle bills promptly, will he please inquire as to what is the actual practice? Would it not be possible, in many cases, to settle for 70 per cent. or 75 per cent., and then to argue about the rest? The idea of holding up the whole of the payment,

445
because there is some argument, is absolutely ludicrous at times like this.
Lord STRATHCONA and MOUNT ROYAL: My Lords, I have great sympathy with what the noble Lord has said, and I can well believe that there are cases where contractors feel that argument over the details of a bill is used as an excuse for not paying any part of it. I can only say that this is not done on instructions. It is not a Government policy. Again, if the noble Lord has examples of this I feel sure that it is something which we should take up.
Viscount HANWORTH: My Lords, would the noble Lord agree, first, that small companies are vital to our national economy and, secondly, that they have the greatest difficulty in getting adequate credit? Does he realise that in many cases when they have a bill prompt payment is demanded, whereas settlement—and I am not saying from whom—is very long delayed? This has a most unfortunate effect on our burgeoning small companies.
Lord STRATHCONA and MOUNT ROYAL: My Lords, I can say to the noble Lord that I made my first speech to this House on the Bolton Report as long ago as, I think, 1971, before small companies became quite so much loved and admired as they now are. I have total sympathy with what he has said and I am quite sure that he is right.
Lord HYLTON: My Lords, is my noble friend aware that a geological branch of central Government regularly takes 90 days to settle its bills? Is he further aware that the Housing Executive in Northern Ireland takes approximately the same time, as I pointed out to his noble friend Lord Elton, with the result that small builders are not willing to tender for maintenance work in Northern Ireland?
Lord STRATHCONA and MOUNT ROYAL: My Lords, I am interested to hear what the noble Lord has to say. I was not so aware; otherwise, I would not have given the answers that I gave earlier on this afternoon.
Baroness SEEAR: My Lords, would the Minister seriously consider, if the Govern-
446
ment owe to someone for, say, over a month, that interest should be payable, as the Inland Revenue charges those of us who do not pay our tax? Why should it be all one way?
Lord STRATHCONA and MOUNT ROYAL: My Lords, the Government are giving careful consideration to the report about the proposition that interest should be payable.
Lord BRUCE of DONINGTON: My Lords, has the noble Lord noticed the reports that have appeared in The Times and the Daily Telegraph over the past fortnight, which emphasise that not only do some very large companies hold up payment, but that also, because of the very high rates of interest, they put the money on deposit and get very large returns?
Lord STRATHCONA and MOUNT ROYAL: My Lords, I have not noticed those reports. I regard that practice as regrettable, but not new.
Lord MORRIS: My Lords, does my noble friend agree that in these days of stringent cuts in Government expenditure, it would make a great deal of economic sense for Her Majesty's Government and their agencies to take as much time as possible before paying, rather than for them to speed up their payments?
Lord STRATHCONA and MOUNT ROYAL: My Lords, I am sure that I should applaud my noble friend's advice as to how to manage our financial affairs, but I should be sorry if we had to stoop to such improper measures.
Lord ENERGLYN: My Lords, may I ask the Minister whether he will look into the delays in National Health authorities' payments to pharmacists? These are very often excessive. Pharmacists have to carry complicated stores of drugs with a very limited shelf life, and many of them are in serious financial trouble, due to overdrafts with banks caused by delayed payments by National Health authorities.
Lord STRATHCONA and MOUNT ROYAL: My Lords, I am interested to hear what the noble Lord has to say. Here, again, if any association or any noble Lord wishes to cite particular instances, I am sure that these will be followed up.

DINNERS
Lord DENHAM: My Lords, it may be for the convenience of your Lordships to know that dinner will be available this evening at the usual time. It is proposed that the Report stage of the Education Bill will be adjourned at around 7 o'clock for approximately an hour, in order to enable noble Lords who have a particular interest in the Education Bill to acquire some refreshment.
SOCIAL SECURITY BILL
Brought from the Commons on Friday last, and printed pursuant to Standing Order No. 47; read 1a.

EDUCATION (No. 2) BILL
2.49 p.m.
Report received.
Clause 1 [Change of nomenclature]:
Baroness DAVID Baroness DAVID moved Amendment No. 1Z:
("Page 1, line 15, at end insert—
(2A) It shall no longer be a requirement that the rules in accordance with which a secondary school is conducted under Section 3(b) be approved by the Minister ").
The noble Baroness said: My Lords, I apologise for the two manuscript Amendments Nos. 1Z and 1Y, which go with Amendment No. 1 on the Marshalled List. The extra amendments are to make the drafting correct, which apparently was not so in the first place. At the Committee stage, I moved an amendment which aimed to put the articles of government of primary and secondary schools on the same footing. My aim was that the articles of government of primary schools should go to the Minister to be approved, as do secondary school articles.
I think everybody agreed that primary education was equally important and there was a certain amount of sympathy in the Committee for the amendment. However, the Minister said that it would make too much work for the department. At first, she said that it would mean 23,000 articles of government going to the department, but I pointed out that each local authority would have only one, so
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it would be only 104. In the end this amendment was defeated.
I am now trying to do it the other way round and to say that neither need go to the department. This would save work in the department and would mean that both types of education were on the same footing. I think that the noble Lord, Lord Avebury, suggested that this might be done. I am going to quote from the Minister's reply, which I must admit I did not find altogether satisfactory. She said:
"The noble Lord, Lord Avebury, asked me whether we could not get some kind of parity of treatment between primary and secondary schools, and suggested that if we could not get any agreement on the powers of school governing bodies, the matter should be left for the local education authorities themselves to decide. If in fact that is the wish—and it is certainly not a matter which we as a Government have considered; I merely state it because our thinking would probably be in that direction, rather than in the other—it is precisely the reverse of what the amendment is asking for ".
Now this amendment is asking for it. The Minister went on:
"I have been asked in particular why the Secretary of State approves the articles of secondary schools, but not of primary schools. The answer is that there are model articles laid down, based upon the proposals written in 1945, but quite a large number of authorities and secondary schools vary very widely from what has been suggested, from the model rules; in fact, they do have to be looked at by the Secretary of State. One of the difficulties is that because there would be so many more primary schools they would have to be looked at, too ".—[Official Report, 10/3/80; cols. 563 and 564.]
I do not think that that does say why they have to be different. Both the Minister and Dr. Boyson during the Commons Committee stage objected to taking away power from the local authorities. Dr. Boyson said,
"To transfer the power to the Secretary of State would be totally against the philosophy we are forming of devolving power to the local authorities ".
So I am asking whether the power can be devolved to give parity of treatment to primary and secondary schools by saying that the articles of government of secondary schools need not go. I beg to move.
Baroness WOOTTON of ABINGER: My Lords, I should like very strongly to support my noble friend. I do not think it matters very much whether the secondary school articles go to the Minister or whether the primary school articles go to

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him, so long as there is a common policy for both. Both are equally important stages of education. Some people would say that the primary is more important than the secondary stage because it lays the original foundations for what follows. Others will feel that the secondary is more important because there is probably greater variety at that stage. However, what I want to emphasise, and I think I said it during the Committee stage, is that the only distinction between primary and secondary education in this respect is a distinction of class and social status. We have lived with that since the 1870s—slightly, but not very much, before my time. It has been very deeply impressed upon me through all the Education Acts that we have had since, notably the famous Butler Act, that distinctions were made which had no educational significance but purely a social significance. On that ground I wish very strongly to support my noble friend.
Baroness YOUNG: My Lords, in answering these two paving amendments for the principal amendment that the noble Baroness, Lady David, is moving, I am very conscious that this is a most ingenious argument, based on what I said at the Committee stage of the Bill. Having re-read my remarks and, indeed, hers, I see why she is doing it.
Let me say at the outset that I cannot accept what the noble Baroness, Lady Wootton, has said: that the Government feel that primary schools are of less importance. For the first time ever, we are legislating in this Bill for there to be governing bodies of primary schools. Although it is perfectly true that many authorities have primary schools with separate managing bodies, there are others which do not. Therefore, we think that to give primary schools governing bodies by statute for the first time marks a major advance. We do it because we believe in the importance of governing bodies and because we believe in the importance of primary schools. To suggest that any part of this legislation is somehow demoting primary schools and making them of less account would be quite wrong and quite unjustified.
Secondly, can I make it quite clear that when I made the remarks that I did during the concluding part of the debate at the Committee stage of this Bill—in
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which I said that I thought the Government were not prepared at this stage to alter the fact that they had decided that the articles of secondary schools should still be approved by the Secretary of State but not those of primary schools, and that if we were going to make an alteration we should do what the noble Baroness is asking for now—this was not meant to imply that we proposed at this stage of the Bill to make a major alteration of that kind. In the first plac it would be quite improper to agree to anything of this nature without discussing it with our partners in the education service, which clearly we have not had time to do. It would mean a major departure from what has been the agreed practice ever since 1944, and therefore certainly not one to be taken on an amendment moved at Report during the very last stages of the Bill.
I hope these reasons will satisfy the House that we have considered this matter very carefully; that in the first part of this Bill we are legislating to have governing bodies of primary and secondary schools; that we are laying down the minimum requirements about them; that we believe this to be a major advance; but that we are not prepared at this stage to alter what has been the practice now for very many years, indeed, since 1944, and certainly not without further consultation.
I regret that this is not an amendment that I can accept or that I can ask the House to accept at this stage. I believe that the dialogue which takes place between the department and the local authorities over the content of articles provides a very useful sounding board for both the authorities and the Secretary of State, and I would not want to do away with that at this stage of the Bill.
Baroness DAVID: My Lords, I have listened with care to what the Minister has said. Although I cannot altogether accept her arguments, I do accept the argument that perhaps it would not be right to do this without first consulting the local authorities. Therefore I beg leave to withdraw my amendment.
Amendment, by leave, withdrawn.
[Amendment No. 1 Y not moved.]
[Amendment No. 1 not moved.]
Clause 2 [Requirements as to governing bodies]:
2.59 p.m.
Baroness DAVID Baroness DAVID moved Amendment No. 2:
Page 2, line 32, at end insert (" and this governor shall not serve longer than twelve months after any child of his has ceased to be a pupil at the school.").
The noble Baroness said: My Lords, the Minister was kind enough to write me a long letter after the Committee stage about parent governors at voluntary aided schools. I was satisfied with the first half of her answer but I was not totally satisfied with the second. In her letter she said that the term of office of a foundation governor is normally limited to three or four years and that if in the interim his child—that is, the child of a parent foundation governor—left the school he would not be eligible for reappointment. Therefore, he would probably serve at the most only about 18 months after the child left.
I do not think the Minister has considered that possibly the foundation parent governor might be appointed only a year before the child left. Therefore, that parent governor might have three years left on the governing body after the child had gone. This is my reason for tabling this amendment again, because I believe it to be important that parent governors should actually have children in the school.
The PARLIAMENTARY UNDERSECRETARY of STATE, DEPARTMENT of the ENVIRONMENT (Lord Bellwin): My Lords, when this matter was discussed in Committee it was explained that the amendment, as drafted, would not achieve the desired effect because the use of the words "any child" would mean that a parent with more than one child in the school would have to cease to be a governor not more than 12 months after the eldest child left school, notwithstanding that he had one or more other children at school. It was also explained that there was nothing between the two sides of the Committee in principle and my noble friend Lady Young undertook to write to the noble Baroness, Lady David, and indeed did write to her, explaining how the Government saw the provisions of the Bill working in practice in relation to
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parents on the governing bodies of voluntary aided schools.
Perhaps I should remind the House of the background against which the provisions of the Bill should be seen. The composition of the governing bodies of voluntary aided schools is determined by their instruments of government which, by virtue of Section 17(2) of the 1944 Act, are made by the Secretary of State. Clause 2 of the Bill requires the Secretary of State, when making such an instrument, to include provisions complying with subsections (4) and (5) of the Bill.
Subsection (4)(b) will require the instrument of government of an aided school to provide specifically that at least one of the foundation governors should be appointed by virtue of the fact that he was the parent of a registered pupil at the school at the time of his appointment. The term of office of such a governor will automatically be limited to the normal term of office of foundation governors—namely, three or four years, and if in the interim his child left the school he would not be eligible for reappointment in the same capacity at the end of the term of office. Therefore, the balance of the term of office outstanding when the child left school would in all probability in most cases be no more than a year to 18 months—not very different from the period proposed in this amendment. But if when we consult about these matters it seems sensible none the less to place a further restriction upon the term of office of such a governor, we should be able to do so either in the course of making the instrument of government or through the regulations which we make under Clause 4. We understand the concern expressed by the noble Baroness, but assure her that there will be a further opportunity if difficulties are experienced in practice. In those circumstances we are unable to accept the amendment.
Baroness DAVID: My Lords, if the Government are prepared to re-examine the matter when they consult about the terms of office of governors, and I can be given that assurance, I would be prepared to withdraw the amendment.
Lord BELLWIN: My Lords, I gladly give that assurance.
Baroness DAVID: My Lords, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
3.4 p.m.
Lord BEAUMONT of WHITLEY Lord BEAUMONT of WHITLEY moved Amendment No. 3:
Page 2, line 45, at end insert—
(" ( ) Local education authorities in appointing governors as laid down in subsections (2), (3) and (4) above shall have regard to the desirability of appointing persons:

(a) with special knowledge of educational matters,

(b) with personal links with the relevant school,

(c) living in the immediate neighbourhood of the school.").

The noble Lord said: My Lords, when we considered this question in Committee the matter for various reasons got slightly mixed up with an admirable amendment tabled by my noble friend Lady Seear on the subject of governors with experience of industry. This amendment relates to a separate series of qualifications which we believe should be taken into account when governors are appointed. I apologise to the House for the fact that the amendment was misdrafted. As was pointed out by the Minister at the time, subsections (3) and (4) are applicable only to subsection (2). If the House agrees to accept the amendment, those provisions can be deleted.
The Government have been adamant in their stand on the fact that we should not write into the Bill qualifications of one kind or another other than those which they themselves have already written in, some of which are extremely good. The stand taken by the Government does not appear to me to be all that logical. I do not see how they can take the view that only their views as to what should appear in the Bill are correct and that other matters should be excluded. I do not think a line can be absolutely drawn in the place in which the Government have drawn it. I am asking the Government to think again about the desirability of including these particular matters.
Noble Lords will remember that in Committee the noble Lord, Lord James, asked where one would obtain boards of governors which did not contain people who lived in the immediate neighbourhood
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of the school or with personal links with the relevant school. The answer is now as it was then, that one experiences that kind of situation in run-down, down-town areas. I think that it is important that we should try to achieve the ideas behind the amendment. We should think about the necessity of this kind of involvement with the school on the part of those who are to sit on these governing boards. I ask the Government to think again.
Lord DERWENT: My Lords, what exactly does this amendment mean? Let us take the first provision:
"with special knowledge of educational matters".
What on earth does that mean? I have special knowledge, since I was educated—or partly so. Does it mean anything? Then let us take the words:
" with personal links with the relevant school ".
Does that apply to my grandfather in relation to a particular school? It seems to me to mean virtually nothing. Then there is the provision:
"living in the immediate neighbourhood of the school ".
What is the "immediate neighbourhood"? Does it mean five miles, 10 miles, IS miles or 50 miles away from the school? I do not think the drafting of the amendment means anything at all.
Lord PARRY: My Lords, just as everybody who goes to church is not expected to be a Christian, I would point out that everybody who goes to school is not a scholar, nor is everybody who goes to school necessarily able to contribute to an important extent at a different level. It is clear that there are people with special knowledge of educational matters who have a special contribution to make and who should be recruited in a particular area. Although the original provisions in the Bill do not specifically exclude them, I believe that it is thought helpful in this amendment specifically to include them.
Baroness MACLEOD of BORVE: My Lords, I wish to express agreement with my noble friend Lord Derwent on the subject of educational qualifications. Would a person covered by the amendment be required to have attended university? That may be relevant in the

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view of some people. Possibly a knowledge of medical matters might be useful for a member of a board. I cannot see any point in this amendment. As for the phrase"the immediate neighbourhood ", does that refer to being in the same street, or within five miles, 12 miles, or what?
Lord ROBBINS: My Lords, I wish to express my complete agreement with the noble Baroness, Lady Macleod. This amendment, and indeed the following amendment, simply suggest that those who appoint governors should be sensible. It is surely incredible that such a requirement should have to be spelt out in the Bill. One can imagine all sorts of other desiderata which might be spelt out in a Bill, but surely one does not wish to inflict such minutiae as these in what will become an Act of Parliament.
Lord BELLWIN: My Lords, the noble Lord, Lord Parry, I think said that everyone who goes to church is not necessarily a devotee. May I say that everyone, even in Her Majesty's Government, who speaks on education is not necessarily an expert on the subject! An expert, maybe not, but knowledgeable, one would hope, at least to some extent. The noble Lord, Lord Beaumont of Whitley, raised this point in almost precisely the same way at Committee stage and he argued then that the House should agree to this amendment to give local authorities a push in the right direction when deciding whom to appoint to school governing bodies. I think everyone would share his intentions in our common wish to see appointed people who are concerned and who take a real interest in the affairs of the school. But as we have previously pointed out, and as the noble Lord, Lord Robbins, and my noble friend Lady Macleod of Borve so rightly said, if we apply those criteria then we must apply others as well and a whole list could be drawn up. I think at Committee stage I referred to some nine or 10 different groups which one might say might be represented—higher and further education, industry, commerce, agriculture, community relations, non-teaching staff, pupils, trade unions, employers, universities. Really, the list is almost endless; and where would one start and where finish?
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The Government's approach to these matters is quite clear. We have decided as a matter of principle that the Bill should contain the minimum of prescription about the composition of school governing bodies. Within the broad framework laid down by Clause 2, which ensures a minimum level of teacher and parent representation, we think it right to leave determination of the detailed composition and overall size of governing bodies for local education authorities themselves to decide, and I am sure that we should leave it to them to decide on what basis to make appointments that adequately and appropriately affect local circumstances and needs.
Viscount SIMON: My Lords, I am afraid that I do not find the Minister's reply altogether satisfactory. I think at Committee stage he said the same thing about the minimum prescription but, if I may say so, there is no prescription in this clause. It may be a useless clause, but it is a clause to remind those who are appointing governing bodies of certain things that they should keep in mind. Of course there are many other things that one might remind them of, but my noble friend thought that these three were very important—and so do I. I cannot see that any harm is done by reminding local authorities of this. When the noble Lord, Lord Robbins, said that any sensible appointing authority would already do this, I fully agreed with him, but the fact is that one finds schools where the appointing body has not done this, and to give them that additional reminder seems to me to be worth doing.
It is on that basis that my noble friend tabled this amendment again, and I hope that the Government will think about it. It may be that it could be done in some other way but, although these things do not cover the whole picture, I am particularly keen about those who have personal links with the school. The noble Lord, Lord Derwent, made some fun of this and suggested that it did not mean anything. I do not think it is necessary to interpret this clause with a legal eye; it is simply suggesting the sort of things that should be in people's minds, and I think that someone with personal links with a school can be a useful member of the governing body. During the Second Reading debate I

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suggested that the governing body should somehow be closer to the school than just a body of people who have a formal responsibility, and it was rather with that in mind that my noble friend tabled this amendment again. I hope that the Government will give some thought to it.
Lord CLITHEROE: My Lords, I have been a governor of a grammar school and chairman of a primary school for a great many years and I have never known an occasion when these matters were not taken into account. Therefore I think the words suggested in the amendment are superfluous.
Lord BELLWIN: My Lords, by leave of the House I should like just to say that the sentiments expressed by my noble friend Lord Derwent in my opinion were fair and proper and apposite. Of course one would agree with the philosophy behind the amendment and would surely expect and hope that those who make such appointments would do so in the knowledge of all the qualities that the particular schools in question needed to have in their governors. In my own experience this has always been so. There really is no reason to suspect that it would not continue to be so, and in those circumstances the Government would have to ask the noble Lord whether he would be prepared to withdraw the amendment.
Viscount BARRINGTON: My Lords, I do not quite understand how one can agree with the philosophy of this if one also agrees with the noble Lord, Lord Derwent, who made a perfectly clear point that it means nothing. I should have thought that the philosophy ought to mean something, and these three things are only considered desirable and are not considered to be mandatory. It is desirable that one should have some general knowledge of education and, with great respect to the noble Lord, Lord Derwent, that does not mean that one was educated oneself. So was I and so was he—and with what results, in my case! It means that one has had some opportunity or attempt, however unsuccessful, to educate other people. I should have thought that "personal links with the relevant school" does not simply mean that I happen to have been at Charterhouse or Gutta Percha or Eton, or wherever it was; it might mean
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that one has an interest in the school' possibly through one's family. I have remote ancestors who founded a great many working men's schools at a time when they were not fashionable, and it might mean that such a man would take more interest in such a school than he would in other circumstances. That might be a bad reason, but it seems to me to be a possible one.
Lastly, referring to the point of "living in the immediate neighbourhood", I think it is carrying it a little far to say that there is no such thing as an "immediate neighbourhood". If one can get to the school at regular intervals without having to hire Concorde I should have thought that was one of the things that might be taken into account as being desirable; but as my noble friend on the Front Bench has said, this is only a question of three things which might be thought desirable. With great respect, I, too, think that they are desirable.
Lord MISHCON: My Lords, perhaps I may be permitted to add one further point which I believe has not been adumbrated so far. It is this: at Committee stage I remember the Minister agreeing with me—at least I think he did—that it was desirable that there should not be automatic political appointments of governors. I think we said that at Committee stage, without any party feelings at all, because it is known on all sides that political parties in some areas are in the habit of inviting people who are members of the political parties to serve as governors if they would like to, or they put forward other nominations. In saying this I am not decrying the many worthy governors who are put forward by political parties, be they Conservative, Labour or Liberal. But all too often it is a question of: "We are expected to nominate three or four people to this school. Who can we think of and who is prepared to volunteer?"
One of the desirable factors of this amendment is that it shows that Parliament had in mind not the automatic appointment of political nominees, and that indeed local education authorities ought to look to the qualifications. If they happen to fall among political nominees, all well and good; but if they do not and there are not any suitable candidates, then they ought to be looking elsewhere for this sort of

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qualification. I remember at the previous stage the noble Baroness, Lady Young, saying that she thought one of the amendments I had the privilege of moving did not in fact achieve this aim, and I gathered from that that she was looking for other amendments that might. I suggest most respectfully to the Front Bench opposite that this is just such an amendment that may serve that very useful purpose.
Lord ALEXANDER of POTTERHILL: My Lords, I do not think this amendment matters one way or the other. As to the effect it might have in preventing party political appointments to governing bodies, I would remind your Lordships that in the provision for co-opted members of education committees this provision relating to persons with knowledge of education has been in the statutes since 1944, and I can only assure you that it has had no such effect.
Lord BEAUMONT of WHITLEY: My Lords, I would thank all noble Lords who have spoken, particularly the noble Lord, Lord Mishcon, who I think put this in its context. I really am appalled at one or two of the replies we have had from the Government Benches. I think the tone was set by the courteously phrased remarks of the noble Lord diagonally opposite to me, who said that in the schools of which he had been a governor there had not been any doubt that this happened. I know this is so. The noble Lord, Lord Derwent, seemed to think that the amendment meant nothing. Admittedly, it is not a prescriptive amendment, but it does mean something, because unknown to a lot of noble Lords on those Benches there are plenty of schools in this country where the governors do not include anyone who knows anything about educational matters, nor anyone who is even a vague relation of any child within that school, nor anyone who would be seen dead living in the immediate neighbourhood, which means the catchment area of that school, because the people who are appointed are not the people who live in those rundown areas and who send their children to those schools. That is absolutely true, and really it should be taken into consideration. But having said all that, it is quite clear that the Government are
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adamant, and I therefore beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
3.23 p.m.
Lord STEWART of FULHAM Lord STEWART of FULHAM moved Amendment No. 4:
Page 3, line 28, at end insert—
(" ( ) In the appointment of Governors consideration shall be given to persons with knowledge of further and higher education, industry, commerce, nad agriculture: and, where appropriate, of community relations.").
The noble Lord said: My Lords, it can be said of this amendment, as of the last one, that it does not so much prescribe as give advice to people who are appointing governors, or at any rate requires them to consider certain points. Where it differs from the previous amendment is that it looks outwards from the school to the world outside. When we were discussing the previous amendment, the noble Lord, Lord Robbins, objected to it on the ground that it was simply saying that the people who appoint governors ought to be sensible. In this amendment at any rate I think we are asking rather more of them than that; we are asking that they should be sufficiently imaginative to consider the needs which the school will have to serve. It is always important to remember that a school is not, as public school housemasters used to inform their boys, a world in miniature. It is only a preparation for the much wider life outside. It used to be the practice of worthy persons at prize-givings to inform the children that their school days were the happiest days of their lives. That must have been extrememly depressing news to the children always assuming—which we need not necessarily assume—that the children were listening. The point I am making is that a school in its nature is not something complete in itself. It is preparing young people for all aspects of life, for their duties and for their power of enjoyment of life. That is why it is important, when any group of people are considering appointing governors, not to think only of the immediate connection of such persons with schools but what knowledge of the outside world they can bring to the school. One of the most valuable things in the whole process of education is for young persons to see before them examples of an experienced, educated, civilised adult. In the process of education one

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always learns far more by example than by instruction.
That is why we have cast the net rather wider than in the previous amendment, and, I venture to suggest, drawn attention to some matters which those appointing governors might not necessarily have thought of. I think one must stress at the present stage of our development in this country the last phrase, "where appropriate, of community relations". I am not sure that at my age I can hope to live to see it, but I hope that there will come a time in this country where we simply need not bother to talk about community relations and need lay no more stress on the colour of people's skins than the colour of their hair. But we all know we are not yet at that situation, and the relationships between people of different races in this country is still a matter that requires special attention. In a neighbourhood where there is a community relations problem I think it is worth while underlining the fact that attention should be given to this in the appointment of governors. The point of what was saying earlier was this: We are still at the stage of our civilisation where we cannot take harmonisation of community relations entirely for granted. We need occasionally to underline the need, to spell it out in a statute. I hope, therefore, that the Government will give careful consideration to this amendment. My Lords, I beg to move.
Baroness WOOTTON of ABINGER: My Lords, I should like cordially to support my noble friend in this amendment and to endorse the grounds on which he has introduced it, that it does bring knowledge of the outside world under consideration when governors are appointed. The only thing that troubles me a little is the phrase," where appropriate, of community relations". "Community relations" has conic to have a rather specialised meaning in this country. I should have thought that "community relations", as those words normally are understood in English, meant relations between all members of the community. But it has come to have this particular meaning of racial relations, and therefore the words, "where appropriate", are put in front of it, because it would not perhaps he particularly appropriate to put somebody with specialised knowledge of
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relations between ourselves and persons of Asian origin in an area where there were no such persons.
In a sense, it gives me a discriminatory feeling. I feel that if "agriculture" had been put in"where appropriate", it would be less discriminatory, because it may not be very sensible to ensure that governors of schools in Stepney have a wide knowledge of agriculture. I feel a little uneasy about this point. I would much prefer that "community relations" was left without these particular words to call attention to it. After all, persons appointing governors are only obligated to consider, and presumably if they considered whether they wanted persons versed in agriculture they would dismiss it very quickly in Stepney. As long as "community relations" has this peculiar meaning—and I agree with my noble friend; I hope it will soon lose it—they will consider whether community relations are strained or likely to be strained in their particular area. I hope perhaps my noble friend would agree, even at the ultimate stage, to reproduce this amendment without this curious discriminatory qualification.
Lord BELLWIN: My Lords, I believe that the last point which the noble Baroness, Lady Wootton, raises almost makes the case, in that when you start to specify in great detail, when you start to lay open to analysis some of the categories proposed, you bring into question many aspects. Indeed, what was said in the discussion on the previous amendment is also not inapposite. The fact is that the more one seeks to lay down and to specify, the more difficulties one can run into. It seems to me that if we are saying to local education authorities —and I think that I am quoting correctly what the noble Lord, Lord Stewart of Fulham, said—that they should appoint those who have knowledge of the outside world, then that is fine and I am sure that that is right. The noble Lord hoped that those appointing would appoint people who might not have been thought of. hence the need to specify them as in the amendment.
However, it seems to me that that is precisely what, in the main, local education authorities do. Again, I know of very many, but I do not know of any

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which are not so concerned to ensure that they appoint just those sort of people, perhaps not always with the results most desired. The whole matter turns, as do so many amendments to the early clauses of the Bill, on the extent to which one does or does not wish to leave matters to the good sense of the individual authorities. I believe that that is something we must do. Overall the record is not such a bad one as to indicate that we should try to be too specific.
I think that we said during our discussions in Committee that no one would quarrel with the sentiments behind the amendment. But the more one seeks to specify, the more one runs into difficulties, and that is why I fear that we should not accept the amendment and that we should be willing to leave it to the good sense of the authorities themselves.
Baroness BACON: My Lords, this is a rather mild amendment. It does not lay down that the local authorities must appoint certain people. It just says:
"In the appointment of Governors consideration shall be given "
to those persons. If the amendment were included in the Bill it would bring home to local authorities the desirability of considering the people who are named in the amendment. I think that is particularly so as regards the last part of the amendment where it says:
"where appropriate, of community relations".
The noble Lord, Lord Bellwin, knows certain areas of Leeds as well or perhaps better—I do not know—than I do. He knows that there are certain areas, for instance, Chapeltown, where it is most appropriate that somebody with knowledge of community relations should be appointed, or at least considered by the local authority to be appointed as a governor. I do not see any harm in putting this amendment into the Bill. It does not lay down that these people must be appointed; it merely jolts the local authorities into considering such people as mentioned in the amendment.
Baroness SEEAR: My Lords, the noble Lord, Lord Bellwin, said that, in the main, this practice was carried out. It has been the burden over and over again of the argument against this amendment and the
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previous amendment that, in the main, most appointing bodies do these things. However, surely the point of a great deal of our law is that a minority do not do the things that they ought to do. That applies to the great mass of laws governing domestic relations. If one argues that, because most people behave in a sensible way, we should have a law to deter those who do not conform, then a great many of the laws of this country would never have been passed. Why do we apply that little argument to this particular amendment when it is accepted as regards the great mass of legislation that we legislate because there are a certain number of people who do not behave in a sensible way? There are some silly people around, and surely that is agreed in your Lordships' House?
Lord DERWENT: My Lords, if the local authority is not going to do what it should do, then this amendment will not make it do it.
Lord PARRY: My Lords, many of your Lordships have debated many Education Bills, more often than I have done so. But, in every education debate in which I have taken part since becoming a Member of your Lordships' House, someone from either side of the House has made the point strongly—and I must say that noble Lords who are now on the opposite side of the House have made the point most strongly of all—that one of the weaknesses of the British education system is that it appears to be geared to the detriment of industry and the manufacturing side of our industry. We have had long debates in this House in which many noble Lords have urged that point. It seems to me that they are now in a position to prove that they mean it. Without giving way to any great degree on the philosophy of the Bill contained in this little clause to which there is tabled this amendment, they can now show that this Government, today's Government, recognise that it is essential that, in a period when our basic industry is in decline (and I have made that point before), there would be on the governing body of each of our schools someone who is able to contribute something by way of informing the school and helping the school to develop a direction towards interesting its pupils and its staff in industry. it is absolutely essential that

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we do that. If it were only for that reason alone, I would urge my own Front Bench to stand on this particular clause because it illustrates our concern about informing the education process, at all levels, of the importance of productive industry.
Baroness MACLEOD of BORVE: My Lords, I am sure that many noble Lords would entirely agree with the noble Lord, Lord Parry. However, I agree with the Minister, because we cannot specify all the different categories that there could be as regards members of governing bodies. To specify them in legislation and to include them in the Bill would, in my view, be absolutely wrong. I had it in mind to table an amendment specifying that an old girl or an old boy of the said school should be a member of the governing body. However, I felt that that was wrong because it would make the whole Bill too specific. If noble Lords are going to say that the people who appoint governors have no common sense, have no knowledge of what is right for their school, then I am sorry to say that they have no respect for the heads of those schools and I entirely agree with my noble friend the Minister.
The Lord Bishop of BLACKBURN: My Lords, is not the spirit of this amendment covered already in the Bill in Clause 2? If there is a minor authority, the minor authority shall appoint, and we have a parent governor. It would seem that the concern is that, as regards an agricultural area, somebody with a knowledge of agriculture should be on the board. If one is considering a school in an agricultural area, I should have thought that the chances are that one of the parents would be involved in that industry. If, on the other hand, one is in the middle of Preston, and living in an area where most of the children in the school may be of a different racial origin, then presumably one of the parents in that school would be living next door to such a person and would have knowledge of community relations immediately rather than professionally. Is not that what is wanted? Therefore, is not what is desired already covered?
Baroness DAVID: My Lords, I would venture to suggest that it is not. We are not specifying who is to be on the board. We are suggesting guidelines. I think
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it is quite obvious that many governing bodies do not include the sort of people they should include. I shall quote from one of my favourite chief education officers, Doctor Owens from North Yorkshire, who in an article this week wrote about how the Education Bill has dealt with Taylor. He says:
"Nothing is said in the Bill about Taylor's representatives of the community".
Then comes the part that I want your Lordships to pay attention to:
"We all know of the limitations of a governing body consisting solely of nominees narrowly conceived from prescribed organisations. The aim should be to recognise the valuable part which governors from, e.g., industry, commerce and the trade unions can play, without seeking to prescribe in detail how local education authorities should achieve what is widely agreed to be required ".
He is a chief education officer with very wide experience of governing bodies and he thinks that there is a need to have people from industry, commerce and so on, which is what this amendment attempts to do. I ask noble Lords, what harm can it do to include this in the Bill? —as my noble friend Lady Wootton asked at the Committee stage. It is an important amendment, particularly so in the parts about industry and commerce. I hope that noble Lords will support it.
Viscount SIMON: My Lords, the indications seem to be that the Government will dig in their heels about this, though I hope that they will not. If that is what they intend to do, is there any possibility of the noble Lord or his colleagues saying that they will include some advice on these lines in a circular to local education authorities?
Lord STEWART of FULHAM: My Lords, I had hoped that we would have a more helpful reply from the Government on this. If I may refer for a moment to the words of the right reverend Prelate, he argued that what we are suggesting can, by implication, already be found in Clause 2 of the Bill. However, the difference is that Clause 2 sets out the kind of people the governors must be; it says that some must be drawn from one category and some from another. Part of the trouble is that in the process of making quite sure that they have a parent governor, so many from the local education authority, so many from the foundation, and so on, they may overlook the question: what kind of people are they

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personally? In Clause 2 we are imposing a good deal of statutory obligation—not just advice, but prescription—on them. In this amendment we are trying to remind them—and I do not think it is unreasonable —that apart from complying with the mere statutory obligations of Clause 2, they ought to take a rather wider view of the task of governors. It may be admirable to have parent governors, but it is even more important that the governors should have the kind of knowledge and experience which is referred to in this amendment.
The noble Baroness, Lady Macleod of Borve, said that she had thought of tabling an amendment saying that there ought to be an old boy or an old girl of the school on the board of governors. I was almost tempted to table an amendment saying that no old boy or old girl should be on the board of governors. There is always a danger of the dead hand of the past descending on the organisation of schools. However, I did not do that because had I moved such an amendment, or had the noble Baroness moved hers, they would both have been mandatory, which is exactly what we want to avoid here.
It is now generally understood that there are sections of our law today which are not mandatory in the sense of saying that one must do this, but which are hortatory in the sense of saying, "We want you to think of this". It has been established in our law for a considerable time now that Ministers are often required to have regard to this, that and the other before they make regulations. I do not think that it would be objected to on that ground. It seems to me that any objection on principle that it is wrong to have merely hortatory clauses such as this in an Act of Parliament, will not stand up; it is not in line with the practice of our law today.
If I may say so, I do not think very much of the argument that if one starts specifying some things, one can go on specifying for ever. So one can, but I think that we have made rather a good choice of what should be particularly specified in this amendment. As one of my noble friends pointed out, we hear a great deal about the unduly low opinion that is sometimes held of industry and commerce among those who conduct
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the educational process. This is the kind of matter which we are trying to put right. Here we are urging that some imagination should be used. I am afraid that we are not getting any response from the Government. Unless the Government can see their way—and they ought to see their way—to accepting this amendment, I would ask my noble friends to press it.
Lord BELLWIN: My Lords, by the leave of the House, perhaps I could touch on a few of the points that have been made, and, as usually happens, the last ones first. The noble Lord, Lord Stewart of Fulham, said that the basis of the amendment is that it calls for a wider view. I should have thought that it calls for exactly the opposite—a narrower view. The wider view is when you seek not to prescribe; the more you prescribe, the narrower you make the view. On the question whether or not an old boy or old girl is better or worse, I believe that that will always be a matter of opinion. Indeed, I think that my noble friend Lady Macleod made the case very well—not by seeking to specify that as a category of persons, but, by the very fact that when one seeks to specify any category of persons one makes the view narrower rather than wider.
The noble Lord, Lord Stewart, said that he thought the list was rather a good choice. I am sure he does; the amendment is in his name, and I should not expect him to think otherwise of his own choice. The noble Lord called for the Government to use their imagination. I think I may say that we use imagination from time to time, but I should have thought that in cases like this the less imagination used, the better—rather less imagination and rather more discretion was the theme.
The noble Baroness, Lady Bacon, reminded me that in an area of Leeds—from where we both come —they have particular community relation problems; and, indeed, they do, although I am happy to say fewer problems than in many other like situations. But then the point is made, because those who make appointments to schools in that region do exactly as the noble Baroness hopes they will—they do, indeed, take this into account and make appointees accordingly. It is to their credit that they do. I would have expected nothing else, and I am sure

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that she would not; indeed, I hope that your Lordships would not.
The other points made were of interest. I am grateful to the right reverend Prelate for believing, as the Government do, that the concerns that have been expressed are already covered. I believe that they are. As I said right at the beginning of this particular discussion, of course, one understands and one can still agree with the philosophy expressed, and it does not have to be written in in detail in this way. We would still prefer it to be left in the same broad sense as it is now, hearing in mind that one of the basic objectives in the Bill is to extend governors in the way we are; that there be a parent and a teacher; that there be a governing body for each school. I think that that indicates the Government's concern as to where they want to go. I repeat that the wider we can leave it to discretion and to good sense, the better it will be.
In those circumstances, we should have to resist the amendment.
Viscount SIMON: My Lords, with the leave of the House, might I ask the noble Lord whether he can answer the suggestion I made as to whether the point could be included in a circular?
Lord BELLWIN: Again, by leave of the House, the point has been made. When circulars are issued, I would certainly ensure that this is considered by the Government. Clearly, the noble Viscount would not expect me here and now to give such an undertaking. The point is made, is taken, and will be considered.
3.48 p.m.
On Question, Whether the said amendment (No.4) shall be agreed to?
Their Lordships divided: Contents, 64; Not-Contents, 111.

CONTENTS

Amherst, E.

Gaitskell, B.

Northfield, L.

Ardwick, L.

Gladwyn, L.

Parry, L.

Ashbourne, L.

Gordon-Walker, L.

Peart, L.

Aylestone, L.

Gore-Booth, L.

Richardson, L.

Bacon, B.

Goronwy-Roberts, L.

Sainsbury, L.

Balogh, L.

Gosford, E.

Seear, B.

Banks, L.

Grey, E.

Shinwell, L.

Barrington, V.

Hale, L.

Simon, V.

Beaumont of Whitley, L.

Hampton, L.

Stedman, B.

Birk, B.

Henderson, L.

Stewart of Alvechurch, B.

Blyton, L.

Houghton of Sowerby, L.

Stewart of Fulham, L.

Boston of Faversham, L.

Hughes, L.

Stone, L.

Bruce of Donington, L.

Jacques, L.

Strabolgi, L.

Byers, L.

Janner, L.

Strauss, L.

Collison, L.

Kirkhill, L.

Underhill, L.

Cooper of Stockton Heath, L.

Leatherland, L.

Wallace of Coslany, L. [Teller.]

Darcy de Knayth, B.

Llewelyn-Da vies of Hastoe, B. [Teller.]

Wedderburn of Charlton, L.

Darwen, L.

Wells-Pestell, L.

David, B.

Lovell-Davis, L.

Wilson of Radcliffe, L.

Elwyn-Jones, L.

Masham of Ilton, B.

Wootton of Abinger, B.

Evans of Claughton, L.

Meston, L.

Wynne-Jones, L.

Fisher of Rednal, B.

Mishcon, L.

NOT-CONTENTS

Adeane, L.

Buckinghamshire, E.

Ellenborough, L.

Ailesbury, M.

Caccia, L.

Elliot of Harwood, B.

Airey of Abingdon, B.

Campbell of Croy, L.

Elton, L.

Alexander of Tunis, E.

Cathcart, E.

Enniskillen, E.

Alport, L.

Clancarty, E.

Exeter, M.

Amory, V.

Clitheroe, L.

Faithfull, B.

Ampthill, L.

Clwyd, L.

Ferrers, E.

Auckland, L.

Cottesloe, L.

Forester, L.

Avon, E.

Cullen of Ashbourne. L.

Fraser of Kilmorack, L.

Balfour of Inchrye, L.

Daventry, V.

Gage, V.

Barnby, L.

Denham, L. [Teller.]

Galloway, E.

Bellwin, L.

Derwent, L.

Gisborough, L.

Belstead, L.

Drumalbyn, L.

Glasgow, E.

Bessborough, E.

Dundee, E.

Glenkinglas, L.

Birdwood, L.

Eccles, V.

Gowrie, E.

Blackburn, Bp.

Effingham, E.

Gridley, L.

Grimston of Westbury, L.

Mansfield, E.

Sandys, L. [Teller.]

Halsbury E.

Marley, L.

Sempill, Ly.

Hanworth, V.

Merrivale, L.

Sharples, B.

Harding of Petherton, L.

Morris, L.

Spens, L.

Harvington, L.

Mowbray and Stourton, L.

Stamp, L.

Hayter, L.

Newall, L.

Strathclyde, L.

Henley, L.

Norfolk, D.

Strathcona and Mount Royal, L.

Hill of Luton, L.

Nugent of Guildford, L.

Strathspey, L.

Hylton, L.

Orkney, E.

Swinton, E.

Hylton-Foster, B.

Porritt, L.

Teviot, L.

Ilchester, E.

Redmayne, L.

Teynham, L.

James of Rusholme, L.

Reigate, L.

Thorneycroft, L.

Kinloss, Ly.

Renton, L.

Tranmire, L.

Lauderdale, E.

Robbins, L.

Trefgarne, L.

Long, V.

Roberthall, L.

Trenchard, V.

Loudoun, C.

Rochdale, V.

Trumpington, B.

Lucas of Chilworth, L.

Romney, E.

Vaux of Harrowden, L.

Lyell, L.

St. Aldwyn, E.

Vickers, B.

McFadzean, L.

St. Davids, V.

Vivian, L.

Mackay of Clashfern, L.

St. Just, L.

Wolverton, L.

Macleod of Borve, B.

Saint Oswald, L.

Young, B.

On Question, amendment agreed to.

Clause 3 [Grouping of schools under single governing body]:
3.58 p.m.
Baroness DAVID Baroness DAVID moved Amendment No. 5:
Page 4, line 2, after (" schools ") insert (" catering for different age groups ")
The noble Baroness said: My Lords, I am having another try at this amendment. I was told last time that it was not well drafted, so I have tried again. I do not know whether I have been any more successful. I am not entirely satisfied about the Government's intentions so far as having one governing body for every school is concerned. What I want to do in this amendment is to make sure that only a junior and an infants school can be linked with one governing body, but otherwise, if there were two primary schools, each primary school should have its own governing body. It seems to me sensible that with a junior school and an infants school, which are probably close together and the children from the infants will almost certainly go on to the juniors, that one governing body would suffice. I beg to move.
Lord BELLWIN: My Lords, the noble Baroness, Lady David, pressed this amendment to a Division when we considered it in Committee because she thought that the clause as presently drafted provided a let-out for authorities who wished to
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continue with the practice of grouping. I should like to try to reassure her that it does not. At present, under the provisions of Section 20 of the 1944 Act, an authority may group as many schools as it wishes of any type without let or hindrance and without reference to anyone. What Clause 3 of this Bill provides is that this will no longer be possible. With one exception, which I shall mention in a moment, it will in future only be possible for authorities to group schools with the agreement of the Secretary of State. And by virtue of Clause 3(5), the Secretary of State will both be able to make his approval subject to any conditions he thinks appropriate, such as a limited duration before a full transition to individual governing bodies is accomplished, and to terminate any arrangement he has previously approved at any time.
The only exception to the need to obtain the Secretary of State's approval is provided in subsection (2): this allows an authority to group two primary schools, but not more than two, on their own initiative. The amendment seeks to restrict this even further so that only two primary schools providing for different age ranges can be grouped in this way, rather than any two primary schools. I do not think the amendment would, in fact, achieve this. But in any case, as I explained in Committee; while the most obvious case where it would be sensible to group two primary schools is where a junior and infants' school share the same site, there may be other circumstances where local authorities would wish to do this. In these circumstances we cannot accept the amendment.
Baroness DAVID: My Lords, with some of those assurances—I hope they will be kept and that there will not be much grouping—I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 4 [Governors' proceedings and tenure of office]:
The MINISTER of STATE, DEPARTMENT of EDUCATION and SCIENCE (Baroness Young)The MINISTER of STATE, DEPARTMENT of EDUCATION and SCIENCE (Baroness Young) moved Amendment No. 6:
Page 5, line 15, at end insert—
(" ( ) Regulations under subsection (1) above shall make provision for the election of a chairman by the governors of any such school.")
The noble Baroness said: My Lords, I am moving this amendment in response to an amendment moved in Committee by the noble Lord, Lord Beaumont of Whitley, when he asked that the chairman of the governing body should always be chosen by election by the governing body itself. Although the model instrument for county schools already provides for this, he argued that in the context of the new provisions of the Bill, it was desirable to enshrine this requirement in the statute. The amendment which I am proposing does that. I beg to move.
Lord EVANS of CLAUGHTON: My Lords. I wish to say from these Benches and on behalf of my noble friend Lord Beaumont of Whitley, who moved the amendment in Committee on my behalf, how warmly we welcome and thank the noble Baroness for adding this provision. This matter has in my experience caused anomalies in the past in some areas where the governing body was not permitted for one reason or another to choose its own chairman. The position of the chairman is very important and he or she should have the support of the governing body, and I therefore very much welcome the amendment from these Benches.
4.2 p.m.
Lord MISHCON Lord MISHCON moved Amendment No. 7:
After Clause 5, insert the following new clause—
("Duties of Governors
. The Secretary of State shall by regulation, (which shall not be made unless a draft has been laid before Parliament and approved by a resolution of each House of Parliament), set out the powers and duties of Governors. Such regulations shall set out:

(a) the duties in relation to the appointment and dismissal of all teachers, and non-teaching staff in the school,

(b) the duties in relation to the maintenance of the school buildings and grounds,

(c) the duties in relation to the curriculum, timetables, and hours the school is open during the year,

(d) the duties in relation to the supply of materials to the school,

(e) the duties in relation to discipline within the school,

(f) the duties in relation to school uniform, and any other requests the school may make to parents to pay for visits or materials.")

The noble Lord said: My Lords, hope springs eternal in the breast of this Opposition and one of the hopes is that on Report members of the Government will seek an opportunity to repent of the position they took in Committee or, to put it another way, will exercise their obvious intellectual right to review some of the things they said at that stage. The amendment seeks to clarify for all governors what their powers and duties are and makes it incumbent on the Secretary of State to set out what those duties are in the matters in particular which are set out in the amendment.
We are anxious, as I understand it, to see that the powers and duties of governors are clear. I said in Committee that I thought it desirable to see that, so far as possible, they were uniform. It is not good, in my submission, that local education authorities should be in any doubt about the sort of powers and duties that should be set out in their articles, and we now know that the articles, certainly of primary schools, will not be submitted to the Secretary of State. I do not think it does any good, if one is trying to be persuasive in regard to an argument, to be repetitive, and the sole point I wish again to emphasise before your Lordships is that it is right and proper that the powers and duties shall be set out very clearly so that governors know exactly where they are and what their powers and duties are, particularly in relation to the matters set out here.
I shall make only one additional observation. The noble Lord, Lord Alexander of Potterhill, said in Committee, and it may have influenced some of your Lordships' minds at that time, that he thought this was not a very sensible amendment by virtue of the fact—and he gave an example—that some schools did not administer their own grounds, that those grounds were sometimes administered by the local authority, be it the parks department or whatever, and that therefore it was not appropriate that governors should be looking after their own grounds as a duty imposed by the amendment.
I remind your Lordships that the answer to that objection was clearly given in the debate, namely that whoever is looking after and maintaining those grounds, or indeed whoever owns them, it is obviously part and parcel of the duties of governors to look at the maintenance of the grounds of the school and attached to the school to see that so far as possible any defects in that maintenance shall be attended to or, if appropriate, to administer praise to those who are maintaining those grounds so well. I hope therefore that your Lordships will not be deflected, however high he his reputation as an educationist, by the intervention of the noble Lord, Lord Alexander, in Committee. I beg to move.
Baroness YOUNG: My Lords, we considered this same amendment in Committee, and at that stage I explained there was no question of putting off a decision on what the powers of governing bodies should be. I think that the noble Lord, Lord Mishcon, has now argued that local education authorities should not be in any doubt about what the powers of governing bodies should be. Both my Government and the previous Labour Administration have considered the matter of the powers of governing bodies carefully and we have both come to the same conclusion; namely, that there should be no fundamental change in the existing provision, and we believe there is no need to write something into the Bill for the present position to be quite clear. All the matters listed in the amendment, from (a) to (f), are already covered in the model articles of government for secondary schools and it is precisely the function of articles to spell out the respective roles of the local education authority, the governors and
476
the head teacher in the running of a school.
The present arrangements provide a framework within which desirable local variations are possible and occur. We on this side of the House do not believe in over-prescription, which is what the amendment would mean. There is indeed great danger that where you over-prescribe local authorities believe that is all they should do rather than putting into their articles anything more than what is required. Speaking on behalf of the last Government's measure in Committee in another place, this point was very well made by Miss Margaret Jackson when she said:
" I fear that the more we seek to set down and make more explicit the way in which we see the powers, the more we tie the hands of local authorities and run into the danger of providing that what is not specifically written down is not, therefore, within the governing bodies' remit. We would also be introducing an element of rigidity into a situation which at present retains a desirable flexibility ".
That is a very important point, particularly at this stage when we are setting up so many new governing bodies, and although I understand the feeling and sincerity of the noble Lord, Lord Mishcon, over this matter, I hope that on reflection he will feel able to withdraw the amendment.
Baroness DAVID: My Lords, may I ask the Minister a question? The Minister refers to articles of government setting out the duties of governors, but it has now been decided that the primary schools articles of government will not be looked at by the department, and so the Minister will not know what is to be included there. Is the department going to send out model articles of government?—because there are to be a great many new governing bodies for primary schools. I believe that quite a number of these schools do not have governing bodies or managing bodies at the moment, and there will be many new governors who will be wondering what they are supposed to be doing. So may I ask the Minister what guidance there is to be?
Baroness YOUNG: We have not yet considered in detail what guidance we shall be sending out. Obviously we shall be considering very carefully the

477
whole question of a circular and what it should contain, once the Bill is on the statute book. However, I shall note the point that the noble Baroness has made, and clearly, if there is guidance that we feel we should give on the matter, we shall give it. The noble Baroness will know as well as I know that many education authorities have managing bodies for primary schools. They have had experience of this matter, and within their own authorities they have managed to devise very adequate and successful schemes of management or government. This is a new field into which we are moving, and I shall certainly note the points that the noble Baroness has made.
Lord MISHCON: My Lords, having regard to what the noble Baroness the Minister has said, I bee leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 6 [Parental preferences]:
4.11 p.m.
Baroness DAVID Baroness DAVID moved Amendment No. 8:
Page 6, line 31, at end insert ("(having regard to the limits determined by the local education authority under the provisions of this Act.)'').
The noble Baroness said: My Lords, in speaking to Amendment No. 8, I wish at the same time to speak to Amendment No. 11, as well as Amendments Nos. 20A and 20B, which are on the list of manuscript amendments. Perhaps I should read out to your Lordships Amendments Nos. 20A and 20B. Amendment No. 20A reads:
Page 8, line 19, at end insert ("and the limits upon admission numbers determined by the local education authority under the provisions of this Act").
Amendment No. 20B reads:
Page 8, line 37, leave out ("that it is intended" and insert ("the local education authority has determined").
All these amendments have to do with the local education authority having the right to impose a limit on the numbers entering a school in any year. I apologise for bringing this matter back to your Lordships, but I feel very strongly about it. I consider it very important for an LEA to be able to plan carefully and with foresight how to reduce the numbers in its schools,
478
particularly in the situation of falling rolls. Clause 15, which we shall reach later, allows for a reduction in numbers—20 per cent. in a standard year. However, despite that procedure, it is perfectly possible for a parent to go to the appeals panel and say, "In spite of the decision that there shall be an entry of 108 this year, I want you to reconsider the policy and force the authority to go back on that process."
Your Lordships will no doubt remember that as the Bill now stands the decision of the appeals panel is binding on the authority, and I believe that the authority must have the right to decide upon the numbers going into its own schools, in the interests of providing good education for all the children in the area. I believe that in Committee the Minister said that if the limit were fixed, there would be no room at all for manoeuvre on appeal, but it seems to me that that difficulty could be got over quite easily by not filling every place at that first allocation; a few places could be kept back for claims at the appeal stage.
Clause 31, which deals with recoupment, gives a free choice to parents across boundaries, and this again makes it much more difficult for an authority to plan its schools and to make the best use of its resources. The Minister said at the Committee stage, as reported at columns 789–90 of the Official Report of 11th March, 1980:
"If an authority wishes to refuse a child's admission to a particular school, they must justify the refusal not just by reference to an arbitrary number but by reference to a great many things, which would include a point made by my noble friend Lord Belstead; that is the efficient use of resources and the efficient provision of education in their area. They must find something more than simply a question of numbers, so that children are not simply numbers on a list".
The words in Amendment No. 8:
"…having regard to the limits determined by the local education authority under the provisions of this Act"
would come at the end of the sentence, so that the entire sentence would read:
"The duty imposed by subsection (2) above does not apply…if compliance with the preference would prejudice the provision of efficient education or the efficient use of resources having regard to the limits determined by the local education authority …".
So the other part of the matter would be taken into consideration. I believe that

479
for the sake of good planning, for the proper use of resources, and for the proper provision of education in each school, we should give the authorities the right to set a limit during this particularly difficult period of reducing numbers. I beg to move.
Baroness YOUNG: My Lords, I am not surprised that the noble Baroness, Lady David, has presented this amendment again because, as she rightly says, it illustrates a division between each side of the House on this matter. I understand that the former Labour Government's Bill of 1978 provided for the determining of admission limits which did not have to be based on any particular considerations, and which, once determined, were unchallengeable. As the noble Baroness, Lady David, has made clear, her group of amendments are in fact designed to establish within the Bill these planned admission limits. What is contained in Clause 6 of this Bill is not the same as that principle, and we have rejected that approach, which we believe was arbitrary and was contrary to parental interests. We believe that if an authority wishes to refuse a child admission, the authority must justify that refusal not merely by reference to a number, but by reference also to the criteria that we have set out in the Bill relating to the provision of efficient education, or the efficient use of resources. I accept that Amendment No. 8 would qualify that situation, yet there would still be set an arbitrary number against which the other matters would be measured.
We believe that as drafted the Bill achieves this advantage for parents, while the amendment before your Lordships does not, because in effect it allows a local education authority to determine in advance that these considerations are to be regarded as satisfied by the limit, rather than that the limit should satisfy the considerations. Both the Government and the local authority associations believe that the Bill will give local authorities the protection that they need to plan sensibly the provision for all the children in their area.
While I am speaking I should like to draw attention to what we regard as two further objectionable features of Amendment No. 11. I explained these argu-
480
ments in Committee, but it seems that it would be wise to repeat them. The limits for aided and special agreement schools would be determined by the local education authority; this would be a restriction on their freedom, which was rejected last year. Under the Bill voluntary aided schools and special agreement schools are able to fix their own admissions policy, and bearing in mind that this particular matter has been debated on a number of occasions during consideration of the Bill, I should point out that what is proposed would be one of the points which would upset the balance agreed between the voluntary schools and the Government under the 1944 arrangements. Under Amendment No. 11 limits would apply to primary schools as well as secondary schools—which I understand is an arrangement which both sides agreed to drop in the former Administration's Bill of 1978. On the basis of all those reasons, I must make it clear that there is here a major division between the two sides of the House regarding policy, and the Government could not accept these amendments.
Lord STEWART of FULHAM: My Lords, I think there is a general point at issue here which crops up not only in relation to this clause but in relation to others as well. It is this: Who are the parties when an appeal is made? At the outset, it looks as if there is the parent on one side and the local authority on the other, but we must remember that the local authority is really representing the interests of children in the neighbourhood as a whole. It is not a conflict between an individual parent with a right and what might be pictured as a soulless local authority. It is a question of the claim of one parent and the need for all parents to have provided for them the best education which the resources of the district allow. I think that has to be remembered in the whole argument about appeals.
On this question of limits, it is going to be the more important for us in the future because of falling rolls. One may have a situation where one school is growing in size and another is falling in numbers and finding it more and more difficult to provide good education, and yet the fall is not such as would justify the closure of the school. In that situation, I do not think we want developing

481
one school which is what one might call fashionable and another which is what is sometimes brutally referred to as a "sink school" I think that is something we all want to avoid; and it helps a local authority to avoid it if it can establish limits. Whenever "limit" or "number" is mentioned, the adjective "arbitrary" is always put in front of it, but this is not a legitimate assumption. One may reasonably presume that in fixing limits the local authority would have regard to what was the best use of its buildings and its resources, and to the needs of the children; and Amendment No. 11 provides that the limit in respect of an aided school or special agreement school can be determined only following consultation with the governors of that school.
Really, I think that the difference between us is that on the other side of
the House it is assumed that one particular parent who has the pertinacity or the resources to use the machinery of appeal shall be almost certain to get his or her own way without regard to what happens to the education of the children as a whole, whereas what we are pressing is that the resources and buildings of a local authority should be so used as to give the best chance of the best education to all the children for whom it is responsible. I am sorry, therefore, that the Government cannot see their way to accepting this amendment.
4.24 p.m.
On Question, Whether the said amendment (No. 8) shall be agreed to?
Their Lordships divided: Contents, 56; Not-Contents, 129.

CONTENTS

Ardwick, L.

Goronwy-Roberts, L.

Northfield, L.

Aylestone, L.

Gosford, E.

Oram, L.

Bacon, B.

Hale, L.

Parry, L.

Balogh, L.

Hatch of Lusby, L.

Peart, L.

Birk, B.

Henderson, L.

Ross of Marnock, L.

Blyton, L.

Houghton of Sowerby, L.

Sainsbury, L.

Boston of Faversham, L.

Hughes, L.

Shinwell, L.

Brooks of Tremorfa, L.

Irving of Dartford, L.

Stedman, B.

Bruce of Donington, L.

Jacques, L.

Stewart of Alvechurch, B.

Collison, L.

Janner, L.

Stewart of Fulham, L.

Cooper of Stockton Heath, L.

Kaldor, L.

Stone, L.

Cudlipp, L.

Kirkhill, L.

Strabolgi, L.

Darwen, L.

Leatherland, L.

Strauss, L.

David, B.

Listowel, E.

Taylor of Mansfield, L.

Davies of Leek, L.

Llewelyn-Davies of Hastoe, B.

Underhill, L.

Elwyn-Jones, L.

Lovell-Davis, L.

Wallace of Coslany, L. [Teller.]

Fisher of Rednal, B.

Milford, L.

Wells-Pestell, L. [Teller.]

Gaitskell, B.

Mishcon, L.

Wootton of Abinger. B.

Gordon-Walker, L.

Noel-Baker, L.

NOT-CONTENTS

Adeane, L.

Blackburn, Bp.

Elliot of Harwood, B.

Ailesbury, M.

Bolton, L.

Elton, L.

Airedale, L.

Byers, L.

Enniskillen, E.

Airey of Abingdon, B.

Caccia, L.

Evans of Claughton, L.

Alexander of Tunis, E.

Campbell of Croy, L.

Exeter, M.

Alport, L.

Cathcart, E.

Faithfull, B.

Amherst, E.

Clancarty, E.

Ferrers, E.

Amory, V.

Clitheroe, L.

Forester, L.

Ampthill, L.

Cottesloe, L.

Fraser of Kilmorack, L.

Ashbourne, L.

Cullen of Ashbourne, L.

Gage, V.

Auckland, L.

Davidson, V.

Galloway, E.

Avebury, L.

de Clifford, L.

Gibson-Watt, L.

Avon, E.

Denham, L. [Teller.]

Gisborough, L.

Balfour of Inchrye, L.

Derwent, L.

Gladwyn, L.

Banks, L.

Drumalbyn, L.

Glasgow, E.

Barnby, L.

Dundee, E.

Glenkinglas, L.

Barrington, V.

Dundonald, E.

Gore-Booth, L.

Beaumont of Whitley, L.

Ebbisham, L.

Greenway, L.

Bellwin, L.

Eccles, V.

Grey, E.

Belstead, L.

Effingham, E.

Gridley, L.

Bessborough, E.

Ellenborough, L.

Grimston of Westbury, L.

Halsbury, E.

Macleod of Borve, B.

Sempill, Ly.

Hampton, L.

McNair, L.

Sharples, B.

Hanworth, V.

Mansfield, E.

Simon, V.

Harding of Petherton, L.

Marley, L.

Spens, L.

Harvington, L.

Morris, L.

Stamp, L.

Hayter, L.

Mowbray and Stourton, L.

Strathclyde, L.

Henley, L.

Norfolk, D.

Strathcona and Mount Royal, L.

Hill of Luton, L.

Nugent of Guildford, L.

Strathspey, L.

Hylton, L.

Onslow, E.

Swansea, L.

Hylton-Foster, B.

Orkney, E.

Swinton, E.

Ilchester, E.

Redmayne, L.

Teviot, L.

James of Rusholme, L.

Reigate, L.

Teynham, L.

Kinloss, Ly.

Renton, L.

Tranmire, L.

Kinnoull, E.

Robbins, L.

Trefgarne, L.

Lindsey and Abingdon, E.

Roberthall, L.

Trenchard, V.

Lloyd of Kilgerran, L.

Rochdale, V.

Trumpington, B.

Long, V.

St. Aldwyn, E.

Vaux of Harrowden, L.

Loudoun, C.

St. Davids, V.

Vickers, B.

Lucas of Chilworth, L.

St. Just, L.

Vivian, L.

Lyell, L.

Saint Oswald, L.

Westbury, L.

McFadzean, L.

Sandys, L. [Teller.]

Wolverton, L.

Mackay of Clashfern, L.

Seear, B.

Young, B.

Resolved in the negative, and amendment disagreed to accordingly.

4.34 p.m.
Lord STEWART of FULHAM Lord STEWART of FULHAM moved Amendment No. 9:
Page 6, line 36, leave out from ("school") to end of line 41.
The noble Lord said: My Lords, the effect of this amendment would be to leave out Clause 6(3)(c). That paragraph in the Bill makes it possible for a local authority to set aside parental choice on the grounds that the the local authority is operating a system of selection by what used to be known (and still is known) as the "11-plus". That, quite plainly, is what the argument is about. Is it right to put children through some kind of test when they are under the age of 11 and, as a result of that, decide what kind of secondary school they are to go to and. consequently, what opportunities in life shall be open to them thereafter? That is what the 11-plus means.
This Bill provides that a local authority can do that; and if it says that that is what it is doing, all the other considerations of parental choice can be set aside. It is important to stress that, because the Government have argued over the whole of the Bill that they are making a great thing of parental choice. Quite clearly, in this paragraph they are doing no such thing. They are setting above parental choice the belief that it is right to have this process not only of selection but of separation at 11-plus. Indeed, I have always felt that the word, separation", is the more correct one because in one
484
sense, throughout the whole process of any child's education, there is some process of selection—what subjects would it be wisest for this child to study; at what rate can it make progress in those subjects? This is a matter of constant consideration. But the specific feature of the 11-plus is that, as the result of a test given when a child is about the age of 10½, you put the children into different kinds of schools, schools which have (and are intended to have) different opportunities. This was never the intention of the 1944 Act.
I stress that only because in quarters that ought to know better—as in articles in The Times newspaper—it has sometimes been argued that separation on the basis of the 11-plus examination was enshrined in the 1944 Act. As noble Lords know, that is not so. There is no mention of different kinds of secondary school in the 1944 Act. The 11-plus really occurred because before the 1944 Act, apart from a few technical schools, secondary education was mainly grammar school education; and the easiest way, although not the best way, for local authorities to deal with the 1944 Act requirement that there should be secondary education for all, was simply to re-name their old senior elementary schools as secondary schools of some kind.
It is significant that they chose the name "secondary modern". It is a completely nonsensical piece of nomenclature. There was a time when a grammar school meant a school where the curriculum was based on a knowledge of Latin. The "grammar" in question was Latin grammar. If that were still true, if grammar schools

485
were still of that kind, there would be some point in talking about secondary modern. But today the grammar school is not that sort of thing at all, at least not exclusively. It is considered to be one which gives the kind of education which can lead on to further and higher education at university, and, in any case, is likely to equip the recipient for the better-paid kind of job—and that would be true whether the pupil studies classics, science, modern languages or whatever. To call non-grammar schools secondary moderns was an admission that no one quite knew what kind of schools they were or what function they ought to pursue, except that they would not be grammar schools. They would be the schools to which children would go who had not passed a classifying test as to whether they were fit to go to grammar schools or not. As I think I said when we were arguing this matter earlier, they have always been regarded as the school that somebody else's child will go to.
In the long argument over comprehensive secondary education, I have been faced often by indignant people with banners proclaiming, "Save our grammar schools". Never did one find a campaign: "Save our secondary modern schools"—the schools to which 80 per cent. of the population went. If one were to hold an opinion poll in a local authority on whether they believed in separation at 11 or not, the only honest way to hold it would be by putting on the ballot paper these words: "A secondary modern school is for less bright children. It is unlikely if your child goes to a secondary modern school that it will proceed to further or higher education or to a university. Do you wish your child to go to a secondary modern school?". If 80 percent. of the population answer, "Yes", to that question, you can fairly say that the people of the locality have voted in favour of the 11-plus, but not otherwise.
The extraordinary thing here is that we are inscribing the 11-plus examination firmly into the law. We are giving it a priority over parental choice at a time when the weight of informed opinion against it has been growing and growing for years. It is remarkable the way in which comprehensive schools have spread over the country. They were represented
486
to begin with as a fad of the Labour Party. But, one after another, local authorities of different complexions adopted them.
The idea of comprehensive secondary education never received any particularly favourable treatment from the Press. Some newspapers were massively opposed; a few were luke-warmly in favour. The same is true of the other media. The movement for comprehensive secondary education grew because it was increasingly apparent that that was what the majority of parents wanted, and because the comprehensive schools were winning the argument. It was argued against them to begin with that they were bound to be too large, regardless of the fact that those of us in the Labour Party who advocated them pointed out that there are many different ways of arranging the comprehensive principle, and the large school was by no means the only way.
It was argued that the brightest children would be discouraged. The fullest and most recent report on the progress of children in comprehensive schools plainly gives the lie to that. It is simply not true. It is sometimes argued that it would be very depressing for the less bright children to be in the same kind of school as the more bright; but that again has recently been disproved. One of the things several reports have shown is that undoubtedly the less bright children at the age of 11 benefit from being in a school with children who are more gifted at that age. The noble Lord, Lord Morris, told us when we last debated this matter that this was not true of is his brother. I am sorry about that. I assure him that it appears to be generally true.
It is extraordinary, in view of the absence of any powerful friends, that the movement for comprehensive secondary education has grown steadily and has been justified. It seems therefore in these circumstances totally wrong to give selection a new lease of respectibility, a new legal status, and to assert it against the right of parental choice to which the Government claim they are so greatly devoted. I beg to move.
4.43 p.m.
Lord EVANS of CLAUGHTON: My Lords, I do not wish to spend a long time

487
discussing the merits or demerits of selective as against non-selective and comprehensive education. My party have shown themselves committed to the concept of non-selective education. A matter that concerned me is that in Committee the noble Lord, Lord Belstead, said that by passing this amendment we would effectively be abolishing all selective education. It seems to me that this is not absolutely clear. In the education authority area where I live, because we are partly an area which was a county borough and had comprehensive schools and partly the old Cheshire County, which had selective education, we have three different kinds of secondary education in one local education area.
We have one type of comprehensive education in what was formerly Wallasty; another type in what was formerly Birkenhead; and a selective system with secondary modern and grammar schools in what was formerly Cheshire County Council. I imagine that this kind of variable system occurs in other local education authority areas. As things stand at the moment, if a child lives in an area which was formerly Cheshire, or within Cheshire, the area which was Bebington, which adds another complication to a system of already Byzantine complexity, he or she will take an examination within the catchment area which was formerly that particular district of the old county. If he or she lives in what was formerly the county borough, he or she—even though the parents might have wished passionately for the child to have had the benefits or otherwise of selective education—is not allowed to take an examination, but, has to go to the comprehensive school.
It seems as though the legislation in Clause 6 requires that every local education authority which has a mixed system, such as the Wirral, should allow pupils who live in whatever part of that local education authority area to sit an examination for the selective schools. For example, a child living in Birkenhead could sit an examination for a place in Calday Grange Grammar School, West Kirby. However, if it does not mean that, if it means that the same system will obtain as before, this amendment will be pointless.
488
It worries me that we may be voting—if we come to vote on this amendment—in the belief that we are voting to abolish a selective system, whereas we might be voting to create an impossible situation. If in a part of a local authority area a child has to sit a selective examination whether he likes it or not, then the whole question of parental choice becomes very limited, in the same way as if the child is not allowed to sit a selective examination in another part of a local authority area. The question of whether or not to exclude the right to choose to go to a selective school at the parents' behest does not apply. Before I can make up my mind which way I shall vote on this amendment, may I have clarification as to what the Government's intentions are in this field? I hope I can be reassured about this: the position is very complex and muddled regarding local education authorities which have partly comprehensive and partly selective systems.
4.47 p.m.
Baroness BACON: My Lords, this is muddled. I am afraid this Bill makes the position even more muddled. This subsection legalises a practice which has been in operation for many years. This is the first time that it has actually been made a part of the law. Everybody knows that in the past some parents have fought, as my noble friend Lord Stewart said, to save our grammar schools in the belief that their particular child would be one of the 20 per cent. who were going to go to a grammar school, and not one of the 80 per cent. for whom a grammar school was not available.
We were told by the Government when this Bill was published that there was going to be a choice for parents. But we have seen that it is not an absolute choice. One of the things that this Bill says is that if we live in an area or adjacent to an area where there is an 11-plus examination or 11-plus selection, it is no use a parent saying, "I wish my child to go to the grammar school and to the selective school ". It is laid down that no choice exists for parents in that situation. In other words, this has been a bit of a "con" trick. We have been told that parents are going to have a choice; but we see that they can only express a preference. If that preference is for their child to go to a selective school (where

489
they think their child ought to go), there can be no choice at all because they can only go to a non-selective school.
The noble Lord who has just spoken has instanced a local authority where there are three types of education for secondary school children. But this Bill makes it possible for parents to opt for the children to go to a neighbouring authority. I wondered on Second Reading what would happen where there were two local authorities, one in which there was selection, and another in which there was no selection. Would the parents have the right to say, "I want my child to go into a neighbouring authority"? This Bill makes it clear that they can do so. However, it is apparently saying, "Not if there is selection in that neighbouring authority". Then they will have no choice at all. It is complicated, but I think this Bill is making it more complicated. What we are saying is that we should take out paragraph (3)(c): otherwise it is just a hollow promise to say that parents are going to have a choice. It is quite clear that the vast majority of parents are going to have no choice whatsoever.
Baroness YOUNG: My Lords, I am sure the whole House listened with great interest to the lecture by the noble Lord, Lord Stewart, on grammar schools, secondary modern schools and the 1944 Education Act. If I took a correct note of his remarks, he said that we are inscribing the eleven-plus into the law. I think the House at this stage needs to look at this clause and at what it is trying to achieve. We need to address ourselves to the real problems that are involved. We had very long debates in this Chamber on our first Education Act and we believe, as a consequence of that, that it should be possible for local education authorities to decide for themselves what sort of education provision they wish to make within their areas. That is why we put through our first Education Bill. If parents in particular areas wish to continue sending their children to selective schools, we on this side of the House believe that they should be able to do so and we will safeguard their ability to do so. In fact, as my noble friend Lord Belstead said on a similar amendment at Committee stage, the effect of this amendment, if it were passed, would be to do away with selective schools altogether.
490
Although we are clearly divided on the issue as to whether or not there should ever be selective education—and there are clear divisions of policy between ourselves and noble Lords opposite, and I accept that they have a perfect right to use this amendment to ventilate these differences—I think they must consider very carefully whether they really think that this amendment should be made to the Bill.
Even their 1978 Bill acknowledged that where grammar schools continue to exist they must be able to continue to operate their slection procedures. If they did not do so, clearly they would not be grammar schools; and they could not operate their selection procedures if any parent could just put down a preference for a certain school without the child in question passing the examination, and being able to do so. So the grammar schools impose selection by ability and clearly a parent can only exercise his preference for a grammar school if his child is selected in the process of selection used for admission to that school. The selection process, of course, must be fair and objective and the Bill will allow it to be challenged before an appeal committee. Not every Member of the House will agree with the existence of grammar schools, but it seems to me very important that, while they exist, we should not interfere with their ability to conduct their affairs in an appropriate and sensible manner by passing this Amendment.
May I say to the noble Lord, Lord Evans of Claughton—who asked: "What happens in an authority in which there are different types of education?"—clearly not everyone can be satisfied after expressing a preference for a school, because it is not only necessary to express that preference but, of course, to be selected for it. But that is not to say it is not possible to express a preference for other schools, and I think it would be quite unfair to say that because you cannot express a preference for a grammar school you have no right to express a preference at all. You can express a preference for the other schools, and to that extent this clause gives a preference where none existed before.
The noble Baroness, Lady Bacon, said that choice is not an absolute choice. I think we would all agree with that statement. In life there is very seldom, if ever, total freedom of choice. All we are

491
saying in this Bill is that we want to give parents an opportunity to express a preference. That opportunity is qualified by the three paragraphs of subsection (3) of Clause 6. The first meets the requirements about the local education authority. Clearly, the second one is concerned with voluntary-aided schools; and the third one is concerned with schools that admit by selection. These seem to be three minimal qualifications for the expression of parental preference. We still believe that, with these qualifications, this whole Clause 6 is art important advance for parental preferences and parental rights, and I am afraid I could not accept this amendment.
Baroness DAVID: My Lords, would not the Minister agree that the choice which does remain in fact is a cloice between comprehensive and secondary modern schools, and that is it?
Baroness YOUNG: My Lords, by leave of the House, as we have already noted many times in education debates, there are more comprehensive schools than other types of schools. That being the case, there is still a very large opportunity for parents to express a preference.
Lord STEWART of FULHAM: My Lords, I shall make no apology for delivering what the noble Baroness called a lecture on the matter. In view of the widespread ignorance of all the issues involved by the opponents of comprehensive and secondary education and the frequent deliberate falsification of history by the advocates of grammar schools, it
is increasingly necessary to spell it out. The facts, as the noble Baroness knows very well, are as I stated them. I am glad that she clearly confirmed what the noble Lord, Lord Belstead, said: that the passage of this amendment—I think this will be a help to the noble Lord, Lord Evans—means the end of separatism in our education. That is exactly why we are moving it.
I cannot follow the argument that, whether or not we agree with grammar schools, we must all agree that if they exist they must be allowed to go on existing: that is really what the noble Baroness was saying. I do not believe that grammar schools, in the sense in which she is using the term, ought to continue to exist. Of course, I believe that there ought to be schools giving the kind of education which is now given in grammar schools. What I do not believe is that they should restrict themselves to that and restrict themselves to one kind of pupil arbitrarily selected at the age of ten and a half. That is the real point at issue; and so I would commend to the noble Lord, Lord Evans, and his colleagues that what is in issue here is whether we believe in comprehensive or in separatist secondary education. The issue is an important one. It is one on which, I think, overwhelmingly on the evidence we have the right of the matter, and I trust my noble friends will want to press this amendment.
4.58 p.m.
On Question, Whether the said amendment (No. 9) shall be agreed to?
Their Lordships divided: Contents, 58; Not-Contents, 116.

CONTENTS

Ardwick, L.

Gosford, E.

Oram, L.

Aylestone, L.

Hale, L.

Parry, L.

Bacon, B.

Hatch of Lusby, L.

Peart, L.

Balogh, L.

Henderson, L.

Ross of Marnock, L.

Birk, B.

Hughes, L.

Sainsbury, L.

Blyton, L.

Jacques, L.

Shinwell, L.

Boston of Faversham, L.

Janner, L.

Stedman, B.

Brooks of Tremorfa, L.

Jeger, B.

Stewart of Alvechurch, B.

Bruce of Donington, L.

Kaldor, L.

Stewart of Fulham, L.

Cledwyn of Penrhos, L.

Kirkhill, L.

Stone, L.

Collison, L.

Leatherland, L.

Strabolgi, L.

Cooper of Stockton Heath, L.

Listowel, E.

Strauss, L.

Cudlipp, L.

Llewelyn-Davies of Hastoe, B.

Taylor of Mansfield, L.

David, B. [Teller.]

Lovell-Davis, L.

Underhill, L.

Davies of Leek, L.

Maybray-King, L.

Wallace of Coslany, L.

Davies of Penrhys, L.

Milford, L.

Wedderburn of Charlton, L.

Fisher of Rednal, B.

Mishcon, L.

Wells-Pestell, L. [Teller.]

Gaitskell, B.

Noel-Baker, L.

Wilson of Radcliffe, L.

Gordon-Walker, L.

Northfield, L.

Wootton of Abinger, B.

Goronwy-Roberts, L.

NOT-CONTENTS

Abercorn, D.

Gage, V.

Mowbray and Stourton, L.

Ailesbury, M.

Galloway, E.

Norfolk, D.

Airey of Abingdon, B.

Gisborough, L.

Nugent of Guildford, L.

Alexander of Potterhill, L.

Glasgow, E.

Onslow, E.

Alexander of Tunis, E.

Glendevon, L.

Orkney, E.

Alport, L.

Glenkinglas, L.

Pender, L.

Auckland, L.

Gowrie, E.

Redmayne, L.

Avon, E.

Greenway, L.

Reigate, L.

Balfour of Inchrye, L.

Gridley, L.

Renton, L.

Bellwin, L.

Grimston of Westbury, L.

Rochdale, V.

Belstead, L.

Halsbury, E.

Romney, E.

Bessborough, E.

Hanworth, V.

St. Aldwyn, E.

Blackburn, Bp.

Harvington, L.

St. Just, L.

Bolton, L.

Hayter, L.

Saint Oswald, L.

Boyd-Carpenter, L.

Henley, L.

Sandys, L. [Teller.]

Campbell of Croy, L.

Hill of Luton, L.

Sempill, Ly.

Cathcart, E.

Hornsby-Smith, B.

Sharpies, B.

Clitheroe, L.

Hunter of Newington, L.

Spens, L.

Clwyd, L.

Hylton, L.

Stamp, L.

Cottesloe, L.

Hylton-Foster, B.

Strathclyde, L.

Cullen of Ashbourne, L.

Ilchester, E.

Strathcona and Mount Royal, L.

Darwen, L.

James of Rushholme, L.

Strathspey, L.

Daventry, V.

Kinloss, Ly.

Stuart of Findhorn, V.

Davidson, V.

Kinnoull, E.

Swansea, L.

de Clifford, L.

Lauderdale, E.

Swinfen, L.

Denham, L. [Teller.]

Lindsey and Abingdon, E.

Swinton, E.

Drumalbyn, L.

Long, V.

Teviot, L.

Dundonald, E.

Loudoun, C.

Teynham, L.

Eccles, V.

Lucas of Chilworth, L.

Tranmire, L.

Ellenborough, L.

Lyell, L.

Trefgarne, L.

Elliot of Harwood, B.

McFadzean, L.

Trenchard, V.

Elton, L.

Mackay of Clashfern, L.

Trumpington, B.

Enniskillen, E.

Macleod of Borve, B.

Vaux of Garrowden, L.

Exeter, M.

Mansfield, E.

Vickers, B.

Faithfull, B.

Margadale, L.

Vivian, L.

Ferrers, E.

Marley, L.

Westbury, L.

Forester, L.

Merrivale, L.

Wolverton, L.

Fortescue, E.

Monson, L.

Young, B.

Fraser of Kilmorack, L.

Morris, L.

On Question, amendment agreed to.

5.6 p.m.
Lord STEWART of FULHAM Lord STEWART of FULHAM moved Amendment No. 10:
Page 7, line 6, leave out subsection (5).
The noble Lord said: My Lords, this amendment deals with a rather specialised point. It proposes to leave subsection (5) out of Clause 6. Subsection (2) of Clause 6 imposes a duty on local education authorities to give effect, subject to a number of conditions, to parental choice; and subsection (5) says that the duty shall apply also in relation to paragraphs (a) and (b). Paragraph (b) reads,
"any application made as mentioned in section 10(3) or 11(1) below".
Both Clause 10(3) and Clause 11(1) refer to a choice, or a preference, by a parent to send a child to a school not maintained by a local education authority. It would appear, then, that the effect of subsection (5) of Clause 6 is to require local authori-
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ties to make arrangements that will enable a parent, if that is the parental preference, to send the child to a school not maintained by a local education authority.
There are similar references in other parts of the Bill, but it is not at all clear to me why it should be the duty of a local education authority to arrange education outside the system for which it is responsible, unless of course, as is sometimes the case, it can clearly be shown that they cannot provide the proper facilities themselves. I hope, therefore, that the Minister can explain to us why this subsection is considered necessary. I beg to move.
Baroness YOUNG: My Lords, I hope that I can answer the question of the noble Lord, Lord Stewart, quite briefly. We believe that parents should be able to express a preference for a school in the area of a neighbouring authority. There are many children for whom the school across the boundary is the one to which they should logically go, because it is the closest to them, because it is easiest to

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get to by bus, because it is a denominational school serving the parish in which the parents live, because it offers choice of subjects which the parents find more attractive, or for any other reason that the parents may consider important in expressing a preference for a school outside the area of the authority in which they live.
Parents will be able to express a preference for a school outside the area of their authority, either to their own authority where that authority makes, or is prepared to make, arrangements for children to go outside the area, or direct to the authority maintaining the school at which the parent is seeking to place a child, if the child's home authority does not in the normal course make such arrangements. If the child obtains a place, then Clause 31 provides for automatic recoupment of the cost from the home authority. We believe that this is an entirely appropriate policy, and one which, we hope, will help to overcome the sense of frustration which many parents feel when they are prevented from getting a school of their choice for their child because there is an arbitrary line on a map drawn between one local education authority and another. That is one group which would be denied this freedom if this subsection were not in the Bill. The other one would be the right for parents whose children were the subject of school attendance orders to express a preference for the school they wish their child to attend. If the application were successful, this would be the school to be named in the attendance order.
There are two kinds of attendance orders. There are attendance orders against parents who are, for one reason or another, educating their children at home, and there are attendance orders against parents who are deliberately keeping their children at home in order that they may, as the parents hope, be able to get into the school of their choice. The second group will be prevented from using this particular loophole by other provisions in the Bill. We feel that in these circumstances it would be right for parents to be able to express a choice, and either group would be excluded if this amendment were put into the Bill. That is the reason for it, and I hope that
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the noble Lord, Lord Stewart of Fulham, will feel that this is an adequate explanation.
Lord STEWART of FULHAM: My Lords, I am obliged to the noble Baroness. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 11 not moved.]
5.12 p.m.
Baroness BACON Baroness BACON moved Amendment No. 12:
Page 7, line 15, at end insert—
("(6) In pursuance of its duties in subsection (1) and (2) above and sections 8 and 11 of the Act of 1944, each local education authority shall draw up a code of practice relating to admissions to schools which shall include reference to—

(a) the need to give preference to pupils residing in the proximity of any school;

(b) the need to maintain a variety of educational provisions at any school;

(c) the need to maintain, or otherwise, sibling or similar relationships;

(d) the need to consider the health disability, or other characteristics or needs of particular pupils;

(e) the need to consider safety and ease of transport in journeys to or from school.").

The noble Baroness said: My Lords, perhaps we could take with this amendment Amendment No. 20, which is dependent upon Amendment No. 12. It is clear from the previous amendments that expressing a preference is not the same thing as having a choice. It is quite clear, too, that if all parents are asked to express a preference, in some areas some schools will be over-subscribed while others will be under-subscribed. It is quite obvious that local authorities are not going to allow some schools to be bursting at the seams while other remain half empty, so some local authorities will have to make decisions about their allocations in very much the same way as they have to do today.
I think it would be much less trouble and cause much less disappointment if parents knew on what basis the decisions are made. It may be said by the noble Baroness the Minister that this is made clear in Clause 6(3), but if we look at Clause 6(3)(a) we see that it says that the choice does not apply if compliance with the preference would prejudice the provision of efficient education or the efficient

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use of resources. That might be clear to the Department of Education and Science and to some local authorities, but I do not think that it will be very clear to parents who have expressed a preference and who then find that that preference cannot be met. So we should prefer this to be spelled out.
The local education authority should draw up a code of practice, which would be made available and which would be well known to parents, which sets out the terms upon which they can make their choice. We think that this code of practice ought to include the need to give preference to pupils residing near the school and also the need to maintain a variety of educational provision at any school so that there is proper use of teacher man or woman power. Also, where possible, and when the parents desire it, children of one family should go to the same school. There is also the need to consider any health disability of children, and the ease of transport and safety on the way to school.
If local authorities were to adopt some such code of practice, we feel that it would be much better understood by parents when they find that their first preference cannot be met. I think, too, that it might prevent many references to the appeals committee. Therefore, although I do not agree with the way in which this choice is being made, I move this amendment in the belief that it will help and make things run much more smoothly.
Lord DARWEN: My Lords, I have just exercised my choice to vote against my party. I should like to support this amendment very strongly indeed. It is extremely well phrased; every part of it carries weight. I hope that the Government will give it their very serious consideration and include it in the Bill.
Baroness DAVID: My Lords, may I say a word about paragraph (b) of the amendment: the need to maintain a variety of educational provisions at any school. As I said earlier, because of falling numbers I think that authorities are going to have difficulties. It is very important that in a comprehensive school there should be a wide range of subjects. For instance, there should be two modern languages and two or three sciences, and
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the arts, crafts, metalwork and so on should be represented. If school numbers are too small, it is going to be very difficult to justify the provision of these subjects because it will probably mean a very high staffing ratio. Therefore, when parents are told what the choices are and what the schools provide, I think it should be made clear to them that when pupils are being allocated this must be a very high consideration.
5.18 p.m.
Baroness YOUNG: My Lords, I listened with great care to what the noble Baroness, Lady Bacon, said in moving this amendment. Nobody could argue that the points she has put down in this amendment—the five different needs which a local authority should consider in its allocations to schools—are not ones which are very important. But the fact is that different local authorities may perfectly reasonably give different weight to different items and might not accept that some needs are overriding.
We can all think of examples. Some authorities would wish to give priority to children living nearest to the school. Others would do so only to those who had listed the school as their first preference. Or, again, priority to those living nearest the school might be incompatible with an authority's wish to avoid an overlong journey for sonic children by denying access to others who live nearer. There are all sorts of arguments. To attempt to draw up a comprehensive list of factors which would command general agreement would be difficult, if not impossible. To attempt to give them some kind of rank order of priority would, I believe, be virtually impossible. The local authority associations and individual local education authorities would almost certainly strongly oppose any proposal to write this kind of prescription into the Bill. There seems to be no good reason why this should not be left to local discretion, in the light of local circumstances.
In their published admission arrangements, local education authorities will or course indicate what priority they give to these and to other factors. That is the answer both to the noble Baroness, Lady David, who made this point about the curriculum and the courses offered, and also to the noble Lord, Lord Darwen:

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that Clause 6 must be read in relation to Clause 8, because the object of Clause 8 is to provide the information in order that parents can make an informed choice. Therefore, the detail that is asked for, which would apply generally to all schools, could well be included by individual schools when they publish information about themselves or in the published admission arrangements of local authorities under Clause 8. Nobody is arguing that these matters are not important for consideration, but I hope that they will be included in other provisions of the Bill.
Baroness BACON: My Lords, may I make one point clear. The matters in the list were not in order of merit. Will the Minister be sending out advice to local authorities and, if so, will she ask them to include in their list the five items which I have set out, since she seems to agree that they are most important?
Baroness YOUNG: My Lords, the noble Baroness will remember that on an earlier amendment local authorities were asked to indicate the type of person who should be chosen as school governor. On this amendment I take note of the noble Baroness's comments; there is general agreement about the importance of the various points. However, I do not wish to leave with the House the impression that I thought the five points which she made are the most important or are in any kind of rank order. I hope that I have left her with the statement that they are important but that there are other matters which are also important. Should we send out a circular, or if we seek to advise local authorities, we shall take into account the statements made in this House and the importance which the House attaches to provisions of this kind. However, I do not believe it would be appropriate to write them into the Bill—certainly not without consultation with local authorities, who would resent them if they were included in the Bill at this stage.
Baroness BACON: My Lords, with that assurance—and perhaps the Minister could at some future time let us know what has happened about this matter—I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 7 [Appeals against admission decisions]:
5.22 p.m.
Lord STEWART of FULHAM Lord STEWART of FULHAM moved Amendment No. 13:
Page 7, line 36, leave out subsection (5).
The noble Lord said: My Lords, Subsection 5 says that the decision of an appeal committee shall be binding on the local authority or the governors of a school, as the case may be, but it does not say whether it is binding on the parents. I raise this matter for these reasons. First, we have been given to understand that after an appeal committee has reached its decision it will be possible for the matter to be put before the local government ombudsman on the grounds that there has been some form of maladministration in the way in which the committee reached its decision. Presumably the parents could then take the question of the validity of the appeal committee's decision to the local government ombudsman, but does the phrase in this subsection to the effect that the decision of the committee shall be binding on the local authority preclude them from taking the matter to the ombudsman?
Furthermore, we have been told that the Council on Tribunals will have some say in this matter. There is provision for the council to be represented at the hearing of the appeal. Presumably, therefore, it would be open to the parents if the appeal went the way that parent did not like to invoke the Council on Tribunals to consider whether the appeal had been properly conducted. If that right is open to the parent, is it also open to the local authority? That is one consideration—namely, does the right to invoke the local government ombudsman or the Council on Tribunals which presumably belongs to the parent also belong to the local authority?
The other question is as follows: If the appeal is decided in the way that the parent does not like, what is the position if the parent then does not send the child to the school which it has been decided is the right school for that child? Presumably, an attendance order will then be made, but presumably this can result in proceedings in court. Does the fact that the appeal committee has given a decision one way settle the matter in regard to

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the court? I think that it ought to settle the matter. If the appeal is to be binding on the local authority, it should be equally binding on the parent, and, if after the appeal has gone against the parent, the parent keeps the child back from the school, there should be no doubt about the result of any subsequent legal proceedings. I hope that the Minister will make the matter clear because it is not clear from the Bill as it stands that the result of the appeal is as binding on the parent as it is on the local authority or the governors.
Baroness YOUNG: My Lords, I hope that I can give the noble Lord, Lord Stewart, an assurance on the point he has made. In the first place the decision of the appeal committee is binding on the parent as it is on the authority. If the parent is displeased, that parent can try another school. But that is a very different proposition from saying that the original decision on that school is not binding.
The parent can take the case to the local government ombudsman, but he is only concerned with matters of administration and is not concerned with the decision that has been taken. Clearly, the local authority does not go to the ombudsman because the ombudsman makes a reference to the local authority rather than the other way round. The ombudsman is concerned with maladministration, be he the parliamentary commissioner in regard to central Government, or the local government commissioner in regard to local government. I think that matter is quite clear and therefore binding.
The second question related to the role of the Council on Tribunals. That council has no role at all in individual cases. As I understand the role of the council, it is an advisory body which operates under the terms of the Tribunals and Inquiries Act 1971 and consists of between 10 and 15 members appointed by the Lord Chancellor and, in addition, the parliamentary ombudsman is a member by virtue of his office.
The Council has three principal functions, of which the first is relevant to appeal committees, and that is:
"to keep under review the constitution and working of tribunals specified in Schedule 1 to this Act"—
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and that is the Tribunals and Inquiries Act 1971—
"(being the tribunals constituted under or for the purposes of the statutory provisions specified in that Schedule) and, from time to time, to report on their constitution and working".
The council at present exercises its functions in respect of a wide range of committees and tribunals in all fields of activity. Therefore, I understand that its aim is not to discusss in any way the details of the case, but to make quite sure that the appeal committee, as other tribunals, is working in the way it should do. The last point put to me by the noble Lord related to an attendance order. I wish to confirm that an attendance order only goes to court in the case of the nonattendance of a child at the named school. The court in such a case has no power to vary the school named. I hope that clears up the three points that were put to me, and I hope it satisfies the noble Lord.
Baroness DAVID: My Lords, if the decision of the appeal committee is binding also on the parent—and we were not at all clear on that point—would it not be a good idea to put it into the Bill so that it will be clear to everybody? Is the Minister willing to table an amendment of that sort on Third Reading?
Baroness YOUNG: My Lords, I am reluctant to say that I will bring any amendments to the Bill at Third Reading, for a variety of reasons, not least of which is the parliamentary timetable. What I will say to the noble Baroness is that the point has been noted; I can see that there appears to be confusion on this matter and I will certainly think about it but I could not give a promise. This, again, might well be something that one should consider in the course of a circular, or something like that.
Lord STEWART of FULHAM: My Lords, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Schedule 2 [School admission appeals]:
5.31 p.m.
Lord STEWART of FULHAM Lord STEWART of FULHAM moved Amendment No. 14:
Page 36, line 20, at end insert ("; and

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(c) a parent of a child attending a maintained school,")
The noble Lord said: My Lords, here is an amendment which will surpass the Government's ingenuity to find a reason for not accepting. It requires merely that at any rate one of the members of an appeal committee should be the parent of a child attending a maintained school. It does not require any addition to the number of members of an appeal committee. The kind of people who have to be members of an appeal committee is laid down in the schedule. All it requires is that whatever other qualifications they shall possess, and for whatever other reasons they shall be appointed, one should make sure when finally drawing up the lists of people on the appeal committee that one of them at least, no matter what other qualifications they may have, has the qualification of being a parent of a child attending a maintained school. I think it would be agreed that, when an appeal committee is judging the matter of whether a parent has a right to send a child to a particular school, it would be unreasonable that that should be considered by an appeal committee not one of whose members was the parent of a child attending a maintained school. It would not be at all difficult to comply with this. It does not add to the size of the appeal committee and, in itself, it is an entirely reasonable requirement. Therefore, I earnestly hope that at long last the Government will say that they are willing to accept this amendment. I beg to move.
Baroness YOUNG: My Lords, as the noble Lord has paid me the compliment—and I take it as a compliment—of being very ingenious about arguments, may I say that this is a matter that we have looked at, but we believe that at the end of the day it is unrealistic to require authorities to nominate a parent to each individual appeal committee. After all, we are going to consider the occasions on which we are going to ask for parents to be involved in the education system. We are going to require two parents on every governing body and we believe that in many areas it will be quite difficult to find enough parents to fill the role on appeal committees. Only a limited number of parents will have sufficient interest in
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education, in the area going beyond the particular school which their own child attends, to be prepared to take on the more objective role as a member of an appeal committee, hearing appeals in relation to other children in other schools.
We believe that the Bill goes some way in the direction which the noble Lord, Lord Stewart, and his noble friends would like, in that it provides for parents to be among the independent persons to be appointed by the local education authority and it is very likely that a good many of those appointed in other capacities will themselves be parents. We have considered carefully the arguments advanced for changes in the present provisions in the Bill, but we have concluded on balance that they are not practicable, nor do we feel justified in writing this specific requirement into the Bill. If this part of Schedule 2 is looked at as a whole, it will be seen that we are trying to get a balanced appeal committee, of which in all of the qualifications of the people serving on the committee that we are considering, we would include that of being a parent. I think that is the right way of putting it, rather than to prescribe a parent in every case.
Baroness DAVID: My Lords, I should like to add just one comment. When I was a member of an appeal committee, of which I have spoken before at Second Reading, we did not have people from outside the authority as members of it, but we did insist on having a parent of a child attending a maintained school, and we managed to find that parent from among the local authority members. I should have thought that was also a possibility and that this amendment would have allowed for that as well.
Baroness YOUNG: My Lords, if I may speak again by leave of the House, what the noble Baroness suggests is not precluded by Schedule 2. Indeed, if I may say so, the noble Baroness herself was a very good example; no doubt being a member of the appeal committee and also a parent, at the same time. That is all possible under what we are allowing, but it is not prescribed under Schedule 2. If they so wish, local authorities can always have a parent on the appeal committee.
5.36 p.m.
On Question, Whether the said amendment (No. 14) shall be agreed to?
The DEPUTY SPEAKER (Baroness Wootton of Abinger): My Lords, Tellers for the Contents have not been appointed pursuant to Standing Order No. 50. A Division therefore cannot take place, and I declare the Not-Contents have it.
Baroness DAVID Baroness DAVID moved Amendment No. 15:
Page 37, line 35, leave out ("or to be represented")
The noble Baroness said: My Lords, in moving this amendment I intend it to be a probing amendment. I want to know exactly what, "or to be represented", means. In my view, it means legal representation, and, if so, I am very strongly against it. I think the way the appeal committee is going to be set up, and its procedure, is much too elaborate and cumbersome. As the House will know, I moved for Schedule 2 to be left out of the Bill. If we are really going to say that lawyers can go along with parents, I am very strongly against that. I think it would become much too formal, would go on much too long, and would not be at all the sort of thing we want to have. So may I ask the Minister what is intended by those words?
The Earl of SWINTON: My Lords, may I support what has been said from the opposite Bench? This also frightens me, because I assume that if an appellant has a legal representative, then the county council or whatever it is, the education committee, will have to have one, as well. I understand these appeals take place somewhere near the schools, not near the education offices, so it probably means a whole day of travel, which is going to put a great deal on the rates. With all respect to Members of your Lordships' House who are lawyers, we know how they do go on at each other. I see the noble Lord, Lord Mishcon, glaring at me across the Chamber. It tends to drag out the proceedings. If this amendment were pressed to a Division, and if these words do mean legal representation, I would have been tempted to follow the noble Baroness into the Division Lobby. I feel rather less enthusiastic after the nonsense that was made of the last Division.
Lord EVANS of CLAUGHTON: My Lords, I must declare an interest as a solicitor. I must say with deep emotion how bitterly I oppose this amendment, not for the reason that I am looking for additional work for solicitors. It would be the kind of work that would be very unremunerative. Would a parent who was a legally qualified person be excluded from appealing? But, more seriously, the concept that noble Lords seem to have in their minds, that the presence of lawyers would make the appeal more complex and more difficult is not so, in my experience, and I am sure a great many other peoples'. The worst complexity comes when people appear at tribunals who are not legally qualified, the long and interminable debates among people who do not understand the procedures and the simplest and most straightforward way of putting the case. I would suggest that a parent, to whom this is a very important matter, should have the right if he wishes to be represented by the person best able to speak for him, whether it be a solicitor or the welfare officer or the vicar or whatever.
Secondly, being represented by a solicitor or barrister I would think would mean that the proceedings would be much shortened. I recall my own personal experience of appearing before an appeal committee of this kind, not a committee of this precise nature but on a very serious matter where it was proposed to expel a boy from the school. If he had not had legal representation that boy's career, which was subsequently a very distinguished one, would have been completely destroyed, if he had not had a solicitor there to make the case clearly for him. It helps in clarifying the case and expressing a parent's view in a way which will make the decision of the tribunal easier to come to, and I would have thought that was in the interest of everyone. One final point. I do not believe for one second, from my experience in local government, that an appeals tribunal, even if the parent was not legally represented, would do without the luxury and privilege of having one of the many local government lawyers present in any event. Therefore, I oppose in the strongest terms the amendment as moved.
Lord MISHCON: My Lords, may I at once take up the points which were so

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courteously made by the noble Lord opposite, and let your Lordships immediately witness one lawyer differing at great length from another lawyer. I would have thought your Lordships would have had one point in mind when considering this appeal procedure, that it should be as homely as possible, as simple as possible, and that everything should be done to make the parents of the child feel at home. With the greatest affection for my profession, that is not the atmosphere that we usually create. We try to, and if members of my profession all had the kindly face of my colleague who has just spoken maybe it would be easier. But it is not the case.
When one hears that the local education authority would most likely be represented in some way or other by a member of the legal department, that may well be true, but I think what your Lordships have to envisage is not merely a representative being there, but somebody actually representing the local authority and cross-examining the parents. There would be absolutely no point, and indeed it would be contrary to normal legal practice, if the parent's lawyer could cross-examine and the local authority's representative could not. I think all of us want to see the parents made to feel at home so that they can put their points very quietly, very firmly, and without any atmosphere which may inhibit them. I therefore hope, having declared my interest, that your Lordships will see that my observations are completely disinterested, because I would not wish to see legal representations before these tribunals.
Lord BOYD-CARPENTER: My Lords, your Lordships have just seen an example of the advantages of legal representation in the admirable way in which a thoroughly bad case was argued by a distinguished member of that profession. I would only like to say this in reply to the noble Baroness on the Front Bench. Not every parent is capable of bringing out the merits of the case he may have. Not every parent is capable of giving a coherent statement or a statement that can be sufficiently succinct to command the attention of a committee. I think to deny them, as the amendment would, the right to be represented would be a mistake, which in certain circumstances could cause injustice.
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As I read the schedule—I am subject to correction by the noble Baroness—to be "represented" is not confined to legal representation. It would presumably cover representation by an officer of a trade union, and officers of trade unions very frequently appear before all sorts of bodies. Many of them are well trained in advocacy and do give great assistance to people who are unable to make their own case. Or there may simply be a parent who is quite incoherent, or has language difficulties; with our considerable immigrant population there are quite a number who may well be in this situation, who could be helped by a friend to put the case, not as well as the noble Lord, Lord Mishcon, but a little better than the parent himself. If one looks at it from the point of view of the people who sit on these committees, someone who can put the case clearly and succinctly is a great advantage, perhaps disposes the committee in favour of the parent, and saves a lot of time. I hope my noble friend will reject this amendment.
Lord RENTON: My Lords, if your Lordships would not find it insupportable to hear the opinion of a fourth lawyer in succession, may I say that I am sure that the members of our profession would not wish to claim any kind of monopoly of representation before these appeals committees. But at the same time, as has been pointed out by my noble friend Lord Boyd-Carpenter and by other noble Lords, there may well be occasions when it would be to the advantage of all concerned for a lawyer to be there. Therefore, I hope that we may regard the words "to be represented" in the broadest sense and without any restriction.
Lord ROSS of MARNOCK: My Lords, could the noble Baroness tell me what the words "or to be represented"actually mean? Does it mean legally represented? From my experience, it has never been any great help to have lawyers there. I remember in Scottish Grand Committees inviting the presence of the Lord Advocate, and as soon as we got him there we told him to go away, because he did not always clarify the position. It is wrong to suggest that they are apt to be very speedy and concise at all times—it depends very much on the lawyer.

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It is surely a question of the atmosphere that we want to create at these proceedings. We want them to be as informal as possible for people to be prepared to appeal. Once we include legal representation, the parents might feel that they must have legal representation. They may not be prepared to pay for it and I do not suppose that the lawyer in such a case will give his time for nothing. That being so, the provision might stop people appealing, which would be wrong.
We want to retain the informality and let people feel that they are being listened to by the appeal committee and that the appeal committee can see a fair case when it is fair, and not have the case argued from a legal point of view. It is very difficult for us to judge at this stage because we have been denied any definite information about what arrangements are to be made and what is to be published. It is left pretty vague. I do not know whether there is scope for legal hassles, but I sincerely hope that there is not.
If this appeal procedure is to get off on the right foot, do not let us have this representation. It says "a friend": it does not say that that friend may not be a lawyer. However, a friend in this case will generally mean someone going along to assist a probably nervous parent or one who may be a little inarticulate. It does not presume that he will be somebody who is paid to be there. Indeed, I have never known of a trade union officer going to a tribunal and being paid. We want to retain that type of atmosphere rather than get into a position of formality with lawyers being present and lawyers being paid. Goodness knows where we shall end up with that sort of thing.
Baroness TRUMPINGTON: My Lords, in the very short time that I have been in this House—and I am certainly not referring to anyone present today—I have learnt that it is not only lawyers who are slightly long-winded. I should like to support my noble friend Lord Boyd-Carpenter. Speaking as a magistrate —and I know that the noble Baroness, Lady David, is also magistrate—I should like to point out the number of times one has thought of giving a severer sentence to somebody who has defended himself. The number of times one has
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changed one's mind when someone has had legal representation, or the representation of somebody in authority who has presented his case properly, makes me feel quite sure that it is right to include the words as already set out in the Bill.
Lord ALEXANDER of POTTERHILL: My Lords, I should have been happier if the clause had had slightly different wording and had read: "to be accompanied by or represented by a friend". The fact that the friend accompanies and that the representation is separate may well encourage a more official and authoritiative situation than I think should be the right atmosphere here. However, we cannot do that. Otherwise, I support the amendment.
Baroness YOUNG: My Lords, the noble Baroness, Lady David, my noble friend Lord Swinton and the noble Lord, Lord Ross of Marnock, all asked me the meaning of "or to be represented". That term does not just narrowly mean "to be represented by a lawyer". A parent who lodged an appeal might well be represented by his or her spouse—if one reads the provisions on procedure one will see that the apeal must be in writing, setting out the grounds on which it is made—or by a friend, by his local councillor or by anyone else who knew about the particular case.
Our expectation is that appeal committees will exercise their right to allow someone to be represented very sparingly, and normally only in circumstances where it was clearly appropriate—for example, where the parent was handicapped, or inarticulate and as a result unable to present his own case, or where the parent could not attend the committee in person because of work or domestic circumstances. As I think my noble friend Lord Boyd-Carpenter pointed out very well indeed, there are cases where it is better for somebody to be represented by someone else, for many reasons, not least of which would be language difficulties, where that was thought appropriate.
I entirely accept the point that has been made by the noble Lord, Lord Mishcon, and others, that we want as informal an atmosphere as possible. The last thing that we want appeal committees to become is a lawyer's paradise, although it is

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always enormously interesting to listen to lawyers disagreeing about something. However, that is not the purpose of appeal committees. I have every reason to think that appeal committees will be built on the best practice that exists at present, where there is an informal atmosphere and where a parent can put his case. However, when legislating in this way it seems to us right to make provision that, when somebody wishes to go to an appeal committee, he or she has the right to be accompanied by a friend or to be represented. That is all that this part of the schedule means—no more and no less. It is not in any way to be interpreted as meaning that we expect everybody to be looking on this as a court of law.
As I indicated in Committee, we believe that the normal informal procedures that operate within local education authorities at present, whereby parents discuss with officials of the education department, with their councillors, with the heads of the schools and with all sorts of people, the school to which they wish their child to go, will continue as before, and we believe that the appeal committee would be a last resort and not a first resort. Moreover, when it is a last resort we hope that it will have an informal atmosphere. That is how we hope it will continue and we have no reason for believing that the present practice of local authorities which already operate an appeal system will not, where it operates effectively and well, be continued in the future under these new arrangements.
Lord LEATHERLAND: My Lords, I do not want to enter into an argument about the real meaning of the schedule or the amendment. However, I should like an interpretation of page 37, line 35. It reads:
"An appeal committee shall afford the appellant an opportunity of appearing and making oral representations"—
that is all clear enough. It goes on:
"and may allow the appellant to be accompanied by a friend".
What is the object of having a friend? Is it mainly to hold the appellant's hand, to give him comfort in a trying atmosphere or is that friend to be allowed to make oral representations—that is to say, to address the tribunal?
Baroness YOUNG: My Lords, with the
512
leave of the House, I should have thought that the noble Lord, Lord Leatherland, would have appreciated from the comments made by other noble Lords earlier, that there are occasions on which a parent might like to be accompanied by a friend. It may be that it is a one-parent family, someone who is rather nervous and who perhaps feels that he would not put the case very well. After all, there are few of us who have not had the experience of feeling rather nervous on an occasion and who would genuinely like to have the company of someone we know, even if that person does not say anything at all. It is a type of moral support. That seems to me to be perfectly reasonable. It would be possible for the friend to say something—that would be for the chairman of the appeal committee to decide—or for the person to be represented, because I believe that in such a case the friend would quite frequently be the local councillor, who would therefore say something. The arrangements are designed to be flexible, reasonable and informal.
Lord LEATHERLAND: My Lords, my question was a very simple one: is the friend to have the right to address the tribunal?
Lord SANDYS: My Lords, we are on Report and the noble Lord must address the House with the leave of the House, should he wish to do so. However, it is not customary on Report to speak twice.
Lord PARRY: My Lords, in that case by leave of the House—although I do not believe that I have spoken twice—it seems to me that the powerful case made by the noble Lord, Lord Boyd-Carpenter, is unanswerable in this particular context. But it also presupposes two other things. In the first place it presupposes that someone who is inarticulate and, therefore, unable to present a case would also find the access to a lawyer formidable and difficult. For example, many of us find the noble and learned Lords who are lawyers formidable, though not difficult. In this context could it also he possible for someone to be represented by a friend at such an appeal only to find that the authority is represented by a QC? As has been the case in certain tribunals that have taken place in other contexts, quite often an authority—not an educational

513
one—has been represented by top legal talent when the person appealing has been represented only by a friend.
Baroness DAVID: My Lords, I am absolutely appalled that everyone who has spoken seems to be looking on this as a court of law where people might be fined or sent to jail. This is simply a case of deciding to which school a child should go. I still think that it would be appalling if lawyers were involved. I am all for a friend being allowed to attend, and a friend can take various shapes or forms; presumably, the friend might even be the husband or wife of the parent who is speaking most of the time. As I have tabled another amendment relating to this matter a little later on, I am happy to withdraw this amendment.
Amendment, by leave, withdrawn.
6.2 p.m.
Baroness YOUNG Baroness YOUNG moved Amendment No. 16:
Page 37, line 44, leave out ("simple majority vote") and insert ("a simple majority of the votes cast and in the case of an equality of votes the chairman of the committee shall have a second or casting vote").
The noble Baroness said: My Lords, I beg to move this amendment. In recent discussions, the local authority associations have suggested that paragraph 8 of Schedule 2 leaves it unclear whether a majority of the appeal committee would be required for an appeal to be successful or, if for any reason some members did not cast a vote, simply a majority of those voting. This amendment clarifies that what was intended was that an appeal should be decided according to the votes cast, and at the same time makes explicit provision for the chairman to have a second casting vote in the event of there being no majority either way. I beg to move.
Baroness DAVID Baroness DAVID moved Amendment No. 17:
Page 38, line 10, leave out from ("private") to end of line 17.
The noble Baroness said: My Lords, this amendment aims to put a full stop after the word "private" in paragraph 10 on page 38 of the Bill. From what I have already said, I am sure noble Lords
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will realise that I want these appeal committees to be as private and as quiet and informal as possible. Many confidential matters will be being brought forward and it is extremely embarrassing for the parents to have other people present.
The rest of this paragraph says that a member of the Council on Tribunals may attend as an observer and, equally, that a councillor can attend as an observer. That is very different from a councillor attending as, perhaps, a friend. It is appalling to have people in the room listening in. I should have thought that there would be nothing worse for inhibiting a parent wishing to say something about, perhaps, an illness or other problems. Therefore, I very much hope that this amendment will be accepted.
Lord RENTON: My Lords, one has some sympathy with this amendment, subject to what my noble friend the Minister of State may say. I must confess that a fear which I have is that if these appeals are not heard in private, they will become the subject of wrangle in the local Press, which I think would be regrettable.
The Earl of SWINTON: My Lords, I, too, should like to support what the noble Baroness. Lady David, said on this amendment. I find myself very much in sympathy with her on this Schedule. I remember one occasion when I was sitting on an appeal committee and, believe it or not, a parent was appealing against a choice of school because it was the school to which the sibling, in this case the older child, was going. The parents did not want the younger child to go there because the older child had some very nasty personal habits, which we were all told about in full detail. I am quite sure that that influenced us greatly and we granted the appeal. I am quite certain that if the public or the Press were sitting in, we should never have been told those rather nasty basic details. It might have spared our blushes, but I cannot believe that a parent who wants to bring out such matters would be very pleased to do so, as it were, in open court.
Baroness YOUNG: My Lords, it is only right to say immediately that as the Bill stands it provides that all appeal committee hearings are to be held in

515
private unless the responsible local education authority or governors direct otherwise. If carried, the amendment would remove not only the possibility of their ever directing otherwise, but also the rights of local councillors to attend hearings or, indeed, of members of the Council on Tribunals to attend meetings.
The provisions enabling councillors to attend hearings is primarily intended to allow an appellant's local councillor to attend the hearing, of his case even if he does not do so in the capacity of "friend." But it would in any case seem unusual to restrict the usual rights of elected councillors to attend the meetings of a committee of their authority—just as Members of Parliament are able to attend the meetings of any committee of their House, whether held in public or private.
As far as the members of the Council on Tribunals are concerned, to which the noble Baroness, Lady David, alluded in her opening remarks. I think that the times they will attend will be very infrequent indeed. As I understand it, there are only 10–15 members of the Council on Tribunals. As it is, it has to look at many other tribunals and has under its general supervision bodies with adjudicatory functions in agriculture, aircraft and shipbuilding, children's voluntary homes, forestry, immigration. industry, mental health, the National Health Service, patients, pensions, rates, rents, taxation
and wireless telegraphy. Therefore, by the time it has done all that, the number of times any one of its members will appear at an appeal committee will be very limited indeed.
I think that in practice we shall find that almost all the hearings are held in private, for the reasons that have been well advanced both by the noble Baroness, Lady David, and by my noble friend Lord Swinton. However, in saying that, we are making provision that where a local councillor would like to attend, he or she can do so. I do not think that this is an unreasonable provision in this case.
Baroness DAVID: My Lords, I think that the parents have the strongest right here. I am not at all impressed by what the Minister has said. The tribunal people may not turn up often, but it seems to me that it will be extremely bad for those parents who happen to be there when they do. I feel strongly about this. The noble Earl, Lord Swinton, and I have actually sat on these appeal committees, so I hope that noble Lords might pay attention to what we have said. I intend to press this amendment.
6.8 p.m.
On Question, Whether the said amendment (No. 17) shall be agreed to?
Their Lordships divided: Contents, 61; Not-Contents, 109.

CONTENTS

Alexander of Potterhill, L.

Glenkinglas, L.

Parry, L.

Ardwick, L.

Hale, L.

Peart, L.

Aylestone, L.

Halsbury, E.

Plant, L.

Bacon B.

Houghton of Sowerby, L.

Ross of Marnock, L.

Balogh, L.

Hughes, L.

St. Just, L.

Birk, B.

Jacques, L.

Shinwell, L.

Boston of Faversham, L.

Janner, L.

Spens, L.

Brimelow, L.

Jeger, B.

Stamp, L.

Brooks of Tremorfa, L.

Kaldor, L.

Stedman, B.

Bruce of Donington, L.

Kirkhill, L.

Stewart of Alvechurch, B.

Cledwyn of Penrhos, L.

Leatherland, L.

Stewart of Fulham, L.

Collison, L.

Listowel, E.

Stone, L.

Cooper of Stockton Heath, L.

Llewelyn-Davies of Hastoe, B.

Swinfen, L.

Darwen, L.

Lovell-Davis, L.

Swinton, E.

David, B.

McCarthy, L.

Underhill, L.

Davies of Leek, L.

Masham of Ilton, B.

Wallace of Coslany, L. [Teller.]

Denington B.

Merrivale, L.

Wedderburn of Charlton, L.

Elwyn-Jones, L.

Mishcon, L.

Wells-Pestell, L. [Teller.]

Fisher of Rednal, B.

Northfield, L.

Wootton of Abinger, B.

Gaitskell, B.

Oram, L.

Wynne-Jones L.

Glenamara, L.

NOT-CONTENTS

Abercorn, D.

Fortescue, E.

Mancroft, L.

Airey of Abingdon, B.

Fraser of Kilmorack, L.

Mansfield, L.

Alexander of Tunis, E.

Gainford, L.

Margadale, L.

Amherst, E.

Galloway, E.

Marley, L.

Amory, V.

Gibson-Watt, L.

Morris, L.

Ampthill, L.

Gisborough, L.

Mottistone, L.

Auckland, L.

Gladwyn, L.

Mowbray and Stourton, L.

Avebury, L.

Glasgow, E.

Norfolk, D.

Avon, E.

Glendevon, L.

Nugent of Guildford, L.

Balerno, L.

Gowrie, E.

Ogmore, L.

Balfour of Inchrye, L.

Grey, E.

Onslow, E.

Banks, L.

Gridley, L.

Orr-Ewing, L.

Belstead, L.

Grimston of Westbury, L.

Pender, L.

Boyd-Carpenter, L.

Hailsham of Saint Marylebone, L. (L. Chancellor.)

Redmayne, L.

Brougham and Vaux, L.

Reigate, L.

Cathcart, E.

Hampton, L.

Rochdale, V.

Clitheroe, L.

Hanworth, V.

Romney, E.

Cockfield, L.

Harmar-Nicholls, L.

St. Aldwyn, E.

Cottesloe, L.

Harvington, L.

Sandys, L. [Teller.]

Cullen of Ashbourne, L.

Henley, L.

Sempill, Ly.

Daventry, V.

Hill of Luton, L.

Sharpies, B.

Davidson, V.

Hornsby-Smith, B.

Simon, V.

de Clifford, L.

Hylton, L.

Strathclyde, L.

Denham, L. [Teller.]

Hylton-Foster, B.

Strathspey, L.

Drumalbyn, L.

Killearn, L.

Stuart of Findhorn, V.

Dundonald, E.

Kimberley, E.

Teynham, L.

Ebbisham, L.

Kinloss, Ly.

Tranmire, L.

Eccles, V.

Kinnoull, E.

Trefgarne, L.

Ellenborough, L.

Lindsey and Abingdon, E.

Trenchard, V.

Elliot of Harwood, B.

Lloyd of Kilgerrnn, L.

Vaux of Harrowden, L.

Elton, L.

Long, V.

Vickers, B.

Enniskillcn, E.

Loudoun, C.

Vivian, L.

Evans of Claughton, L.

Lyell, L.

Westbury, L.

Exeter, M.

McFadzean, L.

Wigoder, L.

Faithfull, B.

Mackay of Clashfern, L.

Wolverton, L.

Ferrers, E.

Macleod of Borve, B.

Young, B.

Forester, L.

McNair, L.

On Question, Amendment agreed to.

[Amendment No. 18 not moved.]
6 17 p.m.
Page 38, line 25, at end insert—
(" 12. Appeals shall be heard at a time when the parent of the child would not normally be working.")
The noble Baroness said: My Lords, I move the amendment that:
"Appeals shall be heard at a time when the parent of the child would not normally be working."
Most Members of this House would agree that choice of school is of vital importance to parents concerned, as the great majority are, for their children's success and happiness in life. It is essential, therefore, that parents should have not only the right of appeal when the school allocated is not of their choice, but that they should believe that the systems of selection and appeal are fair from the parents' point
518
of view. This clearly necessitates recognition of the fact that the great majority of the fathers of school children are in full-time employment and that a significant number of the pupils' mothers are in part-time if not full-time work.
The times of hearing the appeal should, therefore, be flexible and should, so far as possible, enable the parents concerned to attend without loss of time at work. My experience as a school governess suggests that if this condition were fulfilled the appeals committee would normally meet in the evening between 5.30 and 9, but the working hours of parents vary greatly, and in some areas afternoon or indeed morning sittings might be held. May I say, in conclusion, that, although only one parent is referred to in this amendment, I am assuming that both parents would be concerned for their child's educational future, and would wish to put their case jointly before the appeals committee. I beg to move.
Baroness YOUNG: My Lords, I understand the intentions of the noble Baroness,

519
Lady Stewart of Alvechurch, in moving the amendment, but I think there would be very real problems of definition of what constituted work and what could be regarded as"normal working"in these circumstances, and I hope we shall be able to leave the Bill as it now stands and to leave the decision on a matter like this to the good sense of local authorities, who will determine the matter in the light of local and individual circumstances. I am sure they will pay particular regard to the position of single parent families in making their arrangements, and the Bill provides in paragraph 6 of Schedule 2 for an appeal committee to listen to oral representations from someone speaking on behalf of an appellant where they consider that to be appropriate.
Indeed, natural justice would require that the time fixed for a hearing was such that the appellant could reasonably be expected to attend. If the appellant informed the committee that he or she could not attend at a particular time, the committee would have to take reasonable steps to arrange a time at which the appellant could attend. It is unlikely, however, that a committee would be required to make special arrangements solely on the grounds that unless they did so the appellant would have to lose money by taking time off work. If one considers the variety of circumstances that would be covered by the amendment, I suggest it is better to leave it to the normal workings of the local authority, and I hope that with that explanation the noble Baroness will feel able to withdraw the amendment.
Baroness STEWA RT of ALVE-CHURCH: My Lords, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 8 [Information as to schools and admission arrangements]:
[Amendment No. 20 not moved.]
[Manuscript Amendments Nos. 20A and 20B not moved.]
Baroness DAVID Baroness DAVID moved Amendment No. 21:
Page 9, line 3, at end insert—
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("(e) the arrangements for maintaining continuity of education for pupils transferring from primary schools to secondary schools and, where appropriate, from secondary schools to Sixth Form Colleges or other similar educational establishments.").
The noble Baroness said: My Lords, this must be a totally uncontentious amendment. In the information which is published it seems important that parents should know what happens all the way through their children's education. If you have an 11 to 16 school, it is important that parents should know what comes after—where the children would go, for instance to a sixth-form college, a tertiary college or, if they want, to the sixth form of an 11 to 18 school. This information is very important because if there are both 11 to 16 and 11 to 18 schools, that may affect parents' choice. They want to know what will be available at a sixth-form college or at tertiary colleges—the amendment does not fill in every possibility—and this proposal is designed to enable parents to know what possibilities will be open to them at the next stage of their children's education.
Baroness YOUNG: My Lords, if we are concerned with the arrangements relating to the content of education and the curriculum, this is not the right place to try to deal with the matter. Information of that kind will be published under the terms of subsection (5). It remains to be settled how much of such information should be specified in regulations made by the Secretary of State and how much left to the discretion of local authorities and governors. But I am sure that it would be inappropriate to specify that now. In saying that, I recognise—as indeed does anybody who is familiar with the education system—it is important that information about schools should be passed to parents and that information should be passed from one school to another about what the child has done in order that the full records of the child and the education authority may be kept up to date, but I hope the noble Baroness will agree that the way we are proposing to meet this is better than prescribing it in the Bill in the way she proposes.
Baroness DAVID: My Lords, in the light of what the noble Baroness said, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
6.25 p.m.
Baroness YOUNG Baroness YOUNG moved Amendment No. 22:
Page 9, leave out lines 11 to 13 and insert—
("( ) Every local education authority shall, as respects each school maintained by them other than an aided or special agreement school, and the governors of every aided or special agreement school shall, as respects that school publish—").
The noble Baroness said: My Lords, in moving this amendment, I wish to speak at the same time to the linked amendments, which are Nos. 24, 26 and 31.
Lord RENTON: My Lords, would it be in order during this discussion, for I feel it might save time, to refer to Amendment No. 29 to Clause 9, which covers the same point?
The DEPUTY SPEAKER (The Earl of Listowel): My Lords, noble Lords may refer to any amendments they wish to refer to.
Baroness DAVID: My Lords, I have an amendment to the Government amendment, but I presume I move that after the Minister has spoken?
The DEPUTY SPEAKER: That is so, my Lords.
Baroness YOUNG: My Lords, it might be for the convenience of the House if we discussed all my amendments, the amendment to which the noble Lord, Lord Renton, referred, and of course the one which the noble Baroness, Lady David, mentioned. They must, of course, be moved separately afterwards, but it may be for the convenience of the House to debate all these matters together.
We had a very long discussion about the whole question of the exclusion of special schools from the provisions of Clauses 6 to 8 in Committee andl promised on that occasion to re-examine the extent to which the provisions of Clause 8 could be applied to special schools. I have taken the opportunity since Committee not only of re-reading the debate on that occasion but of considering yet again how far we can go in the Bill in meeting the feeling that was expressed in all parts of the Committee on that occasion on this matter. I think it would be helpful if I referred the House once again to the
522
statement I made on our proposals on the Warnock Report and to re-affirm that it is our intention to publish a White Paper soon, and I hope we shall be able to introduce legislation shortly; and I would like anything I say on this matter to be seen, as it were, in relation to that and the undertakings that my right honourable friend the Secretary of State and I have given on this matter.
The amendments, and particularly No. 31, which is the principal amendment, honour the undertaking I gave during the Committee stage to re-examine the extent to which the provisions of Clause 8 can be applied to special schools. The amendment has the effect of requiring local education authorities to publish information about their maintained special schools and their policy and arrangements relating to special educational treatment. The content of the information and the manner of publication will be prescribed in statutory regulations made by the Secretary of State. The reference to policy and arrangements means that the information to be given under this heading is not confined to maintained special schools but includes an authority's use of non-maintained special schools and independent schools, arrangements for home tuition and any other forms of special help available.
I hope that what I have mentioned goes a very long way towards meeting the concern that was expressed, and I hope, too, that the House will realise that by drawing the terms of the matter as widely as we can we are doing all possible to meet this anxiety. In short, the information could provide a guide to all the educational services available for the ascertained handicapped child, and I very much hope that I shall have the support of the House in these amendments.
On looking again at the provisions of Clause 8(5) and (6), in the light of Amendment No. 31 (to Clause 9), it now seems inappropriate to require by statute that the publication of information under Clause 8(5) should necessarily take place at the same time as the publication of particulars under Clause 8(l) and (2). What is proposed by Amendments Nos. 22, 24, and 26, taken together, is that publication not only of the information required by regulations made under Clause 8(5), but also of particulars required under

523
Clause 8(1) and (2), should take place at such time or times as may be prescribed by the Secretary of State in regulations made under Clause 8(6). What those times should be. and whether or not different times should be specified as regards different information, will be the subject of consultation with the local authority associations and other interested bodies. We believe that these latter provisions will lead to more flexible arrangements.
I hope that following my explanation of my amendment those noble Lords who are particularly interested in this matter will realise that they will now have information on the whole framework within which provision is made for handicapped children, which will include assessment procedures and arrangements for consultation, as well as information about the schools themselves. I hope that in the light of this explanation noble Lords will feel that we have gone as far as we can in the Bill towards meeting their requests. I beg to move.
The DEPUTY SPEAKER (The Earl of Listowel): My Lords, I shall now call manuscript Amendment No. 22A, as an amendment to Amendment No. 22.
6.33 p.m.
Baroness DAVID Baroness DAVID moved Amendment No. 22A as an amendment to Amendment No. 22:
Line 2, leave out (" other than an ") an insert ("and each").
The noble Baroness said: My Lords, in moving Amendment No. 22A, may I also speak to Amendment No. 22B, so that the sentence referred to will make sense when I eventually read it out. Amendment No. 22A refers to line 2 of the Minister's amendment, and reads:
"leave out ('other than an') and insert ('and each')".
Amendment No. 22B refers to line 3 of the earlier amendment, and reads:
"leave out ('and') and insert 'having consulted') ".
So the subsection would then begin:
"Every local education authority shall, as respects each school maintained by them and each aided or special agreement school, having consulted the governors of every aided or special agreement school shall, as respects that school publish …".
The aim here is that all the information about both the county schools and the aided schools should be published together, so that a parent can have all the information at one time: but the governors of the aided schools will be consulted about what that information should be. In Committee the point was stressed that it would be helpful for parents to have only one document about the schools from which they had to choose, rather than for them to have to collect a number of documents. I beg to move.
Lord RENTON: My Lords, if the noble Baroness, Lady David, will forgive me, I shall not speak to her amendment because it deals with a point that is separate from the points raised in the amendments of my noble friend in relation to special schools and children in need of special educational treatment—handicapped children. In this respect I mention in particular Amendment No. 31 because, as my noble friend rightly pointed out, it is the one amendment that mentions the special schools and the handicapped, though of course the operative amendments are really Amendments Nos. 22, 24 and 26.
In particular, Clause 8(5) would be very considerably altered by the amendments proposed by my noble friend. If your Lordships will be so patient as to bear with me, I shall read out how Clause 8(5) would read if my noble friend's amendments were accepted, because I believe it is important that we should understand the very complicated position that would be reached. The subsection would read as follows:
"Every local education authority shall, as respects each school maintained by them other than an aided or special agreement school, and the governors of every aided or special agreement school shall, as respects that school publish

(a) such information as may be required by regulations made by the Secretary of State; and

(b) such other information, if any, as the authority or governors think fit,"

and every local education authority
"shall also publish such information as may be so required with respect to their policy and arrangements in respect of any matter relating to primary or secondary education".
If we were simply to take the provisions of subsection (5) as they stand, it would be an act of faith on our part to accept them, because the outcome would depend upon the contents of the regulations which, my noble friend has pointed out,

525
the Secretary of State will have power to make, and upon such decision as the authority or the governors may think fit to make with regard to the giving of information. So that would require a good deal of trust on our part. However, my noble friend has pointed out what the Secretary of State intends to do in the exercise of his power. She has pointed out that there will be assessment procedures mentioned for the assessment of the handicapped; that there will be consultation; and that information will be given as to the educational facilities available. Therefore it seems to me that we have to trust the Secretary of State in that respect. But if there had been no amendment of Clause 9(2), of the kind that has been proposed in Amendment No. 31, I should not have had the faith which I am now trying to express.
Having said that we must at least be thankful for those small mercies, may I ask my noble friend to consider, if only from the drafting point of view, what a tremendously complicated outcome there will be in regard to the contents of Clause 8. When on Committee my noble friend said that she would see that information would be given to the parents of handicapped children, I very much hoped that Clause 8(1), (2), (3) and (4) would be applied, apart of course from subsection (1)(e) and subsection (2)(b) which refer to appeals, and which would no longer be appropriate. But by virtue of the way in which Clause 8(5) is to be amended, the parents of such children will be deprived of the advantages which they might have had had the first four subsections of Clause 8 been applied to the giving of information to them. I do not see any reason why they should be deprived. I wish to suggest to my noble friend that when further considering Clause 8 between now and Third Reading, it might be possible for her to ensure that these four subsections are added to the power to be taken in subsection (5), so that then indeed we would have the fullest opportunity that we could possibly seek with regard to the giving of information concerning the education of the handicapped.
My Lords, I wonder whether I may refer to Amendment No. 29. I think that the noble Lord the Deputy Speaker might well have been informed by the Officers of the House that, owing to a
526
fault in transcribing, there is a small omission there. In the fifth line, instead of "subsection (1) paragraph (b)", it should read "paragraph (c) ", and be followed by "subsection (2)(b)". If that plan had been followed, then the whole of the provisions of Clause 8 would have been made available so far as the handicapped are concerned. I think, then, that my noble friend's rather complicated amendments would not have been necessary; and, although the last thing I would ask your Lordships to do is to reject the amendments proposed by my noble friend —and, personally, I would be glad to support them—I still ask her to consider between now and Third Reading whether it might not be better to have Clause 8 redrafted and simplified, and something on the lines of Amendment No. 29 done to Clause 9. But, having said that—I am sorry it is so complicated, and I have no doubt added to the confusion—I should like to express my gratitude to my noble friend for what she has done, even though she has not been able to go all the way, that some of us would have liked.
Lord HYLTON: My Lords, this is a highly technical matter and I venture into it with very great trepidation. However, I should like to follow on from what my noble friend Lord Renton has said, and no doubt my noble friend the Minister will be expressing a view later as to whether his method has some advantages over her method. Having said that, may I thank her for what she said about the giving of information to the parents of handicapped children? I think this was most helpful, after the Government had succeeded, by a small margin, in defeating the previous amendment at Committee stage.
What I should like to add today concerns the two questions of parents' preferences and appeals in respect of handicapped children. Would it be possible for the benefits of this Bill to be brought in by regulation in these two cases, rather than having to rely on subsequent legislation for this purpose? If that were possible, it would give the Secretary of State ample time for all the necessary consultations and for the setting of a date that would be suitable to everybody. This, I feel, would be preferable to having to wait for a completely separate piece of legislation, with all the attendant risks that go with that.
Baroness MASHAM of ILTON: My Lords, I, too, should like to thank the noble Baroness, Lady Young, for all the work she has done on this; and I should also like to support what the noble Lord, Lord Renton, has said. This really is a highly complicated matter, and I feel that, as it will appear in the Bill if the amendment proposed by the noble Baroness, Lady Young, is agreed to, it will be very complicated for local authorities to work out, and might mean the taking on of extra staff. Since the Committee stage, I have been telephoned and written to by a governor of a special school to say that his special school is probably going to close down, and that the children will then be put in a section of a comprehensive school. Therefore, as things are now those children will not come under this Bill, or will come under only a very small part of it, but if they get moved to the comprehensive school then they will come wholly under all the sections of this Bill. That is just to illustrate how very complicated the whole thing is.
I think it is the right of parents who have children who are handicapped that they should have clear information. Being a parent of non-handicapped children, I would want information about the school to which I was going to send them; but I would want it even more if I had a handicapped child, because one would probably worry more about such a child. Also, the movement of a child from one school to another is not very good for a child, because it is disruptive. Therefore, no parents want to send their child to a special school if that school is going to close down in a year or two. I therefore implore the noble Baroness—and I know she has been so helpful—to try to get this clearer and simpler, so that everybody can understand it.
Lord ALEXANDER of POTTER-HILL: My Lords, I agree that this is complicated. I think it is probably true that to apply the whole of Section 8 to special schools would in fact do less for special schools than the 1944 Act already provides, because under the 1944 Act certain special provisions are made. As I understand it, what is being sought—and I would strongly support it—is that the parents of children should have information
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relating to special schools, just as other parents have information relating to ordinary schools. That is the fundamental issue which I think is being pressed, and I hope the Minister will be able to give us an asssurance that this will be so.
Baroness DARCY de KNAYTH: My Lords, perhaps I may add my thanks to those expressed by other noble Lords to the noble Baroness, Lady Young, who has put in so much work on this; and also back up what the noble Lord, Lord Renton, has said about the complication of this clause. I had hoped for very much more. I had hoped for an inclusion in Clauses 6 and 7, and also at least in the whole of Clause 8, whereas now we have only this slightly emasculated subsection (5). As the noble Lord, Lord Renton, has said, we have just got to have faith and trust. We do not know what we will be given; but I should like to thank the noble Baroness. I think that, at least, it represents a glimmer of hope for the parents of handicapped children that one day they may achieve parity with the parents of non-handicapped children.
Baroness YOUNG: My Lords, I am very grateful to those noble Lords who have welcomed these amendments that the Government are putting forward. I recognise that it does not go (and, indeed, I have never pretended to them or to the House that it does go) as far as those who take this great interest in the handicapped would like it to go, and that is why I prefaced my remarks by saying that these amendments are, as it were, a first instalment, and I recognise that what is required is a new Bill. I have said enough on that matter at this stage, I hope, to assure the House that I, certainly, and the Government, will work for this.
My Lords, I have now been told that this is a complex piece of drafting, and that it makes the clause a rather complicated one. If I may say so, one of the reasons for this, of course, is that we are in fact grafting on to this Bill something which the Bill was not originally intended to do; and, not surprisingly, it comes out in a rather complicated way. That is not in any way to say that I would go back on what we are doing, because I think it is right that we should do it; but I think that is the reason why it reads in this particular way, and I can assure the House that there is no sinister motive behind it at all.

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My noble friend Lord Renton has said he has to take a great deal on trust. I accept, as I said at the beginning, that in fact this does not go so far as he and his noble friends would like, but it is a start. I should like to assure him that we shall be consulting widely on this. We shall be consulting not only the local education authorities but voluntary bodies who are concerned with special schools and with the health authorities, so that I hope that he will feel that over this procedure we shall consult as widely as we can to get a measure of agreement. The noble Lord, Lord Hylton, asked about regulations. They will be made under Clause 8 of the Bill and therefore they will come into effect more quickly than our proposals on any future Bill.
The noble Baroness, Lady Masham, asked about what happens when a special school is closed and children go on to a special section of a comprehensive school. I think the answer is that those children would still be subject to the law under the 1944 Education Act. They would not come under Clauses 6 and 7 in this case. If that is not correct, then I will write to let her know. I believe, as the Act applies to handicapped children, that the provisions which state that handicapped children have to be assessed and put into categories to go to certain schools would still apply. It would mean that the provisions on Clause 8 that I am suggesting would apply to that section of the comprehensive school, and not that parents will have all the other benefits that parents would have if their children were going to ordinary schools and the parents had the ordinary choice of schools. This was also the point that the noble Lord, Lord Alexander, was making.
It may be helpful to state again that I cannot at this stage itemise the contents of future regulations but I would expect them to be widely drawn and I would expect information to include details of the authority's arrangements for special educational treatment for children in different categories of handicap in maintained county, voluntary and special (including hospitals) schools; of its arrangements with the non-maintained special schools and the independent schools; of its facilities for boarding education and of its arrangements for special educational treatment otherwise than in schools.
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The information would also include the authority's procedures for the assessment of children with disabilities of mind or body and for involving parents in decisions affecting their handicapped children; it would indicate to parents the help available to them where they suspect that their child has a handicap and they may not know where the child should go. This is drawing the regulations under Clause 8 as widely as we can.
I have been asked why we have not included Clause 8(1) to (4) in these proposals. I should like to say, as I indicated privately, that I expect that the spirit of subsections (1) to (4) would be carried over into the Warnock Bill; but the treatment would be different. Perhaps it is worth clarifying the situation and looking carefully at what Clause 8(1) to (4) mean. Subsection (1) is concerned with arrangements for admissions, and we believe that it would not be helpful for local education authorities to state that in certain cases, for example, educationally-subnormal children are admitted to an educationally-subnormal school. There would be a difficulty about writing this in in this particular way. Subsection (2) is concerned with the aided and special-agreement schools. There are no special schools which fall under this category. Subsection (3) is concerned with the numbers of pupils and age ranges and, in fact, special schools are inherently flexible in their admission arrangements in order to meet individual needs, and so the particular matters in subsection (3) do not generally apply. Subsection (4) is concerned with the criteria for offering places in schools not maintained by the local authority.
As far as special education is concerned, the circumstances are highly individualised and local education authorities would find it difficult to set out their criteria. It would not always be helpful for the local education authority to state publicly that maladjusted children with, for example, unstable home backgrounds are offered residential places in non-maintained or independent schools because the local education authority had no such residential provision of its own. As one considers the details of this, I think noble Lords will agree that it would be difficult for local education authorities to set out in the context of this Bill requirements which the

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Bill is not designed to meet. That is why I think it is better in the circumstances —and I had not intended to explain this as fully as I have; but I think it right to have done so—to leave this matter to another Bill and to include the spirit of what we are trying to do in this Bill in the Warnock Bill rather than to bring it in in this case.
With that explanation and with the assurances that I have given, I hope that noble Lords will feel that the Government have made a real effort to apply Clause 8, where appropriate, to special schools and that they will accept these amendments.
Lord HYLTON: My Lords, if I may speak again, I think I understood my noble friend the Minister to be saying that it was a policy decision that the matters of parents' preferences and of appeals regarding handicapped children should come in a subsequent Bill. Am I right on this?
Baroness YOUNG: Yes, my Lords. When we discussed this at Committee, I explained that we could not apply Clauses 6 and 7 to special education because it would put on to local education authorities two contradictory requirements. It therefore requires new legislation in order to apply the kind of provisions we have in Clauses 6 and 7 to parents of children in special schools. I said that I would bring forward amendments to Clause 8, and that is what I am doing; but the amendments do not apply to Clauses 6 and 7 for the reasons which I gave earlier.
Baroness DAVID: My Lords, has the Minister anything to say to me about my amendment?
Baroness YOUNG: My Lords, I apologise. I thought that the noble Baroness would move it again later. The point that she was making is a rather separate one from that of special schools. It deals with voluntary-aided schools. It was because I knew it was a separate point that I did not answer it. We discussed a similar amendment on the Committee stage and I think it right to say that we on this side believe that governors of aided schools should retain their responsibility for running their own affairs. This amendment would have the effect that governors of such voluntary-aided schools were
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responsible for publishing particulars of admissions and appeal arrangements but no other information—including examination results specified in regulations made under Clause 8(5). It is because we believe in the importance of voluntary-aided schools having their own rights over their admission arrangements and publication that I feel we cannot accept this amendment. I hope that the noble Baroness will agree with me that there is a difference between the role of the voluntary-aided schools and that of the county schools in this connection.
Baroness DAVID: My Lords, I do not agree entirely. I am not altogether happy with the answer; but I beg leave to withdraw the amendment.
Amendment to the amendment, by leave, withdrawn.
[Manuscript Amendment No. 22B not moved.]
7 p.m.
Baroness DAVID Baroness DAVID moved Amendment No. 23:
Page 9, leave out lines 14 and 15.
The noble Baroness said: My Lords, I said when I withdrew a similar amendment to this one at the Committee stage that I wanted to think again and possibly come back at Report. Having thought again, I am not satisfied with the answer of the Minister. At column 891 of Hansard for 11th March, the noble Baroness said:
"What we are seeking in this clause is that information will be given to parents as a basis for their choice of schools in which their children will have to be educated, and this should not be left entirely to the discretion of LEAs or governors in the case of voluntary schools. At the present time, this is in fact the situation. The situation is not entirely satisfactory".
Here we have the situation that LEAs are not trusted. Then she went on (at col. 892), having said there will be consultation—and I had asked whether there would be a draft regulation before Report, and was told, "No":
"We have to go through these consultations and we clearly could not do so in the next two or three weeks. We propose to use the Department's Circular 15/77, which the noble Baroness quoted, and the noble Lord, Lord Avebury, referred to. The circular lists some 20 points ranging from

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the simplest factual information about schools, like the address and how many pupils it has, to matters of fundamental importance such as details of special facilities offered, examinations prepared for…pastoral arrangements, and so on.
This is likely to form the basis of the proposals which we shall put forward in the consultative process, but in preparing these proposals clearly we would consider any points that will come up in the debate today. The difference is the point that the noble Baroness, Lady David, has herself mentioned, that we have a requirement about examination results. The Government's intention is to require the publication of results by regulation under the provisions of Clause 8, again after the necessary consultations have taken place with all those concerned".
Of course, the Bill has rather been rushed through and the consultations did not take place before so therefore we do not know exactly what is going to happen. The circular is admirable—I have now managed to get a copy of it. The Notes on Clauses about this do say that the publication of examination results not asked for in the circular will be required. I am not at all happy about this, particularly as the noble Baroness said we have a requirement about examination results. I am in entire agreement that it is good for the local education authority to know details of a school's results and policy on entering pupils for GCE and CSE, as it can then take appropriate action if something seems wrong and unsatisfactory with any particular school. I am strongly against league tables and schools individually being able to publish in the local Press or in an individual brochure. These results need much interpretation and explanation, and are open to much misrepresentation. Could we please have an assurance that results will be published by the local education authority and not individual schools?
If I may quote what the noble Lord, Lord Avebury, said in the debate on the same amendment, at column 893 he said:
"If I may say in passing, it seems a little peculiar to me that at this stage the Government have such definite ideas about the publication of examination results when, as the noble Baroness has told us, she has not yet even started on the process of consultation".
I would endorse that. Could we have that assurance about who will publish results from the Minister?
Baroness YOUNG: My Lords, I wonder whether it would be for the convenience of the House if we break off this stage for
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dinner now. I see it is just after 7 o'clock. We could then continue this stage in about an hour's time. I beg to move that further consideration on Report of this Bill be now adjourned.

CONSULAR FEES BILL
7.4 p.m.
Lord TREFGARNE: My Lords, I beg to move that this Bill be now read a second time. The Bill is designed to enable any official who is authorised by the Secretary of State to perform a consular function abroad or a corresponding function in the United Kingdom, to levy the fee already pertaining to that function. The rationale of this may appear so self-evident as to cause your Lordships to wonder why it is that, nearly 90 years after the passing of the Consular Salaries and Fees Act of 1891, which introduced the general right to levy consular fees, this principle has not yet been enshrined in law. Your Lordships may also be surprised to learn that the authority to levy the fee for such services performed in foreign countries resides in the title of the functionary rather than in the service he performs, and that at home the authority does not extend to Northern Ireland.
Originally, only consular officers (as narrowly defined in the 1891 Act) were empowered to charge consular fees. After the First World War, however, a growing need developed for certain consular services (notably the issue of passports) to be performed in this country and the Fees (Increase) Act 1923 was passed to enable public officers of the Foreign Office in Great Britain also to levy the fees for such services. The next development was the emergence of our former colonies as independent nations, and the requirement for our High Commissions there to perform certain services which had previously been undertaken by the colonial Governments. In fact, we seem to have been rather slow in adapting to the situation, as it was only by the Consular Relations Act 1968 that officials exercising consular functions at our High Commissions in Commonwealth countries were empowered to levy the relevant con-

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sular fees. In switching the emphasis away from the formal designation of the officer performing the service, and to the service itself, these Acts of 1923 and 1968 undoubtedly were an advance.
We were still left, however, with the problem that in foreign counties, no matter how modest our diplomatic representation, a consular officer would formally have to be appointed before the mission could levy the requisite fee for any necessary consular service performed. In Northern Ireland, which is not embraced by the term "Great Britain", we have been forced to adopt rather contorted administrative procedures in order to levy a fee.
None of this is conducive to good management. Since 1970 it has been the policy of successive Governments to aim to cover the costs of our consular operations by receipts from fees levied for the services. This goal has been attained thanks to the passport fee which is the major source of income. In order to prevent fees from rising beyond a reasonable level and to ensure the best use of manpower, it is however the Government's intention that the consular services should continue to operate as economically as possible. The fact that fees have remained stable since March 1978 testifies to a satisfactory measure of success in this respect. But we find the provisions of the 1891 and 1923 legislation present an obstacle to further rationalisation of our operations. We no longer have a separate and distinct Consular Service. All our representation abroad is conducted by the Diplomatic Service whether its members bear consular titles or not; furthermore the passport agency in Belfast, in common with the other Passport Offices, has been steadily assuming greater importance as the demand for urgent issues of passports has inevitably increased.
This modest Bill preserves what is of continuing use in the earlier legislation, but removes and replaces those provisions which have no relevance to our changed conditions. It does not introduce new fees, nor does it increase the level of fees already charged. It requires no increase in staff.
I should like to explain the one substantive clause; the first subsection of the
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clause, which reproduces the earlier provision for consular fees to be fixed by Order in Council, states that anyone authorised by the Secretary of State to perform consular functions abroad or corresponding functions in the United Kingdom may levy consular fees. The effect of this clause is to widen the category of qualified officials so as to include not only consular officers in foreign countries and our officials in Commonwealth countries who perform similar functions, but also officials engaged on similar duties in Northern Ireland and in foreign countries, whether or not they hold consular titles.
Subsection (2) defines the consular functions, the performance of which qualifies the official to charge the relevant fee. Use has been made of the list of functions in Article 5 of the Vienna Convention on Consular Relations; this has already been embodied in our own legislation by its inclusion in Schedule 1 to the Consular Relations Act of 1968. Clause 1(3) reproduces the existing provision of the Consular Salaries and Fees Act 1891 which enables the Secretary of State to make regulations governing the way in which the fees shall be levied, accounted for and applied. This is done by statutory instrument subject to the approval of the Treasury.
Subsection (4) requires the table of fees to be displayed in every office where they are levied. This replaces the 1891 requirement that the tables be displayed in consular offices and in customs houses in the United Kingdom. It ensures that the fees will be displayed to the public wherever the relevant services are performed. The requirement for display in customs houses, mainly for the information of ships' masters, is no longer relevant in present conditions and has been abandoned. Subsection (5) repeals the earlier legislation which the Bill replaces and substitutes a reference to the Bill, where necessary, in other enactments. The remainder of the Consular Salaries and Fees Act 1891 has already been repealed.
I trust, my Lords, that you will recognise this as a useful measure intended to streamline the services performed by the Foreign and Commonwealth Office and therefore to contribute to its efficient operation. I beg to move that the Bill be now read a second time.
Moved, That the Bill be now read 2a.—(Lord Trefgarne.)
7.13 p.m.
Lord GORONWY-ROBERTS: My Lords, we are all grateful to the noble Lord, Lord Trefgarne, for moving the Second Reading of this Bill in such clear terms. It regularises one or two anomalies, as he said, and one of them is an Irish anomaly: that must be particularly acceptable in any statute! But the more general anomaly to which he drew attention is one that I am sure the House will be pleased to know is finally regularised: that is that at present the power to charge fees for consular services is confined to consular officers. As the noble Lord said, there is no requirement in the Vienna Convention that these services should be confined to officers bearing consular titles; in fact there is and has been for some years a single Diplomatic Service—a foreign service one might call it—for overseas purposes in this country. The Bill proposes that fees for a consular service should be payable whenever and by whichever officer the service is rendered. That surely should help to make the use of Diplomatic Service manpower more flexible, especially in small missions, and particularly as "mini-missions" of two or three people are beginning to emerge.
I am sure there will be general support in the House for the application to the Diplomatic Service, as to all other activities in this country, of the principle of avoiding all the rigid lines of demarcation of duties. Specialism and adaptability are not incompatible, I am tempted to say as any Minister who has seen the progress of these gifted young men and women through his private office will confirm. They are at once destined for proper specialisation and also trained in flexibility and adaptability. And why not? True specialism and adaptability are complementary, particularly in the Diplomatic Service, I would say. Indeed the Foreign and Commonwealth Office understand this very well. It has given a very good example (dare I say?) to other departments over the past 10 or 12 years of how to conserve and indeed reduce staff without impairing efficiency; and that in a period when the wide-ranging demands of its services have been particularly marked and increasing, perhaps especially so in the consular field.
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As to the level of fees, it has been the policy of successive Governments to bring them up to a level that meets the costs of the services provided. The last increases, as we are reminded, were made in March 1978. The passport fee then became, as it is at the moment, £11. There has in fact been no increase for two years, largely because of the increase in demand for passports. Productivity in this particular case— differently from the Gas Board—has led at least to stability in prices. That trend of the increasing take-up of passports, together with the further streamlining of staff and its more flexible use by the Foreign and Commonwealth Office, should, I hope, postpone any further increase, even in these days of galloping Tory inflation. I hope that the Minister will allow himself half-a-minute at the end of this important debate to give me an assurance that there is no immediate intention of increasing these levies.
At the same time we should be constantly on our guard against false economies. In reviewing from time to time, as we do, the number and strength of our posts abroad, including consulates, we should avoid the risk of attenuating the quality of service and the impact of influence. It is against the need for efficiency and effectiveness as a country that economies in this direction should be pursued. The range of worthwhile activity undertaken by our Diplomatic Service here and abroad is immense. It is also vital to the prosperity and security of our country. We are all familiar with its work in the political field and indeed in the commercial field, and I think that tribute should be paid to our Diplomatic Service for the devotion and skill it brings to bear on these aspects of its work. I am tempted to reminisce a little, but I will restrain myself except to say this: I saw this devotion and skill, both here and abroad, over a total period of some eight years as a Minister in the Foreign and Commonwealth Office. Hardly a week passed without some indication of appreciation of the efficiency, promptness and courtesy of the men and women in London and in posts outside this country when approached for help and advice by an amazing range of individuals and firms. Equally, they have helped countless individuals and families in personal distress in foreign countries, and this is an aspect of their work which I

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hope will not be scamped whatever the pressures of financial retrenchment may be. Anyone in difficulties in a strange country, ignorant of the language and the law of that country—even of the usages of that country—is especially vulnerable, and deserving of the help and protection that our representatives can extend.
It is of very great importance that we maintain and, where necessary, expand that aspect of our Diplomatic Service: first, because of the number of our citizens who travel abroad. The number is increasing every year, and I understand that last year alone nearly 2 million new passports were issued. Secondly, the impact and influence of this country depends, in great measure, on how we are seen to deal with these cases of distress and difficulty for individuals and families, as well as on the way we help our firms and commercial people in those countries. It is not only a matter of prestige, important though that is. What our representatives do abroad in our name, and what they are enabled to do—because they must be provided with the resources with which they can discharge their duties—has a real, if' unquantifiable, effect upon the standing of Britain and, as such, it influences our political and commercial achievements in those countries. This is a small but significant Bill, and I feel sure that all quarters of the House will agree to the Motion moved by the noble Lord.
7.21 p.m.
Lord TREFGARNE: My Lords, I fancy that the only British consular fee that most of us are ever likely to be called upon to pay is the passport fee, although we sometimes contribute to the revenue of other countries by seeking entry visas for pleasure or business. But how often are we required to swear an oath—I mean in solemnity, rather than anger—to obtain verification of a translation from Aramaic, to obtain a certificat de coutume, which I gather is a French document, or to transfer a mortgage on a ship? Yet these are necessary services which properly attract a fee, and which help to bring in the necessary revenue.
But the fee which really enables us to provide essential protection to our citizens abroad is the passport fee. At … 11 for a 10-year standard passport, you may agree
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that it is a bargain and we shall try to keep it so. To answer the point put to me by the noble Lord, Lord Goronwy-Roberts, I can say that all these fees are kept under constant review, as he knows, but there is no plan to raise any of them at the present time.
Nevertheless, as holidays abroad become ever more popular, the number of our citizens who seek assistance from British posts abroad is likely to increase in absolute terms, even if they represent, as now, an infinitesimal proportion of the total number of travellers. We therefore have to make sure that all fee-bearing services in fact yield the necessary return, and that our staff are not prevented by outmoded legislation from charging what is due.
In referring to the staff, may I join the noble Lord, Lord Goronwy-Roberts, in the tribute that he paid to them? I have not yet served eight years in the Foreign Office—I have hardly served eight months—but I have already come to realise that the high qualities which they possess, and which were described by the noble Lord, are of the greatest value to the country. As I have said, the main purpose of this Bill is to correct the anomalies to which the noble Lord referred, and which I described in my opening remarks. I am obliged to your Lordships for so readily recognising the modest merits of this measure.
On Question, Bill read 2a, and committed to a Committee of the Whole House.
Lord LYELL: My Lords, I beg to move that this House do now adjourn during pleasure until five minutes past eight o'clock.
[The Sitting was suspended from 7.20 p.m. to 8.5 p.m.]

EDUCATION (No. 2) BILL
Further considered on Report.
Debate on Amendment No. 23 continued.
8.5 p.m.
Baroness YOUNG: My Lords, I am very sorry if my explanation of the Government's intentions under Clause 8(5) which

541
we discussed in Committee has not satisfied the noble Baroness, Lady David, and her colleagues. We must, I think, agree to differ about publication of examination results. We, on this side, believe that this is information that parents want and should have. As I explained in Committee, I cannot tell the House the precise detail of what the regulations will require local authorities to publish, because that will only be settled after very full consultations with all concerned. For the rest, again the detail will only be settled after full consultations. I would repeat that our present view and intention is that the basis of what the regulations will require will be the 20 or so points set out in the department's Circular 15/77, to which the noble Baroness, Lady David, referred. This covers items ranging from the simplest factual information about individual schools to matters of fundamental importance in the life of the school, and also refers to aspects of local education authority general policy, such as transport and meals and award arrangements.
The effect of the amendment would be to leave the information to be given to parents as a basis for the choice of schools in which their children should be educated entirely to the discretion of local authorities and governors. That is exactly what the situation is now, and this House and the country know that this is not entirely satisfactory. Indeed, the provisions under Clause 8 are put into this Bill at the request of many parents and others who are very concerned at the lack of information about schools. This subsection of the Bill is similar in every essential respect to a comparable provision, Clause 10(5), of the last Labour Government's Education Bill. We believe, as did the last Labour Government, that parental choice can only be exercised effectively on the basis of information. Clause 8 of the Bill provides for this to become available for parents. I hope that the House will agree with me in rejecting this amendment for the reasons I have given.
Baroness DAVID: My Lords, I think the answer is very much the same as last time. I am still not at all happy about the publication of exam results without the LEA taking the initiative about this. But I see that I am going to get no other answer, and I do not think it would be profitable to pursue this to a Division.
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I should like to say that we are extremely anxious about the effects of what the Minister suggests will be done, and I hope that the consultations at any rate will be extensive. I should like an assurance on that point before deciding to withdraw the amendment.
Baroness YOUNG: My Lords, with the leave of the House, I should like to give an assurance to the noble Baroness that, of course, it is very important that we should consult very fully with our partners in the education service, with the local education authorities, in this matter, and that we should, I hope, reach agreement on all the points. We accept that this is not an altogether straightforward matter on which to devise regulations, and that is why we accept that there must be full consultations before agreement is reached on this.
Baroness DAVID: My Lords, with that assurance, I am prepared to beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Baroness YOUNG Baroness YOUNG moved Amendment No. 24:
Page 9, line 24, after ("publication") insert ("at such time or times and").
Lord STEWART of FULHAM Lord STEWART of FULHAM moved Amendment No. 25:
Page 9, line 22, at end insert ("which shall include a schedule of capitation and all other recurring financial allocations and staffing quotas in respect of each type of secondary school or each secondary school maintained by that authority").
The noble Lord said: My Lords, I beg to move Amendment No. 25. We discussed this matter in Committee, but what the noble Baroness, Lady Young, has just said about the desirability of parents being able to make an informed choice, encourages me to press this matter again. We are suggesting that among the various items of information provided to parents should be the surely very important fact arising from "How much money per child do you spend at this school and at that school?" One would have thought prima facie that that was a reasonable matter for parents to want to know.
When we discussed this matter in Committee I was, of course, assured that we must understand that there is not

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a direct proportional relationship between the amount of money, per child, spent in a particular school and the quality of education. Of course, that is so. In a school that has a higher proportion of children staying on to the sixth form, the average cost per child will be higher than at the school where most of the pupils leave at the statutory age. It is also true that the study of some subjects, although quite as important to the people and to the nation as other subjects, are not as expensive because some subjects require more in the way of equipment than others. Therefore, clearly the mere bald statement that at one school more is spent per child than at another, does not by itself prove that one school is being unduly favoured or that one school is better than another. However, I urge that it is one of the pieces of information to which the parent is entitled.
Parents should not be regarded as fools who cannot understand the information given to them. It may well be that to begin with, when such information is published, unfair deductions may be drawn. But the result would be public discussion: the local authority would explain why the amount that was spent on a child in one school was more than that spent in another, and the general level of public information and interest in the matter would rise. The same is true of examination results. If one made a crude judgement from examination results alone as regards the quality of the school, one would be in error. However, when they were published and argued the public would, in the end, begin to see examination results in proper proportion to other facts about a school. The same is true as regards this amendment. If this information were at any rate made available, it would become the subject of public discussion and people would be able to reach more informed judgments.
I do not think that one can avoid the following point: in those authorities that still practice separatist education by means of the 11-plus examination, I believe that it will be found that consistency, and as a matter of policy, more is spent per child in the grammar school than in other types of school—more than would be justified merely by the fact that such a school will have more sixth-form pupils, or by other reasonable arguments.
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If I am right in that suspicion, then the public ought to know about it. We are fairly entitled to ask: Have local authorities anything to hide in this matter? I am not prepared to accept the argument that the information should not be provided merely because ill-informed people would misrepresent it. That can be remedied as public opinion becomes more informed on the matter. There can be no excuse for an arrangement whereby examination results are to be published and the information included in this amendment is not to be published.
The noble Baroness tells us that there are to be consultations, but already prior to the consultations, it is the Government's firm policy that examination results shall be published. Will they say that it is also their firm policy that the schedule of capitation fees and financial allocations shall not be published, or will it at any rate be possible for local authorities to publish that kind of information if they wish? I hope that at least that is true, because if some of them publish it, then of course there will be pressure of public opinion on other local authorities to publish it. Therefore, I hope that at least we shall hear that, under the provisions of Clause 8, a local authority could give this information. I see no reason why it should not be required to give it. I beg the Minister to consider the matter carefully. It is a matter upon which we feel very strongly and as the general trend of Government thinking is in favour of giving parents more and more information, it would be inconsistent and illogical for the Government to resist the amendment.
Lord DARWEN: My Lords, I wonder if I may make an observation on this amendment, although it may not be too happily received by my colleagues on the Front Bench. I point out that I have had the experience of teaching in a school for the maladjusted, where the ratio of teachers to children is much higher than it is, for example, in a grammar school. Therefore, to infer that a higher capitation charge on grammar school children is necessarily a sign that more is being spent on the more intelligent children than on children of lower intelligence is not necessarily right.
Baroness YOUNG: My Lords, I have listened very carefully to what has been

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said by the noble Lord, Lord Stewart of Fulham, and by the noble Lord, Lord Darwen. It would, perhaps, be helpful to the House to know that, in fact, Clause 8 makes it clear that a local education authority can publish any information it thinks fit, including, of course, capitation allowances. I am sure that the noble Lord, Lord Stewart, and the noble Baroness, Lady David, know that capitation allowances for schools and the information that goes with them is the type of information that anyone can get from a local authority. It is nearly always shown somewhere or other in its published accounts, and therefore there is nothing particularly secret about it. The reason why we have not included that in the provisions under Clause 8 is, firstly, that we are allowing local education authorities to publish this information, if they would like to do so; and, secondly, that it is available to members of the public should they wish to find it. But what actually concerns a parent is the nature and quality of the education provided and how successfully the school achieves its objectives. That is not always measured, as the noble Lord, Lord Darwen, has quite rightly said, by the amount that goes into capitation allowances or other allowances in the schools.
Under those circumstances, although I listened with great interest to what has been said, I do not believe that we should be justified in requiring local education authorities to assemble and publish this information school by school, especially as some of it may well change during the course of the school year. In other words, a local education authority, in publishing its forward budget at the beginning of the financial year, may make various proposals, but a key factor in a school may be key members of the staff who, in the course of the year, may leave and perhaps not be replaced. All sorts of factors may enter into the matter which, in practice, could not contribute very constructively to what the parent might see as a result of looking at the information about capitation allowances and other allowances, and the amount of money that is spent in one school versus another.
However, as I have said, once it is recognised that, in fact, a local education authority can, if it so wishes, publish this information and, indeed, that the information is available to any parent who seeks
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it, I believe the amendment becomes unnecessary.
Baroness DAVID: My Lords, I am absolutely amazed by one comment which the Minister made. She said that parents can find it should they wish to find it. I thought that the great point about all this was that information would be freely available. I really disapprove of that. We want to have the information where parents can easily find it. I entirely agree with the noble Baroness that capitation is probably something decided by the local education authority and that will probably be the same for all schools within the authority. But "all other recurring financial allocations and staffing quotas" may differ, and I think that these are very important. Therefore, I am not at all satisfied with the Minister's answer.
Lord ALEXANDER of POTTER-HILL: My Lords, I am sorry but I find myself in total opposition to this amendment. A wise administrator dealing, for example, with capitation allowances, undoubtedly with the approval of his authority, normally fixes capitation allowances either on age ranges or on a basis—
Baroness DAVID: My Lords, if I may interrupt the noble Lord, that is exactly what I said. I acknowledge that capitation allowances are spread over the whole range.
Lord ALEXANDER of POTTER-HILL: My Lords, yes, but the important point is that it is not necessarily what any particular school gets. A wise administration normally holds monies in reserve against capitation allowances, so that if in any particular school there is a special need or a special reason, it can be provided. For example, new staff appointments may be made and as a result an additional supply of text books may be required in order to meet the needs which are being pursued, and additional money is made available. Alternatively, it may be that a school is relatively new, which means that increases are necessary in order to set it off on a proper footing. Therefore, even if the allowances were published, it would not necessarily mean that the actual information in relation to a particular school was given. I do not think that the amendment would be helpful.
Lord STEWART of FULHAM: My Lords, I believe that my noble friend Lord Darwen mentioned a school that dealt with maladjusted children. I can well accept that a school facing those difficulties would have to spend more per child than a school with the more usual problems. I think that the public as a whole would expect that. But is there any reason why the facts should not be made known? The reason for it is not difficult to explain or understand. The whole point of my argument is that the information ought to be there; then people can argue about it and see, if there are differences, why there are differences and to what extent they are justifiable.
We have had a collection of rather contradictory arguments against the amendment. The noble Lord, Lord Alexander of Potterhill, disliked the amendment because he did not want local authorities to have to make this information known. But the noble Baroness, Lady Young, tells us that it is "already available". Honestly, "already available" is not good enough. To have information available somewhere in the council's archives so that a very diligent person can dig it out is not the same as publishing information. The Government do not regard that as being satisfactory in many other fields; therefore, they should not regard it as satisfactory in this field.
The noble Lord, Lord Alexander of Potterhill, spoke of the differences that can occur over the year and said that the wise local authority makes this or that provision. All these are matters that can be explained. If a local authority has to publish the figures, in its own interests
and in the public interests it will want to publish an explanation of them. I am saying that the information—the sheer facts and their explanations—will be valuable to the public and will increase the parents' opportunity to make what they believe to be a wise choice. I must say that the more cagi ness I find about providing this information, the more convinced I am that it ought to be made public, and I urge my noble friends to press this amendment.
Lord HYLTON: My Lords, if this amendment were to be agreed, there would be some danger of misleading information being published. Let me take the question of staffing quotas. If the information is about a previous year, it may be quite inaccurate for the current year. If it is a forecast of what will happen in years ahead, it may never be achieved.
Viscount ECCLES: My Lords, I think that the noble Lord, Lord Stewart of Fulham, is trying to obtain information about the grammar schools and compare it cost for cost with that for comprehensive schools. That is not fair. The sixth form students in the comprehensive schools cost as much as the students in the grammar school. Therefore, we would be misleading the public; they will not understand those things. I am very much against the amendment.
8.25 p.m.
On Question, Whether the said amendment (No. 25) shall be agreed to?
Their Lordships divided: Contents, 46; Not-Contents, 94.

CONTENTS

Aylestone, L.

Hatch of Lusby, L.

Oram, L.

Bacon, B.

Howie of Troon, L.

Parry, L.

Birk, B.

Jacques, L.

Peart, L.

Boston of Faversham, L.

Janner, L.

Pitt of Hampstead, L.

Brooks of Tremorfa, L.

Jeger, B.

Ponsonby of Shulbrede, L. [Teller.]

Chitnis, L.

Kaldor, L.

Cledwyn of Penrhos, L.

Kirkhill, L.

Ross of Marnock, L.

Collison, L.

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

Stewart of Alvechurch, B.

Cooper of Stockton Heath, L.

Stewart of Fulham, L.

David, B.

Longford, E.

Stone, L.

Davies of Leek, L.

Lovell-Davis, L.

Strabolgi, L.

Davies of Penrhys, L.

McCarthy, L.

Taylor of Mansfield, L.

Elwyn-Jones, L.

Milner of Leeds, L.

Thomson of Monifieth, L.

Glenamara, L.

Mishcon, L.

Underhill, L.

Goronwy-Roberts, L.

Morris of Kenwood, L.

Wallace of Coslany, L.

Hale, L.

Northfield, L.

Wedderburn of Charlton, L.

NOT-CONTENTS

Airey of Abingdon, B.

Glendevon, L.

Monson, L.

Alexander of Potterhill, L.

Greenway, L.

Morris, L.

Alexander of Tunis, E.

Grey, E.

Mottistone, L.

Amherst, E.

Gridley, L.

Mountgarret, V.

Auckland, L.

Grimston of Westbury, L.

Mowbray and Stourton, L.

Balerno, L.

Halsbury, E.

Norwich, Bp.

Barrington, V.

Hampton, L.

Nugent of Guildford, L.

Bellwin, L.

Hanworth, V.

Onslow, E.

Belstead, L.

Harvington, L.

Reigate, L.

Bessborough, E.

Henley, L.

Renton, L.

Blackburn, Bp.

Hill of Luton, L.

Rochdale, V.

Bolton, L.

Holderness, L.

Romney, E.

Boyd-Carpenter, L.

Hylton, L.

St. Just, L.

Cathcart, E.

Hylton-Foster, B.

Sandys, L. [Teller.]

Cockfield, L.

James of Rusholme, L.

Selkirk, E.

Cottesloe, L.

Kimberley, E.

Sempill, Ly.

Cullen of Ashbourne, L.

Kinloss, Ly.

Sharpies, B.

de Clifford, L.

Lauderdale, E.

Simon, V.

Denham, L. [Teller.]

Lindsey and Abingdon, E.

Strathclyde, L.

Drumalbyn, L.

Long, V.

Strathcona and Mount Royal, L.

Dundonald, E.

Loudoun, C.

Stuart of Findhorn, V.

Eccles, V.

Lucas of Chilworth, L.

Swinton, E.

Ellenborough, L.

Lyell, L.

Tranmire, L.

Elliot of Harwood, B.

McAlpine of Moffat, L.

Trefgarne, L.

Elton, L.

Mackay of Clashfern, L.

Trenchard, V.

Faithfull, B.

Macleod of Borve, B.

Vaux of Harrowden, L.

Forester, L.

McNair, L.

Vernon, L.

Fortescue, E.

Mansfield, E.

Vickers, B.

Galloway, E.

Margadale, L.

Vivian, L.

Gibson-Watt, L.

Masham of Ilton, B.

Wigoder, L.

Gisborough, L.

Monk Bretton, L.

Young, B.

Glasgow, E.

On Question, Amendment agreed to.

8.34 p.m.
Baroness YOUNG Baroness YOUNG moved Amendment No. 26:
Page 9, line 24, after ("publication") insert ("at such time or times and").
[Amendment No. 27 not moved.]
Viscount INGLEBY Viscount INGLEBY moved Amendment No. 28:
After Clause 8, insert the following new clause:
"Parental rights regarding sex education
(".—(1) It shall be the duty of the head teacher of any school at which sex education is being or will be given—

(a) to give notice in writing of that fact to the parents or guardian of any child to whom sex education is being or will be given;

(b) to explain fully to the parent or guardian the nature of the sex education and enable him to inspect all books, visual aids and other material which will or may be used in the sex education:

(c) to enable the parent or guardian to question the person who is giving or will give the sex education; and

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(d) to give notice of that fact to the governing authority of the school and give them such information relating to the sex education as they may require.

(2) The head teacher of a school shall perform his duties under paragraphs (a), (b) and (c) of subsection (1) above—

(a) in relation to a child who is receiving sex education, as soon as practicable; and

(b) in relation to any other child, at least one month before the sex education begins;

and the head teacher shall perform his duty under paragraph (d) of that subsection as soon as practicable.
(3) After receiving the information specified under one or more of the provisions of subsection 2(1) above, a parent who wishes to withdraw his child from a proposed or existing course of sex education may give notice in writing to that effect to the head teacher, who shall then ensure that the child does not attend the course of sex education.
(4) In this Act "sex education" means any teaching or instruction (by whatever name called and whether or not forming part of another course of teaching or instruction) which is intended to or does transmit knowledge about sexual intercourse between human beings or about their sexual behaviour.")"
The noble Viscount said: My Lords, in moving this amendment I should first of all like to correct any false impression I may have given at the earlier stages of this Bill; any impression that I am in favour of

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compulsory sex education. This is far from being the case. The object of my amendment is that at schools where such a course is proposed the parents should have the right to know in advance that they will be able to see the books, films, film strips or other materials which are going to be used, and finally as a last resort to withdraw their child if they feel that such material is morally corrupting.
No doubt sex education varies a great deal in different schools. No doubt in some schools it is very well done, and in some I would suggest it is very badly done. I have a letter here from a mother in Suffolk who tells of a certain doctor who gives sex education in the local schools in the Ipswich area. I quote:
"One parent told me how [this doctor] had spoken to her 17 year old son, in a mixed class of boys and girls at the Ipswich school. The boy was deeply embarrassed. The doctor had blown up condoms and let them fly round the class like balloons. Re never referred to marriage or even making love"— only "having sex". Re gave them all the contraceptive advice and where to get them. He ended his short lesson by saying, And if all else fails, there's always abortion! ' ".
I would suggest that the best way to counter this kind of sex education is for the parents to become more involved, and that is the purpose of my amendment. The parents should have advance warning, at least a month in advance. They should be able to see the material, particularly films, or film strips which are going to be used. They can then discuss them with the head teacher. If they are still not satisfied they can write to their county councillor. If that does not work, I suggest that they should write to their Member of Parliament or a Member of this House. Finally, if all else fails, I feel that they ought to have the right to withdraw their child. We talk a tremendous lot about human rights, but surely it is an absolutely fundamental human right to withdraw your child from the kind of education which you feel may be morally harmful and which may affect the whole of their lives.
At an earlier stage the noble Lord, Lord Wells-Pestell, referred to the difficulty of finding suitable people to teach this subject. I would entirely agree with him. We might just ask ourselves who is qualified to teach this subject. Someone whose words we would all respect said:
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"Blessed are the pure in heart".
A friend of mine said to me, "Those who teach this subject should surely be at least as pure in heart as the young people they are teaching". I suggest, also, that they should not be people whose salaries are paid by an organisation which benefits from the sale of the contraceptives about which these young people are told. In 1978 the Family Planning Association benefited to the extent of £116,000; the profit on sales covenanted back to them by Family Planning Sales Limited. I suggest also that sex education must be given in the context of marriage. It is no kindness—in fact I would suggest it is very harmful indeed—to give advice which in any way encourages young people to have sex outside marriage.
I come back to where I started; the right to withdraw as a last resort. This is already allowed on a voluntary basis in some schools. This amendment would make legal what already exists; give legal form to the best practice. I appreciate of course that parents would be very reluctant to take this step, which would only be a final step, and indeed I would suggest that to be really effective it would need a group of parents, but if they all acted together it could be very effective indeed. I appreciate what I know the noble Baroness, Lady Young, will tell us later in the debate. I know she is with us in spirit and I know she will go as far as she feels she can to meet the purposes behind the amendment. I beg to move.
8.40 p.m.
Baroness BIRK: My Lords, I read with great interest the Official Report of the debate which took place on this subject in Committee and I wish to make a brief contribution because, some time ago, I was for some years chairman of the Health Education Council and was extremely concerned, as part of my work, with the whole question of sex education in schools. I believe that a great deal of what was said by the noble Viscount, Lord Ingleby, today and what was said in Committee is true—that people are indeed worried about this subject, that it is important to have the co-operation of parents, and that we must at the same time underline the great ignorance that exists among so many young people—but I am not happy with the idea of writing such provisions into a statute. I believe that to

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do so would add more taboos to a subject which is already very much taboo to many people; that it would restrict it and introduce a degree of inflexibility, which would not be good for the parents, the children or the schools. I feel that it would not do anything to encourage schools to cope with and initiate education in human relations, which is really what we are talking about, sex education specifically being part of that.
What, then, are we left with? Children are not static creatures or objects; they will learn anyway, and they will learn from their peer groups. I think it is unrealistic as well as rather unfair to say that parents should deal with this problem, because often, with the best will in the world, parents are unable to do so. Many parents find it difficult to communicate with their children at this level and many youngsters feel far less embarrassed discussing the matter with or listening to somebody who is more of a stranger than their own parents.
I set up a number of conferences when I was chairman of the Health Education Council at which we had people from the schools, from different voluntary organisations and from the Schools Council, which did a lot of work on the curricula in the whole field of human relationships, including sex education, in the whole of the much larger context in which the subject is set. It is clear from what was said by the different people involved that many parents are very embarrassed by the whole subject and find when their children come home and ask questions that they are often asked things they do not understand. The most successful work occurred when parents were brought in at an early stage. I do not mean that the whole school was full of parents but that parents attended particular forms, because this must be done at different levels; it must be an ongoing course, under whatever heading it comes, throughout the child's school career. When parents were brought in and shown some of the films that the children would see and given an opportunity to discuss the matter without being made to feel inadequate, that seemed the best way of dealing with the issue.
I would say with respect that what seemed to be missing from the debate in Committee was any reference to the tremendous amount of constructive, posi
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tive and very productive work being done in their different ways by many schools all over the country. I would not like to see a rigid standard applying everywhere, because we are here dealing with human beings; the children, the people dealing with the matter and the people concerned with the schools are all human beings, and therefore what is the right approach for one group of people will not necessarily be right for another. Therefore, when talking about getting a curriculum together, that must be done in the very broadest sense.
I say with great respect, therefore, that at this stage the Government should not set up a working party or commission of any sort. I would prefer them to gather in information about what is being done all over the country. We shall then see the different experiments that are going on, be able to judge the different processes which are being successful, and see those areas which are not doing as much as they should. From there I hope it may be possible to produce guidelines, or perhaps the department or somebody else could initiate a series of conferences where people could pool their knowledge and discuss the difficulties.
I am very much against dealing with the issue, although we may agree on so many aspects of it, in a rigid way. But whatever we do, let us not forget that the young people of today are not like they were some years ago. It is no good burying our heads or theirs in the sand, otherwise they will do the very things which it may be unwise for them to do and will not get the help and support, spiritual and physical, which those concerned with them are anxious they should have.
Baroness MASHAM of ILTON: My Lords, while I do not want to disagree with my noble friend Lord Ingleby, I wish to query subsection (4)—The definition—and ask the noble Baroness, Lady Young, whether this proposal would not be rather difficult to implement. Would it not be difficult in connection with the teaching of biology, especially human biology? Perhaps the Minister would say whether it would be possible for the Government to ban some of the obscene books such as Make it Happy.
The Lord Bishop of NORWICH: My Lords, I wish to give general support

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to Amendment No. 28, moved by the noble Viscount, Lord Ingleby, because, as I see it, it is designed to be a fail-safe provision to take care for the time being of some of the very real problems which the noble Viscount shared with us, and I note that the opening lines of his proposals reads:
"It shall be the duty of the head teacher of any school at which sex education is being or will be given …".
It is not a provision designed necessarily to promote a whole new area of sex education; it is designed to give a measure of liberty to parents, protection to children and guidance to head teachers, who I believe need guidance in this way and may themselves need to have the support of a provision of this kind when literature of the rather offensive sort about which we heard in the very good debate in Committee is placed in the school.
I take much comfort, as I am sure many other noble Lords do, from the way in which, at the end of that long week of discussion on education, we spent a long time on this subject in Committee, where there was a general sense of agreement that the underlying purpose of the provision was right, positive and useful. I am sure in particular that we must not lose sight of the valuable point made by the noble Lord, Lord Wells-Pestell, supported by the noble Baroness, Lady Gaitskell, about the need for a group to form a sort of agreed syllabus.
I appreciate that the noble Baroness, Lady Young, pointed out, and rightly, that the only real agreed syllabus is in religious education and that religious education stands by itself in a particular situation of great importance. However, there is a certain parallelism in this particular area, and I hope that that idea will not be lost sight of. I was encouraged by the words of the noble Baroness, the Minister, as reported at column 1393 of the Official Report of 14th March:
"If there is some way forward which would be possible, I should like to have the opportunity, perhaps on Report…to discuss this matter".
One can well understand that the Government might find it difficult to swallow a great big clause like this, but one very much hopes that the noble Baroness will be able to give considerable encouragement that in the spirit and atmosphere of
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this clause we are moving in the right direction; and as such I should like to support what the noble Viscount has said to us.
8.50 p.m.
Lord HOUGHTON of SOWERBY: My Lords, we are now discussing the substance of an amendment which was moved in Committee only 10 days ago. Unfortunately on that occasion I was occupied in another part of the building and was not able to take part in the debate. I am not sure that we have in fact given the Minister an opportunity to give the consideration to the matter that she promised to give—only 10 days ago. I cannot accept this new clause; I most strongly oppose it. My noble friend Lady Birk has given some wise words to the House on this difficult subject, but surely the House will pause before writing into an Act of Parliament provisions of the kind which are contained in this new clause. The matter surely needs more consideration, which the noble Baroness the Minister promised to give it, and it needs full consideration, too, by other people; and there must be consultation as well.
If I may say so with respect, there is probably some doubt as to how qualified this House is to discuss this subject at all. The weight of years which rests heavily upon many Members of this House is not alone a qualification for pontificating on the subject of sex or sex education. In most cases noble Lords have had both, and I believe that in a feeling of humility towards the young of today your Lordships might approach this matter a little more tentatively, instead of dogmatically.
What have the head teachers to say about this? They are referred to in the clause, they are directly concerned. Does anyone know what they think? Has anyone tried to find out whether head teachers wish to have, or will accept willingly, the duty which the clause would impose upon them? And what of the local education authorities, whose responsibility this matter at present is? What have they to say about it? The Bill was designed to relieve local education authorities of some of their statutory obligations and to provide greater flexibility in the discharge of them, but this new clause moves in entirely the opposite

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direction. As my noble friend Lady Birk said, it is negative and restrictive, and it surely has an undertone of displeasure. Somehow or other noble Lords are frequently displeased with the subject of sex. I do not know whether they feel guilty about it, or whether they are working out some deeply hidden conflicts in their own experiences of life. I do not accept the literal contributions of many Members of this House on this subject, without examining what is the background to it in relation to their own experience and their own minds.
I think it quite wrong to make the law into a busy-body on this subject in schools, without defining the position of this House in relation to sex education as a subject in the curriculum of our schools. I thought that the manner in which this matter was introduced in your Lordships' House only 10 days ago was particularly unpleasant. I ask your Lordships to read that debate. I thought the sarcasm and pomposity in some of the speeches quite uncalled for. Some of your Lordships in various parts of the House, and the noble Viscount who today moved the new clause, have made attacks on the Family Planning Association and the Brook Advisory Centres without I think understanding the full nature of the work that they are trying to do. The Family Planning Association has 11 Members of your Lordships' House as vice-presidents, and I happen to be one of them—not that that adds anything to its lustre, nor commends it particularly to some of the other noble Lords in the House. But it just shows that there is the weight of opinion in this House behind—
The Earl of LONGFORD: My Lords, may I ask the noble Lord—
Lord HOUGHTON of SOWERBY: No, I am sorry, the noble Earl may not. As I was saying, it just goes to show that there is the weight of opinion in this House behind the work of the Family Planning Association. It is all very well for those who do little or nothing in this field to condemn those who are doing their best. I have read many pamphlets on this subject and many contributions from various sources of moral welfare. Of course they are all in favour of moral responsibility, they are all in favour of the great virtues in life, but so far as I
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can tell, they do very little indeed towards carrying out this difficult, explicit task of sex education—
The Earl of LONGFORD: My Lords, is the noble Lord ready to give way now? Does the noble Lord consider himself qualified, uniquely qualified, in this House to speak on sex education? Does he think that no one else has a right to a view? He has certainly expressed one.
Lord HOUGHTON of SOWERBY: My Lords, I would admit any disqualifications or qualifications that I have when it comes to speaking on this subject, but at least they are as good as most other people's, including those of the noble Earl.
I want to refer in rather stronger terms than those of my noble friend Lady Birk to the responsibilities of parents. We are discussing sex education only because of the failure or the unwillingness, or the incompetence, of parents to undertake this themselves. After all, this is not so much a matter for the education system as it is a matter for the relationships between parents and their children. I believe that today many parents are shedding far too many of their responsibilities towards their children, and I think that this is one of those responsibilities.
The Brook Advisory Centres referred in one of their recent publications to a book entitled, My Mother Said, by Christine Farrell, which was published in 1978. It was discovered that 79 per cent. of parents thought that children should be given sex instruction by their parents, but only 30 per cent. of them had made any attempt themselves to do it, which shows that many parents think that this ought to be done by parents, yet they do not do it.
I can quite understand the delicacy of the relationship between many parents and their children, but if parents cannot communicate with their children, what is their standard of fitness to have children? They should really apply their minds towards trying to communicate with their children. Is it not strange that after more than a century of compulsory education, and despite all the help and support given to parenthood these days, we are still groping around for the best way to tell

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children the facts of life? I think that this is a serious reflection upon the standard of the competence of parents to discharge one of the important duties of their station of life.
If we conclude that sex and a loving relationship should go together, as we do, who is going to teach children about loving relationships? Why should not their parents try to give some guidance on loving relationships? Why should they not demonstrate to their children what a loving relationship is'? After all, parents know all about sex and, hopefully, can demonstrate to their children what a loving relationship is; and I think it should be unnecessary for many parents to go outside the home to fulfil this particular need of young people. I believe, too, many claims are made upon the schools today. I fully accept that, with life as complicated and as difficult as it is, with children exposed to the hidden persuaders of television advertising, of television films and all the rest of it, parents have a difficult job in maintaining their children in the state of Victorian ignorance and rectitude which I think many noble Lords are hankering after in this new clause. They would really like to go back to the Victorian era, to when they were children, when they were told nothing and found it all out in smutty stories at school, and that kind of thing.
I think the teachers need some protection, in present conditions, from ill-judged parents who may make complaints about the sex education which is given to their children, and this new clause certainly attempts to provide that. Nevertheless, I think that the real issue is whether sex education is to be taught in schools; and, if so, is it to be regarded as inseparable from the religious instruction and taught by law—the second subject compulsorily included in the curriculum, added to religious instruction—or what is it to be? Is it to remain voluntary? Is it to be in the hands of the local education authority? is it to be in the hands of the head teachers? Is it to be monitored by the State? Until Parliament decides on these matters, I think it is not right to interfere with this part of the curriculum above all others. My noble friend Lord Wells-Pestell, in the debate the other day, made some sugges
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tions as to how this matter might be dealt with, but I think there are other ways, too. I think the noble Baroness gave the right answer last time, and if she sticks to that I will support her. If she goes any further, I probably shall not; but I await her statement with interest.
The noble Baroness, Lady Masham, referred just now to the weakness of subsection (4). I hope the sponsors are going to explain more fully what the implications of subsection (4) are, and whether the sexual activities of Henry VIII would be included within subsection (4). I guess that if all the things that could be included under subsection (4) were to be included, then we would make our educational system the laughing-stock of Europe. But in the meantime, my Lords, I think more care, more attention and a longer time is necessary before we can resolve the dilemmas of this situation, and I hope sincerely that the House will give the Minister full opportunity to give it that attention.
9.5 p.m.
Lord WELLS-PESTELL: My Lords, there seems to have crept into your Lordships' discussion tonight a certain degree of hilarity, if I may say so. I think we have got to face the fact that we are dealing with a very serious matter. My noble friend Lord Houghton takes the view that we are tending to pontificate. I think he is one who has often been guilty of that in your Lordships' House, as we all have at some stage or other. But this is part of the Houses of Parliament. It is for us, when we are considering a Bill like this Education Bill, to assume responsibility for the education of our young people. Are we going to say that education stops at a particular point, and does not include other matters which will lead to a full and satisfactory life after one has left school?
I think that this is a matter which we have got to consider. It is not a matter which we are going to resolve this evening, or even next week, or next month, or next year. All I am concerned about is that we can persuade the Government to do something that perhaps other Governments have not done, and that is to look at the matter, regardless of the length of time it will take, to see whether a satisfactory syllabus cannot be prepared,

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which will be of value to schools, so that this can be included in the curricula. If we look at what is happening in the field of relationships among young teenagers today, we see the vast numbers of girls of 11 years of age who become pregnant and have children; girls of 12, 13 and 14, faced with that kind of responsibility when they should be enjoying all the various things that teenagers should be enjoying.
It is a problem. I am in sympathy with the movers of this particular amendment, but as they may realise from what I said on a previous occasion, I would find myself in some difficulty in supporting it in the Division Lobby if it was brought to the test. It is all very well to suggest that this is the role of the parents. It is the role of the parents: they ought to be able to do it; but in point of fact the vast majority of them fight shy of doing it. They run away from it.
Lord MORRIS: My Lords, may I interrupt to ask the noble Lord whether he would agree that most parents would believe that religious education is not within their ambit; and, going on from this particular point, that parents have the right to withdraw their children from religious education in the schools, if they wish? The substance of this amendment is not very different.
Lord WELLS-PESTELL: My Lords, I am not dealing with the wording of the amendment. I am dealing with the general principle behind it. I have said clearly that there are reservations in my mind. But what I am concerned about if we reject this amendment, or if the noble Lords who have put it before the House decide to withdraw it, is what is going to be put in its place; because I believe that society has a duty and a responsibility to meet this need in the schools. If parents do not do it, one cannot say that the Churches will do it; because—let us face it!—the Churches have no control over or influence upon the vast majority of young people in this country; and the right reverend Prelates would be the first to agree.
But every child, at some stage, goes through our educational system. If this is a matter of concern, it surely ought then to be the concern of the educational
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system. I can understand why parents fight shy of this. I do not mean this facetiously. I think that the average teenager is years in advance of his parents on the matter of sex. I do not think that there is any doubt about it at all. What I am concerned about is this. Who is going to give this sex education in our schools at the present moment or in the foreseeable future? Is it going to be left to the head teacher to invite anybody whom he or she thinks has some competence in this field? If they decide that this is something to be introduced into the curriculum, will they invite somebody who is going to look at it from the point of view of instruction and divorce it from a relationship?
I think the noble Viscount said a moment ago that this is something that must be seen within the context of marriage. If this is true, then marriage involves the majority of people in three relationships: there is a personal relationship, there is a sexual relationship and, for the vast majority of married couples, there is a parenthood relationship. One will see from that, that the success of all three relationships depends—I was about to say "largely"; but perhaps I ought not to say that—to a large extent on the sex relationship. If noble Lords do not think that is so, then let them look at the statistics for the break-down of marriages. Look at any statistics one likes in this connection and one finds that this plays a very much greater role than many people would care to admit. All I am concerned about is that the educational service at some stage from the age of 5 to 15 or 16, 17 or 18 is going to embrace all our young people. Can there be a better opportunity to deal with this particular matter than through the educational system?
What I am concerned about is who is going to do it. Will it be left to the headmaster or the head teacher to invite anybody who has been recommended to him or to her to do this? If so, what is the content going to be? Is it to be solely on the physical side or on the emotional side or is to be taught as a relationship? I think we ought to know. I think that my noble friend Lord Houghton is right when he says that we do not know enough about it. We ought to be thinking in terms of collecting information, and

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collecting information from a very wide field.
I have been agreeably surprised at the success in this field of an organisation with which, as your Lordships know, I am associated—the National Marriage Guidance Council. When invited to do so, they teach sex education and do not just give sex instruction. It is taught in terms of a relationship, emotional as well as physical; and you cannot teach one without the other. It is supremely important, if you are going to do this, to teach it in its entirety so far as it affects the two people concerned. The noble Baroness the Minister, knows my views on this. I do not think we can do very much in the foreseeable future and I do not know that this particular amendment will help us very much.
I hope that the noble Viscount, Lord Ingleby, will not feel that I am unsympathetic; for I am anything but that. I do not want to see go into the Bill something which is piecemeal, which is left to individual discretion, which in some cases may well be good, but in others may do more harm. When I was a Minister in the Department of Health and Social Security we, with the Home Office, set up a working party to inquire into marriage. This group consisted of representatives of all the organisations working in marriage guidance. It included some very able members of both the DHSS and the Home Office, as well as other people who had been very carefully selected.
They produced a document called Marriage Matters. Your Lordships can put your own interpretations on the word "Matters". Marriage does matter. That document is regarded as having made one of the most significant contributions of recent years in the understanding of marriage difficulties and problems and what society needs to do to help people who want to overcome them. It did not take very long. I am hoping that the noble Baroness may be able to say: "We will do this in the Department of Education: we will set up a similar body and we will bring on to it experts." I use the word "experts" not as being people who know more and more about less and less. They should be experts drawn from a very wide field of responsibility, knowledge, experience and competence.
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We shall have to wait for the report. It has to bring in, as the noble Lord, Lord Houghton, says, people in the educational field who are doing this. It has to bring in people from outside who have a contribution to make. I sincerely ask the Minister whether some real consideration could not be given to this particular point. This is of supreme importance. This is up to us, as people responsible for legislation. There is no other body but Parliament which can give a lead in this matter. In the last analysis, the Department of Education is a part of Government; and Government have to agree. We cannot allow Government departments to go off on frolics of their own; they have to be controlled. It is very difficult sometimes, but they have to be controlled, and the lead has to be given by the Houses of Parliament. That is why I feel that this is very much our responsibility; and we ought not to run away from it.
At the same time, we ought to recognise that a satisfactory curriculum in this field is not going to be devised in a few months; it is going to take some time. I should like to see the Department of Education deal with this. There is a lot of skill involved. We poke fun at departments, and we get a certain satisfaction out of doing so; but in every department, as noble Lords who have been Ministers know, there is a tremendous amount of skill, competence and expertise; and we ought to draw on it because I am sure that they could give a lead.
9.17 p.m.
Viscount BARRINGTON: My Lords, I will say two things. Many of your Lordships want to speak and, above all, we want to hear what the noble Baroness is going to say, after an exhausting time. I want to say how strongly I agreed with the noble Lord, Lord Houghton, in one thing—I am afraid it was only one thing—when he said that this is a very difficult and a very delicate question. I strongly disagreed with him and agreed with the noble Lord, Lord Wells-Pestell, when he said that this House was not in a position to pontificate. My Latin is very rusty but "pontificate", as I understand it, means bridge building. Is that not right? "Pons" means a bridge, and if any House in the world is here to build a bridge in Parliament, I should have thought that it was this House, between

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the Queen and the Commons. The noble Lord, Lord Houghton, would not deny that parents have some rights. If the children's food was being poisoned I think that he would agree that the parents would have some right to protest. Of course, one cannot go too far. Whether vegetarians can withdraw children from meals which are not made entirely of vegetables is another matter. But this is what we are here to talk about.
The reason why this is a difficult subject is because half of it is spiritual—like one side of the House—and half of it is secular. Sex has the two sides to it. I strongly support this amendment. I support something of the kind, and the reason I do so is in order to try to build this bridge so that parents know what their children are being taught and, as an emergency exit, if I may put it like that, if they really thought their children were being taught "poison", they have the right to withdraw them from that class —just as they might withdraw children from a swimming class or a music class if they thought that what they were being taught was damaging. The noble Baroness has said there is as yet no syllabus on this matter. That is a valid point. I think the sooner we can get a syllabus on this, the better. My Lords, I am sorry I have talked for so long; I did not intend to talk at all.
The Lord Bishop of BLACKBURN: My Lords, I am sure we all have sympathy with what lies behind this proposed clause, because the prospect of withdrawal from classes on this subject is really alarming and could be the thin edge of the wedge in regard to all sorts of other things.
I note with satisfaction that the amendment talks consistently about "sex education" and not about "sex instruction". I am sure we would agree with the noble Lord, Lord Wells-Pestell, that most certainly this should be within the context of human relationships and marriage. That overlaps with religious instruction, and some of it is given under biology and some under personal relationships. It would be very, very difficult to apply a withdrawal clause, let alone to have the principle of a withdrawal clause, on a subject of this nature.
I am quite sure that our colleges of education will know that this debate is
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taking place, and I am quite sure also that if they take their subject seriously they will be concerned that there will be not so much a syllabus as a supply of teachers fit to teach it. You can have all the curricula under the sun, but a curriculum on this subject will depend on the quality of the teacher who implements it. It would seem that in our colleges of education we should be trying to supply teachers who are so qualified and so sensitive that the whole idea of withdrawal would be unnecessary.
Lord JAMES of RUSHOLME: My Lords, as a schoolmaster who has tried to tackle this subject in his time, it seems to me that we are trying to deal with a most difficult subject in far too short a time. This is a Report stage debate. Here we are talking about things that we ought really to have thought about a great deal more at an earlier stage: at least some of us ought to have thought about it earlier. There are documents which we have not read. Both the Home Office and the DHSS have produced documents on this subject and I am not sure that all of us have read them. I cannot but believe—perhaps this may be an improper suggestion to make—that this is the kind of thing we ought to have a debate about, or a short debate about, so that we can think about it instead of hurrying it into a Report stage at this time of night, when we are really talking about the nuts and bolts of a new Bill. It is too important for that. I would just put that thought into your Lordships' minds.
9.24 p.m.
Baroness YOUNG: My Lords, I think perhaps it might be for the convenience of the House if I said something at this stage. I recognise we have had a long and very serious discussion on this subject. I have listened very carefully to what has been said this evening, and I have also read again the account of our debate on the amendment moved by the noble Viscount, Lord Ingleby, in Committee. Despite what the noble Lord, Lord Houghton, has said, I believe that the discussion in this House, both in Committee and again this evening, has clearly indicated the concern that many people feel about whether or not the arrangements within our schools for the treatment of a subject which is so sensitive and personal as sex education are fully satisfactory.

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I understand and sympathise with the worries that have been expressed. A good deal of guidance has already been given by my department, as the noble Lord, Lord James, said, on some issues of concern, notably in a circular issued at the end of 1977 covering an advisory booklet on Health Education in Schools. A substantial chapter in this was devoted to the treatment of sex education, and the circular indicated that authorities should take parents into their confidence about the way in which this matter was expected to be treated in their schools. I believe that, in practice, the great majority of teachers are highly responsible in their approach to these delicate matters. recognise, however, that the worries expressed by your Lordships are basically concerned with the extent to which good practice is followed in individual cases.
I continue to believe, however, that the situation is not one requiring legislation imposing special arrangements, as was done for religious education in the 1944 Act. The provisions of the 1944 Act for religious education were part of a settlement arrived at after much discussion with a clearly defined group of interests represented by the Churches, and relate to a distinct curriculum area more susceptible to special treatment than sex education which, as has been indicated, may extend across subject boundaries. Indeed, all our advice has been that sex education should be seen and treated in a broad context, including health education, moral education and social education. I think that this point was quite rightly made both by the noble Baroness, Lady Birk, and indeed by the noble Lord, Lord Wells-Pestell.
Within such a framework, legislation requiring formal local agreement on sex education syllabuses and providing a statutory right of withdrawal would be inherently undesirable. I think this point was made very well by the right reverend Prelate the Bishop of Blackburn, because, as he made clear, and as I think others who consider the matter will recognise, there is something that is quite separate and distinct about the arrangements that are made under the 1944 Act for religious education, and no one, I think, would wish to alter those.
If we come to consider sex education
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and the question of the right of the withdrawal of children from these classes, one opens up the whole question as to whether parents will then ask for the right to withdraw from other classes. Various methods have been suggested, but it is easy to think, for example, of lessons in civics, which might cover political opinions with which people disagreed, or social opinions with which people disagreed, or indeed other subjects on which there could be a very real measure of disagreement between the parent and the child. Therefore, I believe that we should have to think very carefully before we accepted a new principle—and it would be a very new and major principle—of agreeing that parents should withdraw their children from particular lessons.
Having said that, in view of the feelings which have been expressed from all sides of the House this evening, as indeed they were at the Committee stage, I fully accept that we should not simply leave matters as they stand. I also believe that there are positive steps that we can and should take to safeguard the position of parents and the interests of pupils, in respect of the way in which the subject is treated.
There are several possibilities. First, I believe that we should expect school governors to play a significant role in establishing how the subject is dealt with in the curriculum, and in ensuring that the views of parents are taken into account. The Bill which is at present under consideration makes specific provision for parent governors, and I see this as one of the areas in which they could make a very real contribution to the content of education, in examining the approach to personal and social development, including sex education, within the school. I believe that the measure to require parent governors to be appointed is, therefore, a significant step forward in this as in other respects.
It has been put to me that parent governors will be reluctant to raise this matter on governing bodies, and could well feel that if they did so their children might in some regard be discriminated against by teachers. I believe that this will not be found to be true. If parent governors are going to make the valuable contribution which I and I think every Member of your Lordships' House hope, they must be willing to speak on matters upon which

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they feel strongly and which they believe to be right in the presence of the head of the school and the other governors; and to be effective on any committee, whatever kind it is, I believe that it is important to be able to speak out. I am sure that once parent governors are there and their importance is recognised, they will feel that this is one of the areas in which they have a real contribution to make.
Secondly, I recognise the importance that should be attached to ensuring that parents are given adequate advance information about the way in which the main components of sex education are dealt with in school. Under the present Bill the Secretary of State is seeking power to require by regulation the publication of certain items of information about schools by local education authorities. I propose to give very careful consideration to the way in which these regulations can be used to embrace a requirement for local education authorities to publish, and to draw to the attention of parents, the arrangements that exist within individual schools for the provision of sex education. I believe this would be a new and an important step forward, and I should like to give an assurance to the noble Viscount, Lord Ingleby, to those who have signed his amendment and, indeed, to those who are interested, that we shall be happy to discuss with them at an appropriate stage what the regulations might contain.
Since the recent Committee proceedings I have taken the opportunity afforded by our consultations on the framework for the curriculum to discuss these possibilities with representatives of the local authorities, and I have received an encouraging response. I hope that your Lordships will agree that emphasis on the role of parent governors and a specific reference to the subject in regulations under Clause 8 of the present Bill would be valuable safeguards. In addition we shall give further thought, in the context of our discussions on the curriculum framework as a whole, to whether any fresh guidance from the department, or Her Majesty's Inspectors, on the treatment of sex education within the curriculum would be helpful. I must emphasise that we do not wish to dictate what schools should teach, but a more general lead from the department might be of value, and this is certainly a matter which we shall look at further.
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On the other hand—I say this after further reflection over the Committee debate and, indeed, after having listened to the debate this evening—I am far from convinced that we should go down the road of attempting to bring together a national working party to formulate such guidance. I have listened to what the noble Lord, Lord Wells-Pestell, has said on this matter; but having thought it over, such a working party, given the widely differing viewpoints held by many interests, would be extremely difficult to compose, let alone conclude its deliberations. It would seem to me that, if further guidance is desirable, it would best be prepared by enlarging on the views which have already been expressed in previous departmental publications. The possibility that such guidance might supplement what we propose to say in the regulations is a matter to which, as I have said, we shall be giving further attention.
I hope that I have said enough to put at rest some of the fears which the House has expressed. I believe that we can move forward, but at the same time we should not be precipitated into unnecessary legislative action. I would ask your Lordships to take into account what I have said, and to await developments along the lines I have indicated. It is essential that we should consider carefully all the implications of such action before setting out firmly our precise intentions. When that stage is reached, I will of course report those intentions to your Lordships' House, and would welcome an opportunity of discussing them.
With these assurances, and I hope the positive proposals that I have made, I hope very much that the noble Viscount, Lord Ingleby, will agree to withdraw his amendment.
Lord NUGENT of GUILDFORD: My Lords, on behalf of my noble friend and myself and, I think, on behalf of the whole House, I should like to thank my noble friend Lady Young very much for the very forthcoming speech that she has made. It has made a most valuable contribution towards meeting the great anxieties which have been expressed on all sides both today and during the Committee stage. The proposals which she has put before us give two pieces of solid comfort. It will do so, first, through

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the good offices of the parent governors who will be appearing on every school governing body; and, secondly, in what my noble friend will be doing in her regulations by requiring publication by all schools of what sex education covers, what the arrangements are to be and generally how such education is to be carried out. This will ensure that everybody can know about it, the governing bodies in particular and, through them, the parent-teacher associations and all parents.
This goes a long way to meet the anxieties which we all feel in this difficult area. The noble Lord, Lord Houghton, expressed the views of many of us. The general view taken in Committee was that, although we want to see parental responsibility acknowledged and parents given the chance to look after their children in this way, we all equally acknowledge that a great many parents cannot or do not carry out this function themselves. At the end of the day the schools must provide this; it is an essential part of their responsibility. We are concerned to see that sex education should be provided in a proper and decent way which will be of help to the children for the future.
I thank the Minister for offering to consult with my noble friends and others who are interested before she publishes the draft regulations. On the occasion of publication the House will have the opportunity to debate the subject again. Clearly, noble Lords on all sides of the House are very interested in this very important matter. If we as a House of Parliament are not able to give a lead and to exercise our imagination in understanding what is needed in this respect, I suggest that nobody else can. We should do the best we can to see that this is done in a sensitive, positive and proper fashion. We thank my noble friend the Minister for what she has done to meet us. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
The DEPUTY SPEAKER (Viscount Hood): My Lords, I now call Amendment No. 29. If this amendment is carried, I shall not be able to call Amendments Nos. 30 and 31.
Clause 9 [Nursery schools and special schools]:
9.37 p.m.
Lord RENTON Lord RENTON moved Amendment No. 29:
Page 9, line 35, leave out subsection (2) and insert—
(" (2) None of the provisions of sections 6 and 7 above have effect in relation to special schools or children in need of special educational treatment.
(3) The provisions of section 8 above, other than subsection (1) paragraph (b) thereof, shall apply to the giving of information about special schools and about other educational facilities for children in need of special educational treatment.").
The noble Lord said: My Lords, I tabled this amendment not with a view to prolonging discussion, but in order to ask my noble friend Lady Young, whose reply when we discussed this matter earlier gave great satisfaction, not to overlook the advantage of redrafting Clauses 8 and 9. Those provisions must be understood by parents, teachers, school governors, local education authorities and others and, as now amended in a rather complex way, they are not clauses of which we as a revising Chamber can be truly proud. I should like my noble friend to consider this matter.
My noble friend said, by way of an implied reason for not having redrafted them, that the amendments had been implanted upon clauses which were never intended to achieve the purpose of her amendment. That is true, but it does not excuse us from getting the drafting as clear as we possibly can. Perhaps without committing herself now, I hope the Minister will see to it that the draftsmen will examine the matter between now and Third Reading.
Baroness YOUNG: My Lords, when we were debating my amendments, which my noble friend Lord Renton agreed met the point he raised, or part of it, he asked whether one could trust the Government or the Minister. There is one general rule to which I have always subscribed and that is I never give promises which I know I cannot fulfil and I must tell him quite honestly, as I must tell the House, that at this stage it would not be possible to redraft Clauses 8 and 9 to iron out all the difficulties in them and bring the whole matter together on Third Reading. I

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accept that it may sound complicated and it may not be the most perfect drafting but I believe that in public life there is a lot to be said for getting at least half a loaf if not the whole loaf and even if it is not the freshest and the best of bread it is at least part of what is required under these circumstances. When we discussed my amendments I said that they must be seen in relation to the further legislation which we shall be bringing forward on the Warnock Report and at that stage I hope we shall be able to put right the difficulties that may arise.
We shall of course take this point if we consider issuing a circular about the Bill and an explanatory memorandum on it, but I hope the noble Lord will accept that at this stage it would not be right for me to promise something which I could not fulfil and although it may not be perfect I hope it goes some way towards meeting the important points—points I believe to be important and which we have tried to meet in this Bill, even if the result is not as satisfactory as the noble Lord would wish.
Lord RENTON: My Lords, I beg leave to withdraw the amendment. I do so with deep regret but with respect for my noble friend's integrity.
Amendment, by leave, withdrawn.
[Amendment No. 30 not moved.]
Baroness YOUNG Baroness YOUNG moved Amendment No. 31:
Page 9, line 35, after (" sections ") insert (" other than subsections (5) and (6) of section 8 ").
Clause 12 [Establishment, discontinuance and alteration of schools by local education authorities]:
9.43 p.m.
Baroness BIRK Baroness BIRK moved Amendment No. 32:
Page 12, line 12, after (" school ") insert (" or nursery unit ").
The noble Baroness said: My Lords, an amendment very similar to this was moved at 1.24 on the morning of 12th March by my noble friend Lord Mishcon. That is not perhaps the right time of day or night to discuss something which we consider to be extremely
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important, and therefore we are bringing it forward again to give the House the opportunity to consider it again and also to see whether we can get a rather better answer from the noble Baroness, Lady Young, than we did from the noble Lord, Lord Belstead, although his was a very courteous answer.
It is generally considered that the provision of nursery schools is a legal duty on local education authorities. This Bill, however, takes away the legal duty and substitutes a discretion to provide nursery schools. The fear that existing nursery schools might be closed down, which would be an additional deprivation to the service, as well as fewer probably being opened, was met by the Government pointing out that there was a provision in the Bill setting out the procedure which must be gone through if there is a proposal to shut down a nursery school. However, nursery classes and nursery units are exempted from this procedure, which is called, in shorthand, the new Section 12 procedure, and in Committee my noble friend Lord Mishcon quoted from a letter written by the secretary of a Cornwall group of nursery parents which said:
"Throughout the country there are more units than schools, so this intended safeguard will not, in fact, safeguard many children".
In replying for the Government the noble Lord, Lord Belstead, said:
'…a proposal to close a nursery class might in any case become the subject of Clause 12 procedures if it fell within the terms of Clause 12(1)(d)—that is to say, if the closure made a significant change in the character of a county school and, as I understand the Bill, if, paying regard to Clause 15, it significantly reduced the size of a school".—[Official Report, 11/3/80; col. 943.]
There seems to me to be a certain amount of confusion here. In the Bill itself the changing of the character of the school is listed and it seems to me it can be considered separately from the changing of the size of the school. If you take away a nursery unit—and this time the noble Baroness will note that the amendment proposes the insertion of a nursery "unit" and not a "nursery class"—this would surely change significantly the character of the school even if it did not have an effect on the size, which in fact it probably would.
The noble Lord went on to say that he did not think it would be reasonable

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to make the discontinuance of a nursery class within a primary school subject to the approval of the Secretary of State. Well, we believe that in fact taking away a nursery unit must change considerably the character of the school and put in peril many of the existing nursery classes or nursery units. He then went on to say that he was doubtful whether such a step would be in the long-term interests of increasing nursery education provision, that "local authorities might well be discouraged from starting nursery classes in primary schools, in surplus primary school accommodation, if there was likely to be opposition to putting the accommodation back to its original use".
I find that very difficult to accept. We are very short of nursery places. This has run through all Governments for many years, so I think we all share collective blame for this. To be saying now that one should not take this safety-net step to safeguard existing nursery units because local authorities might not want to open them, even if there was a demand for them, in case they had to be used in the future for something else, does not seem to make a great deal of sense. Therefore, I hope that the Government will now accept—as this is early in the day and we are not so sleepy as we were on the last occasion—that this should be inserted in the Bill to give this extra safeguard. As my noble friend Lord Stewart pointed out, since Clause 24 no longer makes it a duty for the local authorities to provide nurseries, then without this procedure there is an even greater undermining of the possibility for nursery education. I beg to move.
Lord AVEBURY: My Lords, I should like to join with the noble Baroness in pressing this amendment on the Government. I do so in the hope that it may commend itself to the Minister, as her colleague, the noble Lord, Lord Belstead, promised on more than one occasion when we were discussing it at an early hour in the morning that he would take it away and have another look at it. I hope the amendment now moved by the noble Baroness, Lady Birk, will have the support of the Government.
I also found it very difficult to accept the argument that was put forward by the
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noble Lord, Lord Belstead, that local authorities would be discouraged from starting nursery classes in primary schools because they would have to go through the procedures if they were put back to their original purpose. After all, if they formed more than one-fifth of the total accommodation, this procedure would have to be gone through in any case. I did venture to draw the attention of the Minister on the previous occasion to the ridiculous state we seem to be getting ourselves into, that, where the nursery accommodation formed less than one-fifth of the total, local authorities would be free to scrap it at will, but, where it formed more than one-fifth, they would have to go through these procedures.
If I may venture to repeat the argument that I put forward on that occasion, it struck me as ridiculous that there could be two nursery schools in, for example, neighbouring villages in Cornwall—I say "Cornwall" because I know that it is a matter of particular interest to the people of Cornwall—and one of them might be a nursery unit which formed just under one-fifth of the total accommodation, and in the neigbouring village there might be nursery classes forming just over one-fifth of the total accommodation. In the one case the local authority would be able to close that accommodation without going through any of the procedures, but in the other it would have to subject itself to the inquiries provided for in another clause. Therefore, I think that the amendment which the noble Baroness has tabled is a very reasonable amendment. I certainly do not think that any local authority will be discouraged from making provision for nursery accommmodation by virtue of this minor change in the law.
As the noble Baroness has said, it has been difficult enough to persuade local authorities to increase the provision of nursery accommodation anyway, and I really do not believe that the argument that the Minister advanced to us the other night holds water; namely, that many of the local education authorities are really going to sit round a table and say, "We had better not do this; we had better not provide this nursery unit just in case we might decide that we want to close it down later, and it may be made more difficult for us by the amendment." Therefore, I hope that the noble Baroness, in view of

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the time that she has had to look at this matter since it was raised the other night with the noble Lord, Lord Belstead, has come round to this point of view and will give us this small concession.
Lord PARRY: My Lords, the case has been well put. There is no need for me to elaborate except to set into the context of the discussion the particular situation of the Welsh language nursery school classes which are seen to be such an important part of the education set-up in Wales.
9.52 p.m.
Baroness YOUNG: My Lords, I should like to assure all noble Lords who have spoken and the noble Baroness, Lady Birk, that I spent quite a lot of time thinking about nursery schools and how we can do better with the resources that are available and make the best use of those resources. I have looked again at the debate in Committee and I hope I can assure the House that we have gone as far as we can with regard to the application of Section 12 to nursery schools.
It might be helpful if I reminded the House that, for the first time ever, separate nursery schools will be subject to the Section 12 procedure—what was always known as the Section 13 procedure, but which will become the Section 12 procedure—if an authority wishes to close a nursery school. That is a new provision in the Bill and one which I think is very important. It will be a very real safeguard to the provision of nursery schools at a time when local authorities are bound, and have been asked, to look for economies, and in an area of education in which there is no compulsion to send one's children to school under the age of five. Therefore, we have written into the Bill the provision that Section 12 should apply to nursery schools. If I understand it correctly, the amendment is asking that nursery classes should be subject to the Clause 12 procedures. I should point out—and this is just a technical point—that the expression "nursery unit" is not, in fact, known under the Education Acts and I assume that it means a nursery class.
What we have said as regards nursery classes—and my noble friend Lord Bel-stead made this quite clear in Committee—is that where Clause 12 (1)(d) applies, if
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there is, because a nursery class is closed, a significant change in the character of the school, it too becomes subject to the Section 12 procedures. The amendment is asking that in any case, where a nursery class is closed—whether or not the school is closed—this should become subject to the Section 12 procedures. With the two measures that I have described, I think that we have gone as far as we can in striking the right balance in the present situation between what the local education authority thinks it must do for the education in its area and what it is right for the parents to have by way of right of objection when some facility which they had previously had is considered for closure. I cannot give an undertaking, and it would not be right, that the closure of any and every nursery class would be subject to Section 12 procedures.
I was asked by the noble Lord, Lord Avebury, what my noble friend Lord Belstead meant when he said in Committee that, if an amendment similar to this one was carried, it would mean that there might be fewer nursery classes. The reason that there might be fewer classes is that local education authorities do not have to provide nursery classes. Many do, and there is quite a considerable provision of nursery classes—something which I believe to be important, which I very much support and which we want to encourage. However, we do not want so to safeguard the provision that an authority, when considering introducing a nursery class for the first time, decides, because for some reason it may have to discontinue it and it will accordingly be subject to a Section 12 procedure, not to start it at all. It is for that reason that we believe that, at the end of the day, if this amendment is carried, there could be less incentive for local authorities to provide nursery classes than there would be otherwise.
Therefore, I hope that, with those two safeguards on nursery schools—the Section 12 procedure applying, first, to nursery schools and then to schools in which there is a nursery class and the consideration whether, if closure of the nursery class is considered, it would constitute a significant change in the character of the school (which is much more widely drawn, as the noble Lord, Lord Avebury, will appreciate, than the rather narrower

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definition based on numbers in the school) —I hope that the noble Baroness, Lady Birk, will feel able to withdraw the amendment.
Viscount SIMON: My Lords, I am not at all happy about the answer which the noble Baroness has given. There is one point in this amendment which has not been mentioned. When the noble Lord, Lord Belstead, was speaking to a similar amendment during the Committee stage he said at one point—and I could understand what he was getting at:
"I would say that one has to look very carefully at whether one should, or indeed could, pull out nursery classes and say they shall be heated in a special way compared with all other classes in all other schools".—[Official Report, 11/3/80; col. 9131
Although he is quite right that there is perhaps no great difference in principle in considering nursery classes and other classes, surely there is a completely different effect both upon the pupils and upon the parents.
If, as we understand happens widely in Cornwall, nursery classes are used rather than nursery schools, and if a nursery class is to be closed, what happens? If another class is closed, the school continues and, no doubt, the children are distributed among other classes. But if a nursery class is closed without full investigation, the children will be sent home. Undoubtedly their mothers will have made arrangements and ordered their lives to have the children in nursery classes, which I think both sides of the House agree is good for the children. The mother may be doing part-time work she may even be doing very valuable part-time work in the local hospital while her children are at school. Yet if they are turned away without a proper investigation being conducted under Section 12, the mother may have to throw up her job and make some arrangements to look after the children at home. It seems to me that this is quite different from closing another class in the school, which is the comparison given by the noble Lord, Lord Belstead. Therefore, that is a point that should be considered in this connection.
10 p.m.
Viscount ECCLES: My Lords, I wonder whether there is not another point that
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supports my noble friend on the Front Bench. School rolls are falling, and noble Lords must know places near where they live where the number of children coming to school is going to fluctuate very much over the next few years. In circumstances like that a local authority might well be less anxious to establish a nursery class knowing that the numbers coming to this, or that, school might he very much reduced.
I am afraid I was looking at your Lordships' Library at the time when this was discussed on Committee stage so I did not have the benefit of hearing my noble friend Lord Belstead, but it appears to me that he made a good point.
Lord AVEBURY: My Lords, has the noble Viscount observed the Office of Population and Census Surveys' recent statement that the number of births in 1979 was larger than in 1978, and 1978 in turn was larger than 1977, with the result that, if my calculations are correct, in three years' time the numbers entering primary education will start to increase again?
Viscount ECCLES: My Lords, maybe in some places, but it is not so in others, if I heard the noble Lord aright. I do not hear very well at that distance. One wants to encourage local authorities where a primary school has more space, but perhaps not very much. to take on a nursery class; but if you say to them, "Once you have taken it on you cannot close it without going to the Minister", a great many of them, looking for economics, will not do it.
Lord MISHCON: My Lords, the noble Baroness, Lady Birk, was kind enough to quote my speech at Committee stage on an amendment similar to this, and I am obliged to her for quoting the better parts of my speech and not the worse parts. I failed to see the logic of Lord Belstead's reply to me, and I fail to see the logic of what the Minister is now saying. I could understand it if the Government, in thinking about this matter and knowing what a crying need there is for nursery classes, had come back and said, "We do not wish to discourage schools from opening new nursery classes, and therefore as from this date, if there are new nursery classes opened, they shall not be subject to

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the Section 12 procedure". I understand the logic of that. "But", I should have expected the Government to say, "because we are so anxious that existing nursery provision shall not be made any less, any school which at the moment has a nursery class shall not be able to get rid of that nursery class without going through the Section 12 procedure". If the Government had said that, then the logic is apparent. I am not going to say that I necessarily would have agreed with any such provision, but at least it would have gone some way to meet the situation.
Instead of that, the Government are saying something quite different: "We will permit the closing down", they are saying, "of existing classes without schools having to go through the Section 12 procedure, because of the possibility that in the future schools might be discouraged from opening nursery classes because they would then have to go through the Section 12 procedure ". I invite the noble Baroness the Minister to have another thought about the logic of what she has said, and to at least come forward with this proposal; namely, that there shall he a difference in procedure between new nursery classes opened after the date of the Bill coming into operation and those already in existence before the Bill comes into operation.
Baroness YOUNG: My Lords, I wish to correct something the noble Lord, Lord Mishcon, said because it was not true. I think he said the Bill would permit the closing down of nursery classes. In fact, the Bill does not say that. It says in Clause 12(1)(d):
"to make any significant change in the character, or significant enlargement of the premises, of a county school; or"
The essential part of that provision is, "any significant change of character", and where the closure of a nursery class would involve a significant change in the character of a school, then of course it is subject to Clause 12. Under our proposals under paragraph (e) nursery schools are subject to Clause 12, and under paragraph (d) it is where the closure of a nursery class means a significant change in the character of the school. The noble Lord has three-quarters of what he wants and we believe, for the reasons I have
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given, that this is the right place to leave the matter, because we believe this is in the best interests of the local authorities and the provision of nursery schools.
Lord MISHCON: With the leave of the House, my Lords, I make only one comment in answer to what the Minister said.
Several noble Lords: Order!
Lord MISHCON: I said, "By leave of the House."
Lord DENHAM: My Lords, if the noble Lord wishes to ask a question he can say, "Before the noble Baroness sits down but the leave of the House may be given only to a Minister.
Lord MISHCON: My Lords, I am grateful for that information and I apologise to the House if I offended. May I therefore put this in the form of a question?
Several noble Lords: Wrong!
Lord MISHCON: Again, I am corrected, and I will get it right this time, my Lords. Before the noble Baroness sits down and she has obviously not sat down yet—may I ask her to consider the fact that her whole argument has been based, as it was before, on the closure significantly affecting the nature of the school'? Would she not agree that the plea that is being made is to save nursery classes from extinction without having to go through the Clause 12 procedure where they may not form a significant part of the school?
Baroness YOUNG: My Lords, I cannot accept the amendment for the reasons I have given, and I do not think now is the time to repeat the arguments.
Baroness BIRK: My Lords, I regret the Minister has been unable to meet us on this. The arguments for the amendment have been quite unassailable and I must therefore press the amendment.
10.8 p.m.
On Question, Whether the said amendment (No. 32) shall be agreed to?
Their Lordships divided: Contents, 42; Not-Contents, 77.

CONTENTS

Avebury L.

Houghton of Sowerby, L.

Pitt of Hampstead, L.

Beaumont of Whitley, L.

Howie of Troon, L.

Ponsonby of Shulbrede, L..[Teller.]

Birk, B.

Jegar

Blease, L.

Jeger, B

Ross of Marnock, L.

Boston of Faversham, L.

Listowel, E.

Simon, V.

Collison, L.

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

Stewart of Alvechurch, B.

David, B.

Stewart of Fulham, L.

Davies of Leek, L.

Longford, E.

Stone, L.

Denington, B.

McGregor of Durris, L.

Underhill, L.

Elwyn-Jones, L.

Milner of Leeds, L.

Wallace of Coslany, L.

Evans of Claughton, L.

Mishcon, L.

Wells-Pestell, L.

Goronwy-Roberts, L.

Morris of Kenwood, L.

White, B.

Grey E

Oram, L.

Wigoder, L.

Hampton, L.

Parry, L

Winstanley, L.

Hatch of Lusby, L.

Peart, L.

NOT-CONTENTS

Abinger, L.

Gowrie, E.

Reigate, L.

Airey of Abingdon, B.

Gridley, L.

Renton, L.

Alexander of Tunis, E.

Grimston of Westbury, L.

Rochdale, V.

Balerno, L.

Harvington, L.

Romney, E.

Bellwin L.

Henley, L.

St. Aldwyn, E.

Belstead, L.

Holderness, L.

St. Just, L

Bessborough, E.

Hood, V.

Sandford L

Boyd-Carpenter, L.

Hornsby-Smith, B.

Sandys, L. [Teller.]

Campbell of Croy, L.

Hylton, L.

Selkirk, E.

Cathcart, E.

James of Rusholme, L.

Sempill, Ly.

Cockfield, L.

Kimberley, E.

Sharpies, B.

Cullen of Asbhourne, L.

Kinloss, Ly.

Spens, L.

de Clifford L

Lindsey and Abingdon, E.

Strathcarron, L.

Denham, L. [Teller.]

Long, V.

Strathmore and Kinghorne, E.

Drumalbyn, L.

Loudoun, C.

Stuart of Findhorn, V.

Dundonald, E.

Lyell, L.

Swansea, L.

Eccles, V.

Mackay of Clashfern, L.

Swmton, E.

Ellenborough, L.

Macleod of Borve, B.

Tranmire, L.

Elliot of Harwood, B.

Mansfield, E.

Trefgarne L

Elton L

Margadale, L.

Trenchard, V.

Faithfull, B.

Monk Bretton, L.

Vaux of Harrowden, L.

Fortescue, E.

Morris, L.

Vernon, L.

Galloway, E.

Mottistone, L.

Vickers, B.

Gibson-Watt, L.

Mountgarret, V.

Vivian, L.

Gisborough, L.

Mowbray and Stourton, L.

Young, B.

Glasgow, E.

Nugent of Guildford, L.

Resolved in the negative, and amendment disagreed to accordingly.
Clause 12 [Establishment, discontinuance and alteration of schools by local education authorities]:
10.16 p.m.
Baroness YOUNG Baroness YOUNG moved Amendment No. 33:
Page 12, line 25, at end insert (" excluding pupils who will not have attained the age of five years within six months after their admission ").
The noble Baroness said: My Lords, I beg to move Amendment No. 33, and I wish to speak at the same time to Amendments Nos. 34, 35, 36 and 37. It may be helpful if I begin by speaking to Amendment No. 36. My noble friend Lord Ridley will recall that we agreed to reconsider the amendment that he put down at the Committee stage of the Bill, which would have the effect of excluding primary schools where the standard number in the transfer age was fewer than 20, from the requirement placed by this clause on authorities or the governors of a voluntary school to publish proposals where they intend to restrict admissions to these schools. My noble friend argued very cogently on that occasion that his amendment was necessary to save administrative costs in areas where schools are relatively small and where a 20 per cent. reduction in admission could be reached simply by the removal from the district of two or three families. The principle of this amendment received widespread support from your Lordships, and we have now brought forward these amendments to meet it.
Like my noble friend Lord Ridley, I stress that nothing in these amendments will make it any easier for a local education authority to close any school. I would further suggest that, where a school is admitting fewer than 20 pupils, it is most unlikely that the local education authority or the governors are likely to wish to restrict the admissions. Such schools, as my noble friend pointed out, may most frequently be rural schools and the authority is likely to wish to encourage
586
admissions to them, rather than the other way round. I therefore hope that the House will support this amendment.
I now turn to the other amendments in this group. The effect of Amendment No. 37 is to restrict the application of Clause 15 mainly to children of compulsory school age. The clause will, however, continue to apply where it is the normal practice to admit children who are coming up to their fifth birthday. The reason for this restriction is that Clause 12 already provides adequate protection of nursery education provision. The Government introduced a new provision in another place, now Clause 12(1)(e), to make the closure of nursery schools subject to the publication of proposals and liable to the approval of the Secretary of State. The closure of nursery classes was already subject to this procedure under Section 13 of the Education Act 1944 in certain circumstances, and Clause 12 retains this provision, in that under Clause 12(1)(d) local education authorities are required to publish proposals to make a significant change in the character of a county school, and Clause 13(1) places the same obligation on the governors of a voluntary school.
Wherever, therefore, the closure of nursery classes constitutes a significant change in the character of the school, the publication of proposals will be required. If, therefore, where circumstances require it, the closure of nursery classes is covered in Clause 12, I see no reason to leave them within Clause 15, which is really concerned with the size of a school. I believe that the safeguards for nursery classes as they exist now and as they will continue to exist after this Bill becomes law are adequate, and I therefore hope the House will agree to Amendment No. 37. Amendment No. 33 is a corollary to Amendment No. 37 and brings Clause 12 into line with the proposals for Clause 15. My Lords, I beg to move the first of these amendments, which I hope will be acceptable to the House.
On Question, amendment agreed to.
Clause 15 [Reduction of school places]:
Baroness YOUNG Baroness YOUNG moved Amendments Nos. 34 to 37:
Page 15, line 19, at beginning insert (" Subject to subsection (1A) below")
Page 15, line 19, after (" where ") insert (" (a)")
Page 15, line 25, at end insert (" and (b) in the case of a primary school, the standard number is twenty or more.") line 25, at end insert—
("(1A) Where the age group in question includes children who will not have attained the age of five years within six months after their admission, those children shall be disregarded both in determining the number of pupils who are to be admitted and the standard number applying under this section.").
On Question, amendments agreed to.
10.20 p.m.
Lord STEWART of FULHAM Lord STEWART of FULHAM moved Amendment No. 38:
After Clause 16, insert the following new clause—
Local education plan
(".—(1) (a ) It shall be the duty of each local education authority to prepare and maintain a local education plan for primary and secondary schools, hereafter referred to as an education plan, which shall estimate the immediate and prospective needs of the area in respect of primary and secondary education and which shall have regard to the provisions of this and former Acts and any Regulations made there under relating to primary and secondary education;
(b) Each local education authority shall publish and submit to the Secretary of State all such education plans, or proposals for amendments thereto, in such form as he may direct or by Regulation require;
(c) All education plans, together with any proposals for amendments thereto, shall show: the action taken by that authority, and any action that the authority proposes to take, to ensure that there shall be sufficient primary and secondary schools available in the area to fulfil the duties of the authority, and in particular those duties prescribed by section 8 of the Act of 1944; that such schools together provide efficient education and ensure the efficient use of resources and; successive measures by which it is proposed to accomplish those purposes.
(2) A local authority before submitting to the Secretary of State an education plan, or proposed amendment thereto, shall

(a) specify which of the said schools the authority propose should be county primary schools, county secondary schools, voluntary primary schools, and voluntary secondary schools, respectively, and, in relation to every such school, give particulars of the proposals of the authority as to the nature of the education to be provided in the school and as to the ages of the pupils to be taught therein;

588

(b) specify what alterations are required in the premises of any school either a county school or a voluntary school;

(c) specify what additional county schools and voluntary schools, if any, will be required for their area;

(d) include information as to any arrangements proposed to be made with respect to schools not to be maintained by the authority;

(e) give particulars of the arrangements made and proposed to be made by the authority for meeting the needs of pupils who have not attained the age of five years and of pupils who require special educational treatment;

(f) give particulars of the arrangements made and proposed to be made by the authority for the provision of boarding schools maintained by them;

(g) include information as to any other measures which the authority propose to take in fulfilment of their duty to secure the provision of primary and secondary education, such as the making of general arrangements for the transport of pupils to and from school; and arrangements made with other local education authorities in respect of admission to schools in their respective areas;

(h) contain such other particulars of the proposals of the authority with respect to schools for providing primary and secondary education for their area as the authority think necessary, or as the Secretary of State may require.

3) A local education authority shall, before submitting their education plan to the Secretary of state, consult the governors, or persons representing the governors, of all schools other than county schools, whether within or without the area of the authority, which would in the opinion of the authority be affected by the execution of the plan, and shall, after submitting the plan to the Secretary of State, forthwith furnish to the governors of every school such particulars relating to the plan as are sufficient to show the manner in which the school would be affected by the execution thereof.
Where an education plan has been submitted to the Secretary of State under this section he shall, if he is of opinion that no particulars or insufficient particulars of the plan have been furnished to any person who, in his opinion, would be affected by the execution of the plan, give such directions as he considers expedient for securing that sufficient particulars are so furnished.
(4) After considering any objections to an education plan made to him within the period of two months after the date on which he is satisfied that all necessary particulars have been furnished in accordance with the last foregoing subsection, and after making in the plan such modifications, if any, as after consultation with the local education authority he considers necessary or expedient for the purpose of securing that the plan makes proper provision for the immediate and prospective needs of the area with respect to primary and secondary schools, the Secretary of State shall approve the plan,

589
and shall give such directions to the local education authority as he considers desirable for the purpose of giving to the governors of every voluntary school affected by the plan notice of the approval thereof, and otherwise for giving publicity to the plan as approved by him.
(5) The approval of the education plan submitted by a local education authority shall not, of itself, affect the duties of the authority, hut in so far as the Minister considers it expedient to impose duties upon the authority for the purpose of securing that effect will be given to the plan as approved by him, those duties shall be imposed by the local education order for the area made under the following subsections.
(6) After approving the education plan for the area of any local education authority, or any amendment thereto, the Secretary of State shall make a local education order for that area designating the local education plan, or any amendment together with any plan already approved, as the authorised education plan for the area, or he may, to such extent as the Minister considers desirable, define the duties of the authority with respect to the measures to be taken by that authority in the discharge of their duties in respect of primary and secondary education.
(7) Where the Secretary of State has made a local education order, other than that approving, or approving an amendment to, an education plan the local education order for that area shall continue to regulate the duties of the local education authority in respect of the matters therein mentioned and shall be amended by the Secretary of State whenever, in his opinion, the amendment thereof is expedient by reason of any change or proposed change of circumstances.
(8) Provided that, before amending the local education order for any area in such manner as to vary the duties of a local education authority in any respect not either provided for by the development plan approved for the area or by proposals approved by him or occasioned by the discontinuance of a voluntary school under the provisions hereinafter contained relating to those matters respectively, the Secretary of State shall give to the local education authority, and to the governors or other proprietor of any school which, in his opinion, would be affected by the amendment, notice of the amendment proposed to be made and shall consider any objections made to him by the authority or by such governors or proprietor within two months after the service of the notice.
(9) If a local education authority inform the Secretary of State that they are aggrieved by an order or by an amendment of an order made under this section, the order or amendment shall be laid before Parliament as soon as may he thereafter, and if either House of Parliament within the period of forty days beginning with the day on which any such order or amendment is laid before it resolves that the order or amendment be annulled, the order or amendment shall cease to have effect, but without prejudice to anything previously done there under or to the making of any new order or amendment.
(10) In reckoning any such period of forty days, no account shall be taken of any time during which Parliament is dissolved or prorogued or during which both Houses are adjourned for more than four days.").
The noble Lord said: Your Lordships will see that this is a somewhat lengthy amendment, but I do not think that my speech need be as lengthy as the amendment. The length of the amendment is inescapable in view of the general idea that I want to put forward. It will be apparent to your Lordships that much of the amendment is drawn from the 1944 Education Act. If the noble Baroness, Lady Young, will forgive me, I shall deliver another short account of a provision of the 1944 Act. It required local education authorities to prepare education plans which, after discussion, had to have the approval of the Secretary of State. That was clearly necessary at that time, since we were embarking upon a great new chapter in education. It had also the merit that it secured the harmonious working together of the voluntary and the county schools; and subsequent measures which have given increasingly generous financial provision to the voluntary schools have ensured that good relations continued, so that today about one-quarter of our primary school children and one-sixth of our secondary school pupils attend voluntary schools.
We are faced now with two facts. One is the special advantage possessed by the voluntary schools under which they can control who shall be admitted to them. The joint judgment of the head teacher and the governors can decide that; and for any child who is not admitted (even if the parents want it to be) education must be found in one of the county schools. This could result—and I do not say that it has resulted--in considerable strain between the local authorities and the voluntary schools. It will be possible for the voluntary schools to operate their own kind of 11-plus selection, either on an intellectual basis or, even less desirably, on a social or even a racial basis or, more generally, by declining to take children who, for one reason or another, do not take particularly kindly to school. They could leave most of those children to be catered for by the county schools. I am afraid that it is true that in some areas this happens. In the great majority, it does not; because a good modus virendi is reached between the local

591
authorities and the voluntary schools. But I have had a number of cases come to my knowledge (and other people have had the same) where a boy whose parents belonged to the relevant church was (shall we say?) difficult; he did not take kindly to school. The voluntary school decides that it will no longer have him there; and, in the end, the county school must deal with him.
In that situation, there is a danger of producing a result whereby some schools are generally felt to be better than others simply because they have adopted a policy of picking the best pupils for themselves. I do not believe that that is a desirable result. It has not occurred generally because of the common sense and goodwill that have prevailed between the voluntary bodies and the local education authorities; but, in the situation of falling rolls, this difficulty could re-arise. We could, as I said on an earlier amendment, arrive at a situation where, increasingly, some schools are felt to be the good schools that you want your children to get into; and others are felt to be the schools from which the wise parent will try to keep his children. Some people will say, "This is what we want. Then free parental choice will result in the schools which are thought to be good being full and the others becoming empty and being closed". But it will not work like that if the voluntary schools exercise their right to refuse admissions. You will have a combination of parental choice at one point and the power of the voluntary schools to refuse admission at the other. That is the problem with which we may be faced.
An answer is the answer found in 1944, the recreation of the idea of the local education plan that can look ahead, consider what the needs of the locality are likely to be, and, finally, after approval of the Secretary of State, get a local education order made. It will determine what kinds of schools there are to be in the various localities. It would be a flexible programme. My amendment provides for local education orders to be amended by the Secretary of State; and my amendment, as drafted, would take account also of the conflicting claims of the central Government, local authorities, the general public and Parliament by providing that where
592
a local authority is aggrieved by an order or amendment of an order made by the Secretary of State, the matter can then be put before Parliament.
This is a large subject, and I have only sketched the outline of it because the hour is getting late and I do not want to be too lengthy. I invite the noble Baroness, Lady Young, to accept that there is a problem here; if we do nothing about it, we may get a very unsatisfactory distribution of children between schools, resulting in the end in neither a real parental choice nor the general welfare of the children. I ask the noble Baroness to consider whether this may not be the remedy or, if she does not consider this is the remedy, what her own views would be about the problem. I beg to move.
10.27 p.m.
Lord MORRIS: My Lords, the noble Lord, Lord Stewart of Fulham, in presenting this amendment, said that it is an amendment very largely borrowed from the 1944 Act. How right he is! It is lifted virtually wholesale from Sections II and 12 of the Act. In so doing, he rather seriously misled himself—I am sure inadvertently—when he said that the Act of 1944 provided for the making of education plans. This is just not so. In the 1944 Act the term used is. "develoment plans". This is the key. If one looks at the preamble to the 1944 Act, it is clear that it is an Act to reform the law relating to education in England and Wales. The fundamental difference between this Bill and the 1944 Act can be seen in the preamble to this Bill. It says that it is an Act to amend the law relating to education.
The development plan proposals under the 1944 Act were developed for that reason: namely, that the local education authority should inform the public of what plans they have for the provision of education. They were in their very nature of course transitional arrangements. Section 12 of the Education Act 1944 provided for the local education orders and appeals there from, inter alia.
In this amendment, noble Lords will have realised that the term "education plans" runs throughout the amendment which is purely changing from the original Act whether you use "development plan". In some parts of the amendment certain

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provisions have been cut out which did not seem to suit noble Lords opposite. For instance, under their amendment in subsection (2)(b) it states that the local authority before submitting to the Secretary of State an education plan, or proposed plan thereto, shall
"specify what alterations are required in the premises of any school either a county school or a voluntary school".
They chose to leave out something rather important, namely:
"…and furnish estimates of costs of those alterations".
If we look at it carefully there are other amendments which are more or less subtle than that. I firmly believe that the provisions under Clause 12 of this Bill which cover this very point, namely, the establishment, discontinuance and alteration of schools by local authorities, is well and truly and very simply covered in this Bill.
The Earl of SWINTON: My Lords, may I begin by thanking my noble friend for those last amendments. I had not realised that we had finished before we had scarcely started. I did support my noble friend Lord Ridley: I have not spoken to him, but I am sure he will be as grateful as I am for the amendments the noble Baroness has moved.
As regards this new clause, I hope she will resist it with a great deal of strength. I was involved in just such a plan in—dare I say it?—the halcyon days of education, when my right honourable friend the Prime Minister was Secretary of State for Education, and we had got the comprehensive reorganisation over and we thought it was time we had a look at a plan for primary schools in our country. We went to endless meetings, meeting parents and deciding which schools should remain and which should close; we toured the length and breadth of the county, mostly attending meetings at night, and they were very well attended. We eventually produced a plan, which met with a great deal of opposition because obviously it necessitated the closing of many primary schools. It did absolutely nothing but upset everybody in all the villages where the school was likely to be closed. They went on writing about it for years. Then, as economic circumstances and local government reorganisation overtook us,
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we have never been able to implement any of it. It was extremely time-consuming, excessively costly and an absolute waste of time.
I think that to place something of this kind at the present moment before local education authorities, who will have to go through the same procedures, only more so, with all the schools and the voluntary organisations, will take an immense amount of time and work, and it will be mostly evening work, because that is the best time to meet local people. Officers will have to go out in the evenings and so will members. It will take ages and ages and ages, and, like all plans, it will be subject to the financial contingencies of the day. I think it will be nothing but an enormous white elephant, and I hope the noble Baroness will resist it.
Viscount ECCLES: My Lords, I want to add only a few words. Of course, these plans were very much to the fore under the 1944 Act, at the time when we were reorganising the old elementary schools. We then had quite a lot of money—never enough, of course, but quite a lot—and the real problem was how to arrange the priorities between one local education authority and another, and, inside each local education authority's capital programme, to agree that it had something like a sensible order of new school building.
That stemmed from the enormous changes which were made in the 1944 Act. We are not in that situation today. First of all, I am not quite sure that the point which the noble Lord, Lord Stewart, was worried about could be catered for under this clause; but there is so much more in the clause besides that perhaps important but limited point, that I really think we ought not to put all this work, as my noble friend Lord Swinton has said, on to local authorities in present circumstances.
10.34 p.m.
The MINISTER of STATE, SCOTTISH OFFICE (The Earl of Mansfield): My Lords, if I may say so, it has been a case of "reculer pour mieux: sauter" for my noble friend as far as the Opposition is concerned, and I trust that your Lordships will bear with me. My noble friend put the matter succinctly on

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Second Reading when this matter was debated, in columns 1012 and 1013 on 25th February. She said in effect that the Act of 1944, which was framed by the noble Lord, Lord Butler, proposed a massive transformation from the pre-war system of education into what we now know as primary and secondary education. At any rate, the task was completed without any local education order being issued; nor have development plans been used for the last 15 years or so.
Sections 11 and 12 of the 1944 Act have both served their purpose and, as my noble friend put it:
"their honourable discharge in this Bill leaves unaffected the present balance of responsibilities between central Government and the local authorities
I should have thought that that effectively encapsulated what my other noble friends have been saying, to the effect that those were the reasons which made us decide to repeal Sections 11 and 12. They are, basically speaking, the same reasons for not accepting this new clause, which more or less re-enacts Sections 11 and 12 of the 1944 Act and which Schedule 7 repeals.
As I have already said, we have had experience of development plans, yet not a single local education order was made by a Secretary of State. The reason is plain. Post-war population growth and movement changed things so quickly that development plans were out of date almost as soon as they were drawn up. This is the situation, that one set of circumstances loses its relevance when circumstances change, and circumstances can change extremely quickly. If one stops to think for a moment, there is nothing which is more calculated to cause a loss of morale than, for instance, to publish a plan covering a number of years, perhaps a decade, listing schools to be closed, and then to find that circumstances change and the schools are not closed. The threat of closure hanging over a school for many years is the most effective way of making sure that parents send their children to other schools, creating, in effect, a dying school, which is had for teachers and for everybody else; not least, parents and pupils.
There is a further hint of what I might call the 1976 Act about this amendment,
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in the sense that this new clause could, I suggest, be used to coerce local education authorities to organise their schools in a way in which the Government of the day consider to be desirable. The point is not so much that noble Lords opposite want to control voluntary schools; we welcome the variety that they bring to the education system. It is a question, perhaps, of standardisation against diversity.
I should have thought, taking the example that the noble Lord, Lord Stewart, gave, that the organisation of local schools should be, and should continue to be, a local matter. There is no reason why good sense and goodwill should not continue to prevail. This clause, if it were passed into the Bill, would give an additional power to the Secretary of State at a time when we are seeking to remove unnecessary controls and to leave more decision-making in the hands of local education authorities. If this amendment were accepted, the effect might be to disturb the delicate balance between local government and central Government in a way which we do not consider to be necessary or justified.
In the circumstances, I hope we all accept that the educational needs of an area change; local education authorities, if they change their political complexion, change their minds; plans which are dependent on buildings may have to be modified, if building resources are not available; plans based on growth in numbers are no longer valid, if the numbers fall and so on. Any plan has to make assumptions about the level of resources, and economic circumstances can force radical change in plans. All this is obvious, but it casts doubt on the wisdom of calling for plans which, if they are to mean anything, will have to be regularly monitored by the Secretary of State simply to ensure that they are up-to-date. So for all these reasons, and not least for all those which have been put forward by my noble friends, I invite the noble Lord to withdraw his amendment.
10.40 p.m.
Lord PARRY: My Lords, before that happens and before the Minister sits down, would he not accept from me the suggestion that the written analyses to the county development plans have been basic to development, both in education

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and in county planning, ever since they were introduced in the relevant legislation and that progress in education since the 1944 Education Act owes a very great deal to the structure planning of that time? While it might be convenient at this stage in the debate—late in the evening—to dismiss the whole concept of a planned structure of education, surely what this Education Bill is ceasing to do is to advance that very plan?
The Earl of MANSFIELD: No, my Lords, I do not agree. One accepts that the arrangements contained in this amendment when they were passed right back in 1944 were extremely necessary to ensure the reformation, if that is the word, of our educational system, but they are simply out of date now.
Lord STEWART of FULHAM: My Lords, I have listened carefully to the arguments which have been advanced on this amendment and I do see the force of some of them: the difficulty of preparing plans. It might be a valid criticism that I have proposed something too elaborate to deal with the particular problem that I have in mind. However, some of the other arguments which have been advanced against the amendment do not seem to me to carry conviction. The noble Earl has just pointed out that if you make a plan of any kind you may have to change it because of altered circumstances. But that is true of almost every department of human life. It is true of making any decision about what you hope to do next year or the year after. If we followed that line of argument, it would be impossible to reach any decisions as
to how to carry out education policy; so I do not find myself convinced by that line of argument.
It seems to me that none of the speeches against the amendment addressed themselves to the problem I had put; that we had, in the framework set up by the 1944 I Act, something which had, among other merits, the great merit of getting as good a working relationship as possible between the county and the voluntary schools. The present Bill, partly through its overelaborate proposals for parental preference and appeals and partly because it is being introduced in the circumstance of falling rolls, has given us a situation where that good relationship, so far, between county and voluntary schools may he upset, to the detriment of the children.
The noble Earl spoke of diversity or standardisation. I can understand an argument that says that we want there to be some diversity in schools, in that perhaps the ethos of schools—and with secondary schools the subjects to which they give great stress—differs one school from another. But I do not think we want the kind of diversity which means that some schools are obviously better than others as a permanent feature. That is a recipe for injustice in education. None of the arguments advanced seem to me to answer the point I was making. I feel, therefore, that l cannot withdraw this amendment.
10.43 p.m.
On Question, Whether the said amendment (No. 38) shall be agreed to?
Their Lordships divided: Contents, 28; Not-Contents, 81.

CONTENTS

Birk, B.

Kaldor, L.

Ponsonby of Shulbrede, L. [Teller.]

Blease, L.

Listowel, E.

Boston of Faversham, L.

Llewelyn-Davies of Hastoe, B.

Ross of Marnock, L.

Brooks of Tremorfa, L.

McGregor of Durris, L.

Stewart of Alvechurch, B.

David, B.

Milner of Leeds, L.

Stewart of Fulham, L.

Davies of Leek, L.

Mishcon, L.

Stone, L.

Denington, B.

Morris of Kenwood, L.

Underhill, L.

Eiwyn-Jones, L.

Parry, L.

Wells-Pestell, L. [Teller.]

Howie of Troon, L.

Peart, L.

White, B.

Jeger, B.

Pitt of Hampstead, L.

NOT-CONTENTS

Abinger, L.

Avebury, L.

Beaumont of Whitley, L.

Airey of Abingdon, B.

Balerno, L.

Bellwin, L.

Alexander of Tunis, E.

Barrington, V.

Belstead, L.

Boyd-Carpenter, L.

Harvington, L.

Rochdale, V.

Campbell of Croy, L.

Henley, L.

Romney, E.

Cathcart, E.

Holderness, L.

St. Aldwyn, E.

Cockfield, L.

Hood, V.

St. Just, L.

Cullen of Ashbourne, L.

Hornsby-Smith, B.

Sandford, L.

Darcy de Knayth, B.

Hylton, L.

Sandys, L. [Teller.]

Denham, L. [Teller.]

James of Rusholme, L.

Selkirk, E.

Drumalbyn, L.

Kimberley, E.

Sharpies, B.

Dundonald, E.

Kinloss, Ly.

Simon, V.

Eccles, V.

Lindsey and Abingdon, E.

Spens, L.

Ellenborough, L.

Long, V.

Strathcarron, L.

Elliot of Harwood, B.

Loudoun, C.

Strathcona and Mount Royal, L.

Elton, L.

Lyell, L.

Stuart of Findhorn, V.

Evans of Claughton, L.

Mackay of Clashfern, L.

Swansea, L.

Faithfull, B.

Mansfield, E.

Swinton, E.

Fortescue, E.

Margadale, L.

Tranmire, L.

Galloway, E.

Masham of Ilton, B.

Trefgarne, L.

Gibson-Watt, L.

Monk Bretton, L.

Trenchard, V.

Gisborough, L.

Morris, L.

Vaux of Harrowden, L,

Glasgow, E.

Mottistone, L.

Vernon, L.

Glendevon, L.

Mountgarret, V.

Vickers, B.

Gowrie, E.

Mowbray and Stourton, L.

Wigoder, L.

Greenway, L.

Norfolk, D.

Winstanley, L.

Grimston of Westbury, L.

Renton, L.

Young, B.

On Question, Motion agreed to.

Baroness YOUNG: My Lords, I beg to move that further consideration on Report be now adjourned.
Moved, That further consideration on Report be now adjourned.—(Baroness Young.)

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