Sitting of 14 May 1980

Preamble
The House met at half-past Two o'clock
PRAYERS
[Mr. SPEAKER in the Chair]
ORAL ANSWERS TO QUESTIONS
  ORAL ANSWERS TO QUESTIONS
  Mr. Speaker: Order. Once again, I appeal to hon. Members for questions to be questions, not statements.
  ORAL ANSWERS TO QUESTIONS
    FOREIGN AND COMMONWEALTH AFFAIRS

      Human Rights (Individual Petition)
      Mr. Silvesterasked the Lord Privy Seal by what date he must record his decision with the European Commission of Human Rights if he intends to continue with the right of individual petition from the United Kingdom.
      The Lord Privy Seal (Sir Ian Gilmour): The existing declaration recognising the competence of the European Commission of Human Rights to receive petitions from any person, non-governmental organisation or group of individuals expires on the 14 January 1981. A declaration of renewal ought therefore to be deposited with the Secretary-General of the Council of Europe before that date.
      Mr. Silvester: Is it not disgraceful that such an important matter has never been debated in this House? Will my right hon. Friend do his best to persuade the Leader of the House to make such arrangements, before a final decision is taken?
      Sir I. Gilmour: I do not know whether I can agree that it is disgraceful. I know how much interest my hon. Friend takes in these matters. I shall pass on his remarks to my right hon. Friend the Leader of the House.
      Mr. Churchill: Will my right hon. Friend confirm that it is unprecedented for a nation that has contracted to the convention subsequently to discontinue
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      the right of individual petition? Will he accept that none of the 21 nations of the Council of Europe has ever done so?
      Sir I. Gilmour: I think that my hon. Friend is right. However, he will realise that several nations, including Cyprus, France, Greece, Liechtenstein, Malta, Turkey and Spain, did not accept that right in the first place.
      Mr. James Lamond: Is it our intention to renew the right of individual petition?
      Sir I. Gilmour: As my right hon. Friend the Prime Minister recently stated in a written answer, we are considering the matter.
      Mr. William Shelton: Is my right hon. Friend aware that one of my constituents, a British Rail train driver, petitioned the court about the closed shop? Does not he agree that the court has played a valuable role in that case?
      Sir. I. Gilmour: I am sure that that is true. As my hon. Friend will realise, there are strong arguments on both sides.

      Falkland Islands
      Mr. Michael McNair-Wilsonasked the Lord Privy Seal if he will make a statement about the discussions which have taken place with the Argentine authorities about matters relating to the Falkland Islands.
      The Minister of State, Foreign and Commonwealth Office (Mr. Nicholas Ridley): I met an Argentine delegation for wide-ranging and exploratory talks in New York on 28 and 29 April. We had cordial and positive exchanges and were able to reach a better understanding of each other's position.
      Mr. McNair-Wilson: Was the subject of extending the Antarctic treaty to cover the dependencies of the Falkland Islands discussed? Are the Government considering such an extension? If so, will it affect Britain's sovereignty over those dependencies?
      Mr. Ridley: The talks were confidential. However, the subject was not discussed. Issues concerning Antarctica will be discussed soon at the Canberra conference on living resources. However, those issues were not discussed in New York.
      Mr. James Johnson: Is the Minister aware that I welcomed, with some surprise, the two words " cordial " and " positive ", which appeared in his statement? Does the Foreign Office propose to make a statement soon about 200-mile fishing limits and about the islands in the South Atlantic? Better still, does the Foreign Office propose to make a statement about a joint venture with Argentina as regards commercial fishing in those waters?
      Mr. Ridley: Once again, I am in the same difficulty. The talks were confidential. However, I shall answer as I did before. The matters were discussed in a " cordial and positive " manner.
      Sir Bernard Braine: Although it is of great interest to know that the discussions were conducted in a cordial atmosphere, why has my hon. Friend been so coy? Why has he not told the House the precise nature of the subjects discussed? This issue has always been close to the heart of the House of Commons.
      Mr. Ridley: We agreed with the Argentinian Government that these talks should be confidential. They were exploratory talks designed so that each party could discover the position of the other. Having given an undertaking to the Argentinian Government, I would not like to break it.
      Sir B. Braine: Why?
      Mr. Donald Stewart: Will the Minister at least give the House the assurance —given by the last Government—that there will be no change in the status of the Falkland Islands without the full accord of the islanders?
      Mr. Ridley: I utterly endorse that. Indeed, I have said it so often that I find myself saying it in my sleep.
      Mr. Alan Clark: When the Minister goes to Canberra no doubt he will discuss the future of the Falkland Island dependencies—a territory which is rich in mineral resources and in fish. Will he assure us that he will not sign anything there that would diminish United Kingdom sovereignty? Would not he be well occupied in consulting his right hon. and hon. Friends about questions of development and defence, because whatever international arrangements he makes will have very little effect unless we are pre-
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      pared to defend and develop these territories on our own?
      Mr. Ridley: On the first point, the conference in Canberra is about the Antarctic region, of which we are a claimant State. It is not about dependencies. They are not included in the subject matter for the conference. Of course, the question of dependencies was mentioned at the talks to which I have just referred and that was the proper place for that. We do not have a claim to the dependencies, we have sovereignty over them.
      On the second point, this is a matter for the Secretary of State for Defence but clearly, what my hon. Friend has said is very much in our minds.
      Mr. Rowlands: Perhaps it is useful to know that the Minister talks in his sleep. However, his reply was bland and un-informative on an issue that is of public concern and of particular concern to the House of Commons. Will he at least tell us whether he has had useful conversations about economic co-operation and fishing matters because these could be of great benefit to the Falkland Islanders? Further, was the issue of sovereignty raised or discussed in these conversations?
      Mr. Ridley: On the second point, it is right to say that the Argentinian Government raised the matter and it was discussed. On the first point, one positive conclusion of the conference was that arrangements would be set in hand for the Falkland Islanders to have direct contact with people in Argentina, both in government and in the private sector, with whom they are co-operating on economic and supply matters. The arrangements have been set in hand to institutionalise those contacts to the satisfaction of the islanders and the Argentinians.

      Iran
      Mr. Adleyasked the Lord Privy Seal what reassessment of British foreign policy he has made following recent events in Iran; and if he will make a statement.
      The Minister of State, Foreign and Commonwealth Office (Mr. Douglas Hard): Recent events in Iran have underlined the need for Western cohesion and the fullest consultation. We remain determined to engage with our partners and allies in diplomatic, political and

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      economic measures to help secure the release of the American hostages and thus make possible a revival of our traditional friendship with Iran.
      Mr. Adley: Will my hon. Friend agree that, whatever our attitude to it, the Islamic revolution, of which the events in Iran are a symptom, is a signficant occurrence in world affairs and it makes more urgent the need for a settlement in the Middle East, particularly of the Palestinian issue? Is my hon. Friend considering any further positive steps with our European allies to implement United Nations resolution No. 242?
      Mr. Hurd: I agree with my hon. Friend's first comment, and it is precisely because of that that the Foreign Ministers of the nine EEC countries have been asked to prepare a report on this subject which the European Council will consider at its next summit meeting in Venice on 12 and 13 June.
      Mr. Lennox-Boyd: Following the supplementary question of my hon. Friend the Member for Christchurch and Lymington (Mr. Adley), will not my hon. Friend agree that, while he may be saddened, he is not surprised that there will be no agreement between Israel and Egypt by 26 May? Will he further agree that the Israeli interpretation of the words " full automony " is rightly seen by the majority of people in the Middle East as conferring upon the Palestinian people no more than the rights of a self-governing colony?
      Mr. Hurd: We do not want to do anything that will cut across the conversations which are continuing between Israel, Egypt and the United States. We have made it clear from time to time, and so have our partners in Europe, that some aspects of Israeli policy, particularly on settlement, are an obstacle to the success of that venture.
      Dr. M. S. Miller: On a point of order, Mr. Speaker. Is it a new convention of the House that we debate or discuss matters that are not at all concerned with the original question that has been asked?
      Mr. Speaker: There was a tenuous connection, which the Minister accepted.
      Mr. Faulds: Correction, Sir—it was a very real connection.
      Mr. Speaker: Order. We shall all be satisfied if the hon. Member for Warley, East (Mr. Faulds) says " connection ".
      Mr. Faulds: Will the Minister accept that instead of kow-towing to the more ridiculous demands of an American President in election year, and helping to damage our future trading prospects, not only in Iran but throughout the Middle East, because of the ridiculous legislation that we have just passed, it would be more fitting to his office if he tried to mount a much more effective counter operation by the European countries through the launching of an initiative to settle the real problem in the Middle East which is at the core of all the other problems, including Iran, namely the Palestinian problem?
      Mr. Hurd: The hon. Member was not with us during the watches of the night—
      Mr. Faulds: I am too old.
      Mr. Hurd: Therefore, I would not accept his comments in the stimulating debates that occurred. On his second point, I have already tried to indicate that we are active in this way. We do not want to cut across what is already being done, but if we can help to promote a settlement by some clear European initiative, we shall do our best.
      Mr. Brocklebank-Fowler: Is my hon. Friend satisfied with the arrangements for consultation with the United States and the EEC in order to get a more coherent policy within the Western Alliance for dealing with this problem than we have had in the recent past?
      Mr. Hurd: There is a great deal of consultation—sometimes one feels that there is almost too much coherence. However, my hon. Friend is quite right, it is absolutely essential that all these matters clustered under this question should be considered as one, and proper priorities agreed among them.
      Mr. Shore: The Minister well knows that the meeting of the nine Foreign Ministers is taking place in Naples this weekend. He will also know, because he was here throughout the two-day debate on the Iran (Temporary Powers) Bill, that there are considerable reservations about the sanctions, and even stronger reservations about the timing of the proposed

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      implementation. Will he advise the House what line the British representative will take at Naples, particularly after hearing the new United States Secretary of State, Mr. Muskie, speak in Brussels, calling for immediate and full implementation?
      Mr. Hurd: If the discussion in another place proceeds satisfactorily, my noble Friend will go to Naples equipped with the powers that he said he would seek on this front. Then he and the other EEC Ministers will review the whole situation and consider what has happened since 22 April when they last met and to what extent they can find new diplomatic ways to make progress. They will also consider to what extent it would be helpful to use the powers which, by then, we expect all the countries to have to impose economic sanctions.
      Mr. Shore: The Foreign Secretary will go to Naples with these powers, but may I urge him strongly that the time is right for a full appraisal and a pause before any further action is decided upon? I hope that that will be put very strongly to the other countries in the EEC.
      Mr. Hurd: I note what the right hon. Gentleman says. However, the hostages have been held for six months, and no one can be accused of being headstrong.

      Gibraltar
      Mr. McQuarrieasked the Lord Privy Seal what further progress has been made in his discussion with the Spanish Government on the lifting of restrictions between the territory of Gibraltar and the Spanish mainland; and if he will make a statement.
      Sir Ian Gilmour: Following preparation through diplomatic channels, technical discussions about the implementation of the agreement reached between my right hon. and noble Friend and the Spanish Foreign Minister opened in Madrid on 5 May. Gibraltarian representatives took part.
      Mr. McQuarrie: I am sure that the House will welcome continuation of the discussions, but if agreement is reached that the border gates are opened on 1 June, will the Algeciras-Gibraltar ferry operate effectively from that date?
      Sir I. Gilmour: As my hon. Friend knows, the target date for re-opening the border is 1 June. However, I emphasise that it is only the target date.
      Mr. Russell Johnston: Why is there a delay? What is the problem? Spain is democratic. Why should she not open her gates? If the people of Gibraltar wish to remain associated with Britain, can the right hon. Gentleman assure us that the Government will support them?
      Sir I. Gilmour: I do not accept that there has been a delay. The Lisbon agreement is quite recent. As the hon. Gentleman will be well aware, there are a number of technical matters to discuss. The Gibraltar Government would be the first to agree that that is so. The hon. Gentleman will also be aware that our commitments are absolutely clear.
      Mr. Anthony Grant: Will my right hon. Friend make it clear to the Spanish Government that, as between friendly nations, we expect reasonable co-operation if they expect reasonable co-operation from us when they seek to join the EEC?
      Sir I. Gilmour: Of course that is true. However, as we have just reached an agreement with the Spanish Government, which I believe is satisfactory to both parties, I do not believe that minatory tones would be appropriate on our part just now.
      Mrs. Dunwoody: Is not the right hon. Gentleman saying that a technical matter is being discussed, when we desire to make clear to the Spanish Government that the free movement of workers in the Community means that the borders must be opened quickly? Will the right hon. Gentleman accept that the borders were closed at great speed, and we should like to see them opened again?
      Sir I. Gilmour: I do not understand the hon. Lady's difficulty. The agreement was made recently, and the target date for implementation is 1 June. If we do not meet that target date, the border will be opened shortly thereafter. There is no undue delay.

      South-West Africa
      Mr. Nicholas Wintertonasked the Lord Privy Seal if he intends to meet the Minister of Foreign Affairs of Zimbabwe

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      in the near future to discuss South-West Africa.
      Sir Ian Gilmour: No, Sir.
      Mr. Winterton: Will my right hon. Friend accept that I am somewhat disappointed with that reply? Does my right hon. Friend agree that what happens in Zimbabwe, as we now call it, in the immediate future and the attitude of Mr Robert Mugabe and the Zimbabwe Government, will have a great bearing on evolutionary changes in the remainder of Southern Africa? Does he further agree that it would be wrong at this time to put undue pressure on South Africa and the Administrator-General in South-West Africa which may be counter-productive in bringing forth a more democratic Government, which is the objective of the Administrator-General, who is doing so much good at present?
      Sir I. Gilmour: I entirely agree that the attitude and the behaviour of the Zimbabwe Government are of the utmost importance in Southern Africa. However, that is a matter for the Zimbabwe and South African Governments. I entirely agree with the second part of my hon. Friend's question. I do not believe that this is an occasion for undue pressure. As my hon. Friend knows, we are working for a general agreement.
      Mr. loan Evans: Does the right hon. Gentleman agree that, now that we have a democratically elected Government in Zimbabwe, we should seek their co-operation to end the illegal occupation by South Africa of this territory known as Namibia? Does the right hon. Gentleman accept that the United Nations for many years has called for it to be given independence and a democratic Government?
      Sir I. Gilmour: The procedures begun under the previous Government whereby the Five and the secretary-general negotiate and act with South Africa, are being continued. As I said, no doubt developments in Zimbabwe will have had a beneficial effect.
      Mr. Rowlands: Is the Lord Privy Seal aware that the successful momentum achieved by the ultimately peaceful settlement in Zimbabwe should be carried forward to solving a similar problem in Namibia by the same combination of
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      internationally supervised elections, as proposed by the United Nations? Will the right hon. Gentleman accept that there is a danger that the momentum will be lost? What is the state of play on the negotiations between the contact Five and the South African Government with regard to Namibia?
      Sir I. Gilmour: We do not want the matter to come to a standstill, but equally we do not want it to be rushed. The hon. Gentleman will be aware that the South African reply was received in London only yesterday. It requires a great deal of consideration, and I am reluctant to comment on it now.

      Iran
      Mr. Temple-Morrisasked the Lord Privy Seal if he will make a statement on the Government's policy towards Iran.
      Mr. Hurd: The Government wish to maintain friendly relations with the Government of the Islamic Republic of Iran. The main matter at issue is Iran's illegal detention for more than six months of the United States diplomats. Her Majesty's Government have throughout this time made repeated efforts to secure their release, and with this in mind have decided, with our European partners, to take powers to impose a range of sanctions on Iran.
      Mr. Temple-Morris: I appreciate that my hon. Friend has had enough of Iran to last him for at least a day or two, but will he accept that we shall continue to have the worst of all worlds with regard to Iran unless we work towards, and rapidly achieve, a continuous and definite policy towards that country, not least a strategy towards the area as a whole?
      Mr. Hurd: I entirely agree. I believe that we have such a policy. We take all available opportunities to impress on our partners and allies that a policy towards Iran needs to be considered within the framework of our policy towards the Middle East.
      Mr. Arthur Lewis: Without going into the problem of sanctions, does the hon. Gentleman accept that the easiest way to cope with the matter is to shut these numerous phoney English language schools that Iranian students flock to for various false reasons? Does the hon.

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      Gentleman agree that that has been going on for years, yet no one takes action? Why not put an end to that and keep those students out?
      Mr. Hurd: Schools are not a matter for me, and nor is kicking people out of the country. In the past few days we have given notice that we propose at the end of the week to institute a visa regime that will control the future entry of Iranians to this country.

      Zimbabwe
      Mr. van Straubenzeeasked the Lord Privy Seal whether he has any plans to pay an official visit to Zimbabwe.
      Sir Ian Gilmour: I have no plans to do so at present.
      Mr. van Straubenzee: Will my right hon. Friend accept that I appreciate the prompt and generous financial provision made for the new State of Zimbabwe? Will my right hon. Friend confirm that, official visit or not, he will be keeping in touch with the situation to monitor the effect of the aid, so that if, on a continuing basis, further assistance is necessary, that can at least be considered?
      Sir I. Gilmour: I am grateful for my hon. Friend's earlier remarks. As he knows, an ODA mission went out in January and another will be going in June to consider these matters. We shall naturally keep everything under review.
      Mr. Whitehead: Will the Lord Privy Seal discuss with the Governments of Zambia and other Comonwealth countries in Central and East Africa the deteriorating situation in Uganda? Can the right hon. Gentleman tell us anything about the state of affairs there? Will he undertake to express the concern that many of us feel about the deterioration?
      Sir I. Gilmour: The situation in Uganda is serious, but the hon. Gentleman will agree that the matter does not arise from this question.

      Lebanon
      Mr. Hooleyasked the Lord Privy Seal what steps are being taken by the United Kingdom in the Security Council to make fully effective the work of the United Nations interim force in the Lebanon.
      Mr. Hurd: We voted for United Nations Security Council resolution 467 on the 24 April, and we shall continue to support the efforts of the United Nations and the troop contributors to enable UNIFIL to operate more effectively in South Lebanon.
      Mr. Hooley: Is the Minister aware that the behaviour of the so-called militia, armed and backed by Israel, is causing considerable bitterness among those countries that have contributed troops in the name of the international community to maintain peace in that area? Do not the Five permanent members of the Security Council have a clear duty to give the necessary diplomatic and other backing to make that force fully effective?
      Mr. Hurd: We agree that there is no justification for the continued Israeli presence and their support of the Haddad militia. Of course, Israel argues, with some justification, that it is concerned about infiltration into the UNIFIL area by Palestinian units, but it would be much easier for UNIFIL to look after that part of its job if it were not being harassed by Major Haddad's militia.
      Mr. Kilfedder: Presumably the Government recognise the provocation and agony caused by the murder of Christians in southern Lebanon by terrorists who infiltrate on occasions into northern Israel. Is it not, therefore, unreasonable that the Irish Republic, one of the peacekeeping countries, should have gone overboard in favour of the PLO which, incidentally, has connections with the Irish Republic Army?
      Mr. Hurd: I am not responsible for the policy of the Irish Government, but having visited UNIFIL, I know that the Irish battalion does a good job.
      Mr. John Home Robertson: In view of the hon. Gentleman's great experience of economic sanctions, can he tell us when the Government intend, through the United Nations, to impose economic sanctions on Israel as a result of its persistent military attacks, both direct and indirect, on the State of Lebanon and on the United Nations forces there?
      Mr. Hurd: We have no such plan, but we have no hesitation in making our views known at every opportunity.
      Mr. Hicks: Is it not a fact that the purpose of establishing UNIFIL was to allow the Lebanese Government to restore their sovereignty over their territory? Should not the British Government, as one of the five permanent representatives, be taking a more positive role in order to see that objective fulfilled?
      Mr. Hurd: I agree with my hon. Friend, and we are doing everything that we can. The Foreign Minister of Lebanon was here on a private visit a few days ago and some of us had the chance to discuss the matter with him. I gave him that assurance. I have a great deal of admiration for the Foreign Minister, the Prime Minister and others in Lebanon who are trying, against considerable odds, to rebuild their country.
      Mrs. Dunwoody: Will the Minister make it clear that, although we support the work of the United Nations force in Lebanon, there should not be infiltration through this area, because it will not be understood by the Israelis and will cause enormous uproar within the area if there are continuing terrorist incidents?
      Mr. Hurd: Yes. That is certainly true.

      Brandt Commission
      Mr. Goodladasked the Lord Privy Seal what consultations he has had with United Nations agencies about the recommendations of the Brandt commission.
      Mr. Hurd: My right hon. Friend had a short exchange of views with the Secretary-General of the United Nations on 16 April. This is likely to be taken further when the Secretary-General visits London next week.
      Mr. Goodlad: In view of the grave threat to world development and, potentially, to stability that is posed by the enormous increase that is taking place in the world's population, will my hon. Friend promote the objectives of the United Nations fund for population activities, not least by working to restore the British contribution to the fund, since it is no longer underspent on its budget as it was when the decision to halve our contribution was taken?
      Mr. Hurd: I know of my hon. Friend's interest in this matter. We contributed £2 million to the fund last year and are contributing a further £2 million this
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      year. I do not think that that is too bad in the light of our circumstances.
      Mr. James Lamond: As the Brandt Commission's report deals at length with the great increase in expenditure on arms throughout the world, would it not be difficult for the Government to accept some of the recommendations for reducing the total amount of spending on arms, since that would fly in the face of the decisions that were announced recently when we debated the Defence Estimates?
      Mr. Hurd: Certainly some of the recommendations are difficult for us to accept. We have had one debate in the House, there has been a debate in another place and I understand that my right hon. Friend the Leader of the House has promised a fuller debate in Government time before the end of June. I think that these matters will be best thrashed out then.
      Mr. Whitney: In considering a response to the Brandt commission report, will my hon. Friend bear in mind that some of the more important recommendations are potentially of considerable inflationary impact and that if fuel is added to the world inflation it will result in great harm being caused to developing countries?
      Mr. Hurd: The Brandt report is a powerful piece of analysis, but of course my hon. Friend is right in pointing out that some of the proposals cause practical difficulties for us. We are not in the business of saying that we shall do things if we cannot do them. That is why we must look at the report carefully and together.
      Mr. Shore: Does the hon. Gentleman agree that the Brandt report addresses themes of immense importance, not only to the international economy, but to the question of political stability in so many regions? Does he agree that it will require careful handling and a carefully thought-out programme if we are to make a worthwhile response? Does the hon. Gentleman also agree that not only should United Nations agencies, which may have useful comments to make, be consulted, but that the subjects should be seriously considered in the OECD, which is the major forum of the developed countries?
      Mr. Hard: Yes, indeed, and that is now happening. We have to prepare for the special session of the United Nations General Assembly which will certainly concentrate on many of those matters.

      Esperanto Broadcasts
      Mr. Squireasked the Lord Privy Seal if, in the light of the growing number of Esperantists, he will direct the Overseas Service of the British Broadcasting Corporation to broadcast in Esperanto.
      Mr. Ridley: No, Sir. The BBC external service broadcasts either in English, which it is the Government's policy to promote as an international language, or in the native languages of selected countries or regions.
      Mr. Squire: While our desire to broadcast in our own language is understandable and laudable, will my hon. Friend recognise that many people will be disappointed by his answer? Is he aware that a growing number of countries, including China, as well as Radio Vatican, broadcast in Esperanto for the benefit of bringing people closer together.
      Mr. Ridley: Esperanto is the second language of all those who speak it and we think it better to broadcast in their first languages. The BBC broadcasts in 39 such languages.
      Mr. Faulds: As the BBC is renowned throughout the world as the most dependable and responsible broadcasting organisation—and it uses the services of the best people available—would it not help international understanding if, instead of chasing this obscure and unknown little fake language, the Government were to make available more money for BBC broadcasts in English throughout the world?
      Mr. Ridley: Such money as the Government make available to the BBC external services is better spent in broadcasting either in English or in the language of those living in the countries to which the BBC broadcasts.
      Mr. Maurice Macmillan: In view of my right hon. Friend the Prime Minister's determination to flood the Soviet Union with propaganda, will my hon. Friend
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      consider restarting the BBC's Ukrainian language broadcasts and bearing the cost of them on the defence budget rather than within propaganda expenditure?
      Mr. Ridley: We have increased broadcasts, to a small extent, to both Russia and Afghanistan and we are studying whether there is scope for further increases. As to whether the money would be better placed on the Vote of the Ministry of Defence, that is a matter which would not help the general total of money spent, whichever Vote it was put on.

      Afghanistan
      Mr. Bestasked the Lord Privy Seal if he will make a statement on the current situation in Afghanistan.
      Mr. Hurd: There is no sign of Soviet troops being withdrawn from Afghanistan. Further demonstrations in Kabul at the end of April showed the continuing opposition of the Afghan people to the Russian presence and to the Government whom the Russians have installed. We deplore the loss of life of the many young people, including school girls, who have been killed during the suppression of the demonstrations.
      Mr. Best: May I draw my hon. Friend's attention to the fact that on Saturday a meeting of the Young Conservatives' national advisory committee, a body which represents the largest political youth movement in this country, overwhelmingly passed a motion urging Sir Denis Follows to pay less regard to the International Olympic Committee and more to the wishes of the people of this country, as expressed through their democratically elected representatives in this House and in the European Parliament, that there should be a boycott of the Olympic Games?
      Will he also—
      Mr. Speaker: Order. If the Minister is to answer in time, the hon. Gentleman had better stop there.
      Mr. Hurd: I am greatly reassured and strengthened by what my hon. Friend has told me. Nothing that has happened in Afghanistan or elsewhere in the world since January weakens, in any way, our view about the need for a boycott of the Olympic Games.

    EUROPEAN COMMUNITY

      Community Legislation
      Mr. Spearingasked the Lord Privy Seal what action he has taken or proposes to take, consequent on the First Special Report of the Select Committee on EEC legislation (HC 543) relating to EEC instruments not deposited in the House.
      Sir Ian Gilmour: My right hon. Friend the Leader of the House and I have discussed this report. We accept that the Committee should be informed as promptly as possible of legislative proposals. Further representations are being made in Brussels to try and improve the service. We shall also ensure, wherever possible, that when no depositable document is produced before a legislative proposal is considered by the Council, the Scrutiny Committee is kept fully informed by use of unnumbered explanatory memoranda.
      Mr. Spearing: Does not the right hon. Gentleman accept that there has been a breach of the undertaking, in that a statutory instrument has been made by this House when no document on which it is based has gone to the Scrutiny Committee? Will the right hon. Gentleman assure the House that Her Majesty's Government will not in future assent to any directive or regulation in the Council of Ministers until they have a document from the Council which can be put before the Scrutiny Committee of this House, in accordance with their undertakings?
      Sir I. Gilmour: With all respect to the hon. Gentleman who, I know, takes a close interest in these matters, I think that my first answer went fairly far towards meeting his point. We accept that there is a difficulty. We are trying to deal with it. The hon. Gentleman knows that there are occasional difficulties when we have to proceed. We shall do our best to see that there is an adequate document whenever we discuss matters.
      Mrs. Dunwoody: Will the Lord Privy Seal look at the Danish system, whereby Ministers are required to come back to the Danish Parliament with detailed propositions before they are decided upon in the Council of Ministers? We would like the right hon. Gentleman, if he is to deposit documents, to make sure that they are deposited in good time.
      Sir I. Gilmour: We would, of course, like documents to be deposited in good time but each Parliament has its various customs. In this matter, I do not intend to suggest to the House that we should follow the Danish example.
      Mr. Arthur Lewis: The right hon. Gentleman did not answer the question put by my hon. Friend the Member for Newham, South (Mr. Spearing) or his supplementary question. The right hon. Gentleman was asked whether he would state to those in the so-called European Parliament and to these so-called Europeans that we would refuse to carry out any directives unless the papers and documents, are put to the Committee. Will he not simply do his best? Will he tell them that?
      Sir I. Gilmour: No.

      Treaty of Rome
      Mr. Dormandasked the Lord Privy Seal if, following the recent meetings of EEC Ministers, he will take steps to secure the amendment of the Treaty of Rome.
      Sir Ian Gilmour: No, Sir.
      Mr. Dormand: Will the right hon. Gentleman try to persuade the Cabinet to read the speeches that some of its members made when the Treaty of Rome was being debated in the House? Is it not now abundantly clear that the milk and honey promised in at least some of those speeches is totally divorced from present reality and that the main cause is the nature of the treaty? If the Government do not intend to withdraw from the EEC, will they at least try to make fundamental changes in the treaty?
      Sir I. Gilmour: I do not think that it is very good for politicians to spend time reading their own speeches. Some were rather proud of doing that. They probably gain greater intellectual refreshment from reading other people's speeches or other matters. We have no intention of proposing amendments to the Treaty of Rome. As the hon. Gentleman knows, we are proposing changes in our budget contribution, but that is a very different matter.
      Mr. Straw: Is not the Lord Privy Seal aware that the continuing deterioration in our trade with the EEC, particularly

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      in non-oil products, points to amendment of the treaty? Is the right hon. Gentleman aware, notwithstanding his injunction not to read his own speeches, that when he told the House a month ago that there had been an improvement in our trade with the EEC between 1978 and 1979, he was wrong? Does he realise that figures published by the Government prove that there has been no change? If the greatly increasing exports of oil to the EEC are removed, is he aware that our trade with the EEC has deteriorated from 83 per cent. to 78 per cent. and the deficit in non-oil trade has doubled to £4 billion?
      Sir I. Gilmour: With respect, the hon. Gentleman is not right. Our trading performance with the EEC is better than it is with the rest of the world. The United Kingdom's performance in manufacturing trade with the world as a whole has been disappointing but. last year, the deterioration in our trade with the Community was less bad than that with the world as a whole and less than that with the United States or Japan.
      Sir Derek Walker-Smith: Does my right hon. Friend appreciate that no amendment of the Treaty is required for the appropriate restructuring of the common agricultural policy since the articles in the Treaty relating to the common agricultural policy are cast in generalised terms? Will he, therefore, press ahead to secure the necessary agreement in the Council of Ministers, which is all that is required for this laudable and imperative objective?
      Sir. I. Gilmour: My right hon. and learned Friend is extremely learned in this matter, as in other matters. The House will accept his word. We wish to restructure the budget, but, as my right hon. and learned Friend will know, that is a medium and long-term matter rather than something that can be dealt with during the next few weeks.
      Mr. Shore: By his own high standards, the Lord Privy Seal is being exceptionally complacent in his replies to this question. Is he really telling the House that a Treaty, written 25 years ago, not one word of which was contributed to by a British hand, is not a subject that he ought to be thinking about in terms of major amendment and change after all
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      the experience of failure in matching and meeting its own objectives, let alone our national interest? If he is not thinking about it, he should start doing so now.
      Sir I. Gilmour: The difference between the right hon. Gentleman and myself is that I wish to secure an agreement with the EEC and the right hon. Gentleman does not. The right hon. Gentleman therefore, wishes to maximise our difference with the EEC whereas the Government do not wish to do so.

      Yugoslavia
      Mr. Knoxasked the Lord Privy Seal what discussions he has had with his EEC colleagues on the Council of Ministers about Yugoslavia.
      Sir Ian Gilmour: Discussions on Yugoslavia have occurred regularly during recent meetings with my European Community colleagues, culminating in the signing of the European Community-Yugoslavia co-operation agreement in Belgrade on 2 April and the interim agreements on trade and financial co-operation in Brussels on 6 May.
      Mr. Knox: Will my right hon. Friend agree that it is important that the EEC as a whole should be well prepared to deal with any changes that may come about in Yugoslavia, or that may concern Yugoslavia, following the death of President Tito?
      Sir I. Gilmour: I accept entirely the force of my hon. Friend's question. He will be aware that the speeding up of the negotiations between the EEC and Yugoslavia was directly caused by the serious and sad illness of President Tito.
      Mr. Churchill: Would not my right hon. Friend agree that, with the passing of President Tito, Britain has lost an honoured friend and wartime ally? Bearing in mind the Kremlin's long-held desire to see Yugoslavia incorporated within the Soviet empire, as part of the Warsaw Pact, will he make clear Her Majesty's Government's determination to do all in their power to secure the continued independence of Yugoslavia including, if neccessary, the sale of defensive weapons?
      Sir I. Gilmour: I entirely agree with what my hon. Friend said about President Tito. It has been a long standing policy of the British Government, including

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      previous Governments, to support the independence of Yugoslavia. We shall do all that we can to see that that is assured.

      Foreign Policy Co-ordination
      Mr. Dykesasked the Lord Privy Seal when he intends to raise the question of the inclusion of new areas and subjects in the region of political co-operation and modifications to the role played by the Committee of Permanent Representatives on foreign policy co-ordination.
      Sir Ian Gilmour: The Government attach great importance to political cooperation with our European partners. We wish to strengthen and intensify it. We are always prepared to propose new subjects for political co-operation if they are in areas where Europe can make a useful contribution. We are similarly willing to put forward or support practical proposals which will improve the machinery of political co-operation. The important thing is to build on the valuable direct contact between Ministers and officials of the Nine which political cooperation involves.
      Mr. Dykes: I thank my right hon. Friend for that very positive and comprehensive answer. Will he also acknowledge that political co-operation is sufficiently informal and empirical for a number of additional subjects to be included within it? One of those could be, for instance, the establishment of a Community institution in London. Will my right hon. Friend press for this in coming years, to reinforce our involvement in the Community? Will he, for example, consider the European export bank if it is established, or the European trade mark office, which is due to be formed in three years' time?
      Sir I. Gilmour: I agree with my hon. Friend, and I shall seriously consider both matters that he has raised.
      Mr. Spearing: Does not the right hon. Gentleman agree that it would be inappropriate at this time of disagreement about the budget to agree to any extension of political co-operation other than that which is an obligation under the Treaty?
      Sir I. Gilmour: I cannot agree at all. The Western world is seriously threatened, and the maximum amount of political
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      co-operation that we can achieve among the Nine is clearly in the interests not only of this country but of the free world as a whole.
      Mr. Eldon Griffiths: As terrorists who are wanted in one EEC country are still finding havens in others, does not my right hon. Friend think that one of the jobs that the committee might do is to improve co-operation in counter-terror operations? In particular, will my right hon. Friend invite it to devise a common code of practice for the pooling of criminal intelligence and advance warning and the whole matter of the protection of embassies?
      Sir I. Gilmour: My hon. Friend raises some wide and very important matters. I think that they go rather wider than the question, but we shall certainly consider them.
      Mr. Hooley: If there is to be better foreign policy co-ordination, it should surely be in a much wider context than the Nine. Is the right hon. Gentleman satisfied that co-ordination in the wider world is effective, and is not the Treaty of Rome an obstacle to that?
      Sir I. Gilmour: Of course it is not. There is no doubt that co-operation between the Nine is not an obstacle to cooperation in other forums as well or with other people, such as the United States. The maximum amount of co-operation within the Nine is clearly to the advantage of us all.

      Budget (United Kingdom Contribution)
      Mr. Strawasked the Lord Privy Seal what further meetings have been arranged involving Ministers of his Department concerning the re-negotiation of the United Kingdom's contribution to the EEC budget.
      Sir Ian Gilmour: I expect the United Kingdom's contribution to the European Community's budget to be discussed at the informal meeting of Foreign Ministers scheduled on 17 and 18 May and again at the Foreign Affairs Council in Luxembourg on 2 and 3 June.
      Mr. Straw: Does the right hon. Gentleman agree that the farm price deal that has been agreed so far by the other Eight is wholly unacceptable in any circumstances, involving as it does a £1 billion

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      increase in the cost of the CAP, and that it is wholly contrary to the Government's stated intention of reducing the CAP? Will the right hon. Gentleman confirm that, in the Government's anxiety to get a deal on Britain's overall budget contribution, there will be no surrender on the farm price deal?
      Sir I. Gilmour: We are not in the surrendering business. On the first part of the hon. Gentleman's question, he should pursue his quarrel with his own leader. The Leader of the Opposition said on 29 April:
      " I repeat very strongly that we shall support her "—
      that is, my right hon. Friend the Prime Minister—
      " in not giving way on the agricultural price freeze until the budgetary issue is settled."— [Official Report, 29 April 1980; Vol. 983, c. 1154.]
      Mr. Nicholas Winterton: Does not my right hon. Friend agree that the demand by my right hon. Friend the Prime Minister for a substantial cut in our EEC budget contribution is fully justified, bearing in mind the lethargic and slow method of operation in the EEC, which means that much of our industrial base is being undermined? I refer particularly to the very slow way in which the EEC processes applications for anti-dumping measures and so on.
      Sir I. Gilmour: I am not sure how closely connected the two parts of my hon. Friend's question are, but I agree with him 100 per cent. on the first part.
      Mr. Russell Johnston: Can the right hon. Gentleman confirm that the nub of the negotiations about the budget is the relative GNP per head of the member States in relation to contributions rather than any argument about juste retour, or broad balance?
      Sir I. Gilmour: We have never sought juste retour, and that has nothing to do with our case. The main point is that we are the seventh richest member of the Community and by far the largest contributor. But the matter goes beyond that. On the present basis, if nothing happened, we should be supplying about 60 per cent. of the Community budget. Germany would be supplying the rest, and virtually everybody else would be in surplus. That is plainly wrong.
      Mr. Shore: It is manifestly wrong, as the Prime Minister has made it plain on a number of occasions. But will the right hon. Gentleman make clear to the country that there is no question of trading off a temporary concession on the British net contribution to the budget against a major new imposition on the British housewife and consumer and additional cost through the already over-costly CAP? Will he also make plain that he is trying to get at the heart of the matter, which is the whole crazy system of own-resources and the pattern of budget expenditure?
      Sir I. Gilmour: The right hon. Gentleman should pursue that matter fundamentally with his own leader.
      Mr. Rowlands: Answer the question.
      Sir I. Gilmour: I will. It is worth bearing in mind that the previous Government, which the right hon. Gentleman adorned, as did his hon. Friend the Member for Merthyr Tydfil (Mr. Rowlands), agreed to average price increases of 7·5 per cent. a year. Therefore, even if we agreed to a 5 per cent. increase, it would be much lower than the average increases conceded by the previous Government.
      Mr. Dykes: Does my right hon. Friend agree that the 5 per cent. farm price increase would add a mere 0·2 per cent. to the retail price index, whereas excessive wage claims in this country are pushing inflation up to 20 per cent?
      Sir I. Gilmour: That is largely true. Nevertheless, everything that adds to inflation is in itself to be regretted. The 5 per cent. increase is large, but is not large compared with that which was normally agreed to by the previous Government.

      Disciplinary Procedures
      Mr. Jayasked the Lord Privy Seal whether he will publish the memorandum by Sir Roy Denman on disciplinary procedures within the European Economic Commission.
      Sir Ian Gilmour: No, Sir. The document in question is, I understand, an internal Commission memorandum prepared as part of the Commission's work on the report by the Spierenburg committee. It is not a matter for Her Majesty's Government.
      Mr. Jay: But as the Prime Minister is so keen on reducing the number of civil servants, and as Sir Roy Denman says that they cannot be dismissed in Brussels even if they are dead drunk all day, what will the right hon. Gentleman do about it?
      Sir I. Gilmour: That extract from the report is clearly grist to the right hon. Gentleman's mill, but as he will be aware, what Sir Roy Denman was saying was that there was security of tenure in Brussels, virtually whatever happened. There may well be too many bureaucrats in Brussels, but compared with, say, the Scottish Office, their number is not great.
      Mr. Spearing: While it may not be appropriate for the Government to publish the Denman report, does not the right hon. Gentleman agree that there is considerable, and probably justified, public anxiety about the appointment, terms of reference, general disciplinary procedures and terms of employment of those employed by the Commission? Is he satisfied that they are up to at least the standards in the British Civil Service? If not, what will he do about it?
      Sir I. Gilmour: I did not know that there was anxiety. I should have thought that the general standard of public servants in Brussels was very high.
      Mr. English: Would the right hon. Gentleman care to commend staff regulation No. 4 of the European Communities to his own Department and to the home Departments of State? He will recollect, I am sure, that that regulation says that the Commission can take away the pensions of people who take jobs contrary to the wish of the Commission after leaving the service of the Commission. Perhaps he could commend that regulation to the Department of the Industry, for example.
      Sir I. Gilmour: Fortunately, I think that that is another question.
      Mr. Arthur Lewis: Will the right hon. Gentleman say whether it was on this report that The Daily Telegraph based its article on Monday, pointing out that poor European MPs could not get their £40,000 a year—mostly in expenses—tax-free? Is he aware that many of them,
      1500
      according to the article, are having to apply to their banks for overdrafts? Is it not terrible that these poor people cannot manage on that money?
      Sir I. Gilmour: I was abroad on Monday and did not see the report in The Daily Telegraph. From what the hon. Gentleman said, the newspaper report appears to relate to Members of Parliament. As the Denman report does not relate to Members of Parliament, I think that the connection is unlikely.

FOREIGN AND COMMONWEALTH QUESTIONS
Mr. Nicholas Winterton: On a point of order, Mr. Speaker. You will see from the Order Paper today that 32 questions were down for answer by the Lord Privy Seal on general matters relating to the world situation and six questions relating to EEC matters. Thirty-five minutes were allocated to world affairs—I repeat there were 32 questions on world affairs —and 20 minutes were allocated to six questions on EEC issues. This is not the first time that we have completed all the EEC questions.
Will you indicate, Mr. Speaker, what discussions are taking place to help Back Benchers have their questions on world affairs answered in questions to the Foreign and Commonwealth Office and to the Lord Privy Seal in particular as opposed to so much time being spent on EEC matters? I believe that this is an important issue and I shall be obliged if you will advise the House.
Mr. English: Further to that point of order, Mr. Speaker. In considering that issue, I hope that you will bear in mind that, whatever may be the number of questions put by hon. Members, it is surely more important for us to consider the affairs of a legislating body such as the EEC than the vague views of hon. Members on foreign affairs.
Mr. Speaker: The House is aware that this arrangement is usually settled through the usual channels. The hon. Member for Macclesfield (Mr. Winterton) should be well pleased that both the Leader and the Shadow Leader of the House have heard what he had to say.

ADJOURNMENT (SPRING)
Motion made and Question proposed,
That this House, at its rising on Friday 23 May, do adjourn till Monday 2 June.—[Mr. Cope.]
3.32 pm
Mr. Donald Coleman (Neath): Before the House agrees to the motion on the Spring Adjournment there are one or two matters that I wish to raise in an attempt to get some answers from the Leader of the House.
Right hon. and hon. Gentlemen may sneer at the TUC day of action, but the reasons for the day of action will not go away until the Government change their attitude and their policies in dealing with those things that have caused the anger and annoyance felt by working people in this country.
My right hon. Friend the Member for Battersea, North (Mr. Jay) asked the Home Secretary last Thursday—when the right hon. Gentleman was answering questions on behalf of the Prime Minister—what he would be advising the unemployed to do today. The unemployed hang like a millstone round the neck of the Government. Every constituency in the land can demonstrate increases in the unemployment figures, in varying degrees.
In my constituency we have every cause for complaining and protesting today about the rising unemployment figures. In April 1979 the unemployment figure in the Neath and Resolven travel-to-work area was 7·7 per cent. The latest tables, published in April this year, show that that figure has risen to 9·3 per cent. If Conservative Members want to know why those in my constituency and elsewhere have responded to the call of the TUC today, the reason is the serious rise in unemployment.
Last July the Secretary of State for Industry decided that Neath was to lose its special development area status in August 1980. Unemployment in the area continues to rise, and still the Secretary of State for Industry will not reverse his decision. He justifies that decision by saying that the level of unemployment in Neath does not warrant special development area status. I remind the House that at this time last year unemployment in the Neath area stood at 7·7 per cent.
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and that the figure is now 9·3 per cent. We cannot afford to tolerate that situation any longer. The Secretary of State for Industry says that he is not prepared to reverse his decision until he has had the opportunity of knowing what decisions have been taken about redundancies in the steelworks at Port Talbot.
We in Neath cannot afford to wait that long. Our unemployment figure gallops upward and redundancies at Port Talbot will turn our serious situation into a disastrous one.
Mr. Ioan Evans (Aberdare): Is it not a fact that the closure of every pit in Wales today, coupled with the massive response to the call by the TUC, is due not merely to the present high unemployment caused by the Government's policies but to the fear that if those policies continue in the years ahead there will be massive unemployment throughout Wales? That is why working people are out today. They are telling the Government to halt their present policies.
Mr. Coleman: My hon. Friend is right. Not only are we facing massive unemployment in the steel industry; we face the same threat in the South Wales coalfield. Even more redundancies are now forecast and if that happens it seems inevitable that coal mining will cease in South Wales.
In Neath we cannot afford the luxury of waiting for the Secretary of State for Trade to make up his mind about the restoration of our status. I hope that the Leader of the House, if I may have his attention, will tell his right hon. Friend of our impatience and advise and instruct him that an urgent and early decision is vital to the people of my constituency and West Glamorgan generally.
The Government have some odd priorities in the spending of money. The Secretary of State for Industry told us that the Government are prepared to pay a transfer fee of £2 million to an American company to facilitate the transfer of a new chairman of the British Steel Corporation. Such a sum of money would have been better spent in trying to prevent the recent tragic steel strike.
Let us move on to the disaster area of the Government's housing policy. We find that council house building has come to a stop because there is no money

1503
available for house building programmes. The hopes of home buyers obtaining local authority mortgages have long dried up. No money is available.
We read in last Friday's Daily Mirror that the Government are to spend money on advertising in the hope of resolving their great flop—the sale of council houses. The article states:
" A million pounds is to be spent on advertising the Government's campaign to sell council houses. The cash is being poured out because the buy-your-home campaign has flopped. Fewer council houses were sold in the first six months of this Government than in the previous six months under Labour."
In view of the need for decent housing it would be better if the Government decided to spend £1 million not on advertising a flop but on providing houses. I hope that the Leader of the House will suggest that to his colleagues with responsibility for housing.
The issues that I have mentioned are good reasons for people to show their disapproval of the Government. I assure the right hon. Gentleman that unless things change the disapproval and protest will grow and become louder. The Leader of the House must tell his colleagues that that is the mood of the people, because time is not on their side.
3.40 pm
Mr. Christopher Murphy: Before rising for the Whitsun Recess, the attention of the House should be drawn to the importance of the family and the need for personal responsibility, particularly in these economically difficult times. The nation needs to gain that ideal which has been sought by Conservatives for so long but has still to be achieved—the responsible society.
If we are to realise that aim, we must look to the cornerstone of our way of life—the family unit. Under Socialism and so-called progressive thought, the family is debased and undermined. The attempt to substitute the State can guarantee only that a country propels itself even faster towards destruction and degradation.
In recent years it has become more and more evident that parents are not necessarily willing to accept full responsibility for their children. In times of trouble increasingly parents direct blame at the teacher, the policeman, the doctor, the social worker, the probation officer and
1504
anyone else except themselves. Self-reproach has become a virtue of the past.
As Conservatives, my hon. Friends will, I am sure, deplore that attitude and support fully the Government in their effort to redress the balance in our society. We must get the Socialist encumbrance off the backs of the people and thereby allow the family unit to flourish once again.
Surely it is up to us all to engender the notion of standing firmly on one's own two feet whenever possible rather than leaning automatically against the ever-advancing wall of the State for support. We must all play a part in ensuring that standards and discipline improve and that morals and behaviour are learnt in the home.
My right hon. Friend the Prime Minister in speeches throughout the country has rightly paid attention to the role of the family. The nation would do well to heed the wisdom of her words. At the same time, she emphasises the need for greater personal responsibility, which is the prerequisite for a successful and caring society. With a strengthened family unit playing its part in the community, a responsible society can be achieved. The opportunities for the exercise of individual freedom will, at the same time, be enhanced.
A respected literary figure, George Bernard Shaw, said:
" Liberty means responsibility. That is why most men dread it."
The House should take the lead in encouraging and advocating liberty and responsibility so that men and women welcome it, to the benefit of their families and the nation.
3.43 pm
Mr. James Hamilton: It is difficult to understand how the Government can go into recess bearing in mind the Scottish unemployment figures. In Scotland, 191,000 people are unemployed. According to David Bell, president of the Fraser of Allander Institute and well-known economist in Scotland, that figure will be about 200,000 by October this year. It is an appalling figure when one takes into account the devastating state of the Scottish economy.
Many school leavers will take at least two years to find their first jobs. That should worry the whole House. If we are

1505
to deal with the vandalism problem, we must cope with the young unemployed. The House has a duty and a responsibility to give serious consideration to the facts before it. In Strathclyde last year, 21,148 people were declared redundant. Eighty per cent. of Scottish redundancies were in the Strathclyde region. What do the Government intend to do to remedy that serious defect? Before the election they made many promises to the people of the United Kingdom, and in particular to the Scottish people, about what they would do to remedy that disastrous defect.
I worked in the construction industry before I became a Member of the House. Under all Governments that industry is always the first casualty of public expenditure cuts. It is experiencing many changes. Many liquidations have occurred simply because the Government are not measuring up to their responsibilities.
My hon. Friend the Member for Neath (Mr. Coleman) mentioned house building in Wales. In Scotland house building has reached a low level. The Government encourage owner-occupation, but building societies fail to provide the money to enable young people to purchase their own houses. If that situation prevails, the construction industry will experience even more serious difficulties. I ask the Government to reconsider the position of the construction industry before the recess. Unless they are prepared to reconsider public expenditure cuts, they are doomed to failure.
I am pleased to say that the Scottish people were not conned by the Prime Minister's promises. The right hon. Lady conned the people of the rest of the United Kingdom, but not the people of Scotland. Many of the Government's policies were not mentioned in their election manifesto. They have a duty to tell the people why they are introducing measures for which they have no mandate.
The steel workers in my constituency, and throughout the country, are in a serious position. I find it nauseating that the Government have made a deal with an American company to pay £2 million to acquire the services of Mr. Ian MacGregor as the future chairman of the British Steel Corporation without taking into account Mr. MacGregor's age and the length of service that he can give to the BSC. I hope that the Government
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will give serious thought to that matter.
The steel workers realise that the £2 million that is to be paid for Mr. MacGregor could have solved the dispute in the first week of the steel workers' strike. If the Government expect the steel workers to give Mr. MacGregor their full co-operation and assistance—which is essential to that industry—they are, quite frankly, living in cloud-cuckoo-land.
I hope that the Leader of the House and the Government will seriously consider the matter, retrace their steps, change their policy and, above all, alter their determination to cut public expenditure, which is seriously affecting the economy of the United Kingdom, especially that of Scotland. On that basis, I ask the Leader of the House and, indeed, the whole House, to give serious consideration to the contribution that I made this afternoon.
3.52 pm
Mr. R. A. McCrindle: Compared with the weighty matters of national and international economic policy that have been given as reasons why we should think carefully before going into recess, I wish to raise two matters that may appear to be unimportant. However, I believe that they should be brought to the attention of the House in the interests of Britain. The only link between the two subjects is that they both relate to the use of motor vehicles.
First, I wish to refer to the alleged effect upon the atmosphere of the emission of fumes from the internal combustion engine. For a long time there has been controversy about the effect of lead poisoning on health. It is a product of the internal combustion engine.
I have heard it said that we are concerning ourselves needlessly over the matter. I have also heard it said that the effect on the health of people, especially young children, is such that the issue should be among the highest priorities to which the Government should turn their attention. I cannot pretend to know which approach is correct. A high level committee recently examined the matter, but came to no definite conclusion. There was an ambiguity about the report which, far from leading people

1507
to feel that they need no longer concern themselves with the problem, redoubled their anxieties. In the months that lie ahead, the Government will come under increasing pressure to reach a conclusion, one way or another, and to decide upon the best course of action.
When I visited the United States and Canada, I noticed that every petrol station gave the motorist an option to purchase lead-free petrol. No such option exists in Britain. On inquiry, I discovered that the oil companies in Britain concluded that it would be too expensive to produce lead-free petrol. I am no student of the economics of the oil companies, and I have to accept their point of view. However, I should be less than honest if I did not express some doubt about whether the economics of introducing lead-free petrol in the United States would be so very different from the economics of introducing similar petrol in Britain. There is little doubt that we are unlikely to be able to obtain lead-free petrol in the immediate future.
It is tempting to allow the matter to go by the board, and to overlook the genuine anxieties felt by many about the pollution of the atmosphere by lead poisoning. May I suggest to my right hon. Friend the Leader of the House, who is to reply to the debate, that a compromise may exist? If we cannot look forward to the production of lead-free petrol, and if we cannot come forward with a report that reassures people that they are concerning themselves needlessly, should we not decide on a reasonable middle course? We should consider introducing legislation to ensure that by a certain date every motor vehicle in Britain has a filter fitted to its exhaust system.
I have been reliably informed by people in the scientific world that, although that would not wholly eliminate the effect upon the atmosphere from lead fumes, it would make a substantial contribution. I believe that that proposal merits consideration by the Government.
When we decided that it would be useful, even desirable, to fit seat belts to motor vehicles, a date was fixed after which all new vehicles had to be fitted with seat belts. Subsequently, a date was fixed after which all vehicles had to be fitted with seat belts. Would it be
1508
possible for the Government to consider fixing a date after which a filter should be fitted to the exhaust system of all vehicles? That could be carried out progressively. Many fear that lead has an effect upon health, especially in regard to children. That effect could be largely reduced through the fitting of a simple device, which would cost little and which motorists would be given a reasonable time to carry out.
The second matter to which I wish to draw the attention of the House also relates to motor vehicles. I wish to underline the problems arising from drinking and driving. I doubt whether I have any need to re-emphasise the enormous dangers that present themselves as a result of people drinking and driving. The statistics are there for all to see. Yet it is an inescapable fact that all the propaganda to which we have turned our hand does not appear to have been effective. Have we sufficiently explored the possibility of providing an incentive to those who might otherwise be encouraged to drink and drive not to do so? I suggest to the Government, and especially to the Ministry of Transport, that they should discuss with the insurance companies the possibility of excluding cover for damage to a motor vehicle if the incident is one in which it could be proved that the driver had been driving under the influence of alcohol above the legal limit.
I wish to make it clear that I am not suggesting that motor insurance should become party to allowing motorists to drive without cover. The minimum cover that is required by the Road Traffic Act 1937 must be maintained, irrespecsive of the state of the driver. However, conditions are already laid down by insurance companies about the applicability of policy cover. For example, it is possible that the first £50, or a higher figure, should be paid by the insured person under certain circumstances. Is it taking the matter very much further to suggest that cover in respect of damage to a vehicle should not apply if the insured person—or another authorised driver under the policy—is driving while having alcohol in his bloodstream above the legal limit?
Mr. Arthur Lewis: As is often the case, reference is

1509
made to drinking and driving, but no mention is made of the fact that at different times almost everyone visits a doctor who prescribes drugs but rarely tells the person " Don't drive while you are taking that, because it can slow up your reflexes." As a result, people take their tablets, get in the car and drive off. Does not the hon. Gentleman agree that the medical profession should warn people, because driving under the influence of drugs is just as bad, and many people do it but are not aware of the dangers?
Mr. McCrindle: I do not challenge what the hon. Gentleman said. That is a parallel, and perhaps equal, difficulty. However, I hope that the hon. Gentleman will forgive me if I concentrate my attention on an area which undoubtedly causes greater distress to the public than even the area to which he drew my attention. Although I would be prepared to move on to the consideration that he put forward, I believe there is great urgency for positive action to be taken by the Government in discussions with the insurance business.
I have reason to believe that the insurance business would not be unreceptive to such a suggestion. Because of the carnage which undoubtedly results from drunken driving, I strongly urge that before we rise for the Spring Recess the Ministry of Transport should make representations to insurance interests, particularly to the British Insurance Association, to see whether some sort of additional incentive can be given. Clearly propaganda has failed. It might just be that financial incentive would succeed.
4.3 pm
Mr. Charles R. Morris: I should explain at the outset that it is not my intention to detain the House for any great length of time, nor is it my intention to deny hon. Members access to the Whitsun Recess. However, it would be a tragedy if the House were to adjourn without giving some consideration to an issue that is causing anxiety and concern in Manchester. I refer to the serious overcrowding at Strangeways prison.
I do not raise this matter on a party political basis, because I accept that the overcrowding conditions at Strangeways have built up over a number of years,
1510
but at the present time, I believe, overcrowding there is now at a critical level, it is serious and it is giving cause for concern.
As the House will recall, Strangeways prison was built in 1868 to provide accommodation for 1,059 prisoners. The current occupancy figure is 1,755. Of those prisoners, 432 are allocated two to a cell and 687 are living and sleeping three to a cell. Because of the overcrowding, it is not unknown for prisoners at Strangeways to be locked in their cells for 23 of the 24 hours of the day. In my view, human beings are entitled to be treated better than that.
Is it any wonder that the distinguished governor of the prison, Mr. Norman Brown—a man not given to dramatics or exaggerations—has been quoted in a newspaper report as saying:
" If we don't tackle this situation we are going to have riots and serious problems "?
He went on to say:
" It is an ever-present fear that one day we will have a crisis on our hands—it could happen in the exercise yard, on the landings, in the workshops."
Given the prospects of a long hot summer, the governor, a dedicated prison staff and the community in the city are understandably anxious about the developing situation. At the present time, the prison is taking 20 to 30 overflow prisoners from the Armley gaol, in Leeds, and because of the collapse of buildings at the Risley remand centre, near Warrington, in Lancashire. Strangeways is obliged to take an additional 200 to 300 of what are termed " remand and trial prisoners ".
I am amazed at what has happened to the physical fabric of the Risley remand centre. It is suggested that it was caused by a fault in the cement, but the structure of the centre is virtually disintegrating. Sections have been closed, as a result of which Strangeways must take an additional 200 to 300 remand and trial prisoners.
Along with other hon. Members, I listened the other day to the Home Secretary's serious statement dealing with overcrowding in Britain's prisons. He suggested that shorter sentences might bring relief to the problem of overcrowding. That was a logical argument, but I had the feeling that I had heard it before. I heard it on a previous occasion when

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we were seeking to justify the introduction of suspended sentences. At that time it was argued that such sentences would lead to a solution of the overcrowding problem in Britain's prisons. However, overcrowding is still with us at a critical level, certainly in Strangeways.
The community in Manchester is seeking a Government assurance on two points —I would welcome a statement by the Leader of the House on them—that repairs to the fabric of the Risley remand centre will be pursued with a new urgency and that an early decision will be made on the construction of the proposed new prison at Appleton Thorn, in Lancashire.
It may well be that by watching that delightful and homourous television series " Porridge ", the public have developed a light-hearted view of life in Britain's prisons, but I can assure the House that serving a prison sentence at Strangeways is no joke.
I hope that the Leader of the House will be able to comment on this urgent issue. I believe that we owe action now to a dedicated prison staff at Strangeways and to the prisoners themselves. The need for urgency on this issue has never been greater.
4.10 pm
Mr. David Knox: This is the first time that I have participated in a debate on an Adjournment motion in the 10 years that I have been a Member of the House. Nevertheless, I do not intend to detain the House for very long. I wish to raise three important issues, but before doing so I wish to support the right hon. Member for Manchester, Openshaw (Mr. Morris). I once had occasion to visit a constituent who was serving a term of imprisonment in Strangeways gaol. I found the conditions in that prison horrifying beyond words. I hope that something can be done to meet the legitimate arguments that the right hon. Gentleman has presented.
First, the House should not adjourn for the Spring Recess until we have had an indication from the Government of the action that they intend to take on income increases in the next 12 months. This morning the provisional March index of average earnings was published. It showed an increase of 20 per cent. in earnings over the past 12 months. That
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compares with an increase of slightly under 15 per cent. in March 1979, and so represents an acceleration in the increase in earnings of one-third over the past year. Clearly free collective bargaining is not working very well.
It is important that there should be an early indication of the Government's intentions on pay, because today's figures, albeit provisional, represent the position near the end of the current wage and salary bargaining round. In the near future the various bodies concerned with pay negotiations will start to prepare their cases for the next round. They will do so against a background of a 20 per cent. annual rate of inflation. They will do so with the near certainty that even if import prices—that includes oil prices— remain stable over the next 12 months the increase in earnings over the past 12 months will mean that we shall have an annual inflation rate of about 12 per cent. for the next year. In such circumstances it seems important and urgent that the Government should give a lead about the size of settlements in the next round.
I appreciate that the Government are opposed to an incomes policy, although they are not in all circumstances opposed to a freeze. However, a freeze is not a viable proposition if inflation is in double figures. If, as it is now, it is running at about 20 per cent., a freeze is just not on. The Government should enter into negotiations at an early stage with the CBI and the TUC to try to reach an agreement about the maximum percentage increase in the next wage and salary round.
Mr. Tony Marlow: Does my hon. Friend agree that every time we have had a norm for a maximum increase it has become the minimum increase, and everybody has got more than that? Does he agree that we do not want to go down that path again?
Mr. Knox: There is some truth in what my hon. Friend says, but it is not the whole truth. I am arguing for a maximum percentage increase to be set. I am not certain exactly what that should be, but I think that it should be about 12 per cent. If the Government take early action—I emphasise that there is not much time to spare—they will make a real contribution to reducing the rate of inflation.

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The reduction of inflation is of especial importance to my constituents. Already the joint industrial council for the Leek and district textile and clothing industries has settled on a wage increase of 12½ per cent. for 1981, to start on the first Monday of 1981. In the circumstances, I believe that that is a sensible and responsible settlement, which reflects great credit on the unions and employers in my constituency. If all industries behave with the same responsibility I think that we shall have taken a real step towards reducing the rate of inflation.
I am worried, however, that in the absence of an early lead from the Government that will not happen. I am rather worried that others may go for much larger settlements than my constituents, and that my constituents' responsibility may well be rewarded by their having to pay excessive price increases in 12 months' time consequent upon irresponsible wage and salary settlements elsewhere.
My second reason for saying that the House should not adjourn for the Spring recess is that the Government must first take action to deal with the serious unemployment in the town of Biddulph, in my constituency. In October 1964 there were 94 people out of work in Biddulph. By June 1970 unemployment had increased to 163. It fell back to 130 in February 1974. However, it increased to 294 in May 1979. On 10 April 1980, which is the most recent date for which I have figures, there were 494 persons out of work in the town.
My right hon. Friend the Leader of the House will notice from these figures that unemployment in Biddulph fell during the administration of the previous Conservative Government and increased during the administrations of the previous two Labour Governments. Be that as it may, it is unemployment today that matters. In Biddulph it is now more than five times higher than in 1964, a mere 16 years ago. In the past year one large firm—Cowlishaw and Walker—has closed down, with over 300 redundancies. The same thing has happened to smaller firms in the area. It is obvious that the situation in Biddulph is serious. There is a dark cloud hanging over the town and the people are naturally worried about their future.
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North Staffordshire people are hardworking. Labour relations in the area are good. All that is needed is a little Government assistance in Biddulph. If that were forthcoming, Biddulph, through the efforts of its people, could soon regain its previous economic prosperity.
Thirdly, I do not believe that the House should adjourn until the Government announce their intentions to reform or, better still, abolish, the domestic rating system. If my hon. Friend the Member for Bodmin (Mr. Hicks) catches your eye, Mr. Deputy Speaker, I understand that he wishes to say rather more about the rating system. The present system is grossly inequitable. It is disliked throughout the country. In recent years my constituents have suffered substantial rate increases. In a low wage and salary earning area that has resulted in considerable reductions in living standards. A measure of the disapproval that they feel for the system was indicated in the general election in May 1979, when a ratepayer candidate— he was probably the only one in the country—polled 1,451 votes in the Leek parliamentary constituency.
It will take some time to reform the domestic rating system and even longer to get rid of it. Time is not on the Government's side. We need an early statement about their intentions, and that means before the Spring Recess.
4.18 pm
Mr. James A. Dunn: I draw the attention of the Leader of the House to employment on Mersey-side, especially in Liverpool. The impact that it is having in the area that I represent is catastrophic. We now learn that the second round of redundancies is starting to emerge. The larger-volume redundancies in individual firms have ceased and redundancies are now being announced in secondary industries. We are hearing of pockets of redundancy. They are being announced a few hundred at a time. Jobs are in jeopardy and the future is uncertain for many.
Some redundancies are inevitable. The Leader of the House will be aware that on Merseyside, and especially in Liverpool, there is an inner city partnership. One of the policies of the Government within that partnership is to make a real

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attempt to provide alternative employment. That has to be done against the background that the port is not providing the employment that it once did. On the river 10 or 15 years ago there were 9,000 or 10,000 work people directly employed. There are 18,000 employed on the docks. The shipbuilding and ship repairing industries employed between 20,000 and 25,000. That employment did not include ancillary services, suppliers and transport that served the port, industry, shipbuilding and ship repairing.
I learnt with distress that one of the last remaining groups of ship repairers is now in great difficulty. The group of CBS and Gordon Allison is well known. It is a small ship repairing undertaking on Merseyside. It provides a specialist service. It has offered this service and performed it efficiently and well. Jobs have been put in jeopardy because some orders have been lost. I understand that there is little hope that other orders can be attracted in sufficient time to stop redundancies altogether. Nevertheless, this may be a time when the inner city partnership can be given an impetus by taking this as a marker to look at prospects for the port, for ship repairing and for shipbuilding, and to see whether, in the remaining months of this year, it is possible to rekindle that specialist activity on the River Mersey.
I bring to the attention of the House the problem still facing sugar refining. There is a degree of uncertainty on Merseyside about this matter. The financial columns, which indicate that the British Sugar Corporation may be subjected to other financial arrangements, cause anxiety, to say the least, among those who are still employed in sugar refining.
There is another aspect of that problem. Confectionary is suffering a recession. Taverner Rutledge and Barker and Dobson are suffering from a diminution of orders. People probably do not have the money in their pockets to buy additional sweets and chocolate. That is having an impact on the industry.
The problem goes further. It extends to cakes and other forms of food. Scotts bakery is in the final process of making all its confectionery workers redundant, much to the alarm of the people who have run the industry for so long. In-
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deed, the family that owns that business is gravely concerned at what can happen if the redundancies have to be made.
There is an overspill effect. This problem touches not only confectionery— fortunately, the bakery is still in full production. There is a roll-on effect in the sugar refining industry, sugar confectionery and bakeries.
At least another 20 small industries in Liverpool and on Merseyside are in jeopardy. Not all these industries are situated in my constituency, but some of the people who work in them live there.
I bring this matter to the attention of the House because I believe that the time has come, before we go away for the Whitsun Recess, for the Leader of the House to arrange with his colleagues to see a deputation of Merseyside Members of Parliament, either collectively, on an all-party basis, or individually, according to the wishes of individual hon. Members, to review what prospects there are for the Government to salvage at least something from what is almost a wreck and to use the inner city partnership as the vehicle to do it.
I know that the Leader of the House will not take offence when I say that all the plans and platitudes in the world and all the prospectuses that may be put on paper and put to a committee, will have no effect unless, consequential to all those things, something tangible starts to emerge. As yet, nothing tangible has emerged. The time has come for that to begin.
4.23 pm
Mr. John Stokes: I support the remarks of my hon. Friend the Member for Welwyn and Hatfield (Mr. Murphy) about family responsibility. Independently of what he said, I wish to speak on another aspect of that most important problem.
I do not believe that we should adjourn for the Whitsun Recess until we have debated the whole question of what is now called sex education, the rights of parents in this matter and the activities of certain pressure groups in this area. The subject was barely touched on in debates on the recent Health Services Bill, although an attempt was made to raise it in the other place.

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For something like 1,500 years this has been a Christian country where traditional morality has prevailed and where the Christian ethic of chastity before marriage and fidelity afterwards has been held up as an ideal. Now all that has been challenged, and the State itself has not been blameless.
I took part in the debates on the National Health Service Reorganisation Bill in 1973 when Mr. Speaker himself made a distinguished contribution. I protested at that time at contraceptives being made freely available by the State to single as well as to married people and to children as well as to adults.
The State has also seen fit to intervene in the controversy whether doctors should prescribe contraceptive devices to children under the age of 16 without informing their parents, although the DHSS has recently modified its attitude in this respect. It seems to me a pity that the State should intervene at all in this intimate and private matter between doctors, children and their parents.
Lady Brook, of the Brook Advisory Centres, thinks quite differently. In a letter to The Times on 16 February, which has become quite notorious, she said:
" From birth till death it is now the privilege of the parental State to take major decisions— objective, unemotional, the State weighs up what is best for the child."
That seems a terrifying doctrine, the end of which one dare not see.
Since our debates on this subject, there has been an enormous increase in what I can only call the sex education industry which, not only by teaching in the classroom, conferences, propaganda and so on, but by a considerable number of pamphlets, has forced its minority view on the public at large. My prime objection to its view is that it cheapens the sexual act. It treats it as a purely physical thing without any mention of the mental and emotional issues involved. By all its propaganda for what it calls " sexual freedom ", it is in fact undermining the institution of the family, which is the basis of our civilisation.
There are two bodies which are primarily concerned in this sinister campaign—the Family Planning Association and what are called the Brook Advisory
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Centres. The name "Family Planning Association " suggests stability and respectability, which is far from the case, whereas the Brook Advisory Centres are so revolutionary in their approach to sexual and family morality that there is not even a pretence of respectability.
The pamphlets of both concerns are written in such a vulgar and tasteless way that I shall not burden the House with more than a small number of quotations. The whole of their theme is not the need for self-control in sexual relationships but the necessity at once, and at the earliest possible age, for girls to take precautions against having a baby.
This is a positive encouragement to indulge in sexual intercourse from an early age, coupled with the sinister suggestion that everyone is having sexual intercourse with everyone else all the time and that is the most normal and natural thing in the world. I call that damnable advice. It is based on an entirely false premise, is addressed to young people at a most impressionable age and is tantamount to an encouragement to the widest promiscuity, with the result that fornication and even adultery would appear to be a normal condition of affairs.
The latest pamphlet was sent to all Members of Parliament by the Brook Advisory Centres only a few days ago. Those colleagues of mine whom I have asked about this have said that they put it in the waste paper basket without reading it—and quite rightly. Its tone can be taken from its title: " Safe Sex for Teenagers ". It might just as well be " Safe Bathing for Teenagers ", for sex is treated as of no more moral concern than bathing or any other harmless physical activity. Also, I object to the term " sex " as shorthand for sexual intercourse, which is what is really meant. The introduction has the cheek, in its first sentence, to say
" The last 20 years has seen a revolution in teenage sexual behaviour "—
a revolution for which bodies such as the Brook Advisory Centres bear a great responsibility.
I shall not burden the House with the many other pamphlets which are produced, some of them very well known, such as " The Little Red School Book " by the Family Planning Association, and "Make It Happy—What Sex Is All

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About", published by Virago Press— which I hope one day will be suppressed.
The commercial pressures behind this propaganda are particularly sinister. These bodies are purveying their irresponsible views to increase their sales. That is something to which the whole House will object very strongly.
We live in an age of propaganda and public relations, and the views expressed by the new sexual morality lobby are fully backed up by much of the media— whose representatives are no doubt taking down every word that I am saying this afternoon. I mean, of course, television, wireless, newspapers and magazines—all suggesting or actually inviting young people to engage in promiscuous sexual activity. There is no concern about and hardly a mention of ordered responsible personal relationships and that restraint which is essential to any civilised society. The harm done to these young people's minds by this sort of propaganda is incalculable and makes the job of parents, teachers, clergy, youth leaders and so on much more difficult.
Therefore, I hope that the Government will withdraw the grants which they make to these bodies. Above all, I hope that the Department of Education and Science and the Department of Health and Social Security will insist that no teaching about sexual behaviour can be given in the classroom without the fullest consultation with parents. Now that, unfortunately, the influence of the Church is far weaker in our country than it used to be in matters of morality, I believe that it is up to the State and to Members of Parliament to take up the challenge. I believe that most parents still want to be bring up their children with traditional standards of morality. Therefore, it is up to this House to help them to ward off challenges from these disagreeable bodies, which, if left unchecked, would in a short time build another dark age in this land.
4.34 pm
Mr. Kenneth Marks: I shall not follow the hon. Member for Halesowen and Stourbridge (Mr. Stokes) too deeply into his dissertation on sex education. His allegation that the traditional moralities prevailed in the
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past interested me, for the more that we learn of the Victorian and Edwardian upper and middle classes, the more I am convinced that the only place in which it prevailed was among the working classes and that the period about which he was talking was a period of great hypocrisy.
The hon. Member was right to refer to the commercialisation of sex—but one cannot blame organisations such as the Brook Advisory Centres or the teachers who teach such matters for that. As one who taught boys and girls between the ages of 11 and 16 for 20 years, I can tell the hon. Member that there is still, not not only among children but among parents, a great ignorance about sex and a great need for sex education. Sometimes schools have to fill the gap which would otherwise exist.
I was interested, too, in the remarks of the hon. Member for Leek (Mr. Knox) when he demanded of the Government the abolition of the rating system. He could have reminded the House that the present Prime Minister, in an election speech, promised a 9½ per cent. maximum mortgage interest rate, the abolition of domestic rating, and the switching of teachers' pay to the national Exchequer. I do not think that the hon. Member will see any of those developments in the lifetime of the present Government. If the Conservatives are to abolish domestic rating, the money must come from some form of taxation—probably from income tax, and the present Government would not like that.
I do not think that the House should rise for the Whitsun Recess without considering the effect of the Government's policies on young families. On 29 April, I put a question to the Prime Minister asking her to
" take time today to consider more carefully than she has in the past the effect of her various Departments' policies on young families ".
I said:
" Will she ask herself whether such families are being asked to bear too great a part of the sacrifices which she is demanding? "
The right hon. Lady had said in a previous speech that our standard of living had risen by 6 per cent. in the past year. I asked:
" Has the standard of living of young families gone up by 6 per cent.? "

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The reply was interesting, although the right hon. Lady did not answer either of my questions. She said:
" With regard to the Government's policy on families, I believe that it is most important to leave families with a greater proportion of their own income—their own earnings—to spend in their own way. The standard of living of a family must come not from the Government but from the action of the breadwinner.
With regard to specific measures, I believe that it will be of great help to families when more of them can purchase council houses because that will fulfil an ambition for many people. I also believe that it will be of great help to families that the family income supplement is going up by one-third."—[Official Report, April 1980; Vol. 983, c. 1149–50.]
The fact that the right hon. Lady gave those four points to me showed either her ignorance or her lack of care about what is actually happening, not only in families on supplementary benefit or family income supplement but in a great many more as well.
The right hon. Lady talked about leaving them a greater proportion of their own income. But in the last 12 months they have not been able to retain a greater proportion of their income. Some of them may have had a tiny reduction in income tax, but what they have had to pay through other taxes has more than compensated for that. Therefore, it is not true that for the vast majority of young families she has done that.
According to the right hon. Lady, the action of the breadwinner is more important than the actions of the Government in regard to the standard of living. What advice will the right hon. Lady give to the breadwinner who has just lost his job, such as one of the constitutents of the hon. Member for Leek, among the extra 200 there unemployed in the last 12 months, where there are no jobs and where Government policy is seeing to it that there are no more jobs?
On the sale of council houses, whether people can buy their own council house or any other house is irrelevant to a great many people with young families in the face of present problems. Indeed, people who have families and who are making mortgage repayments are among those facing the greatest problems as a result of what has happened in the past 12 months. All hon Members will know of people who are experiencing great
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difficulty in paying their mortgages. I am not referring to those who propose to buy or have bought council houses. I am talking about those who are faced by an enormous rise in their mortgage payments.
Only last week, I heard about a couple with four children in my constituency. From the Prime Minister's point of view, they have done all the right things. Two years ago, the parents struggled to buy a terraced house. With the prospect of a Conservative Government in view, they moved to a bigger house and took on a bigger mortgage. The mortgage rate then increased. As a result of an operation, the wife will be away from work for almost a year, and they cannot cope with their mortgage. I suggested that the building society might be able to help by letting them off their repayments on the capital sum. However, the building society pointed out that the amount being paid hardly paid for the interest, let alone the capital.
The couple decided to sell the house. All hon. Members will know that it is difficult to sell houses now. The family is caught in a cleft stick. It cannot get the money to pay the mortgage and it cannot move into a smaller house. It faces eviction, and the council will have to deal with those people as if they were homeless.
The Prime Minister referred to people qualifying for family income supplement. A couple with two children, earning £60 a week gross, receive 30p a week in family income supplement. Those just above that level have suffered a fall in income in the past 12 months. Of those considered poor enough to receive family income supplement, three-quarters pay back some of it in income tax. That is one of the nonsenses that the Budget has made worse. So much for the Prime Minister's ideas on how to help young families who have been hard hit as a result of the Government's policies.
What have the other Ministers been doing? Many have introduced Bills. All of those Bills have been designed to worsen services by forcing cuts in education, housing, social services and social security benefits. A young family with children at or below school leaving age needs those services the most. Parents will have to pay more for their children's school meals. If they live in an area

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with a Tory council, they will find that that council will make even bigger cuts in education than the Government have done. It is typical of the Government's attitude that they have decided to pay millions of pounds on an assisted places scheme. Last week they announced that they would close the Centre for Advice and Information on Disadvantage in Education in order to save a few thousand pounds.
The Department of Health and Social Security has also played its part. There is insufficient time to go through the many decisions that it has made that will make life worse for the average family. My right hon. Friend the Member for Salford, West (Mr. Orme) went through those decisions during the debate on the guillotine motion on 6 May. One example of such a decision is the freezing of increases in child benefit. Those Conservative Members whom the Prime Minister calls " wets " are just as worried about that as we are. Many parents are demonstrating today against the Government's actions during the past year. They should realise that there is worse to come.
The Green Paper entitled " Income During Initial Illness: A New Strategy " is a pretty strong document. According to that paper, employers would have to find a flat rate payment of £30 a week. Families with children will discover that that is below the present sickness benefit. In addition, it is taxable, although present sickness benefit is not. Part-time workers—including many mothers—will receive less than £30.
The proposed abolition of earnings-related supplement in 1982 will affect those families who suddenly find themselves in difficulties. This year, invalidity benefit will be cut in real terms. Many parents of young children are on invalidity benefit. The children's addition will be increased by only 5 per cent. when there is an inflation rate of 20 per cent.
The indirect effect of the actions and threats of the Secretary of State for the Environment will have a great impact on young families. Such families use the social services more than others. Conditions in schools will worsen. Facilities for child welfare, nursery education, libraries and recreation will become worse. All those facilities affect families.
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Some Ministers may say that local councils must decide how to spend their money. The Secretary of State for the Environment does not say that. He is threatening them. In my area, the housing investment programme has been cut by 36 per cent. during the past year. That area had planned a reasonable programme of new building and housing improvements, and those cuts will prove a disaster.
The Chancellor of the Exchequer has played his part in the attack on families. More and more families will face the poverty trap as a result of the Budget. A family which only just receives family income supplement and receives a wage rise of £1 a week will lose 50p of the income supplement, and will pay 30p more tax and £1·75 a week more per child for school dinners. In addition, families will also lose help in paying their fuel bills. When the breadwinner takes action and gets a rise, the family will be worse off.
If the father had been paying tax at 83 per cent.—not many of my constituents pay that amount, although there may well be some in the Hitchin area that do —he will now pay tax at only 60 per cent. Such families will be better off. The major problem facing families, and the reason why some are demonstrating today, is an inflation rate of 20 per cent. The Prime Minister said that our standard of living had increased by 6 per cent. during the past year. However, on the following day it was announced that the inflation rate was 19·5 per cent. with a probable addition of 1½ per cent. resulting from the Budget.
The hon. Member for Leek spoke about textile workers accepting a wage settlement of 12½ per cent. That is a result of free collective bargaining, free enterprise and non-interference by the Government. We know why they have accepted 12½ per cent. and why the miners have not. The demand for textile workers is not as great. The hon. Member for Leek will find that, as a result of the Government's policies, unemployment in his constituency will increase at a faster rate. Those who remain employed will face decreases in their real wages.
During the election, the Prime Minister's shopping bag was conspicuous in front of television cameras. She should

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take that bag, disguise herself a bit— that would be wise—and listen to conversations at various supermarket checkouts and shops where people on average or below average incomes work. She would hear much to her disadvantage. Many fathers and mothers have gone to work today, despite the TUC's call. The Government should not think that that indicates support for the Prime Minister's policies. People cannot afford to take an unpaid day off. On 1 May they showed what they thought of the Tory policies of the past 12 months. Unless the Government listen and learn, they will not only suffer election defeats. The frustrations of those who do not have the opportunity, as we do, to talk directly to the Government will boil over. Young mothers as well as organised workers will take days of action.
4.50 pm
Mr. Robert Hicks: In spite of the pessimism of the hon. Member for Manchester, Gorton (Mr. Marks) about the success of representations from my hon. Friends and myself over reform of the domestic rating system, we still feel that, before the House rises for the Whit-sun Recess, the Government should make a statement confirming their intention to introduce the necessary legislation in the next Session of Parliament to bring about fundamental reform of the domestic rating system.
I appreciate that circumstances change, and that Governments must respond to new situations as they arise. In view of the very real increase in the level of domestic rates, it is appropriate to remind the House of the Conservative Party's intentions on this matter in the October 1974 election manifesto. I point out that in my constituency the recent increase to householders was 21·4 per cent., and, in addition, the water and sewerage charges have risen by similar amounts. These charges are both based on the outdated concept of rateable values.
In the election manifesto to which I have referred, we stated that within the lifetime of a Parliament we would abolish the domestic rating system and replace it with a more broadly-based tax, related to people's ability to pay. Some of my hon. Friends may say that that manifesto pledge was given a long time ago. We did not win that election, but had we done
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so the electorate would have expected us to honour our commitment. Many people still remember the Tory Party for that October 1974 election commitment and, on that basis, they have continued to vote Tory. The British electorate does not consist of as many mugs as some people like to believe.
The Chancellor of the Duchy of Lancaster and Leader of the House of Commons (Mr. Norman St John-Stevas): The doctrine of the mandate is a recondite one, and volumes have been written about it. If a political party puts proposals before the electorate at an election and the electorate rejects that party and what it put forward, those proposals are not binding on the rejected party.
Mr. Hicks: But I shall seek to relate to the House further statements made by Conservative Front Bench Members which did not end when we lost the October 1974 general election.
That pledge to abolish domestic rates was given against the background of substantial rate increases which took place in April 1974, particularly in rural areas, as a direct consequence of the Labour Government's decision to alter the balance of the rate support grant in favour of the urban areas. In Caradon, in my constituency, this change imposed an increase of £30 a year on every household. I was unhappy about the situation at the time and later that year I raised the matter in an Adjournment debate. Subsequently, in response to pressure from all parts of the House, the then Labour Government established the Lay-field committee to investigate local government finance. When that committee reported, the then Secretary of State for the Environment, the right hon. Member for Stepney and Poplar (Mr. Shore) made a statement to the House on 19 May 1977, acknowledging that the rating system needed substantial reform, although he said that he agreed with the conclusion of Layfield that it would be wrong to abolish domestic rates.
My right hon. Friend, the present Secretary of State for the Environment, who was then the Opposition spokesman on environmental matters, made the Conservative Party's position very clear. I refer the House to his statement on that same day. He said:
" Will the Secretary of State understand that the rating proposals that he has put forward

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are quite unacceptable to the Opposition, who believe that his announcement about rates, particularly in an economic climate of high inflation and high income taxes, will simply make the present bad system worse? "—[Official Report, 19 May 1977; Vol. 932, c. 715.]
I would have thought that there was a continuing process of commitment, and that my party was committed to some action on the rating system.
Indeed, in the 1979 manifesto we again made a commitment, although it was relegated in status. We said:
" Labour's extravagance and incompetence have once again imposed a heavy burden on ratepayers this year. But cutting income tax must take priority for the time being over the abolition of the domestic rating system."
However, in my view this is a subject that cannot be dismissed, nor will it remain dormant. Because of recent rate increases public concern about the inequities of the existing basis of rating have again manifested themselves. I have had a considerable post on this matter in recent weeks and I know that I am not alone. There is an early-day motion on the Order Paper signed by 50 of my hon. Friends.
On 24 April 1980 I wrote to the Secretary of State, and in his reply on 7 May he said:
" It does, however, remain our longer-term objective to abolish domestic rating and we are currently looking at all the possible future alternatives... Please be assured that we do take the whole rating matter very seriously, and are actively seeking ways to improve the position."
The estimated income from domestic rates in 1979 was £2,700 million. This represents, on current figures, about 5½p in the pound on income tax at present levels. But there are 26 million taxpayers in this country and the number of ratepayers is significantly fewer. Those ratepayers carry a disproportionate burden, especially when one remembers that we all share the services provided out of the rates. This is an unfairness which is certainly highlighted in my constituency where average earnings are 14 per cent. below the national average and where 18 per cent. of the electorate comprises persons who are living on retirement pensions or other fixed incomes.
I hold that a growing number of my hon. Friends believe that it is imperative for the Government at an early date to confirm their intention to introduce legislation, not only on fundamental reform
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of the rating system, but to bring in a suitable alternative method of funding local government expenditure. Like me, my right hon. Friend is run second in his local constituency by a minority party. In the West Country we do not forget that there is an economic price that the person on a low income or a retired person on a fixed income can afford to pay. I remind my right hon. Friend of that. There is also a political price that they will be prepared to pay. The Government can take positive action to alleviate the problem. An early commitment is necessary.
5 pm
Mr. Christopher Price: There are two issues which I feel should be debated before the House adjourns. I shall deal briefly with the first. The second is rather more substantial.
We must have a debate on the Government's Green Paper which reviews the Public Order Act. A few weeks ago in Lewisham, we had a second National Front march. I have criticised the police in the past. However, on this day, when Stephen Hickling, a young constable in Lewisham, had his hand blown off and his arm amputated at the elbow, the whole House wish to send good wishes to this young 19-year-old and the other policemen who were taken to hospital. We hope that his eyesight can be saved. I talked this morning to his father and to the local commander, and there is every hope that it can be.
In 1978 a National Front march took place through Lewisham. The three local Members of Parliament, the local council, the bishops, the clergy and many other people assured the Commissioner of Police that there would be severe disorder if it took place. They even went to court over it. The Commissioner of Police knew better. The disorder was appalling. It could have been prevented by legislation passed by this House in 1936. Retrospectively, I believe that everyone agrees that the march should have been banned.
A few weeks ago, just before a sensitive GLC by-election, another march took place. Happily, there were comparatively few arrests and hardly any injuries. The House should, however, debate the financial cost. The Commissioner's estimate is £300,000, but press

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reports suggest that that is a low estimate, bearing in mind the enormous disruption.
The Government have issued a Green Paper on the review of the 1936 Public Order Act, the initial work having been done by the previous Administration. It suggests that cost, disruption and offence to the local community might be grounds on which marches were banned, in addition to the single ground presently in the Public Order Act—the possibility of a breakdown in public order. The Green Paper is tentative, and I ask the Government for a statement.
It is absurd that in London alone in 1978, £2·5 million was spent on policing such demonstrations. National Front marches are deeply offensive, particularly when, as in 1978, they are deliberately routed through immigrant areas. They cause terrible disruption. A few weeks ago the South Circular road was closed for about five hours and lost holiday-makers were wandering the highways and byways of my constituency. The march caused severe loss to tradesmen and others who wanted to carry on their businesses.
I hope that the Government will accept that the decision of the London borough of Lewisham to withhold its police precept results partly from frustration at not being able to get such issues properly discussed. It hardly lies in the mouths of Ministers to condemn Lewisham for threatening to withhold its legally due precept when the Prime Minister sets a splendid example by threatening to withhold our legally due precept to Europe because she wants a little more control over what goes on there.
The substantial issue that I wish to raise concerns the National Association for Mental Health and the Government's policy towards mental health. Are they still giving priority to mental illness and handicap, as they said? A scurrilous campaign against MIND is being pursued inside and outside the House by the hon. Member for Wokingham (Mr. van Straubenzee). I object particularly to the allegations against the director. The campaign is uncharacteristic and unworthy of the hon. Gentleman. We have sat on Select Committees together, and we have not done all the things that the hon. Member for Halesowen and Stourbridge (Mr. Stokes) talked of earlier.
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There is concern about our special hospitals. No one can remain unconcerned, having seen the television programme about Rampton. Members of the all-party mental health group have visited Rampton and other special hospitals. The all-party mental health group, which has been serviced by MIND for many years, cannot be accused of being irresponsible. The hon. Members for Plymouth, Drake (Miss Fookes) and for Cheltenham (Mr. Irving) cannot be accused of being dangerous Marxists. The group comprises a cross-section of individuals concerned about mental health and handicap.
MIND has been funded by the Government for many years. It provides, week by week, essential services to some of the most distressed and unhappy people in our society. Its existence is in jeopardy because a tiny number of Conservatives are trying to get its grant withdrawn. It has been substantially funded by the DHSS, and could not exist without it. I know intimately many of its operations and am acquainted with many of its workers, who work for a pittance compared with the money that they could earn elsewhere. They have a continuous barrage of telephone calls for help from distressed people.
MIND still does not know whether it is to get any money this year from the DHSS, because there have been nasty little motions on the Order Paper, such as that last Friday entitled "Treatment of Mental Health " in the name of the hon. Member for Wokingham. That motion read:
" To call attention to the problems of the treatment of mental health … and in that connection, before further public funds are made available to it, would welcome a public inquiry into the administration of the National Association for Mental Health ".
No doubt a public inquiry would cost a great deal, and I am sure that the Secretary of State for Social Services has not the slightest intention of holding one. However, I hope that the Leader of the House will say something to reassure not only this worthwhile charity, but the many mentally-ill and mentally-handicapped people in this country who go to it for help, and that he will be able to tell us that it will have a long-term future and will not be chopped off because of a political campaign that has been

1531
started by Conservative Back Benchers for reasons that I fail to understand.
The operations of MIND are taking place against a background of cuts. I know that the Secretary of State has said that he wants mental illness and mental handicap to retain their present priority, and I appreciate the fact that the right hon. Gentleman is here for the debate, but I must remind him of the saga of the Lambeth, Southwark and Lewisham area health authority and the commissioners. Mentally-ill patients were moved from St. Olave's hospital where they had access to a park, a garden and reasonable conditions to the fourth-floor of a tower block at Guy's hospital. Many of those patients were driven to mental illness partly by living in the tower blocks which we ought never to have built in the 1960s. No one could see that as a satisfactory way of dealing with mentally-ill people.
The problems remain, and there is a desperate need for an organisation at arm's length from the Government—not within the DHSS—that can campaign on these issues to try to get more money and, more than anything else, more awareness of the increasing problems of the mentally ill and mentally handicapped.
I understand that the hon. Member for Wokingham represents members of the Prison Officers Association who act as nurses at Broadmoor. They are his constituents, and he is right to represent their interests. But we must make it clear that hospitals exist for the patients and not simply for the staff, and that allegations against staff should be properly investigated.
I do not want to go into detail on the recent allegations that have been made about events at Broadmoor. The all-party mental health group intends to visit Broadmoor. We have discussed the issue with Dr. McGrath at a meeting at the House. There are matters of great concern, particularly the use of electroconvulsive therapy without sedatives. That is something about which the whole psychiatric community is worried, but Dr. McGrath did not give an assurance that it would cease at Broadmoor.
In a sense, MIND can look after itself; it has much sympathy within the DHSS. However, the hon. Member for Wokingham, in backing up his campaign,
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has made allegations that the director of MIND is a sympathiser of the IRA. That is an appalling and scurrilous accusation.
Mr. William van Straubenzee: I am obliged to the hon. Gentleman for giving way and for his typical courtesy in giving me notice that he would be making personal references to me, but will he at least do me the credit of relating his remarks, to which I can take no exception, to the words that I used in the House on 20 December? I am sure that he has them with him.
Mr. Price: The hon. Gentleman can make his own speech and quote the words that he used on 20 December. However, those are not the only words that he has used on this issue. He has pursued his campaign for some time.
The hon. Gentleman has connected Tony Smythe, the director of MIND, with the IRA. That was a scurrilous thing to do. There is an honourable tradition in the House that, if one makes such a serious allegation, one either substantiates it or withdraws it completely. I understand that the hon. Gentleman intends to speak in the debate, and I believe that, in the interests of MIND and of honour and decency in the House, he should either fully substantiate that allegation or withdraw it. The whole issue has grown too big to be left alone. It must be sorted out.
I know that a number of hon. Members take a great interest in mental health. I have done so partly because it has been brought close to me. I have had experience of the problem in my family, and I know what appalling difficulties mental illness and mental handicap can produce within families.
Uniquely in the Western world, we have a charitable organisation that has done untold good for mentally ill and mentally handicapped people. I beg the hon. Member for Wokingham to leave his campaign alone and to withdraw his allegations.
5.17 pm
Mr. William van Straubenzee: I start by repeating my appreciation of the courteous reference by the hon. Member for Lewisham, West (Mr. Price) to me and the notice that he was good enough to give me.

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I confess that I am somewhat divided about whether I am happy that the issue has been raised today. In one sense, I am only too glad, because, with an increasing sense of frustration, I have been searching for a parliamentary opportunity to raise the matter. The House will know the narrow confines of many of our debates and, therefore, the difficulty of finding an appropriate time to raise the matter. To that extent I welcome this opportunity, and I am glad that the matter has been raised. As the hon. Member for Lewisham, West knows, I had been seriously contemplating raising it myself.
On the other hand, although we are grateful to my right hon. Friend the Secretary of State for Social Services for his courtesy in being present for the debate, a reply from my right hon. Friend the Leader of the House—able and comprehensive though it will undoubtedly be—is not the same as an answer by a Minister of the DHSS, with all its technical knowledge.
The hon. Member for Lewisham, West was good enough to say that my campaign was uncharacteristic of me. Perhaps that is true, and I therefore wish to set out the background so that the House can understand how these matters arose. I shall then deal not with what the hon. Gentleman said I said but with the words that I used on the only occasion when they have been used, certainly in the House and, as far as I know, outside it.
I start with the sequence of events. Last September, there was a meeting in Liverpool at which a nurse on the staff of Broadmoor hospital, who was at that time unidentified, made a number of allegations about the ill treatment of patients at the hospital. He was subsequently identified as a Mr. Byrne who, with the other young nurse later associated with him, has only a short period of service on the staff. He was immediately interviewed, rightly so, by senior officers of the Department. He was interviewed for the good reason that the allegations that he made, if true, amounted to criminal offences. Senior officers of the Department thereafter referred immediately to the Thames Valley constabulary at senior level the allegations made by Mr. Byrne.
1534
The police investigation was completed. The Director of Public Prosecutions was consulted and advised that no further police action should be taken. Throughout the period, the Department of Health and Social Services acted totally and absolutely correctly, given the nature of the allegations made. Although action was fairly swift, the Department was unable to make any comment because the matter was, if I may, use the phrase, sub judice.
While that process was in train, the organisation, MIND, chose, both in its newsletter or magazine " Mind Out " in November and at a press conference, to give full publicity and every kind of publicity backing to the accusations of brutality and other misconduct made by these two young members of the staff. It did not wait. It went ahead while the Department was unable to say anything and while members of the staff, rightly, were unable to do or say anything. This is not the first time that such a technique of accusation has been used. I have lived through it before in my constituency.
Back in 1977, almost identically sensational allegations were made about another hospital in my constituency, Church Hill House, at Bracknell, that cares for the mentally handicapped. For two years, those allegations were subjected to exhaustive inquiry by a quasi judicial inquiry headed by Queen's Counsel. The cost to the Berkshire area health authority was £60,000 from public funds. I see the then Minister of Health, the right hon. Member for Lewisham, East (Mr. Moyle), in his place. I recall how helpful was the right hon. Gentleman, as was his Conservative successor, in the whole matter.
The report is available for any hon. Member who wishes to see it. Every charge was found to be totally baseless. I do think that I have ever seen a report in which accusations against the staff were shown to be so wholly and totally without foundation. Yet for two years—this is the point—the administrative, medical and nursing staff of that hospital lived under a cloud.
If I became a little emotional about the matter, and still do, I apologise to no one. I was rather close to the staff of the hospital at that time. Over the 20 years that I have had the honour to

1535
represent the Wokingham constituency I have also sought, as would other hon. Members in similar circumstances, to keep close to the staff of Broadmoor hospital. I think I know at first hand something of the pressures under which staff live when public accusations are made against them.
I have sought to say in the motion to which the hon. Member for Lewisham, West has drawn attention that there is an increasing tendency today for organisations of one sort or another to make public accusations, to say that because the accusations, have been made there must now be an inquiry and that those accused must prove their innocence. I shall come to the point that the hon. Gentleman raised in my own time. If I have reacted against this, I have done so because I think that those members of medical and nursing staff working in this sphere are peculiarly vulnerable because of the nature of their work. Restraint of some kind or another is often a necessary part of the treatment that they mete out. It is a proper part of the job. For that reason, they are peculiarly vulnerable.
Mr. Christopher Price: I take the hon. Gentleman's point about Church Hill House. I hope that he will take my point. I do not think that there has been any inquiry about these particular Broadmoor allegations. One cannot express a view with certainty. Would he not agree that, of all the inquiries, which are not wholly satisfactory, from Ely onwards, into this sort of allegation in a mental illness or mental handicap hospital since the late 1960s, when great concern began to be expressed, the majority have shown that there are many wrong things that ought to be put right? For that reason, any organisation like MIND ought properly to be very concerned about these matters.
Mr. van Straubenzee: I agree with the words " ought properly to be very concerned ". That, however, is not what happened.
Mr. Price: Yes, it did.
Mr. van Straubenzee: No, it did not. The chairman of the all-party mental health group, my hon. Friend the Member for Cheltenham (Mr. Irving), has been saying " Hear, hear." I shall make some
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remarks about his activities in a moment. The hon. Member for Lewisham, West is not correct. What happened is that, while the matter was sub judice, the organisation went public. This happened while the Secretary of State's hands were tied behind his back and while members of the staff were unable to say anything. That is my complaint.
It is, of course, perfectly appropriate, if there are reasons and grounds for anxiety, for a responsible body to act responsibly. I am on record in speeches in this House on the issue, as is the right hon. Member for Lewisham, East when he and I took part in debates on the matter. I should have deep concern if, in this or any other hospital, I had reason to be anxious about whether something was going seriously wrong. I am not taking the position that the staff should be supported on every issue and on every occasion.
What were the lessons that emerged from the inquiry at the hospital to which I have referred? They were that the allegations were instigated—this is on the record for anyone to see—by extreme Left-wing militant members of the staff. I am talking about Church Hill House hospital. The record shows the part played by the newspaper " Militant ". It had the luck to be assisted by a local newspaper editor anxious to sensationalise, but the thread exists for everyone to see.
That was the situation, having just received a report on one hospital, that confronted me as the constituency Member of Parliament when MIND went public. I reacted extremely roughly. I am a great believer in the Queensberry Rules, but not if others fail to use the same rules. I repeat what I said. MIND is a magnificent organisation. Its concept is splendid. It has enrolled to its voluntary service men and women of distinction. Its present chairman, known to me personally, is a person greatly respected in her particular field.
But the organisation has now got into the hands of what I have previously described, and describe again, as professional agitators. It is the permanent officials; I am not now talking about the voluntary workers. My plea to the voluntary workers is to wake up and see what is happening and take steps to control those who are in this work not because they

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have a concern for mental health but because they are in the business professionally.
I take the career of Mr. Tony Smythe, only because the hon. Gentleman specifically raised it. Mr. Smythe was secretary of the International Organisation of Pacificists and secretary of the National Council for Civil Liberties before becoming chief executive of MIND. In other words, he is professionally concerned with such organisations. He is not a person who has grown up in the world of mental health, who has worked in hospitals of this kind. He is not professionally concerned in this field.
That is why I drew on personal experience of Mr. Smythe's work when he was working for the NCCL. I was at that time on the receiving end of constant allegations of brutality, and worse than brutality, by the police forces and the Armed Forces. I had at least one personal interview with representatives of that organisation, and that led me to say that in his capacity
" all his interests lay on the side of the Irish Republican Army."—[Official Report, 20 December 1979; Vol. 976, c. 1056.]
I believe that they did. I stand by that assertion. I experienced it, I went through it, and I am responsible to the House for the accuracy of my statement. I believe that Mr. Smythe and his officials of that time gave every impression that that was where their sympathies lay and that they had no sympathy for the forces of law and order, just as now he gives the impression that all his interests are on the side of those making the allegations.
In fairness, I should like to add that I think that it is true to say of the NCCL that a considerably better balance was kept once Miss Hewitt became its general secretary. I say that in fairness, because I think she feels that my previous words in some way impinged on her, which they were never intended to do. Because I have been critical, I want to make that quite clear.
Mr. Christopher Price: I am grateful to the hon. Gentleman for giving way a second time. Does not he agree that there is a distinction between saying that the activities of the NCCL were calculated to help the IRA—with which I
1538
would not agree, though I would defend to the death the hon. Gentleman's right to say it—and implying that in some way Mr. Tony Smythe sympathises with the activities and methods of gunmen and murderers? It is that implication that many people in both political parties feel it is unworthy for someone such as the hon. Gentleman to have made. I did not have the impression that he was continuing to make it in the carefully weighed words that he has just uttered. I think that he would do himself and the whole House a service if he would make it clear that he is not making that allegation.
Mr. van Straubenzee: I have used exactly the same words as I used on 20 December. That is why I was so careful. That is precisely why I intervened in the hon. Gentleman's speech and asked him, if he is to attack me, which is perfectly reasonable, at least to do so in his usual fair way on the basis of words that I used. It is true that he has drawn further inferences from that. The context in which I have used these words makes it clear that I was talking of Mr. Smythe's professional work in his NCCL capacity.
By comparison with everything else, this is a detail, but, if it assists, I of course make clear that I was not seeking for one moment to suggest that Mr. Smythe indulged in or personally supported the kind of activity for which unfortunately the IRA is most well known. If he feels affronted by that, I make that perfectly clear. But I stick, without any doubt whatever, to my first assertion. I am seeking to make the point that the organisation has fallen into the hands of " professionals " who, I believe, are doing it no good whatever.
It pains me to add—it really does, because two of my hon. Friends are officers of the all-party mental health group—that I do not think that the group's conduct in this matter has been helpful. First, that conduct is totally contrary to what I understand to be the courtesies of the House, as well exemplified by the conduct of the hon. Member for Lewisham, West. Some of the officers put the weight of their authority behind the allegations without any prior notice to the Member of Parliament in whose constituency this major hospital is. They gave no prior notice—I read it first in the all-party " Whip "—of the date of

1539
their visit. I regard that as discourteous. I have said so to my hon. Friend the Member for Cheltenham, and I gave him notice that I would say it today.
Mr. Charles Irving: Although you have just said that you did not read of the visit until you saw the all-party " Whip ", you were at the meeting of the all-party mental health group, of which you are a member. You attend the meetings, and you were at the meeting when the visit to Broadmoor was arranged. It might be as well for the House to realise that you are a member of our group. You have had more than ample opportunity to raise all the matters that you have chosen to raise in the House in a most unpleasant and scurrilous way.
Mr. Deputy Speaker (Mr. Bryant Godman Irvine): I have never been a member of the group.
Mr. van Straubenzee: I think that you will have been saved something, Mr. Deputy Speaker.
I, of course, knew in principle about the visit, because I heard the physician-superintendent issue the invitation. But if I ran an all-party group, it would never occur to me to arrange a visit to a Member's constituency without making certain that that Member first knew of it from me and not from the all-party " Whip ". I have just had an approach by an hon. Friend on a precisely similar all-party group, not connected with this matter, courteously giving me full information.
I do not think that the all-party group has done itself credit by giving equal weight to the enormously distinguished physician-superintendent and two young, cub nurses.
Mr. Irving: I remind my hon. Friend that the distinguished physician-superintendent, Dr. McGrath, was present before we saw the nurses, and we heard both sides of the problem. I believe that he was heard to say that he felt that I, as chairman, had dealt with both meetings very fairly. It is extraordinary how my hon. Friend changes his views when he is in a position of privilege rather than at a public meeting.
Mr. van Straubenzee: It is a matter of judgment. I think that it is very questionable for a so-called all-party group to give a platform to two people making
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allegations which have been substantially investigated by the Director of Public Prosecutions and found to be without substance. That is a matter of judgment, but I know that, as a result, Mr. Larry Gostin, the so-called legal director of MIND, has been loudly trumpeting that the all-party group has given support to the allegations. It can perhaps be understood just how strongly my constituents feel.
I believe that my right hon. Friend should carefully consider—I express a view contrary to that of the hon. Member for Lewisham, West—why £250,000 a year of taxpayers' money should continue to be given to MIND in its present form. We know that distinguished people connected with the organisation are concerned about the way it conducted this campaign.
I see the right hon. Member for Norwich, North (Mr. Ennals) in his place. He knows that I propose to refer to a letter that he courteously sent to me which he wrote to the Secretary of State and in which he specifically dissociated himself from these allegations. The right hon. Gentleman said that he had his own differences with MIND about the way in which the allegations were being pursued.
I believe that it is reasonable for the taxpayers to feel not that no allegations should ever be made or that organisations such as this one should be merely the creatures of Government but that they are entitled, as taxpayers, to think that a body of this nature will act professionally in making allegations.
In fairness. I must say that MIND published half an apology in its latest edition of " Mind Out ". A copy was courteously sent to me by my hon. Friend the Under-Secretary but not by MIND. I think that MIND now regrets having made these public allegations before police investigations were completed.
I should like the House to know that I have done my best to understand the nature of the problem. The chairman of MIND and two other people were to have come to see me a fortnight ago. Everything was arranged. They have now pulled out of that appointment. If the hon. Member for Lewisham, West has influence with them, I hope that he will encourage them to come and talk about (he problems of MIND. I am

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ready, anxious and willing to talk to them. I think that they should be encouraged to talk to me.
I am sorry to have kept the House on a matter of comparative detail. Fairly and courteously, however, a personal reference has been made to me and I think that I am entitled to defend myself. I say quite clearly that I have no regrets whatever. If people play roughly with my constituents—they have not played roughly with me—they are in for trouble. That seems to me to be what Members of Parliament are for, and I intend so to act in future.
5.42 pm
Mr. David Ennals: I had not intended to take part in this debate until I had a courteous note from the hon. Member for Wokingham (Mr. van Straubenzee) saying that this particular issue was to arise. As correspondence has passed between us about the charges he made, I thought it appropriate that I should be here to comment on the issues.
We should be clear about the exact words that were used by the hon. Gentleman on 20 December. He said:
" MIND is an admirable example of an organisation with a full-time agitator in charge. It is an admirable example of the new generation of—I use the words in inverted commas— ' civil servant ' who moves from organisation to organisation, dependent on noise for his success and his salary.
" When I had dealings with Mr. Tony Smythe, when I was proud to serve at the Northern Ireland Office and he was in the National Council for Civil Liberties, I had no doubts whatever that all his interests lay on the side of the Irish Republican Army. He is now applying precisely the same agitation in the MIND organisation."—[Official Report, 20 December 1979; Vol. 976, c. 1055–56.]
Those were the words of the hon. Gentleman on that occasion. As soon as the matter was drawn to my attention I called on the hon. Gentleman to withdraw what I thought was a scurrilous attack both on MIND and on its director. I asked him to withdraw or, if he would not withdraw, to repeat his words outside this House where he would not be protected by the privilege of the House, or to give the evidence on which his monstrous charges were based.
The hon. Gentleman has referred to half an apology—I have not seen it—
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and I suppose that he has made half an apology today by withdrawing the suggestion that Tony Smythe held the views alleged by the hon. Gentleman and that he was totally on the side of the IRA. I believe that the hon. Gentleman should have withdrawn the whole charge.
I must declare an interest in MIND. I was the director of MIND from 1970 to 1974, and I have had close contacts with the organisation since then. I am glad that the Secretary of State is here to listen to this debate.
I believe that MIND is a magnificent organisation which, over many years, has given marvellous service to this country. At one stage, the hon. Member for Wokingham did say that that was so. However, he went on to say that he hoped that the Government would withdraw their grant from MIND. We should consider the tremendous work done right across the country by local associations of MIND in running group homes, hostels, advice centres, social clubs and day centres. We should consider also the educational work undertaken by MIND involving professionals and volunteers. An advice service is provided by MIND to people in desperate difficulties who feel the need, sometimes, to turn away from their social worker or their general practitioner and who do not know where else to turn than to MIND. We should also remember the work done by MIND on patients' rights, policy formation and certainly on pressure.
When I said in my letter to the Secretary of State, to which the hon. Gentleman referred, that I had my own differences with MIND, that is part of the set-up. When I was Secretary of State, MIND brought pressures to bear upon me with which I did not agree. That was the organisation's right. It is an organisation that speaks up not only on behalf of the mentally ill and the mentally handicapped. It speaks of the broad concern that the community should express in the interests of those who are mentally ill and mentally handicapped.
Mr. Speaker: Order. I am sorry to interrupt the right hon. Member for Norwich, North (Mr. Ennals), but this is not a debate on MIND or on the National Health Service. It is a debate on the Spring Adjournment. The right hon. Gentleman should come to that point.
Mr. Ennals: I shall come to that matter, Mr. Speaker, because my plea is that there should be a debate on this subject before the House adjourns. I am sure that that is so.
The only other point that I wish to deal with is the actual allegations made against Mr. Tony Smythe. I have known him for many years, and I know many witnesses who know that what was said by the hon. Gentleman on 20 December last year was absolutely untrue.
Mr. Speaker: Order. With every respect to the right hon. Member, we must not go into an in-depth debate on MIND. We should make this the customary debate on the Spring Adjournment.
Mr. Ennals: I am grateful to you, Mr. Speaker. The hon. Member for Wokingham made certain allegations, and I did not hear you, or your Deputy, bring the hon. Gentleman to order.
Mr. Speaker: Order. The right hon. Member would have had a job to hear me. I was not in the Chair. When I am in the Chair, however, I am required to expect everyone in the House to follow the same rules of debate. If I do not, it is not fair to other hon. Members who are waiting to speak.
Mr. Ennals: I shall bring my remarks to a close, but Mr. Deputy Speaker did not call the hon. Member for Wokingham to order.
I hope that there will be an opportunity for a debate on the work of this magnificent organisation and on what I hope will be a continuing Government grant which will enable it to do its work undisturbed by the type of campaign which the hon. Member for Wokingham has conducted in the House and outside.
5.52 pm
Mr. Iain Sproat: Before the House goes into recess, we should have the opportunity to discuss the tragic plight of the fishing industry. I know that the hon. Members for Kingston-upon-Hull, West (Mr. Johnson) and for Grimsby (Mr. Mitchell) will agree with me. I do not wish to go into great depth about the manifold problems caused by soaring costs, loss of grounds, the common fisheries policy and all the well-known problems afflicting the industry, which almost closed Fleetwood
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and Hull, and which have caused the Aberdeen fleet to be reduced from 150 vessels to between 30 and 40 in a decade.
The aspect that should be debated is how our Common Market partners are behaving now, before the common fisheries policy is reformed or renegotiated. The reform of the policy is the most important single action that can help to put the industry back on its feet. What worries us is that, even while the negotiations are being conducted so patiently by my right hon. and hon. Friends, there is concrete and visible evidence that some of our Common Market partners are cheating. There is no other word to describe what they are doing.
The hon. Member for Kingston-upon-Hull, West and I saw a special Granada film, in which an unemployed trawler skipper was taken to Holland and France. He was taken to a quayside and asked "What are the fish in the boxes?", to which he replied " There is no doubt that they are herring." The fish had come off a boat that had just returned from British waters, where it is illegal to take more than a 5 per cent. by-catch of herring. However, tonnes of herring were on the quayside. When the French fishermen were asked what they had to say, since catching herring was illegal, they said " Many things in life are illegal." When they were asked about the inspectors who should have prevented them from landing the fish, they said " What inspectors?"
It was clear that the fishermen were breaking the EEC regulations. The inspectors were not fulfilling their duties under the regulations, and auctions were being conducted by auctioneers employed by the French Government. It is essential that, before we renegotiate the common fishery policy, we sort out the cheating, because it is having an extremely depressing effect on our industry.
To prove that I do not speak from a constituency bias, let us consider Hull, which has been crippled by what has been going on. The film showed a sad sight. The quaysides of Hull were as quiet as the grave until the arrival of a ferry from Holland. There were no British vessels. Off the ferry from Holland rolled Dutch lorries filled with fish that had been caught illegally in British waters by Dutch vessels. The fish had been taken

1545
to Holland and brought back to be sold in Britain because that was the only way that the British fishing industry could be kept going. The film showed illegal behaviour by the French and the Dutch.
We now have visible evidence of the cheating. I ask my right hon. and hon. Friends to make the strongest representations to the French and Dutch Governments and to tell them that we cannot tolerate the cheating, particularly when we are trying to renegotiate the common fisheries policy and when our industry is being crucified.
British fishermen are frightened of the future because they do not know whether they will have a job this year or next year. They also feel a strong sense of injustice because they know that their great fishing industry, with Hull and Aberdeen as the premier European fishing ports, is dead or dying. There is a grave sense of injustice that the death of the industry has been brought about through no fault of the industry, whose workers are hard working.
The industry is in its present state as a result of Government action and the failure of successive Governments to grapple with the problem which our entry into Europe caused. I speak as somebody who supported the Common Market when we went in, and who still supports it. I do not believe that this is a reason to get out, but we have a right to say to our partners "We are obeying the rules; you, too, must obey them."
Perhaps our fishermen might like to evade the regulations in the way that the French and Dutch are doing. However, they could not do so because our inspectorate is so efficient and methodical and sticks so strictly to the regulations that we are being crucified by our own virtues.
Even if the other countries obeyed the regulations as we do, times would still be hard because of the low quotas, the lost grounds and soaring costs. To see the industry crucified because we are virtuous and stick to the regulations when our partners do not is intolerable.
I hope that the Government will treat the matter as urgent. Unless they do something quickly, there could be the eruption of a volcano. The fishing industry
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is patient, but its patience has been tried. I hope that my right hon. Friends will be able to say that they will extract justice from the French and the Dutch.
5.58 pm
Mr. Harold McCusker: There are some good reasons why the House should not go into recess. The House will not be surprised that I intend to raise the question of the terrorist war in Northern Ireland. It is appropriate that we should have this opporunity less than 24 hours after a gun battle on the frontier of the United Kingdom. When most people were wondering whether and how they would get to work and others were trying to stop them from going to work, a well-organised gang of terrorists, operating from high ground in the Republic of Ireland, waged a battle not for five or 10 minutes but for two hours with the police at Middletown. They exchanged several hundred rounds of ammunition.
About 24 hours earlier, a 57-year-old single man of limited means and limited intelligence was abducted on the border by the IRA and, in the IRA's words, executed for informing the Army and security forces about IRA activities.
I am glad that the Secretary of State for Northern Ireland is in the Chamber. It was no surprise to anybody in County Armagh that the man was killed. We were told five weeks ago from the Republican plot on consecrated ground in the churchyard of the Roman Catholic church at Crossmaglen that the IRA intended to execute that man. The crowd was addressed by a uniformed and masked thug, who should have been shot as he delivered his message. He also threatened the lives of members of the police and the Army in the Crossmaglen area. Five weeks later to the day, IRA men abducted a pathetic old man and killed him, just as they would shoot a dog. That happened only a few hours after the Secretary of State told the House that co-operation between the security forces and the Irish Republic had never been better.
The Monaghan Army base is only five minutes away from Middletown. Why did the Government of the Irish Republic allow their territory to be used for a two-hour gun battle without one member of the Irish Army appearing on the scene during that time? Why are the Government of the Irish Republic prepared to

1547
allow their territory to be used by murderers and executors from the IRA who deal out death in this way to an elderly, perhaps mentally deficient, man? Yet, we are told that co-operation between the security forces has never been better.
That death was in addition to the six people already killed in County Armagh this year. Twenty-nine were killed last year. I am sorry if I bore hon. Members by referring to the matter, but 200 of my constituents have been killed since I was elected to the House. Hon. Members may wonder why I am angry, and why I continue to tell the House about such matters. It is because I wonder how many hon. Members would tolerate 200 constituents being killed in a six-year period from 1974. Nothing has been done about that.
We were told last week that the Government would not permit terrorism in any part of the United Kingdom. But the people of Northern Ireland know that the " United Kingdom " means Great Britain. The Government will not tolerate terrorism in London, Birmingham, Southampton or anywhere else, but they appear to be prepared to tolerate it in Northern Ireland, especially in County Armagh. Yet they say that co-operation between the security forces and the Irish Republic have never been better.
The terrorist campaign has changed. Once again, it is a border campaign. It is a campaign that we cannot win while sanctuary is provided in the Irish Republic. It does not matter what measures the Secretary of State or the Government decide to introduce, while men can lie in the safety of the 26 counties in the Irish Republic, cross the border, and then slip back to safety, their terrorist activities will continue for ever. There could be another 200 deaths in the next six years.
The Prime Minister of the Irish Republic appears to be taking some action. By finding arms and bomb factories, the authorities have confirmed that what we have said for years is correct. The Prime Minister instructed his security forces to take action, and hundreds of rifles, rounds of ammunition and bombs were found. But not a single person was arrested. Does any hon. Member think that the security forces of the Irish Republic simply tripped into those bunkers last
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week or the week before? They have known about them for years, and have watched the terrorists operate from them.
I suppose that, in the present southern Ireland political situation, Mr. Haughey's policy is understandable. It is a policy of "Let us draw their teeth and try to disarm them. We are only 18 months away from another election, and I do not want to face the political consequences that go with arms trials." He should be putting terrorists in the dock on arms offences.
It is not good enough for the Government to send their representatives to Dublin to talk about security co-operation, and then to come to the House— as they did last week— and say that the position has improved dramatically. Both the Secretary of State and I know what is really happening in Northern Ireland. The SAS was hailed in the House last week for its tremendous work in eradicating terrorism in London. I wish to see that organisation return to Northern Ireland. It appears to be acceptable to kill Arab terrorists—an Arab terrorist can be shot because he deserves to be shot for what he is doing. But if it is an Irish terrorist, the matter is different. It does not matter that an Irish terrorist shot a 57-year old man. It does not matter that he shot a policeman a fortnight ago, and then asked that policeman's colleagues to rescue him because he was afraid to surrender himself to the Army after he had killed one of its members in Belfast a few weeks ago.
I wish to see the SAS return to Armagh. It is the only organisation that has had any success against the bloodthirsty killers—that is what they are, and we cannot say anything different. Mr. Shields, who was killed last week, joined two other elderly Catholics killed last year and others the year before that, and two young Catholic boys who were killed in Keady.
I am not complaining about IRA men killing Protestants in that area. I am complaining because they are killing the people whom they claim to protect. We would free the Roman Catholic community from its oppressors if we killed some IRA terrorists. I wish to see the SAS back in Armagh doing the job that it should be doing.
I ask the Secretary of State to intervene with the Ministry of Defence, and

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to tell it to stop damaging our local security forces through its policy of closing UDR camps. If the Army commitment in Northern Ireland must be withdrawn—and to a degree I would welcome that, although not the withdrawal of specialist units—we must use local security forces. The UDR provides one source. We shall not increase the size of the UDR if, at the same time, we close the camps and centres from which it can operate.
I ask the Secretary of State to take on board the two measures that I have suggested. I have given better reasons for the House not going into recess than many of the other reasons—important though they are—that I have heard this afternoon.
Mr. John Biggs-Davison: Before the hon. Gentleman sits down—
Mr. Speaker Mr. Speaker Has the hon. Member for Armagh (Mr. McCusker) sat down?
Mr. McCusker Mr. McCusker indicated assent.
Mr. Speaker: I am afraid that the hon. Member for Epping Forest (Mr. Biggs-Davison) is too late.
6.8 pm
Mr. James Kilfedder: Many important matters have been mentioned already in the debate, but, regardless of how important they are, they pale into insignificance against the terrible war that is being waged in Northern Ireland, and which has been waged for the past 11 years. The House, the Government, and their predecessors have not tackled the problem as they should have done. The House should not adjourn. I made that appeal during the debate on the previous recess. The House should not adjourn unless, and until, the Government recognise that they must adopt a tougher policy towards the Provisional IRA in Northern Ireland.
I am glad to see the former Secretary of State for Northern Ireland, the right hon. Member for Barnsley (Mr. Mason), in the Chamber. I know that the leader of the DUP attacked him mercilessly, but I think that most people in Northern Ireland—Protestant and Roman Catholic —would pay tribute to the right hon. Gentleman for his hard work when he
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was Secretary of State for Northern Ireland. That should be placed on the record. Our differences do not matter— tribute should be paid to a man who tried to do his best for the people of Ulster.
Hon. Members will soon be leaving the House for the Whitsun Recess. They, and others in Britain, will bathe in the pleasure of the early summer sunshine, the prospects of a holiday and the pleasures of existence. But the same does not apply to the Ulster people. During the past few weeks the House has debated the invasion of Afghanistan, the gunmen in the Iranian embassy, the American hostages in Iran, and the murder and the mayhem in different parts of the world.
Quite rightly, the House has expressed itself forcefully and demanded that action should be taken to bring peace wherever there is trouble in the world. On each occasion, the Government and Parliament have expressed their determination to come to the air of people anywhere in the world who are living under the threat of terrorism. The high-water mark was reached during the recent SAS operation against the gunmen who occupied the Iranian embassy, when the Secretary of State, who was smug and at times incomprehensible, declared that the Government would not permit terrorism to exist in this country.
The Home Secretary knows that the people of Ulster have been scourged and harassed by the Provisional IRA for 11 long years. It is worth remembering that in that part of the United Kingdom, where British law ought to prevail, more than 2,000 innocent people have been slaughtered by these vicious gunmen and that many thousands more have been horribly mutilated, in some cases cruelly so. Thousands suffer the agony of living in fear. I am not talking about Protestants alone. I am talking about Protestants, Roman Catholics and those who do not adhere to any religion. Indeed, I emphasise that people living in areas that are dominated by the Provisional IRA dream of the day when those vicious men will be taken off their backs so that they and their families can look forward to a decent life.
Of course they cannot go on to the streets and say to the British Government and the security forces " Come in and

1551
remove the Provisional IRA ", because that would be an open invitation to a terrorist to pick them out and slaughter them. But, as British citizens, they believe that one day the Government will be shamed into action to restore law and order in Northern Ireland and to give them hope. That is what I ask for today —that before the House adjourns the Government should give hope to the Ulster people.
In Northern Ireland, whenever the police have arrested a terrorist, who is then charged and tried, the allegation is automatically made by the Provisional IRA men that he was tortured by the police or the Army. There then follow further restrictions on the police or the Army, which makes their task much more difficult. The godfathers of crime go free. No matter what its depravity, the Provisional IRA does not wish to be subject to the law, let alone to the restraints imposed upon the security forces. Above all else, no matter how many they murder and mutilate, the Provisional IRA terrorists do not wish to risk their own lives in any venture.
Last week, there was a splendid example in Belfast of what I speak about. IRA gunmen murdered a British officer. When the house from which they fired the fatal shots was immediately surrounded by the Army, what did they do? One would have expected those so-called patriots to stand their ground and fight it out in an equal way. Instead, they put out the white flag of surrender and sought the opportunity, which they have never given to any of their victims, to preserve their miserable lives.
Despite all the allegations that are made against the RUC by the Provisional IRA about the torture and beatings, and the possibility of dying at the hands of the RUC in their prison cells, those gunmen asked that they be allowed to surrender into the hands of the police. That is a perfect example, not only of the cowardice of the Provisional IRA, but of the fact that the gunmen wish to save their miserable skins. It rebuts the allegations which they have made so frequently about the police, the Armed Forces and British law in Northern Ireland.
Of course, the Provisional IRA does not want an equal fight with the forces
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of law and order on any occasion. Those cowardly, evil men shoot helpless people. The example has just been given of the poor, unfortunate Roman Catholic man in the Crossmaglen area who was murdered by the Provisional IRA, which apparently tried and tortured him—a man who was perhaps not 100 per cent. mentally fit—to force him into stating that he was assisting the British forces.
The IRA believes in other tactics. It will murder by planting bombs, without regard for the consequences of human life, and no matter how many women and children may die. All along the border, Provisional IRA savagery continues unabated. Protestant and Roman Catholic families, members of the police and the UDR, are all at risk. Our hearts ought to go out especially to those who live in isolated areas, where, during the hours of darkness, they never know whether one of those evil IRA men will call at their door and kill them for doing their duty by their country.
The gunmen are helped by the fact that the Government of the Irish Republic are not fully committed to the destruction of the terrorists. Despite the fact that the Republic is a member State of the Common Market and ought, therefore, to be an ally of the United Kingdom, it continues to make hostile claims to the territory of Northern Ireland and continues to work and scheme for a united Ireland. Republic of Ireland embassies throughout the world are used to disseminate anti-British propaganda aimed at destroying Ulster as part of the United Kingdom. Why are British embassies, which cost the taxpayer a tremendous amount of money and seem to do very little in return, not ordered to counter the anti-British lies and the distortion of the truth with regard to the Ulster situation? Until that is done, I do not think that the Government will undertake the type of campaign that is necessary in the border area to dislodge and defeat the Provisional IRA.
One gets the feeling that this Government, like their predecessors, believe that there is an acceptable level of violence in Northern Ireland, but the courageous and patient soldiers, police and Ulster people reject that scandalous standard. As Ulster people, we demand the right to live. We demand freedom from fear and injury.

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We demand the protection of the State against the Provisional IRA terrorists who poison Ulster by their presence and threaten Protestants and Roman Catholics and their future.
In my opinion, the House should not adjourn until we get some assurance for the decent people of the Province, who want action rather than sympathy when an atrocity is committed. As it did during the previous recess, the Provisional IRA will no doubt commit further atrocities in the next couple of weeks. The hon. Member for Armagh (Mr. McCusker) gave details of the Provisional IRA attack on the border, during which there was a two-hour gun battle without any intervtion by the forces of the Irish Republic. That must call into question their good faith.
Caches of weapons, bombs and bullets have recently been discovered by the Eire police, but, so far as I understand, they were discovered as a result of information given by the British Army. One thing we know is that few of the Provisional IRA terrorists who operate from the other side of the border are ever arrested by the forces of the Republic.
In a few days' time, the Prime Minister will meet the Prime Minister of the Irish Republic. When she does, I hope that she will make it clear that this country will no longer tolerate the half-hearted attack on the Provisional IRA by the police and Army of the Republic. I hope that the right hon. Lady will make it clear to Mr. Haughey, who was involved many years ago in gun running, although he was fortunate enough to have the charge not proved against him at the trial, that he must keep his nose out of Ulster's affairs and that Eire, as a member State of the Common Market, must suppress terrorism in the Republic in the same way as France and Germany help each other when terrorists seek sanctuary in either country.
The people of Northern Ireland are entitled to hear the Prime Minister state next week that she wishes to see action from Mr. Haughey to prove his good will and to demonstrate that the Irish Republic is at long last determined to destroy those who are destroying innocent lives an the Province of Northern Ireland.
6.21 pm
Mr. Roy Hughes: The matter that I wish to raise is one that has given me considerable concern. It arises from the recent steel strike and the failure to pay unemployment benefit to those who were declared redundant before the dispute started and who finished their employment before the strike had ended. When they signed on with a view to securing unemployment benefit, they were disqualified.
I have written to the Minister, I have written to the local office of the Department of Employment, I have written to the British Steel Corporation, I have raised the issue in parliamentary questions and I have tried on several occasions to secure Adjournment debates. I notified the appropriate Minister that I would raise the issue in this debate.
It will be best if I read a letter that I have received from a constituent, which sets out the details. I have received many more similar letters raising the same issue. The letter reads:
" I am writing to you in protest at the arbitrary and possibly unlawful fashion in which I and many others like me have been treated by the Department of Employment. Having worked in the steel industry for 30 years, 20 of which have been spent at Llanwern, I was given redundancy notice (on the 14th of December 1979) of three months. This expired on March 7th 1980."
It is noticeable that this man was given notice before the dispute started. The writer continues:
" On the 10th March I received all the paperwork severing my connections with BSC, and at 51 years of age after a lifetime of service to the industry, and for the first time in my life, I find myself unemployed. Having contributed to the fund for 30 years, the Department of Employment tells me that I am not entitled to unemployment benefit, at a time when I most need it. They maintain I am in dispute with BSC. This cannot be so as I no longer work for BSC, and my notice of redundancy was issued long before the strike commenced. The Department itself is somewhat puzzled by the ruling and have obviously received instructions ' from on high '. As you can well imagine, all this has left me rather bitter and disillusioned."
The author of that letter is a man full of despair That is his state of mind after a lifetime in the steel industry. He was declared redundant, he worked his notice, he received his redundancy pay and he severed his connection with the steel industry. He signed on at the local

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employment exchange, and now he has been told that because of the coincidence of a strike at the works where he was formerly employed he is not entitled to unemployment benefit.
Surely such a ruling is against all the principles of natural justice. It is a double blow to individuals who find themselves in the situation that I have described. Insult is being added to injury. My constituent who wrote the letter from which I have quoted has already had his livelihood removed from him. Why should he be penalised again?
My understanding is that social security law on trade dispute disqualification for unemployment benefit is contained in section 19(1) of the Social Security Act 1975. However, that is a consolidation measure that merely repeats provisions that have featured in national insurance legislation since 1946. The relevant part of section 19(1) states:
" A person who has lost employment as an employed earner by reason of a stoppage of work which was due to a trade dispute at his place of employment shall be disqualified for receiving unemployment benefit so long as the stoppage continues."
Surely that should not apply to those to whom I refer. They lost their jobs and were declared redundant before the dispute started. At the time when they made the claim, they no longer had any connection with the steel industry. It is obvious and apparent that they had little more than an academic interest in the dispute. They knew that, whatever its outcome, they would not benefit. Their employment had already been terminated. Despite that logic, the local national insurance officer decided against payment. Apparently, the issue can be referred to the National Insurance Commissioners.
Lord Gowrie, Minister of State, Department of Employment, in a letter dated 19 May, stated:
" No Minister nor anyone acting on his behalf has power to intervene in or alter their decisions."
I have also received a letter from the Under-Secretary of State for Employment, the hon. and learned Member for Royal Tunbridge Wells (Mr. Mayhew), dated 12 May. He wrote about the off-the-cuff reply that he gave me to a question on 22 April. He said that if a further change in the law was required, it was a matter for the Secretary of State for Social Ser-
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vices. Apparently the Department of Employment deals with unemployment benefit claims only as an agent for the DHSS.
I urgently request the Ministers concerned to reconsider the issue and to realise the injustice that has been done. I ask them to take whatever steps may be necessary to rectify this glaring anomaly. I suggest that they bring my remarks to the notice of the National Insurance Commissioners. Secondly, if justice cannot be secured with existing legislation, I suggest that a minor amendment to the law is required to ensure that justice is done to a small section of the community that has been so unjustly treated.
6.30 pm
Mr. David Alton: Before the House adjourns for the Whitsun Recess, I should like to bring two matters to the attention of the Leader of the House and the Government.
First, I echo the sentiments of the hon. Member for Liverpool, Kirkdale (Mr. Dunn), who I wish well personally and in his campaign to try to get a meeting arranged between Merseyside Members of Parliament and the respective Ministers for Employment and Industry to consider the chronic problems of the unemployed on Merseyside. The hon. Member for Kirkdale and I and others have been involved in that campaign on many occasions. Therefore, I hope that, before the House goes into recess, the Government will take a careful look at that chronic situation.
My main reason for rising to speak is to bring to the attention of the House the problems of marine pollution on birds, wild life and the coastal waters around this country. I hope that, before the House goes into recess, the Government will take time to discuss this serious situation.
Between 1971 and 1979, a total of 35,982 birds died of marine pollution. That is about 10 a day. But during that period there were only 17 successful prosecutions for pollution by ships at sea, and the average fine imposed on marine polluters totalled only £700.
The House will probably be aware that about six months ago the Royal Society for the Protection of Birds published its findings into the effects of

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marine pollution on birds. At about the same time as the society was publishing its report, 2,000 birds were found dead in the Mersey estuary. Some of the birds were scarcely recognisable. They were encased in oil, contaminated by unidentifiable chemicals, heaped together, and some still alive making valiant but futile attempt to decontaminate their plumage.
The Secretary of State for the Environment was requested by me and other hon. Members to hold a public inquiry. He promised an investigation. Ultimately, several possible sources of the pollution were located, but the Secretary of State was unable to say for sure who were the culprits. The Department of the Environment promised to do its best to stop it happening again.
It is now 70 years since the first recorded case of oil pollution on our beaches where birds were found to have died, and it happens again and again. In 1907, the "Thomas W. Lawson" sank off the Isles of Scilly. Oil from her tanks fouled the shores of Annet, and sea birds died. By 1922, it was not accidental but deliberate discharge of contaminated waste into the sea that led to Parliament passing the Navigable Waters Act. That made it an offence to pollute Britain's territorial waters, but it did very little to alleviate the problem, because most of the pollution was being carried on outside our three-mile limit, and outside that limit it was still legal to discharge pollutants.
It was not until 1954 that the international community was able to reach agreement on the need to take concerted action to prevent pollution at sea. The recommendations of the convention for the prevention of pollution of the sea by oil came into force in 1958, and there were subsequent amendments and a further convention in 1973.
At the 1973 convention, it was declared:
" certainly by the end of the decade we expect the complete elimination of intentional marine pollution by oil… and the minimisation of accidental spills."
That objective has not been achieved, and the convention has revised, its 1980 target. The Royal Society for the Protection of Birds says that it is unlikely that, on the basis of present progress, marine pollu-
1558
tion will be eliminated by the end of the century.
If the House does not take action, there will continue to be serious levels of contamination and death amongst our bird life. The figures published by the Royal society show that between 1971 and 1979 there were 88 major incidents involving 50 or more birds in British waters. For instance, 24,700 auks, including guillemots, razorbills, puffins and black guillemots, died; 2,331 sea ducks, including eider, scotter, long-tailed ducks, scaup and goldeneye, died; 1,318 gulls, 592 gannet, 966 shag and cormorant died. In all, a total of 35,982 died in those eight years alone, and many more will not have been accounted for. In stark figures, that means that in Britain 10 birds die every day from the effects of pollution.
Since December 1977, oil specimens have been collected from birds for detailed examination. Crude oils and fuels together comprise more than 80 per cent. of all specimens examined. The majority were specificaly identified as cargo tank residues, yet the level of fines and successful prosecutions is derisory. Between 1971 and 1979, the number of successful prosecutions of ships at sea totalled only 77, and the average fine was about £700.
Penalties under the Prevention of Oil Pollution Act 1971 allow for a fine of £50,000 on summary conviction and an unlimited fine on indictment, yet in the 17 recorded cases, the fine was a mere £700 on average. As it is well known among those who commit these offences that even the existing laws are not being properly enforced by the authorities, they do not pose a serious challenge to the law breakers, and the present levels of fines are not serious deterrents. Indeed, many would argue that they are laughable.
Therefore, I call on the Government to urge the adoption of a six-point plan which I hope they will consider before the House goes into recess. First, there should be more international co-operation in attacking marine pollution and, in particular, the early ratification and implementation of the 1973 MARPOL Convention.
Secondly, there should be British acceptance of the recommendations of the international union for the conservation of nature and natural resources 1978 on

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the protection and management of the marine environment. Thirdly, there should be the extension of the limit of territorial seas to at least 12 miles, to enable better protection of coastal and natural resources. Fourthly, the Prevention of Oil Pollution Act 1971 should be amended to increase fines.
Fifthly, there should be legislation to establish a compensation scheme for un-attributable oil spills which affect local or national interests; to impose fines rather than the revocation of licences where spillage results from offshore exploration; to introduce the Inter-Governmental Maritime Consultative Organisation's prohibited areas provisions around, for example, the Shetland Islands, where unique concentrations of wild life are at risk; and to ensure that operators applying for oil production licences undertake environmental impact studies on the potential effects of their activities on marine life.
Sixthly, the Department of Trade should take drastic steps to improve the level of law enforcement at sea, including the arrest of ships, as is done in pursuance of fisheries legislation, and a declaration of sea lanes around the United Kingdom, particularly those close to sea bird concentrations and holiday beaches, with round-the-clock patrols to detect and apprehend polluters.
Mr. James A. Dunn: Would the hon. Gentleman include as a seventh objective the responsibility of the Department of the Environment to ensure that water authorities keep clear estuaries of rivers, because it is known that some of the discharges by manufacturing industry, directly or indirectly, cause some of the pollution to which he has drawn attention?
Mr. Alton: I am grateful to the hon. Gentleman for bringing that matter to the attention of the House. Indeed, the water authorities should take action to stop the dumping of sludge, which takes place in the Mersey Estuary, because they are amongst the worst offenders in creating pollution in that way.
I urge the Government to consider this matter before the House goes into recess. Otherwise, our green and pleasant land will become a very green and poisoned land.
6.38 pm
Mr. Paul Hawkins: I shall try to please my right hon. Friend the Leader of the House by being brief and by not asking that the House do not adjourn for one week. I ask my right hon. Friend for another week, because I think that in that period both the Government and the Opposition would benefit greatly, and that they would return with some fresh ideas.
Mr. James A. Dunn: Badly needed.
Mr. Hawkins: I would agree with that remark as far as it applies to the Opposition Benches.
Before I suggest what that time should be used for, I should like to pay tribute to our colleagues from Ulster. We have heard some horrifying stories. Very rarely do we hear any tribute to the Members themselves, whose job of representing Ulster constituencies must be terrifying. Not being in such a situation myself, I should like to pay a personal tribute to them in view of what they must put up with.
I ask that the extra time be used by the Opposition partly in having a weekend at their leader's farm, and perhaps finding a new leader and thinking up some fresh ideas, instead of attacking us for the state of affairs which they have produced by their profligate expenditure over the last five years, whereby the interest on the money borrowed, on the national debt increase, would pay for another health service.
The extra time could be used also by the Cabinet, whose members might have a weekend at Chequers during which, I suggest, they promise, at least among themselves, that they will never again have a year of legislation such as this one. I think that that will appeal to the Leader of the House.
Secondly, I suggest that the Lord Privy Seal or whoever speaks about the European Community puts over to the House and to the country the fact that we are all too quick to criticise the European Community, but that we are members of it. Like many of us in the House who fought in a war, I believe wholeheartedly that the one great benefit that the European Community has brought about is an end of wars where they have started before, between France and Germany. The European Community can bring

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benefits to foreign policy, and we ought to emphasise that.
Mentioning a concern to my constituency, I have to say that we must not forget that the common agricultural policy, although perhaps not run as perfectly as it should be, is the insurance of the whole of our agricultural community at home—farmers, farm workers and landowners—and that without the CAP they would have no insurance for their future.
I hope that the Leader of the House will bear those two points in mind.
6.42 pm
Mr. James Johnson: Before the House adjourns for Whitsuntide, and since there seems no chance whatever of a debate upon the plight of the fishing industry, I should like to call the attention of the House, particularly that of the Leader of the House—whom I do not think is listening—
Mr. St. John-Stevas: I am listening to every word.
Mr. Johnson: I call attention not only to the sad plight of our fishing industry but to the constantly accelerating pace of its decline, and hence the urgency of the matter. I have with me a telegram from one of the firms in Hull which I should like to quote to the Leader of the House to illustrate what is happening:
" For your information, one of our senior executives has just returned from Cuxhaven and Bremerhaven and he informs us that the deep water vessels operating or laid up in those ports are to receive subsidies totalling 60 million marks from the Federal Government during 1980. We cannot survive against such heavily subsidised competition and unless H.M. Government take immediate steps to remedy the present situation, J. Marr and Son's entire fleet of 25 fishing vessels will cease to operate."
This is happening to firm after firm—Torn Boyd and Co. Ltd., for example, and many others which I could cite. Therefore, I am warning the Leader of the House that, if matters in Hull do not change, we shall be liquidated.
The Hull Vessel Owners Association has gone into voluntary liquidation as an association looking after the dock; and firms are left as units, fishing if and when they possibly can. People in Hull are feeling
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the worst malaise that one can possibly imagine. They think that everyone's hand is against them. They get hammers striking them week after week. They do not know which way to turn.
We must be fair about this. We have taken our case into the boudoirs of No. 10, after a meeting with the Prime Minister in the mayor's parlour in the Guildhall in Hull, where the lord mayor looked after us. I shall not go over past events. Although the Leader of the House is not a fishing man, he knows our difficulties. The Minister of Agriculture, Fisheries and Food knows them even better.
Basically, there are two difficulties which must be overcome. One of them is the matter of the EEC and its quotas. These are completely unfair. I need not go into details about that. We ask that, at the June meeting of EEC fishery Ministers, our case be put not only with expertise and knowledge but with determination—which the Prime Minister has shown on numerous occasions.
Fishing has always been the Cinderella alongside agriculture. We have often asked for a Minister of fishing but have never got one. Even under a Labour Government we have never got a Minister such as the Norwegians have, among others, to look after fishing affairs. We have been a Cinderella for decades. However, we now think that we have found a fairy godmother. When we met the Prime Minister, we found that she was not only knowledgeable but sympathetic. Therefore, I appeal to the Leader of the House to convey my thoughts— more than my thoughts, my beliefs—to the Prime Minister and to the Minister of Agriculture to illustrate how we feel in Hull.
The pace of acceleration of the decline is meaningful to the nth degree. I am indebted to the hon. Member for Aberdeen, South (Mr. Sproat), because he made half of my speech for me. As many other hon. Members must have done, he saw a television film about Hull and the condition of the port, which included Hull skippers who went—on behalf of the Government, I suppose—to investigate the conditions of cheating. That was the term used by the hon. Member for Aberdeen, South, but that is a polite term. Deceit, subterfuge and lies surround us in the EEC with our so-called partners, the French in particular.

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But the Granada film made all this out. Those who saw it cannot but be appalled by the unfair and dirty competition that we constantly face about our shores.
That is why the matter is so urgent and that is why I am now pleading—I do not often plead—on behalf of my constituents in Hull, and people beyond Hull. Other ports such as Fleetwood and Grimsby may be suffering in similar fashion, but not to the same extent as Hull. If this state of affairs continues, we shall be finished in less than 12 months.
Cod wars or not, last year we landed in Hull only 11,000 tons with our own boats. We are dependent upon our past enemies—so-called—upon the Icelanders, who landed 144 vessels in our port last year and kept the fish market going.
That is the position, and that is why I now make this appeal. I hope that I have convinced the Leader of the House, who is very perceptive in these matters, about the urgency, which is continually accelerating and doubling up on itself. I ask him to convey all this to the Minister of Agriculture and to tell him to do his best at the June meeting. My belief is that his best will not be good enough. We have too many enemies in the EEC fishing world. Perhaps we shall not get what we want. What will happen to my people in Hull between June and September? J. Marr and Son, Tom Boyd and other firms will cease their fishing operations. They are all apprehensive, We have many enemies. We now seek help from high places.
6.50 pm
Mr. Sydney Chapman: I am glad that I caught your eye, Mr. Speaker, and since I have sat here since 2.30 pm I have rapidly concluded that it is in my own interests as well as those of other hon. Members if I am as brief as possible. Before supporting the motion, I should like to ask for some reassurance about the problems facing the greatest industry in Britain, whether measured in terms of manpower or output. My right hon. Friend the Leader of the House will know that I refer to the construction industry.
It is worth recalling some of the basic statistics. More than 1¼ million people are engaged in the construction industry. That represents almost 5 per cent. of the
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total working population of the United Kingdom. In comparison, that is more than four times the number of those engaged full-time in the agriculture industry. However, I recognise that agriculture is also important. If one adds to that figure the hundreds of thousands of those who produce materials, manufacture equipment and provide services to the construction industry, one finds that almost one in 10 of the total working population is directly or indirectly engaged in the construction industry.
In spite of the recent recession, last year's total output reached the colossal amount of about £19,000 million. That figure is well over twice the gross output of the agriculture industry. Indeed, agricultural output was estimated at £7,250 million. The former figures are very high and conceal the fact that there has been a decline in real output since 1973. The construction industry now regards 1973 as its golden year, and, since then, a continuing recession has taken place under successive Governments.
The construction industry has two particular worries. It fears that the recession will continue, with plans for a greater decline. Secondly, there is a high level of unemployment in the industry. The latest figures show that 196,000 construction workers are registered unemployed. Although that figure is not as high as it was in 1978, it represents about 13·6 per cent. of the total number of registered unemployed. That means that the rate of unemployment in the construction industry is three times higher than the national average, at a time when the national figure is high.
Not all is doom and gloom. There has been some buoyancy, and the repairs and maintenance sector has boomed. Nevertheless, the figures and trends are exceedingly worrying. I recognise that there is a political problem. The voice of the construction industry is not heard in this Chamber as often as it should be. The reason is quite simple. Construction workers are evenly spread over the United Kingdom. There are no construction seats in Parliament, as there are farming, car industry and mining seats, waiting to be won and lost at the drop of an electoral threat or promise. The construction industry is important. The Government should pay more attention to it.

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At both national and local levels, the Government are the construction industry's largest clients. Although we may argue about the level of public sector capital projects, it is essential that the industry should know where it stands. It is essential for it to have a smooth flow of work. It is a long-term investment industry that needs to know what level to plan for. As its largest client, the Government should be more forthcoming about their plans and designs. I ask my right hon. Friend to ensure that the House is given some reassurance—perhaps in the form of a statement by my right hon. Friend the Secretary of State for the Environment—and that a debate will take place on this subject, if not before we adjourn for the Whitsun Recess, shortly after we return.
6.55 pm
Mr. Tam Dalyell: After my participation in last night's debate on Iran, some of my colleagues may think that I should do the decent thing and take Trappist vows, at least until November. However, before adjourning, we should do our best to clear up a mystery. Did the Government know that American forces used the base at Diego Garcia, in the Indian Ocean, during their military operation into Iran? I also wish to refer to the related issue of the Downing Street blocking of parliamentary questions.
You will recollect, Mr. Speaker, that I have been raising this issue for some time. I thank you for your courtesies last week. My interest in Diego Garcia is not of recent origin, nor does it follow simply on the heels of a headline. On 12 November 1970, I asked the former Prime Minister what discussions he had had with President Nixon about a joint United Kingdom—United States base at Diego Garcia. Mr. Maudling replied:
" I have been asked to reply.
The details of my right hon. Friend's exchanges wiih President Nixon are confidential." —[Official Report, 12 November 1970; Vol. 806, c. 255.]
On 15 December 1970, the right hon. Member for Sidcup (Mr. Heath), then Prime Minister, replied to a question that I had asked. He said:
" I am now able to state that in accordance with the terms of the United States-United Kingdom Exchange of Notes of December,
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1966, published in April, 1967 (Cmnd. 3231) Her Majesty's Government have agreed to the construction by the United States Government of a limited naval communciations facility on Diega Garcia atoll in the Chagos Archipelago. The United Kingdom will assist in its manning. It will provide communications support to United States and United Kingdom ships and aircraft in the Indian Ocean."—[Official Report, 15 December 1970; Vol. 806 c. 327.]
On 16 December 1970, I raised this issue under Standing Order No. 9. It was not allowed by the former Speaker, the then Mr. Selwyn Lloyd. I pointed out that:
" the decision represents a new turn in British defence policy by facilitating and introducing a static United States military presence in the Indian Ocean for the first time."—[Official Report, 16 December 1970; Vol. 806 c. 1371.]
It is relevant to note some of the terms of the Exchange of Notes. They are:
" (1) The Territory shall remain under United Kingdom sovereignty …
(3) Consultation
Both Governments shall consult periodically on joint objectives, policies and activities in the area. As regards the use of the facility in normal circumstances, the Commanding Officer and the Officer in Charge of the United Kingdom Service element shall inform each other of intended movements of ships and aircraft. In other circumstances the use of the facility shall be a matter for the joint decision of the two Governments."
According to a report in The Times, which has never been refuted and which has been endorsed by conversations with people who might be expected to know, Diego Garcia was used during the buildup of the American military mission to Iran. If the Government wish to refute that Diego Garcia was used—I gave the Chancellor of the Duchy of Lancaster's office warning of this—I should be happy to accept that refutation. The Government had many opportunities to make such a refutation, but no refutation has been forthcoming.
There are two possibilities. The first possibility is that the Government knew. The second possibility is that they did not. Either way, serious issues are involved. If they knew, why did the Secretary of State for Defence reply to a question that I put to him on 28 April as follows:
" I shall continue with my speech because there is a great deal that I want to say in a debate covering the whole range of this ubject. I do not know the answer to his question ".—[Official Report, 28 April 1980; Vol. 983, c. 997.]
That referred to a direct question which I put during the defence debate when I

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raised the matter of Diego Garcia. Indeed, the Secretary of State in a written reply of Friday, 2 May, when asked about personnel said:
" These personnel are permanently stationed at Diego Garcia, and they include eight radio operators and communications engineers."— [Official Report, 2 May 1980; Vol 983, c. 697.]
If the Government did not know, why did the radio engineers not report the facts of the matter?
For the sake of greater accuracy, my hon. Friends the Members for Eton and Slough (Miss Lestor) and Liverpool, Walton (Mr. Heller) and I wrote to the Prime Minister on 29 April and said:
" Dear Prime Minister, You will recollect that we raised the Diego Garcia issue in relation to its use by an American Task Force and C141s with you and your Ministers. Could you tell us the date and time when you first knew that Diego Garcia was being used by Americans in support of their operation to the Iranian desert? "
We got a courteous reply on 1 May which did not answer the question. It said:
" In accordance with the terms of the 1976 Agreement on the support facility in Diego Garcia, the US Commanding Officer has kept the Officer in charge of the UK element informed of movements of ships and aircraft. The UK Officer in charge has reported them regularly."
That does not answer the direct question that we put to the Prime Minister.
If the Government did not know, the matter is even more serious. If the Prime Minister only learnt for the first time on the radio on the Friday morning that British territory had been used for a military operation without the British Government knowing, delicate and fundamental issues are involved concerning the House's relationship with Downing Street and the arbitrary block of parliamentary questions by diktat of the Prime Minister.
To be fair, this Prime Minister has been very good about not transferring parliamentary questions of substance, and her actions in relation to Diego Garcia are out of character with her attitude to parliamentary questions. That, too, is possibly a cause for suspicion, that suspicion being that Downing Street accepts questions that are considered convenient, and blocks inconvenient questions. I believe that there was a block on a question that I tabled on 14 May
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which was due to be answered today. The question to the Lord Privy Seal was:
" At what point he or Her Majesty's Ambassador in Washington was informed to the United States' intention to use the Anglo-American bases at Diego Garcia for the purpose of making possible the American military expedition to the Iranian Desert."
That question was tabled, but was ruled out of order on the grounds that questions would not be answered—although it is legitimate to raise the matter in debate—about movements from allied bases. However, I tabled the following question for Friday 9 May to the Secretary of State for Defence:
" Whether he will list the route and stopping points used by Hercules aircraft carrying vehicles for the Cambodian relief operation, listing the dates on which it stopped at Cyprus."
That question was accepted by the Table Office and remains on the Order Paper. How is it that, since Cyprus is an allied base, this innocent question stands, while the less innocent question of Diego Garcia falls? Is there one rule for what are arguably British bases and another for what could be called Anglo-American bases? If so, it would be a service to the House to make this point explicit before we go further into discussions on the siting of the cruise missiles in East Anglia.
This is perhaps the most important aspect of the Diego Garcia episode. Yesterday, I asked the Secretary of State for Defence:
" If he will clarify the precise powers of Her Majesty's Government over the release of cruise missiles based in East Anglia, in relation to the powers of the United States Government, specifying whether, in the calamitous circumstances of a nuclear war, arrangements have been made for consultation with the Americans on the use of cruise missiles in the few minutes available; and whether Her Majesty's Government will have at every stage of any nuclear confrontation, the inalienable, unqualified and unconditional right of veto over their use."
I was referred by the Under-Secretary of State for Defence for the RAF to an answer that the Secretary of State had given to my hon. Friend the Member for Keighley (Mr. Cryer). In my supplementary question I asked:
" In that reply there was a reference to joint decision. Does 'joint decision' in that context mean dual key control of the missiles? "
The Under-Secretary replied " No ".

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This raises very fundamental and urgent issues in relation to the Anglo-American relationship. If a Prime Minister resorts to a blocking device simply for the overriding reason of our relations with other countries, I personally do not complain too much. But it can hardly be said by a Prime Minister who has authorised sanctions against Iran that she does not want foreknowledge of the use of British territory to embarrass our relations with the Iranians. If that was what she was concerned about, she would not be calling for sanctions.
In all conscience, I have taken up enough time of the House in the last 24 hours. But there is an urgent issue here of precisely what is meant by " joint decision ", affecting not only the direct question of Diego Garcia, but also its consequences for cruise missiles based in East Anglia.
7.7 pm
Mr. Tony Marlow: I wish to raise two subjects of great public concern which should be brought to the attention of the House and perhaps debated before the Whitsun Recess.
First, there is a question of great and growing injustice of which a democratic Government must take increasing note and do something about, namely, the subject of the rates. I say " injustice " because, in a parliamentary answer that I received today, I discovered that one-quarter of ratepayers were too poor to pay income tax, whereas one-quarter of income taxpayers, who are relatively rich compared with those who do not pay income tax, do not pay any rates. It is probable that those income taxpayers are using a far greater proportion of local authority services than those ratepayers who are not paying income tax. That demonstrates, beyond peradventure, the injustice of the present situation.
I should like to concentrate on water and sewerage charges. I am sure that we all have within our constituencies several 80-year-old widows who are living in relatively large houses in which they once lived with their husbands, since deceased, and children, since departed to other parts of the country. These elderly ladies do not use a great deal of water— I do not suppose that they have many
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baths every day. Some of them may even be constipated, and I doubt whether they use the sewers to anything like the same extent as a smaller house up the road with four adults living in it. Yet the situation is such that these elderly widows are required, in many cases, to pay up to £3 a week for water and sewerage. When they write to me, I get in touch with the local water authority to ask what can be done about it. I get an almost impertinent answer, that if these elderly people wish they can pay a capital charge and have a meter installed. This would make very little difference in the overall amount that they would have to pay.
The provision of water and sewerage services throughout the country costs £1,600 million. That is a lot of money. If we are not to raise this through the current water and sewerage rates, we must raise it in some other way. There is an argument that it should be raised through water and sewerage rates because the people who are raising the money would be the people providing the service and therefore they would be more responsive. However, I think that that construction is something of a joke. Very few people would look upon the water authorities as being responsive to public opinion at present. I would prefer therefore, that this money was raised in different ways.
The Government are rightly in favour of increasing work incentives and are worried about the " Why work? " syndrome. It would be improper to increase income tax to pay for the charge. However, I understand from Treasury statistics that 1 per cent. VAT would raise £800 million. If VAT were increased by 2 per cent., the income would cover the entire water and sewerage services in the country. One per cent. only would cover the cost to the domestic ratepayer. The Government are concerned about the retail price index. However, if it is correctly constructed, whether the money is raised through VAT or through water and sewerage charges makes no difference. The Government should consider the charge I have suggested in detail.
Another matter of great concern to the country—although I sometimes wonder whether the concern is reflected in this House—is immigration. A basic right of a country and its people is to decide who should be its citizens and

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live within its borders. Again using Government statistics, for every 1,000 births to white mothers in 1975–76, there were 78 births to coloured mothers. Three years later, in 1978–79 that latter figure had increased to 93. We also know that for every 100 white births there is one further coloured birth from mothers born in this country. Therefore, for every 10 white babies, one coloured baby is now born in this country. I do not say that there is anything wrong with that, but it is a fact that we should note. This proportion is increasing, and the probability is that by the end of the century the proportion will be one in seven.
That population in time will reproduce itself throughout the country. In 50 to 70 years' time, the coloured population in Great Britain will be equivalent in size to the entire population of Greater London. Colour may not have a lot to do with it, but they will be people who, in the main, have different cultures, backgrounds and, to some extent, loyalties. I do not complain about it, but it is a factor to be taken into account.
To the figures that I have posed, despite the recent immigration rules, we have to add the incoming population from other parts of the world of people of different cultures and backgrounds. That number is sufficient every two years to populate a new parliamentary constituency, as I said yesterday. Figures from the Office of Population Censuses and Surveys show that the current population of Great Britain will have doubled by the end of the century. Hon. Gentlemen will suggest that I am wrong to say this, that it will stir up racial prejudice, and that to do so is appalling and racist. I have no personal prejudice, but the people of this country are interested and concerned.
The measures that we have so far introduced will not affect those predictions. Despite the honourably made commitments of past Governments, I ask the Government to seek alternative policies. Unpleasant though they will undoubtedly be, and offence though they undoubtedly will cause, we must consider policies that will have an impact on those figures.
7.13 pm
Mr. Arthur Lewis: I should love to take up the remarks of the hon. Member for North-
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ampton, North (Mr. Marlow), particularly with regard to water, because his Government are responsible for the increased charges. However, I have promised my right hon. Friend the Member for Ebbw Vale (Mr. Foot) that I shall not be long.
I notice that a professional journalist will reply from the Labour Benches and I believe a semi-professional journalist from the Government Benches. That is interesting, because I can see no professional journalists in the Press Gallery. I do not know whether they are obeying press laws and having the day off. That too, is interesting, as the press has been saying that people should turn up for work. Members of the press attack hon. Members on silly and futile grounds such as subsidised food, which the press also has, or yellow socks or a pink shirt. It is a pity that they are not here to listen to the debate.
I have two or three serious points to raise. For 25 years, which is a long time, I have tried to institute security measures in the Palace of Westminster. Unfortunately, it took the death of an hon. Member before security was tightened up. For 36 years, I have been trying to institute fire drill in the Palace of Westminster. No one in the Palace knows what to do in the event of fire. We have visitors, including children, in the Palace. To my knowledge, there has never been a fire drill. I have heard a whisper that at long last we have made progress. We should all know what to do in the event of a fire, especially in view of recent incendiary bombs. Not one hon. Member does. I ask the Leader of the House to ensure during the Whitsun Recess that a proper fire drill is devised and that everyone is aware of it.
Secondly, the law courts will also recess for Whitsun. Today, in another place, the Lord Chancellor castigated workers for taking a day off. That is quite right. However, higher legal charges result because the law courts and the entire legal fraternity have long holidays. The Ronan Point incident occurred many years ago, and it has only just been resolved, with millions of pounds involved. Will the Leader of the House consider in the recess whether we could speed up the judicial system, where fabulous fees are paid for long-drawn-out processes?

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My third point concerns the transfer of nuclear waste. Secrecy on overseas bases has been mentioned, but it is even more difficult to find out what is happening with the dangerous nuclear waste that travels through my constituency and all the industrial areas of London. There is also no security. I took a mock-up bazooka on to Stratford station at midnight. We asked the railway people when the trucks were coming through. They told us. We took photographs, and had the opportunity to do any damage that we chose. That is still going on.
I do not know whether it is true, but I have heard that Queen Mary college has established in my constituency an experimental nuclear reactor.
Are the safety precautions sufficient to protect us? We could be vulnerable to terrorist attack, and we have just had the Iranian embassy incident. I do not want to see those chaps blowing the nuclear waste bottles sky high. Thousands upon thousands of people would then lose their lives, and we should be nuclearised for 150 years. [Interruption.] It is not a laughing matter. It is serious. I should like the Leader of the House to consider that during the recess.
Last and most important of all, the House cannot recess without paying tribute to West Ham and Arsenal. About 100,000 Londoners and people throughout the country and from other parts of the world met at Wembley. There was no trouble, and not one spectator was arrested. We pay tribute to them. The Scots should not laugh. They are not so good. I am pleased that West Ham won, but I hope that tonight Arsenal will get some consolation with a thundering victory in Brussels. But God bless West Ham!
7.19 pm
Mr. Michael Foot: I shall be brief, though I am happy to congratulate my hon Friend the Member for Newham, North-West (Mr. Lewis) on Saturday's victory. I am pleased to see that he is still in such good spirits about it, and I am sure that that will continue.
The Leader of the House has the duty of replying to all the points that have been raised. I have selected a few not because I think that the others are not important but because I should like to
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hear the right hon. Gentleman's reply to the matters that I intend to raise.
My hon. Friend the Member for Newport (Mr. Hughes) raised the question of people who had been on strike not receiving unemployment benefit that would have been paid if the strike had not occurred. That appears to be a peculiar situation, and I cannot see that a concession on the matter would involve considerable repercussions. Even if the Leader of the House cannot reply today, I hope that he will ask the Secretary of State for Employment to make an early statement and to see whether the problem can be overcome. It should not be left in the form in which it was left by the last letter from the Department of Employment.
My hon. Friend the Member for West Lothian (Mr. Dalyell) put an awkward question about Diego Garcia which will continue to be put until the Government decide to answer it. It will not be sensible for them to continue to dodge, postpone or avoid the question. It will not go away. We all know that my hon. Friend will not go away. He will come back with the question and will go on putting it. It is a legitimate question which cannot be shrouded in the claim of military secrecy. After all, the operation was supposed to be not a military operation but a different sort of operation. We may have different views about whether that distinction can be drawn, but the House is entitled to a full statement from the Defence Minister or the Prime Minister.
The Government will find it better to come openly to the House to give us the truth. The matter will be probed persistently, and the implications that my hon. Friend put to the House are serious. If we are to have collaboration with the United States on the use of bases, such questions will occur in the future. I urge the Government to choose a proper time to make a statement to the House. Some of us may think that the proper time was the debate on the defence White Paper, but that opportunity was not taken, and there should be an early Government statement.
Two or three Conservative Members have referred to the promises, pledges, indications, or hints—call them what you will, Mr. Deputy Speaker—about the future of the rating system. The hon.

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Member for Leek (Mr. Knox) opened the subject in his usual expert manner and he was followed by others, and we all appreciated what was said on that subject.
When references were made to pledges, manifesto undertakings or mandates, all that the Leader of the House could say was that it was a recondite question. I am sure that what he meant was " Don't be such damned fools as to think that you will get an answer from me on that point." That is not satisfactory. The right hon. Gentleman gave the impression that once the electorate had flooded to the polls to vote down the proposition of doing away with the rates, that was wiped from the slate and would not reappear.
Obviously the right hon. Gentleman has not been as careful a student of the speeches of the Secretary of State for the Environment as have some of his hon. Friends. I do not blame him for that. The right hon. Gentleman shows his usual discretion. We have all been interested in the speeches of the Secretary of State for the Environment. None of us expects a simple answer to that recondite question today, but I am sure that we should have it some time, even if it means having to listen to another speech by the Secretary of State.
If the time had been available I should like to have raised on my own account the Granada case which I mentioned at Question Time a week ago. That is an important matter for the freedom of the press. In a sense, the case is still sub judice, and I therefore do not ask for an immediate Government statement. However, if by any offchance the verdict of Lord Denning and his associates is upheld by the higher court, the Government should take action, because otherwise some of the journalists concerned will say that they will not reveal their sources.
Mr. Deputy Speaker (Mr. Bernard Weatherill): Order. I am sorry to interrupt the right hon. Gentleman, but the case is sub judice and he ought not to be talking about it.
Mr. Foot: I can make what I am saying exactly relevant to the debate. Indeed, if I may be so presumptuous as to say so, my remarks may be even more rele-
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vant than some of the other speeches in the debate.
I am not asking the Leader of the House to reply on the merits of the case. All that I ask for is tn undertaking that, when the judgment is delivered the Government will come to the House at an early date and state their view on the situation. That is good advice in the interests of the Government and of the freedom of the press and in order to ensure that we do not have a long interval in which the question is debated and argued about.
I am not seeking to trespass on the rights of the courts. The matter is going to appeal, but, if there is any possibility of the verdict being upheld, extremely serious consequences will be involved and I indicate to the Government that they should be prepared to take action immediately.
A number of my hon. Friends have raised matters of great significance that we cannot settle in this sort of debate. The most important subject, which was raised by the hon. Member for Leek and a number of my hon. Friends, is the appalling economic situation that the country faces. We are going deeper and deeper into the worst recession since the end of the war. Far from relieving the recession, most of the measures being taken by the Government are deepening it further. No one should be under any misunderstanding. Up and down the country, inflation is getting worse. The Conservative Government were supposed to be solving it, but almost every measure that they have taken has made it worse. That applies across the whole field of unemployment. There is not one hon. Member from the great industrial areas who could not repeat the same story that I would relate from my own constituency. The crisis is getting deeper week by week and month by month. All the major actions of the Government are making the crisis more formidable.
People throughout the country are protesting on this day of action. Hon. Members should make no mistake. The protest will grow from one end of the country to the other until the Government either make up their mind to change course or choose to face the electorate and get thrown out. Confronted with a 20 per cent. inflation rate and with unemployment heading for the 2 million mark,

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the Government should have a little humility in appearing before the country and the House of Commons. There will be other opportunities to debate these matters. I say only that Conservative Members should perhaps show a little modesty. When they have got the inflation and unemployment figures down to the figures that existed when they took office, they may have some right to talk.
7.31 pm
The Chancellor of the Duchy of Lancaster and Leader of the House of Commons (Mr. Norman St. John-Stevas): This has been a wide-ranging debate covering a number of topics. I have a certain sense of déjà vu in approaching the debate. It seems that only the other day we had an equally wide-ranging debate on an even wider range of topics.
I take seriously the words of the hon. Member for Neath (Mr. Coleman) about unemployment. To have a situation permanently in which people are denied the right to work is intolerable. The Government are seeking to tackle the root causes of rising unemployment. We have to face the fact that we are dealing with a world recession, partly due to the renewed upsurge in world oil prices and factors that are outside the control of this country or this Government. We have also to go through a period of bringing public expenditure under control again. We have had to take crucial decisions on the economy and on industries in trouble —decisions which had been postponed for too long.
We are getting to grips with those problems. We are also getting to grips with the root problem that lies at the base of rising unemployment—making United Kingdom industry competitive. This becomes ever more vital at a time of contracting world trade. While the Government are well aware of the difficulties that are being felt in various parts of the country, particularly in Wales, we are determined to continue our course, sure in the knowledge that this is the only way to put the economy on a sound basis. That is the ultimate answer to questions of unemployment.
With regard to Wales itself, we are concentrating regional assistance on areas of greatest need so that it is more effective. The particular difficulties fac-
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ing the Welsh economy are recognised by the fact that under present proposals 94 per cent. of the working population will continue to be covered by assisted area status after 1982.
I was grateful to my hon. Friend the Member for Welwyn and Hatfield (Mr. Murphy) for taking our debate back to the basic problems of our society, which, in my view, are not economic but moral. I welcome warmly what he had to say about the need for a responsible society and the need to strengthen the institution of the family by our social and financial policies. We have done that. I cite one example. The increase in child benefit in November of 75p will benefit over 13 million children in 7 million families. The cost in 1980–81 will be £160 million, bringing total expenditure on child benefits to more than £3,000 million a year. Of course, we would all like to do more, but we cannot do more until the economy is once more fully productive and competitive. We can all feel compassion, but unless that compassion is based on a sound economy it is nothing more than a sentiment It can, indeed, become a self-indulgence.
The hon. Member for Bothwell (Mr. Hamilton) brought our attention to the specific problem of Scottish unemployment. The answer to these problems, in the long term, must be the creation of a more favourable economic climate and the pursuit of the principles of economic policy that the Government have laid down. His criticisms of Mr. Ian MacGregor are becoming somewhat stale. The hon. Gentleman, I think, rather overstated them. The point about the appointment of Mr. MacGregor is that he is the right man for the steel industry. It is important to get that industry fully competitive in an increasingly difficult world market. His remarks on Mr. MacGregor's age seem singularly inappropriate in view of the hon. Gentleman's proximity to his right hon. Friend the Member for Ebbw Vale (Mr. Foot). When I look at the right hon. Member for Ebbw Vale, it seems to me that Mr. Ian MacGregor is almost a teenager.
I listened with great interest to the remarks of my hon. Friend the Member for Brentwood and Ongar (Mr. McCrindle) about the need to reduce polution from petrol and his suggestion that a filter should be added to new

1579
vehicles. The pollution of the air by lead fumes from petrol is a great and increasing problem in our cities. I see that the highest concentration of lead pollution in the whole country—the right hon. Member for Ebbw Vale will be interested to know—is in Heath Street, Hampstead. I have nothing against Hampstead. I used to live there myself in the days when I was an intellectual. I gave that up when I became Leader of the House.
I understand that my right hon. Friend the Minister of Transport will deal with this matter in a reply to my hon. Friend.
We are also considering suggestions from outside bodies on ways to strengthen the present law on drinking and driving. My right hon. Friend will make a statement as soon as possible.
The right hon. Member for Manchester, Openshaw (Mr. Morris) raised the question of overcrowded prisons in general and the particular difficulties of Strange-ways prison. As my right hon. Friend the Home Secretary has recognised, our prisons are chronically overcrowded and the prison services operate under severe strain. In his statement of 30 April my right hon. Friend gave an indication of the measures that the Government will take.
Manchester's problems are severe, but the problems throughout the United Kingdom caused by overcrowding are also severe. Prisons have always come low in Governments' priorities for capital expenditure, but the measures that my right hon. Friend outlined will do something to alleviate that.
My hon. Friend the Member for Leek (Mr. Knox) raised a number of interesting questions which were of a more or less academic kind but which aroused a certain response and vitality in the extinct or semi-extinct volcanoes on the Opposition Benches. There were several rumbles at that point. It will hardly surprise my hon. Friend if I tell him that it is not the Government's intention to introduce an incomes policy, for the very good reason that, while such policies work for a time, in the end they break down and cause greater troubles than those that they were designed to remedy.
The proposed abolition of the domestic rating system was also raised by my hon. Friend the Member for Bodmin (Mr. Hicks). It aroused an interesting consti-
1580
tutional discussion on the exact status of the mandate, a discussion to which the right hon. Member for Ebbw Vale made a characteristic contribution. It was not particularly enlightening, because it missed the point of the distinction that I was making—that the commitment in our 1974 manifesto was a very precise one which was not repeated in the 1979 manifesto. Neverthless, he will be relieved to hear that those manifestos are easily reconcilable with one another.
The long-term aim remains to abolish the domestic rating system, but we cannot do everything at once. As we made clear in the 1979 manifesto, which I am sure the right hon. Gentleman has studied, the reduction of income tax must take priority over the abolition of the domestic rating system. That is all that I have to say on the subject. For any further study, I refer hon. Members to the collected speeches of my right hon. Friend the Secretary of State for the Environment. I have not read them recently, but I recommend them to hon. Members without reserve.
We share the concern of the hon. Member for Liverpool, Kirkdale (Mr. Dunn) about unemployment in Liverpool and Merseyside. It is one of the worsthit areas of the country. The hon. Gentleman mentioned small industries and small businesses. We believe that the measures that we are putting forward for small industries and small businesses will be a practical and major contribution towards the alleviation of the unemployment problem. May I say how glad we are to see the hon. Gentleman in his place today? He is his usual courageous and resilient self.
I turn to my hon. Friend the Member for Halesowen and Stourbridge (Mr. Stokes), who brought us back again, as he always does in his speeches, to basic principles. I very much agreed with what he said. [Interruption.] It may be eccentric, but my hon. Friend was speaking the truth.
Mr. Russell Kerr: The right hon. Gentleman misheard me. I said " Back to the eighteenth century."
Mr. St. John-Stevas: That is a fairly eccentric remark to come from that source, but if the hon. Gentleman wishes

1581
to go back to the eighteenth century, God-speed and farewall.
I agree with my hon. Friend that the foundations of our morality in this country are the Christian foundations, the foundations of the Judaeo-Christian traditions. I am sympathetic to what my hon. Friend said about sex education, or what too often masquerades as sex education. It is important that people should be properly instructed, but it is vital that it should be done in a family context. While schools undoubtedly have a part to play, they should always take into account that they are there in the place of parents, that they represent parents, that their duties and responsibilities derive from parents and that therefore they should make every effort to bring parents into this type of education rather than phasing them out. Therefore, I believe that what my hon. Friend said was of great utility.
Sometimes my hon. Friend arouses a certain amount of mirth among Labour hon. Members, but I am sure that he has the inner resources to repell such superficial reactions to words which, whenever he speaks, are of profound truth, and by which the House is enlightened. We should be much poorer without them.
I turn to the hon. Member for Manchester, Gorton (Mr. Marks), who subjected a speech of my right hon. Friend the Prime Minister to a certain amount of exegesis. The more the hon. Gentleman spoke about my right hon. Friend's speech, the truer seemed to me the contents of that speech. Although I do not think that that was the intent that animated his remarks, that was the effect that the hon. Gentleman had on me.
Of course it is no policy of this Government to have high mortgage rates. We deplore them, but we must recognise that we are in a world of high interest rates. We hope that as soon as possible interest rates in general will come down, and the mortgage rates with them.
The hon. Member for Lewisham, West (Mr. Price) made some remarks about the march in Lewisham. There is a fundamental distinction between the right to hold a public meeting and the right to march. I think that the right to hold
1582
a public meeting should not be infringed or limited, but I do not think that the right to march is in the same category. When one enters that area, one must consider factors other than freedom of expression. One must think of people's social susceptibilities, the social make-up of a given area and the provocative intent that may be behind such demonstrations. I sympathise with the hon. Gentleman in the difficulties that he has had in his constituency.
We have issued a Green Paper, which is a contribution to the discussion. My right hon. Friend the Home Secretary will welcome views from the hon. Gentleman and others on the difficult issues involved. When those views have been received and considered, we shall be in a position to inform the House of the Government's conclusions, and we shall carefully consider the need for a debate.
I became increasingly nervous as the hon. Gentleman spoke about his second point, the question of MIND. I became even more nervous when I heard the contrary view expressed by my hon. Friend the Member for Wokingham (Mr. van Straubenzee), and my nervosity reached a high point with the speech of the hon. Member for Norwich, North (Mr. Ennals). But that is a reaction I frequently experience when listening to his speeches. At that point, the whole issue was ruled out of order by Mr. Speaker who had returned to the Chair.
That particular controversy was fascinating, but it is obviously a fascinating minefield. During the debate there were present in the House my hon. Friend the Minister for Health and my right hon. Friend the Secretary of State for Social Services. They were present throughout the speeches that were made, and I think that that is an indication of their concern about the problems of mental health. I have no doubt that they will—my hon. Friend the Minister for Health has just returned to the Chamber—give serious attention to this issue and to the views expressed. I hope that those remarks will also suffice to satisfy my hon. Friend the Member for Wokingham. I was extremely impressed by the cogency of the arguments expressed on both sides, but it would need a Solomon to give a judgment upon the issue.

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My hon. Friend the Member for Aberdeen, South (Mr. Sproat) expressed concern about fisheries policy. The Government are determined to achieve a satisfactory settlement of the revised common fisheries policy which fully reflects the needs of the industry. The same concern for the fishing industry was expressed by the hon. Member for Kingston upon Hull, West (Mr. Johnson). I was deeply impressed by the force and sincerity of his remarks about the threat to our fishing fleet. I shall certainly bring to the attention of my right hon. Friend the Minister of Agriculture, Fisheries and Food the concern expressed by the hon. Gentleman. I can assure him that the Government are in close touch with the fishing industry and are well aware of the considerable difficulty that certain sectors of the industry have been facing. As the hon. Gentleman knows, we have announced a package of financial aid for the fishing fleet worth £3 million.
The hon. Gentleman mentioned the fact that the Prime Minister is knowledgeable about the industry and sympathetic to its needs. I shall take the opportunity to bring the remarks of the hon. Gentleman to her attention on the eve of the continued negotiations about our Common Market policy. I am sure that his views will have the greatest effect in those negotiations.
Mr. James Johnson: Does the Leader of the House fully appreciate that Hull is unique? It is the only distant water port. We are the only port in this predicament. That was the point I wished to get across. Aberdeen is Aberdeen and Lowestoft is Lowestoft. Hull will be finished completely, whereas the others have something else to fall back on.
Mr. St. John-Stevas: That point has been made cogently by the hon. Gentleman, and I will convey it to the knowledgeable and sympathetic Prime Minister. I hope that she will be even more knowledgeable and sympathetic as a result.
My hon. Friend the Member for Chipping Barnet (Mr. Chapman) raised the problems of the construction industry. I shall convey his remarks to my right hon. Friend the Secretary of State for the Environment.
I turn back to the most important contributions made by the various hon. Members from Northern Ireland and in
1584
particular the speech of the hon. Member for Armagh (Mr. McCusker) and that of the hon. Member for Down, North (Mr. Kilfedder). In this House we tend, all too easily, to forget the strains and sufferings to which the people of Ulster are continually subjected. It is good to be reminded of that in these debates when hon. Members raise the matters that they consider most important. I can only say that the Government are determined to continue their struggle against the IRA and, although the IRA, unfortunately, maintains the capability to murder and destroy property, the campaign of the security forces to suppress terrorism through the law continues unabated. There have been a number of important arrests, finds of arms, ammunition and explosives in recent weeks. The most significant of these was the capture of an M60 machine gun in Belfast on 2 May. My right hon. Friend the Secretary of State was present for part of the discussion. We shall continue our efforts to bring peace and security to the people of Northern Ireland.
The hon. Member for Newport (Mr. Hughes) raised the issue of unemployment benefit, and it was also mentioned by the right hon. Member for Ebbw Vale. Under a long-standing rule, a claim for unemployment benefit by a person declared redundant whose employment has not been terminated when a trade dispute begins is treated in the same way as a claim from other workers who lose their employment because of a trade dispute. Where it is imposed, disqualification for unemployment benefit continues until the end of the stoppage unless the claimant obtains other employment in the meantime.
We have no plans to change that rule, but I shall bring to the attention of my right hon. Friend the Secretary of State for Employment the particular case mentioned by the hon. Gentleman in order to see whether my right hon. Friend can be of assistance in this matter.
I listened with interest to the remarks about the Royal Society for the Protection of Birds and the problem of marine pollution. Those points were raised by the hon. Member for Liverpool, Edge Hill (Mr. Alton). This is a matter of concern to many, and the Government will continue to pay close attention to practical measures aimed at reducing the

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number of shipping accidents and preventing oil pollution. We shall continue to develop existing arrangements for dealing with oil spills.
I was grateful to my hon. Friend the Member for Norfolk, South-West (Mr. Hawkins) for suggesting that we should have a further week's holiday. I would be happy to get back to the position, which I regard as normal, where the Whitsun Recess was two weeks. That has recently gone by the board. That would be a welcome restoration, and I hope that in the next Session we may be able to move once more in that direction. However, I cannot give a more definite undertaking than that.
I listened, once again, to the speech of the hon. Member for West Lothian (Mr. Dalyell) about Diego Garcia. He deploys his arguments with great force and conviction but, alas, I am afraid that I can add nothing to the words used by my right hon. Friend the Prime Minister on 29 April and, indeed, by Mr. Speaker on 1 May. I suggest to the hon. Gentleman—as was suggested by the right hon. Member for Ebbw Vale—that the right people with whom to pursue his point are the Prime Minister and Mr. Speaker; not myself as Leader of the House.
In relation to water rates I have sympathy with what was said by my hon. Friend the Member for Northampton, North (Mr. Marlow). The water industry is considering various new and modified methods of assessment.
The views of my hon. Friend on immigration are understood. The important principle is that which was annunciated by the Prime Minister in reply to a question. She said that every citizen born within the kingdom is entitled to equal rights and respect before the law. We are determined to ensure that that principle is upheld.
The hon. Member for Newham, Northwest Mr. Lewis) asked about two important matters—fire drill and the transport of explosive flasks. I have never taken part in a fire drill. I believe that plans are being made to hold one in September. As I do not intend to be here in September, I shall be unable to
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take part in it. I hope that the hon. Member's anxieties will be allayed. I shall draw his remarks to the attention of the appropriate authority in the House.
The transport of explosive flasks is being examined. I understand that the Secretary of State is satisfied with security measures and that the risks are minimal.
I congratulate the hon. Member for Newham, North-West on West Ham's victory. He will be surprised to hear that I am a West Ham supporter. I was particularly pleased with the result and delighted at the peaceful celebrations. It set a magnificent example to the rest of the country and proved that people can enjoy celebrations which express feelings of delight while respecting the right of others to go about their own business free of disturbance.
Mr. Dan Jones: Has the Leader of the House considered the possibility of changing his career and joining the diplomatic service?
Mr. St. John-Stevas: I imagine that that is a kind remark. I take everything as a compliment unless I am being knocked down, when that attitude is more difficult. My words might be diplomatic but they are meant sincerely.
While I am in a diplomatic mood, may I say a word to the right hon. Member for Ebbw Vale about press privilege? I do not wish to go into the case, which is sub judice, but I heard the right hon. Gentleman's broadcast on the subject on " The World at One ". In so far as that broadcast related to the position of the press and the importance of its right to safeguard sources, I entirely agree with every word that the right hon. Gentleman said. I congratulate him on avoiding being trapped into a false position by Mr. Robin Day. It was an unequal contest. Poor Mr. Day was so much out of his depth that he seemed like an amateur dealing with a professional.
Question put and agreed to.
Resolved,
That this House, at its rising on Friday 23 May, do adjourn till Monday 2 June.

CLEGG COMMISSION (ABOLITION)
8.3 pm
Mr. John Townend: I beg to move,
That leave be given to bring in a Bill to abolish the Standing Commission on Pay Comparability; and for connected purposes.
The body, commonly known as the Clegg Commission, was set up as a result of a statement in the House by the then Prime Minister, now the Leader of the Opposition, last year. Hon. Members will recall that that was at the end of the winter of discontent when the Labour Government's prices and incomes policy was collapsing round their ears. There were disputes with local authority and National Health Service manual workers and with ambulance men. Rubbish was piling up in the streets of London, the dead were left unburied and the sick were suffering. The Government's aim was to get those workers back to work on what appeared on the face of it to be reasonable percentage increases, whatever the long-term cost.
As in the firemen's case, a year before, it would have been cheaper to give the workers a larger cash offer than to put off the evil day with a post-dated cheque. The firemen would have returned to work for about 20 per cent. When the deferred payments and the reduced hours were worked out, the settlement cost was no less than 84 per cent.
The advantage to the Labour Government was that they did not have to cash the post-dated cheques. The incoming Conservative Government had to pay the bills. The cheques were expensive. The full year cost of Clegg awards to date is £1·6 billion. That does not include the 13 outstanding references.
The awards have slowed down the Government's policy of bringing expenditure under control and reducing inflation. They have also caused public sector pay increases this year to rise at a faster rate than private sector increases which, in most areas, are higher than the inflation rate.
Those of us who are sceptical about the concept of comparability between public sector and private sector pay had
1588
our worst fears confirmed shortly after the commission was set up. The Labour Government made a payment on account of the comparability study even before the study started. They prejudged the issue. That showed that the exercise was a fraud aimed at increasing settlements by the back door in order to buy industrial peace.
In its first report, the commission gave awards to cleaners and catering staff. Most people accept that wage rates in the private sector, in the hotel, catering and domestic service industries are already lower than in the public sector.
Comparability is always a doubtful exercise. If it is to have any credibility, it must include not only pay but all the elements, including pensions, whether inflation-proof or not, length of holidays, hours and conditions, job security, market conditions and the surpluses and shortages of skills. I do not know how such factors can be assessed. How does one compare the stress on a production manager or foreman who has to deal with recalcitrant shop stewards with the problems of a teacher dealing with difficult children? If a teacher cannot cope, he can send a child to the headmaster, possibly to be caned.
The most important perk for public employees is the inflation-proof pension. What is the cost of that privilege? One would expect to find that cost in the Clegg report, but it is not there.
I asked a private insurance broker to quote on two schemes—a normal company pension scheme with no indexation and a fully inflation-proofed scheme. He quoted me for a scheme that would cost 12½ per cent. of gross salaries without indexation. However, he said " We cannot get a quotation for an inflation-proof scheme because no insurance company will gamble on the future rate of inflation." He said that if I wanted to chance my arm on the rate of inflation he could supply a figure based upon that. I asked him for a quote for a 10 per cent. inflation scheme. The cost was not less than 40 per cent. of gross salaries—27½ per cent. more than the non-inflation-proof scheme.
What value does Professor Clegg put on that great privilege? In his first report on local authority and National Health Service manual workers he valued it at

1589
between 1·7 per cent. and 4·5 per cent., depending on grade. With regard to teachers, the commission valued it at between 2·5 per cent. and 3·1 per cent. How on earth did it arrive at such a ridiculously small figure compared with the quotation that I received? It was simply by taking for comparative purposes not the normal non-inflation-proof private schemes, but the untypical, partially inflation-proofed private schemes which are enjoyed by relatively few people.
I tabled a parliamentary question asking for details of which scheme we used for comparative purposes, but I was told that it was confidential information. The average member of the public is appalled at that attitude, which clearly undervalues public sector pensions. He sees it as a cover-up by the bureaucracy to protect its privileges.
Many of my hon. Friends, especially my hon. Friend the Member for Knuts-ford (Mr. Bruce-Gardyne), have appreciated for some time the damage created by Clegg. It is a pity that my party, during its campaign at the last election, undertook to honour the Clegg awards. These things happen in election campaigns, and it is right and proper that, once an undertaking has been given, it should be honoured. However, it is regrettable that the Government did not announce immediately after the election that there would be no more references to the commission.
If any hon. Members have any lingering doubts about the need to abolish the Clegg commission, they must surely appreciate what a dangerous menace it is after its latest report on the teachers' pay claim. Professor Clegg had difficulty in finding comparisons because teaching is a particular profession. He asked a number of consultants for suggestions. He then selected consultants, and they carried out a study. Because the study did not produce the answer that he wanted, and he did not think that it was credible, he scrapped the whole lot. Professor Clegg did not take into account the longer holidays, shorter hours and job security, and he grossly undervalued pensions.
Finally, he based his recommendations on a comparison of teachers with other graduates, not only in the private sector
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but in the public sector. He made a mistake: he forgot to include the increments that teachers receive because they are graduates. That mistake cost Britain £140 million. Because the mistake was not brought to light before the local authorities accepted the recommendation, it must be paid for by the long-suffering taxpayer or ratepayer, or by a further reduction in the number of jobs for teachers. That final episode proves that the Clegg commission is not only a nonsense but that it is incompetent and should be abolished forthwith.
Quite rightly, the Government believe in payments for productivity. If we pay for productivity in the private sector, and that is followed by comparability without productivity in the public sector, it is a recipe for inflation. I trust that hon. Members will support my view that the Clegg commission should be swept away as soon as possible. I commend the motion to the House.
8.15 pm
Mr. Peter Snape: It is with some degree of personal surprise that I find myself rising tonight to defend the Clegg commission, and thereby defending the whole system of the comparability of jobs. In my youth in the Labour Party and the trade union movement, I worshipped unashamedly at the altar of free collective bargaining. It is only in recent years that I have come to modify that strongly held view.
When we read the history of the 1960s Labour Government, and look back at our experience of the last Labour Government, we find that only some permanent and long-term system of pay comparability can be remotely fair to public sector workers, especially lower-paid workers.
Despite the eloquence of the hon. Member for Bridlington (Mr. Townend), may I say that under successive Governments over the years there has been a multiplicity of boards or commissions of inquiry considering pay in many different industries. Indeed, some of those organisations and institutions still exist. In the 1960s the then Labour Government established the National Board For Prices and Incomes. It was felt then that that might be the long-term solution to the vexed question of public sector pay. The

1591
incoming Conservative Government in 1970 abolished it in almost their first Act of Parliament.
Presumably the hon. Member for Bridlington wishes to return to those days, when there were no boards of comparability and pay increases for any group of workers were a matter of turning the clock back to the freedom of the market place. The Bill is based on a myth, commonly held by Conservative Members, that public sector pay and pay increases are greater than those appertaining in the private sector. I attempted to find some information about the decade of the 1970s to see whether that myth was correct. It appears that the hon. Member for Bridlington would like the present Government to emulate the example set in the first year of the previous Conservative Government.
The increase in weekly earnings for predominantly male manual workers hi 1971–72 showed some interesting statistics. The average increase for railway men, for example, was 8·6 per cent. It is difficult to find an exact equivalent in the private sector as statistics are fairly misleading, but the average increase in all private sector industries and services was more than 13 per cent. That indicates to me that, without some form of comparability and long-term and permanent pay arbitration, the lower paid will receive lower pay, especially in the public sector, and will fall behind even further.
In his speech the hon. Gentleman made great play of the question of index-linked pensions in the public sector. It is currently a frequent whipping boy for the Conservative Party. I wish that the hon. Gentleman, who spoke so eloquently about the matter, had been available to advise his right hon. Friend the Member for Sidcup (Mr. Heath) when he introduced the index-linked pensions in the early 1970s. Some Conservative Members who enthusiastically support the hon. Gentleman were in the House at that time and, presumably, supported the measure.
I do not know about the hon. Gentleman's experience in industry, but it appears to me to be difficult, once someone is given a privilege—and index-linked pensions are a privilege—to take it away. If the Government even attempt to do that, they will provoke a considerable outcry throughout the public sector.
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The public sector manual worker is usually singled out when discussing index-linked pensions. Yet it means comparatively little to most ambulance drivers to have an index-linked pension by the time they reach the age of 65. It might mean a considerable amount to the chief execcutive of a local authority, especially one of the new local authorities. It is a pity that the hon. Gentleman and some of his hon. Friends were not in the House to advise the leaders of the last Conservative Government against reorganising local government and giving chief executives and other chief officers the rates of pay that they now receive. It is likely to be impossible to receive an index-linked pension. Members of the present Conservative Front Bench appreciate that, even if the hon. Gentleman does not.
It is possible to pray in aid various sources in defence of the Clegg commission, and comparability—whether or not under Clegg. Comparability for public sector workers, especially lower-paid workers, is not only about that subject. It is difficult to quantify the productivity of a member of NUPE in an average sized hospital. The fact that they do not sell their commodity in the market place does not make them any less essential or necessary to society. After all, the fact that lower-paid workers in the public sector were as discontented as they were during the period of the previous Labour Government—I note the gloats and scoffs of Conservative Members about that phase in our political history—indicates that they themselves felt that over the previous two, three or four years their pay, meagre and inadequate though it was, had fallen behind what they considered to be that of their equivalents working within the private sector.
It is only by reference to a long-term and permanent commission such as Clegg, if Clegg is to be long-term and permanent, that such long-term feelings of injustice can be corrected, particularly among low-paid workers.
I conclude by quoting from what is not a notoriously Left-wing source of information—the National Institute Economic Review—where in an interesting article entitled
" The reform of the wage bargaining system "

1593
Mr. F. T. Blackaby, a member of the National Institute, says:
" There is a clear need to re-establish a single arbitral body to deal with all such matters "—
that is, pay and comparability within the public sector. He concludes:
" The need is not for an arbitral body substantially different from those which have preceded it ".
As I have said, there have been plenty of those under both Governments over the years. He adds:
" The prime requirement is for a body which will survive political change ".
I oppose the motion, not because I think that Professor Clegg ought to be proteced from the economics of the market
Question accordingly agreed to.
Mr. Snape: On a point of order, Mr. Deputy Speaker. As the Clegg commission was set up by what might be called a Prime Ministerial decree in 1979, it can surely be abolished in the same
1594
place or that he should be treated differently from anyone else in the country, but because I believe that the only way in which to achieve genuine social justice for lower-paid public sector workers is by having such a commission.
I hope that my right hon. and hon. Friends will join me in the Lobby to oppose what I believe is a misguided motion.
Question put, pursuant to Standing Order No. 13 (Motions for leave to bring in Bills and Nomination of Select Committees at Commencement of Public Business): —
The House divided:—Ayes 84, Noes 32.

Division No. 305]

AYES

[8.22 pm

Alton, David

Howells, Geraint

Rhys Williams, Sir Brandon

Aspinwall, Jack

Jessel, Toby

Robinson, Peter (Belfast East)

Beaumont-Dark, Anthony

Kellett-Bowman, Mrs Elaine

Ross, Stephen (Isle of Wight)

Beith, A. J.

Kilfedder, James A.

Skeet, T. H. H.

Best, Keith

Knight, Mrs Jill

Speller, Tony

Bevan, David Gilroy

Lawrence, Ivan

Spicer, Jim (West Dorset)

Blackburn, John

Lloyd, Ian (Havant & Waterloo)

Sproat, lain

Braine, Sir Bernard

Lloyd, Peter (Fareham)

Stanbrook, Ivor

Brotherton, Michael

McCusker, H.

Steel, Rt Hon David

Brown, Michael (Brigg & Sc'thorpe)

McNair-Wilson, Michael (Newbury)

Stevens, Martin

Browne, John (Winchester)

McQuade, John

Stewart, Rt Hon Donald (W Isles)

Buck, Antony

McQuarrie, Albert

Taylor, Teddy (Southend East)

Butcher, John

Major, John

Thompson, Donald

Clark, Hon Alan (Plymouth, Sutton)

Marlow, Tony

Thorne, Nell (llford South)

Clark, Sir William (Croydon South)

Mawby, Ray

Townend, John (Bridlington)

Cockeram, Eric

Maxwell-Hyslop, Robin

Trippier, David

Colvin, Michael

Mellor, David

Viggers, Peter

Cranborne, Viscount

Mills, lain (Meriden)

Wainwright, Richard (Colne Valley)

Eggar, Timothy

Mills, Peter (West Devon)

Walker, Bill (Perth & E Perthshire)

Fookes, Miss Janet

Moate, Roger

Walker-Smith, Rt Hon Sir Derek

Gardiner, George (Reigate)

Molyneaux, James

Waller, Gary

Gow, Ian

Myles, David

Ward, John

Gower, Sir Raymond

Nelson, Anthony

Wheeler, John

Grant, Anthony (Harrow C)

Neubert, Michael

Wickenden, Keith

Griffiths, Peter (Portsmouth N)

Page, Rt Hon Sir R. Graham

Wilson, Gordon (Dundee East)

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

Penhaligon, David

Hannam, John

Powell, Rt Hon J. Enoch (S Down)

TELLERS FOR THE AYES:

Hawkins, Paul

Proctor, K. Harvey

Mr. Bob Dunn and

Hawksley, Warren

Rees-Davies, W. R.

Mr. Christopher Murphy.

Henderson, Barry

NOES

Ashton, Joe

Foulkes, George

Marks, Kenneth

Cant, R. B.

George, Bruce

Mason, Rt Hon Roy

Clark, Dr David (South Shields)

Hamilton, James (Bothwell)

Owell, Rt Hon Dr David

Dalyell, Tam

Hamilton, W. W. (Central Fife)

Palmer, Arthur

Dean, Joseph (Leeds West)

Haynes, Frank

Powell, Raymond (Ogmore)

Dixon, Donald

Home Robertson, John

Robertson, George

Dormand, Jack

John, Brynmor

Snape, Peter

Dorrell, Stephen

Johnson, James (Hull West)

Tinn, James

Douglas, Dick

Jones, Dan (Burnley)

Dunn, James A. (Liverpool, Kirkdale)

Kerr, Russell

TELLERS FOR THE NOES:

Evans, John (Newton)

Litherland, Robert

Mr. Austin Mitchell and

Foot, Rt Hon Michael

McCartney, Hugh

Mr. Leslie Spriggs.

way. That being so, there was little point in the hon. Gentleman's Bill in the first place.
Mr. Deputy Speaker: The hon. Member for Bridlington (Mr. Townend) had every right to introduce a Ten-Minute

1595
Bill. The hon. Member for West Bromwich, East (Mr. Snape) knows the relevance of such a Ten-Minute Bill.
Bill ordered to be brought in by Mr. John Townend, Mr. Ralph Howell, Mr. Eric Cockeram, Mr. Michael Colvin, Sir Nicholas Bonsor, Mr. John Browne, Mr. Keith Wickenden, Mr. Christopher Murphy, Mr. Bob Dunn and Mr. Tony Speller.

CLEGG COMMISSION (ABOLITION)
  CLEGG COMMISSION (ABOLITION)
  Mr. John Townend accordingly presented a Bill to abolish the Standing Commission on Pay Comparability; and for connected purposes: And the same was read the First time; and ordered to be read a Second time upon Friday 4 July and to be printed. [Bill 208.]
ORDERS OF THE DAY

  GAS BILL
  Order for Second Reading read.
  8.33 pm
  The Secretary of State for Energy (Mr. David Howell): I beg to move, That the Bill be now read a Second time.
  I begin by warning the House that this will not be the most exciting speech that I shall make on energy issues. To judge by the state of the Opposition Benches on this great day of action, there will not be a large audience to listen to it, anyway.
  Although it is true that gas supply will play an increasing role in energy supply in the coming years and although some of the major and most dramatic developments in energy supply lie in this area, the Bill is a limited measure that applies to an immediate gas supply problem. Although the Bill is short it is of some complexity.
  As I am sure hon. Members are aware, there has been an unprecedented increase in the demand for gas during the past year as a result of the enormous oil price increases and the great and continuing uncertainties over the oil supply.
  The British Gas Corporation, before the dramatic events in world oil markets last year and this year, had already planned to increase supplies of gas steadily over the next five years, but the sharp increase in demand has far exceeded that planned expansion. As a result, the corporation has been obliged to limit its acceptance of new business for fear that it could not maintain an adequate level of security of supplies during a severe winter.
  I emphasise that it is the difficulty of matching supply and demand on peak winter days that poses the problem with which we are dealing rather than any general shortage of supplies on an overall annual basis. Failure to meet peak demand could mean rationing or cutting off whole areas and industries at very short notice. That, for the gas industry, could also raise safety problems and be highly undesirable.
  The corporation has already announced plans for bringing forward several capital

  1597
  investment projects to increase peak supplies further in the face of the situation that I have described. It has recently acquired the partially depleted Rough gas field in the southern basin which it plans to use as a seasonal store. Other storage will be provided by the construction of salt cavities. The construction of the fourth onshore pipeline from St. Fergus in Scotland will be advanced to relieve bottlenecks in the supply system bringing gas from the northern North Sea southwards. The corporation is planning to obtain supplies from new sources which exist in both the southern basin of the North Sea and its own Morecambe field in the Irish Sea. All these projects are in being, but, inevitably, they have long lead times and involve major complexities. The problem is that peak supplies cannot be increased substantially overnight.
  The corporation has, therefore, had to limit its new supplies, except in most exceptional circumstances, to those whom it has a statutory obligation to supply. That means, with few exceptions, only those premises within 25 yards of a gas main and requiring fewer than 25,000 therms a year. However, the statutory obligation to supply also extends to those premises which consumed more than 25,000 therms a year prior to 30 November 1976. That is under existing legislation. Such premises are entitled to receive up to the maximum amount supplied in any year prior to that date regardless of whether they are consuming gas now or even whether the premises are still owned by the same person or company. They are also able to take that supply on tariff at any time if they so wish. In other words, British Gas is in no position to control large offtakes of gas in this area.
  The Government have, therefore, decided to seek powers to relieve British Gas of its statutory obligation to supply anyone with more than 25,000 therms a year and to allow it to do what at present it does not have the power to do, namely, to enter into special agreements—contracts where the price is negotiated between supplier and customer—for supplies above that level. Therefore, in future, instead of a statutory entitlement, any premises consuming more than 25,000 therms per annum would, under the powers in the Bill, have to rely on a freely negotiated
  1598
  contract, as would be the case in other instances—for example oil supplies.
  Mr. T. H. H. Skeet: My right hon. Friend talked about a freely negotiated contract. How can one have a freely negotiated contract with a monopoly?
  Mr. Howell: Because the gas is supplied in relation to the nearest competitive fuel, which is oil. Firms are now turning in great numbers from very high-priced oil to gas, so there is a competitive element there. That is the limitation on the monopoly. I agree that, with oil prices going through the roof, as they have done, the pressure to take gas instead at prices very much higher than before rather than to pay the still higher prices for oil is bound to be present.
  Currently, British Gas offers supplies on special agreement to anyone consuming more than 100,000 therms a year. These agreements provide better control over supplies than is the case with supplies on tariff which are not subject to off-take restrictions, but under the provisions of the Gas Act 1972, British Gas is permitted to do this only where a supply on tariff would be inappropriate owing to special circumstances—in other words, very large volume requirements.
  As I have mentioned, in practice British Gas has entered into special agreements only where the customer's demand would exceed 100,000 therms a year. Given the intention under this Bill to restrict its obligation to supply to 25,000 therms a year in all cases in future, the Government have decided to seek to give British Gas powers which will enable it to offer special agreements to any premises consuming more than 25,000 therms a year and to do so on an unequivocal basis. This will both avoid doubt about its position and place the right to supply on the basis of negotiated contracts, as in the case with negotiated contracts for those now receiving gas and consuming it at a rate of over 100,000 therms a year. That is the limited purpose of this small Bill.
  I turn to the specific provisions in the Bill. As I have said, it is short. The two substantive provisions are contained in clause 1. These amend and modify the application of certain provisions contained in the Gas Act 1972. Subsection (1) of clause I amends the corporation's

  1599
  general obligation under paragraph 2 of schedule 4 to the Gas Act, so that it shall not be obliged to supply any premises with more than 25,000 therms a year. Section 13 of the Energy Act 1976 relieved the corporation of the obligation to supply more than 25,000 therms a year to new customers. It provided, however, that where existing customers have been receiving higher annual amounts prior to November 1976, they should continue with the right to receive supplies up to those higher figures.
  In other words, the Energy Act 1976 created, in effect, a sort of preferred class of customers, to whom I have already referred, who were able to continue to take gas on non-domestic tariff in this way. Such customers could have been receiving their supplies either on non-domestic tariff or under firm or, indeed, under interruptible contracts. But whatever the method of supply, it is plainly unsatisfactory that, because of the fact that they were not covered by the 1976 Act, they should be guaranteed higher supplies indefinitely and whenever they care to seek them, in preference to new and developing industries—and many of us know of many examples—which might well, at a time of pressure on supplies, have a more deserving case and would be prepared to pay for any gas that they could get.
  The effect of subsection (1) coupled with subsection (3) of clause 1 is, therefore, to revoke the statutory right of the pre-1976 customers to an annual supply exceeding 25,000 therms.
  Mr. Dick Douglas: Will the Secretary of State explain the length of the contracts in existence? Are they annual contracts or do they exceed a year's duration? If they are annual, it is understandable, but if the Gas Corporation has entered into contracts for longer than a year, for, say two years, he is in extreme difficulty with the Bill.
  Mr. Howell: Firm contracts are largely annual. I would not like to say that all contracts are fixed to one year. Some are certainly longer. But the firm contracts about which we are talking are usually annual.
  In that context, I emphasise—I am glad that the hon. Gentleman raised the point about the nature of contracts—
  1600
  that nothing in the Bill affects any contractual obligations of the corporation to give a supply of gas. In other words, customers already receiving their supplies on contract will be able to continue to rely on their contract. Commercial arrangements are, obviously, a matter falling within the responsibility of the corporation's management, but it would not be its intention to use the power in the Bill to make reductions in the amounts currently being supplied over 25,000 therms a year to industrial and commercial tariff customers. I should also make clear that they, and British Gas existing contract customers will, on negotiation or renewal of their contracts, have to expect to pay what those currently without access to a gas supply would be prepared to pay.
  Once a customer's consumption exceeds 25,000 therms, BGC will supply gas in excess of 25,000 therms—in the absence of a special agreement—at an appropriate and published tariff rate. Under section 25(5) of the Gas Act 1972, BGC is prohibited from exercising " undue discrimination " against any person, or class of person, when fixing tariffs. In order to ensure that existing customers who consume more than 25,000 therms a year can continue to be supplied at an appropriate tariff rate until they have negotiated a contract, the Government propose an amendment to the Bill. We seek to ensure that the undue discrimination provisions of section 25(5) will not apply to any person consuming more than 25,000 therms per year.
  Clause 1(2) relates to cases where the BGC supplies a customer with more than 25,000 therms a year—that is, more than would be the customer's statutory right under the Bill. It provides that the proviso in section 25(6) of the Gas Act, which restricts the BGC's power to enter into a special agreement in cases where the tariffs in force are not appropriate owing to special circumstances, will cease to apply to a special agreement covering an annual supply of more than 25,000 therms.
  Mr. Arthur Palmer: Perhaps the Minister will explain how it will be possible to avoid undue discrimination if there are no standard rates, and if each case is negotiated individually.
  Mr. Howell: That is precisely the point of the amendment. It removes the undue discrimination provision and allows the BGC to propose new tariffs for an offtake of more than 25,000 therms a year. Those tariffs will be published shortly.
  At present, the corporation has set 100,000 therms a year as the threshold at which it offers a supply on contract. The effect of subsection (2), is that customers who take between 25,000 and 100,000 therms a year, and who are now supplied on the non-domestic tariff, will be invited to take supplies on contract.
  Clause 2 makes clear that the Bill does not extend to Northern Ireland, and that is consistent with the Gas Act.
  This is an important, but limited measure, which addresses itself to the immediate problem of the vast surge in demand that followed the enormous increase in oil prices, which has been experienced both this year and last year. I know that many hon. Members—including myself—have received letters from industries in their constituencies complaining about the difficulty of getting a gas supply. That is an unsatisfactory state of affairs when work could be done, wealth could be created and jobs could be generated if gas supplies were laid on. Through extending the range of the contract market—where flexibility is an important factor in matching supply and demand—the BGC will be able to make the best use of available supplies in the short term, pending plans for extending those supplies in coming years to meet the new problems.
  The provision should help to ensure that those who are anxious to get a gas supply will have a better chance of bidding for what they need instead of depending on some form of arbitrary rationing by the BGC, or simply not getting the gas at all.
  The pattern of gas supplied to industry is very far from satisfactory. Preparing for the much heavier demand on the gas supply system—a feature of the 1980s— is bound to take time. It will also involve difficult decisions. The Bill is one small step towards the further arrangements required. I commend it to the House.
  8.50 pm
  Dr. David Owen: We do not oppose the Bill, and
  1602
  we welcome the Minister's amendment as a helpful clarification. However, we regret the need for the Bill and are concerned about the consequences for some industries, particularly those with an absolute requirement for gas. It should be made clear from the outset that in its difficult decisions over contracts we expect British Gas to show particular care about the way in which it deals with industries which must use gas— those with preferential or highly technical reasons for relying on gas.
  The Secretary of State has explained the Bill, and I do not complain that he has confined his remarks to a limited description of the measure. However, the problems will be with us through the 1980s and 1990s. Gas is showing every sign of becoming an important new energy resource. Its use is expanding rapidly and the manner in which we use it is crucially important.
  It is also important that we know what is being done to increase the supply of gas over and above the short time scale with which we are dealing in terms of the projects that are already virtually committed. We welcome the Morecambe Bay project and the exploitation of southern gas. We welcome the pipeline for northern gas, and we are in favour of looking at ways of building up reserves in various geological formation to give a reserve capacity.
  We believe that the safety requirement is of such importance that it is necessary for British Gas to have this interruption capability. But it is much more important for us to be assured that the intended expansion of British Gas production from the present 5,000 million cubic feet a day to a projected 6,500 million cubic feet a day will be fully maintained. Indeed, we should look seriously at whether production should be expanded a good deal faster. The projected increase is about 30 per cent., and that is substantial.
  Most hon. Members will be worried about the fact that there was no commitment in the Secretary of State's speech to future gas-gathering pipelines. The House has waited patiently for this for months. My main reason for intervening in the debate is that I do not believe it is satisfactory to continue with this delay.
  I know that the Secretary of State is involved in difficult negotiations with

  1603
  Norway, and we wish him success. If it is possible to reach an agreement between the two countries, we would all wish to see it. But increasingly, over the past few years, the fundamental national interests of the United Kingdom and Norway have been diverging. Norway has a strong interest in seeing that gas prices are at the highest possible level and that they follow oil prices. I do not believe that it is in the United Kingdom's interests that gas prices should follow oil prices. I am increasingly concerned about some of the arguments from the Conservative Benches that we should encourage this trend.
  We all realise that gas prices cannot be insulated from overall energy prices. There is bound to be a relationship to oil prices. However, OPEC does not have a stranglehold on gas prices at present. It controls only 18 per cent. of the overall supplies of internationally traded gas. Admittedly that percentage will increase substantially, and we can expect that by 1990 about 37 per cent. of all the gas internationally traded will be controlled by OPEC. That still does not give it a stranglehold on gas prices, although it gives it a powerful influence.
  It is important to realise that the other major gas producers—the Netherlands, still a major factor, with 27 per cent.; the Soviet Union, which does not have an interest in pushing internationally traded gas prices up to full comparability with oil; Canada with 16 per cent. and Norway with 9 per cent.—are in a similar situation to the United Kingdom. They have an overriding interest to see that energy prices internationally are restrained as much as possible. That has been Britain's view under successive Governments. Despite the fact that we are oil rich and have substantial gas resources, we do not believe that it is in our interests to push up energy prices, but rather to act as a reasonably restraining influence. I wholly support that policy.
  Those countries with substantial gas reserves owe it to the overall energy pricing situation, first, to try to restrain oil prices where they have an influence on them, and, secondly, to try to ensure that gas prices do not automatically follow.
  Mr. Gordon Wilson: I am particularly interested in the right hon. Gentleman's argument about re-
  1604
  straining gas prices. Does he agree that tremendous new discoveries of gas are likely in the Norwegian sector and that the United Kingdom will have to bid in the market place with West Germany, France and other European countries, which will be desperate for energy resources?
  Dr. Owen: We may have to bid. We have already purchased from Norway. I do not exclude the fact that we may have to purchase again from Norway and other countries. We already have a small liquid natural gas supply, but it may be necessary to bid.
  I am asking for a policy which tries to restrain gas prices internationally, which as far as possible avoids having them pushed up by the OPEC cartel and which does its best to use the existing gas from the United Kingdom continental shelf in the United Kingdom. It has been the policy of successive Governments not to export gas. It is therefore of fundamental importance that we bring it to our own country as quickly as we can.
  That means two policy decisions. First, we have to invest in a gas-gathering pipeline linking at least 11 fields. That may be possible if we get agreement with Norway. However, I believe that the oil price increase has been of such a size that we can justify going ahead with the United Kingdom gas-gathering pipeline without Norway.
  It is becoming more and more clear that to avoid future delay, and because of quite legitimate divergent national interests between Norway and the United Kingdom, we should pursue the idea of a United Kingdom gas-gathering pipeline with the utmost speed.
  Mr. Tim Eggar: Is the right hon. Gentleman aware that the Canadian Government recently announced their intention to seek parity for their gas prices into the United States with prices negotiated by the Mexican Government? Is he further aware that Frigg gas from the Norwegian sector is already linked to oil prices?
  Dr. Owen: I am aware of those facts. The question is whether they are desirable. One factor that needs to be taken into account is that 77 per cent. of United Kingdom gas production is owned by foreign multinational companies, 52

  1605
  per cent. of which are United States companies. They all have a strong vested interest in the highest price possible. Only 17 per cent. of the production is directly State owned—10 per cent. through British Gas and 7 per cent. through BNOC.
  Conservative Members should be arguing the case in perfect logic that if we can get gas at a lower price, it is in the national interest to do so. It would be helpful if the hon. Gentleman and his hon. Friends would argue the case that gas pricing does not necessarily have to follow international oil pricing. It does not have to be influenced and dominated by OPEC. There are already signs that OPEC is asking not only for comparability of price but for extra charges because of the high freight charges for carrying liquid natural gas. In addition, it wants a premium. If voices argue from this Chamber that it is perfectly normal and right for natural gas prices to be the same as oil prices, it will be harder for the Government and British Gas in their negotiations to resist that.
  I understand why the Secretary of State thought it necessary to increase the price of gas, and in justifying the increase he paid great attention to international factors. However, Conservative Members cannot go on to argue from that that gas prices have to follow oil. Perhaps they have to be influenced strongly by the oil price, but they do not have to follow.
  It is important to realise that the pressure for gas to follow oil is coming largely from international companies with a substantial stake in the United Kingdom's continental gas. We ought to offset that by arguing for a lower price where possible. That is why I believe that British Gas has been right to strike good bargains in the past. Of course, those days are over and British Gas will not be able to get gas so cheaply in future, but we and our industry have benefited considerably from those favourable contracts. British Gas should be strengthened in negotiating for a cheap price. Certainly nothing that we do should increase the price.
  A decision on a gas pipeline is needed soon. It will reduce the amount of flaring, which is a serious problem. Until we have a pipeline, we shall continue to
  1606
  have considerable flaring. I hope that now that the international oil supply situation is easing—though it changes from month to month—the Secretary of State will continue with his tough flaring policy and will relax it only if we run into serious oil shortages.
  We were driven to relax the policy in the immediate aftermath of the Iranian crisis, but the Minister of State subsequently tightened the requirements and I believe that there is a case for considering whether they should be tightened even further. As 14 million cubic metres of gas were flared daily in the first quarter of 1980, it is clear that the amount of flaring is still far too high.
  I turn to the financing of a gas pipeline. We must question the Government's intentions behind the decision announced in a written answer—a strange way of introducing a new tax—to tax gas. The price increases announced by the Secretary of State were astronomical and were justified under the terms of the Gas Act by the Government's claim that the increases were in the long-term interest of gas consumers, because surpluses were being built up and invested in Government loan stock with a substantial return, which British Gas could justify as a sensible deployment of its resources and which also helped the public sector borrowing requirement and the Treasury.
  I have no objection to that, but we are now told that the gas tax will substantially reduce the surplus. I do not believe that the power to raise prices in the autumn exists in the Gas Act, now that the Government have decided to syphon off part of the surplus in a gas tax. If they wish to raise prices in the autumn they will have to amend the Gas Act.
  It is one thing to build up a surplus that is invested by British Gas, but another to build up a surplus on a price increase and channel it into a gas tax. When is the legislation for a gas tax to be brought forward? Is the tax intended to operate during the current fiscal year? We wish to know a great deal more about it.
  My main worry is that if such a tax is introduced, the resources will go directly to the Treasury and we shall no longer have British Gas with a substantial surplus capable of generating funds

  1607
  to invest in a gas pipeline. That raises serious problems. If I am wrong, I hope that the Secretary of State will intervene. If we are to syphon off a gas tax from British Gas, its ability to finance its share, which I hope will be substantial, of a gas pipeline will be severely reduced. It will no longer be able to build up such substantial reserves as it plans to do.
  We must have an assurance that British Gas, with Mobil, which did the original consultancy for the gas gathering pipeline, will be a major shareholder in any pipeline.
  Mr. Skeet: Why?
  Dr. Owen: The hon. Gentleman asks " Why? ". I believe that over the last 15 years British Gas has demonstrated a good record in bringing gas ashore to its consumers, but it has run into a problem of a shortage of gas supplies, largely due to international factors that were hard to foresee, which has affected demand. It would be sheer animus against a successful nationalised industry if it were unable to have a major stake in any gas gathering pipeline.
  If Ministers wish to have any form of bipartisanship over policy, the question of a partnership between private and public enterprise in the North Sea is extremely important. If there is to be a restriction of the monopoly of British Gas and a restriction of the investment of British Gas in its future, that will be strongly against the national interest. It will very much change the Opposition's attitude on a number of energy policies, particularly as they affect gas.
  Mr. David Howell: We are wandering a good way from the contents of the Bill. I should, however, like to make it clear that there is no reason on earth why a levy on the costs of the British Gas Corporation arising from the PRT-exempt gas fields in the southern basin of the North Sea should affect or influence the investment decisions of the BGC, whether in joint ventures, or drawn from the public sector, or in any other way. The right hon. Gentleman asked me to correct him if he was wrong. I am correcting him. He is wrong.
  Dr. Owen: It will very much change its financial situation. We do not know what rate will be levied. This industry, under a pricing policy largely forced up-
  1608
  on it by the right hon. Gentleman, was heading for substantial profits. One of the arguments was that these profits would be invested for the day when there would be higher investment in terms of pipelines and development of further fields to expand production. This is closely related to the issue that we face—the inability of British Gas to meet demand without taking a strong interventionist power to interrupt its supplies. These factors are closely related and are part of a seamless robe. The right hon. Gentleman should see that it is necessary to take a view now.
  We have waited months for a decision on the gas pipeline. I am interested to know who will finance the pipeline and whether British Gas will have the freedom to invest and take the substantial stake in that pipeline which I believe is necessary if part of its profits are to be creamed off through a specific gas tax.
  The energy pricing policy announced by the right hon. Gentleman a few months ago is increasingly being undermined. The Opposition are not wedded to market principles in energy pricing. It is an illusion to believe that a genuine market exists in energy prices. The OPEC cartel, in the first place, is the dominant force. We are in favour of an interventionist policy on pricing. We do not necessarily object to it. I believe that there was a case for increasing, preferentially, the price of gas over and above electricity, which was one of the effects of the right hon. Gentleman's previous statement. That will now be changed by the decision to allow the increase in electricity prices to be brought forward.
  I hope that the Secretary of State understands that the Opposition, in supporting the Bill, support basically the principle that this area of energy—gas, electricity, oil or coal—cannot be left to totally free market forces. There is a strong case for intervention and for recognising that we operate in a situation in which there is an overwhelming interest in protecting the United Kingdom industry and the United Kingdom consumer.
  My view, on looking at our gas pricing policy, is that we should take into account very much all the views of our industry. Serious concern is felt by some industries dependent on gas about the way in which they can suddenly find themselves facing substantial price increases. There is also

  1609
  the whole qustion of interruptible supplies.
  We believe that it is necessary to take these powers at present, but we should like to see a far closer integration and greater coherence in the overall energy policy pursued by the Government as between gas, electricity, oil and coal. That is the main yardstick by which we shall judge the Government's intervention. We recognise the need for intervention and will welcome it, but we grow more and more anxious about the rhetoric of Ministers' speeches about market forces and market pricing. There is no such thing in energy matters. The sooner that is realised on both sides of the House, the sooner we shall have a rational energy policy.
  9.10 pm
  Mr. T. H. H. Skeet: The right hon. Member for Plymouth, Devonport (Dr. Owen) lives in a dream world. He said that it was not in the United Kingdom's interests that gas prices should follow oil prices. He was aware of it, but is it desirable? Most of the world has accepted that these matters are related. The current chairman of the British Gas Corporation has indicated that it is his desire to relate gas prices to gas oil prices, for firm contracts, and fuel oil prices for interruptable supplies.
  I said the other night that British Petroleum in the development of the Ula field in Norway would ultimately deliver gas to Gelsenberg at an oil-related price. Mexican and Canadian prices have been mentioned. All these prices are moving up in general alignment.
  We cannot escape the fact that in Iran, covering the Igat pipeline, the Iranians, before their severe problems, were intent on increasing considerably the price that the Russians would be forced to pay. Moreover, OPEC controls over 75 per cent. of the liquefied natural gas market, an international market that affects these matters.
  Therefore, the right hon. Gentleman may desire certain things—we all desire to have low prices—but unfortunately they do not happen like that in the real world. We experienced exactly the same with the oil prices. We had hoped to have remarkably cheap oil for the benefit of our industry, but
  1610
  OPEC forced up the price and is continuing to use its muscle. We must face reality. It is no good the right hon. Gentleman's hoping that he will persuade the Government to accept some of his suggestions.
  My right hon. Friend the Secretary of State talked about freely-negotiated contracts. But such contracts with a monopoly are not practicable. I remember when the British Gas Corporation was making its arrangement with the oil companies over the southern gas fields. The low price imposed on them—1·87 old pence per therm—was not freely negotiated. It was because prices were forced to such a depth that very little exploration has been carried out for gas in the northern fields.
  However, I must return to the Bill. It may be useful if I ask my right hon. Friend or my hon. Friend the Under-Secretary a number of questions. My right hon. Friend has presented a Bill in which he deprives certain customers of their rights. How many customers fall within the category of taking 25,000 therms to 100,000 therms a year? I have an idea that there are probably about 11,500 affected. That is not a small number. They are being deprived of a right. We shall find out exactly what they receive in return.
  Secondly, will my right hon. Friend describe the type of customers affected? Are they not small industrialists and commercial operators? What representations has he received from those affected? How much gas is involved and is available for switching to the large industrial and commercial customers? If a small amount is involved, why bring in this Bill? If it is a large amount, I am surprised that the Secretary of State did not mention it
  We must have an answer as to what will be the quid pro quo for this group which has lost its rights to assured supplies of gas and is obliged to pay higher contractual rates. We will see when we reach the amendments that a contractual rate and no longer a tariff rate or a published rate is maintained. It is a rate established on contractual terms. What the monopoly buyer can get out of the consumer cannot be compared with any other rates paid by other consumers, because the rates are not published.

  1611
  The Secretary of State said that the provisions were in the Bill because of inadequate supplies available in the United Kingdom. I accede to that point, but would not one of the short-term answers be to import more LNG into the United Kingdom to cover peak requirements? Many projects are being developed and the British Gas Corporation has plans with a capital cost of £5 billion. As these projects will take some years to secure, surely the answer is intensification of exploration.
  However, there are four golden rules that must be observed, and I wonder whether the Government are observing them. There should be less regulation on crucial matters. There should be reasonable and stable taxation. There should be recognition of the inability of the British Gas Corporation to make the effort both in exploration and marketing. Monopolies should pay reasonable market prices for raw gas. If those rules were observed, exploration could be intensified and more supplies made available to meet insatiable demand.
  There is a need for an early start on the construction of the required infrastructure and the pipeline to bring North Sea gas ashore. I agree with the right hon. Member for Devonport about that.
  Parliament has still to be advised and to take a decision on this matter. It is quite absurd that companies are already planning policies on acceptance of the joint report, yet apparently this House has no knowledge of it. I assume that die Minister has read the report, but perhaps he is deferring his statement on it for some time.
  In order to increase supplies, we should do everything we can to top up indigenous supplies by imports from Norway and elsewhere by permitting private initiatives in selected areas in the industrial sector.
  Mr. Joseph Ashton: How?
  Mr. Skeet: I will come to that in a moment. I will give the hon. Member for Bassetlaw (Mr. Ashton) the answer if he is patient enough.
  I think that the Secretary of State has missed a great opportunity to bring in a comprehensive Bill to deal with the gas industry. There are one or two other things that my right hon. Friend has also
  1612
  overlooked that might have appeared in the Bill. One is die establishment of a common carrier pipeline system for the North Sea gas transmission lines and a tariff regulatory authority to ensure fair transit charges for delivery to the monopoly buyer, the British Gas Corporation. I assume that the right hon. Member for Devonport, is listening to this, because I am certain that he would find acceptable a regulatory authority that would set fair tariffs.
  There should be a windfall profits tax and the British Gas Corporation monopoly should be curtailed. That could be affected by the establishment of free transmission and distribution rights in enterprise zones or specific industrial areas in modification of the Gas Act 1972 and the Energy Act 1976.
  We could provide for and clarify any desirable diversification of the British Gas Corporation which has not been provided for in the earlier Acts, particularly in section 2 of the Gas Act 1972. We might also dispose of, or assign, British Gas Corporation's oil interests as being outside its primary function as a marketer and distributor of gas.
  It has been reported in the national press that the British Gas Corporation is to apply for planning permission to build an ethylene plant at Nig Bay, in Ross and Cromarty, on land owned by Dow Chemicals. Whether the British Gas Corporation has authority to manufacture petrochemicals would doubtless be determined by an interpretation of section 2(2)(f) of the Gas Act 1972. However, the Act should be amended to provide that this right is exercised only upon the express consent of the Secretary of State.
  Section 9 of the Coal Industry Act 1977 gave the National Coal Board the right to move into this sector. Clarification should now be given on whether the Government are prepared to endorse that line of approach.
  The Government should modify section 2(2)(b) of the Gas Act 1972 to provide that, where the British Gas Corporation has discovered oil with only marginal supplies of natural gas which are not commercially exploitable, it should sell or assign its interests in such fields as being outside its primary function as developer and marketer of gas. The following oil fields would fall into that

  1613
  category: Montrose, with a 30 per cent. holding, Beryl, with a 10 per cent. holding, Fulmar, which is under development, with a 3·9 per cent. holding and North West Hutton, with 25·7 per cent.
  Mr. Douglas: Does the hon. Gentleman concede that all the oil companies operating with the British Gas Corporation are extremely pleased with the relationship? To destroy that relationship would not be beneficial to British interests in relation to a United Kingdom public share of oil and gas resources.
  Mr. Skeet: I do not agree with that argument. Such a relationship could be conveniently operated by the BNOC, if it were kept, because it is an oil establishment. It could be successfully operated by British Petroleum, which is approximately half owned by the Government. It could be operated by the market, which would provide the money, so that it would not have to come out of the coffers of BGC. There is every argument for doing that. The BGC, being a monopoly buyer, would be in a position to receive the product from the mouth of the pipeline.
  I turn to the question of the windfall profits tax. The right hon. Member for Devonport said that he would like clarification. So should I. About three or four weeks ago I asked a question of the Chancellor of the Exchequer. The Secretary of State replied. He said that legislation was required and that it would be introduced as soon as possible. Why does he not introduce it in the Bill? Will we be told that it will be included in the Finance (No. 2) Bill?
  It is worth tracing back a little. Section 16 of the Gas Act 1972 provides for payments of excess revenues to the Secretary of State. It has only a limited application to the exploration and winning of natural gas and petroleum and does not apply to the marketing and distribution of gas.
  The next device deployed by the Secretary of State, correctly, was to invite the BGC to lend to the National Loans Fund. The difficulty was that the funds were never alienated. They were simply lent by the corporation to the NLF and the corporation was paid interest over the term. At the expiry of the loan it was to be returned to the corporation.
  1614
  The corporation would thus wax stronger and fatter in the course of time.
  One must bear in mind the comparability. Even though the oil companies have to go ahead with vast exploration programmes in the United Kingdom and abroad, they pay petroleum revenue tax and other taxes. Why is it not possible for the BGC to do the same? After all, it would involve only a modification of section 10 of the Oil Taxation Act 1975, which applies to contracts made after 30 June 1975 which are subject to PRT.
  The Secretary of State should consider that now and bear in mind that such measures are required in the interests of the country. I hope that he can relieve my mind of anxieties. I read in a recent edition of Euroforum about the possibility of an EEC energy tax. That could have serious repercussions for the United Kingdom. The article stated:
  " The main possibilities here are to tax energy consumption, either in all its forms or just on oil or specific oil products; to tax production of energy in general or oil in particular; to impose a duty or levy on all imported energy sources, or again just on imported oil."
  Will we have accumulation upon accumulation of taxes all along the line? If that is to happen, we will certainly not increase supplies to meet insatiable demands.
  I shall conclude by making one or two observations about modifying the gas monopoly. One of the best ways to increase supplies to the United Kingdom is by increasing the number of people who are searching for it and distributing it and not letting the job be done solely by the British Gas Corporation.
  I could make to the Government one or two suggestions about the way in which that could be operated. The encouragement of private initiative is observable in the electricity industry, where private companies contribute to their power requirements. In the chemical and allied industries, the contribution is as high as 29 per cent., and in the non-ferrous metals industry it is 33 per cent. Why is it not possible to allow outside interests to contribute to their supplies of natural gas, and to sell marginal supplies to others? That would mean more people bringing it in, and more people making it available. We should then through greater effort be able to meet demand.

  1615
  I wish to raise two other points. Where there is non-standard gas, which must go through a different pipeline system from that which is used by the British Gas Corporation, why could it not be relegated to some authority other than the British Gas Corporation? To encourage the National Coal Board, the distribution of methane from collieries and coke ovens supplied by the National Coal Board to outside industries should constitute a separate and independent venture. The Michelin tyre works at Stoke-on-Trent is scheduled to receive methane from five Staffordshire collieries. What has that to do with the British Gas Corporation? I am sure that an agreement could be reached between them, but use should be entirely independent of the gas monopoly.
  The Government should encourage the establishment of free imports of methane to meet the inadequate supply position, and authorise distribution of products within selected zones, namely, enterprise zones. Perhaps gas should now be defined in the Gas Acts to confine the British Gas Corporation to methane, and to exclude the heavier gases, such as ethane, propane and butane, and the pentanes, which could be dealt with and distributed by other companies.
  9.28 pm
  Mr. Arthur Palmer: I will give this to the hon. Member for Bedford (Mr. Skeet)—he impartially knocks, as the mood takes him, both Front Benches. He does not show much discrimination in the matter. I hope that he will forgive me if I do not follow him and instead move back a little in the history of gas legislation to the Gas Act 1972.
  I was in the House at that time and took quite an interest in that piece of legislation. I served on the Standing Committee, as did the hon. Member for Bedford. It was legislation introduced by the Conservative Government of the right hon. Member for Sidcup (Mr. Heath). The activities of that Government still result in much embarrassment for the present Government.
  This is yet another embarrassing piece of legislation for the present Conservative Front Bench, among the measures introduced by the 1970 Conservative Government. The 1972 Gas Act broke down the regionalisation of the gas industry,
  1616
  and substituted the nationalisation of the industry under a Gas Corporation. That change coincided with the introduction of natural gas and the departure from town gas and allowed the gas industry to escape from its previous dependence on the coal industry.
  I cannot help pointing out, however, that the electricity supply industry has, by circumstances, been tied even more strongly to the coal industry now that oil firing is so expensive and nuclear fission develops only slowly.
  The 1972 Act did something else which I thought was wrong at the time, and I still regard it as wrong in principle. Here was a new national energy resource, which in its creation owed nothing to the gas industry as it stood at the time. I suppose that it owed much to nature and to God.
  It is true that natural gas had to be brought ashore, but many agencies besides the Gas Corporation—once it was established—helped in that regard. The 1972 Act handed over to one publicly-owned industry, engaged in the competitive retailing of energy on a nation-wide scale, the monopoly control of the wholesale side. That, coupled with the licence then given to the Gas Corporation to pick and choose its customers on profitability from its own point of view, has in my judgment brought about a distortion of the British fuel economy and, among other consequences, has led to this Bill.
  An electricity board, which is engaged in active retail competition with the gas industry, must by law supply any would-be consumer, profitable or otherwise, up to 50 yards from a main. However, the regional organisation of the Gas Corporation can refuse the supply if the potential customer is beyond 25 yards of a main.
  The Secretary of State for Energy has told us tonight that the provision which normally exists in public utility Acts, to prevent undue discrimination, is now to go for gas. Again, that introduces something which is new for a utility; the electricity supply industry remains tied to the undue discrimination handicap.
  I urged at the time when the 1972 legislation was introduced that, instead of control of natural gas sales, both wholesale and retail, being handed over

  1617
  to a centralised Gas Corporation, a publicly-owned agency should be established—a gas sales agency—which would hold the balance fairly in both price and availability between all would-be takers, including gas retailing, large and small industrial consumers and even the electricity supply industry itself. Although I am not advocating the burning of natural gas under power station boilers, I should point out that a power station can be a gas industrial consumer like any other.
  I regard the present Bill as quite inadequate. I do not suppose that Ministers would claim that it was other than inadequate—I hope not—but it is unable to deal with the complex problems which the organisation and practices of the gas industry present to our fuel economy. The fact is that the ill-thought-out legislation of 1972 has given the Gas Corporation under the energetic and able leadership of Sir Denis Rooke—I pay a full tribute to him—the opportunity to make large cash surpluses, at times almost by near dumping of gas supplies. That has gone on for more than 10 years, and very little has been done by successive Administrations about it.
  I do not aquit the previous Labour Administration in this regard. As my right hon. Friends know, I have urged for quite a period that there should always be proper relative pricing in energy matters. It is the business of any Government to lay down the outline of such a pricing policy; only a Government can do it. The effect of that on our fuel economy— the way in which gas supplies have been introduced so indiscriminately—has been serious. I shall take a moment or two of the time of the House to quote some evidence that was given to the Select Committee on Energy on the effect of these abundant and cheap gas supplies, as they were in the past, at any rate, on our fuel economy. The Department stated:
  " Perhaps the most striking feature of the domestic sector is the continued rapid penetration of gas which is forecast to increase its market share from 44 per cent. in 1977 to about 66 per cent. by the end of the century. This substantial share will have important implications for the provision of substitute fuels as, in the longer term, natural gas supplies begin to decline."
  In its evidence the Department observed that
  1618
  " Electricity has lost ground in the domestic space and water heating markets, and by the end of the century between two-thirds and three-quarters of its domestic sales are likely to be in lighting appliances and other electricity specific uses; from the turn of the century it could begin to regain some of its lost ground in the domestic heating market through sales of off-peak supplies."
  It will need to, as the supply of natural gas runs out.
  I recognise that depletion policy is extremely complicated. There is not time to advance any arguments about it one way or the other tonight. As I say we are now facing the consequences of the mistakes that have been made in the past 10 years in the careless and wasteful use of natural gas supplies. It has resulted in a recent sudden and most unfair price rise for the ordinary domestic consumer. Natural gas was so cheap that many households invested in it. They have spent their capital on it, and it is not easy for them now to change again even if there were anywhere for them to go.
  There has been a substantial price rise. The domestic consumer has been faced with an increase in price of about 29 per cent. That could have been avoided if there had been from the beginning a much more sensible pricing policy.
  Mr. Eggar: Will the hon. Gentleman confirm that, even after the price rises announced by the Government earlier this year, gas is still cheaper than alternative fuels?
  Mr. Palmer: That may be so. I am not making any point about the size of the price increases. In a sense, the increases have been inevitable. However, it would have been much better for the fuel economy generally if gas prices had been put right earlier. There would have been a much better and more economical use of our gas supplies if that had been done.
  The careless depletion policy that has been followed has led to a steep and abrupt rise in price for the domestic gas consumer. That has often involved a great deal of hardship. As I have said, once a householder has invested in these appliances he cannot easily escape from them. From a national point of view, it has led to an inability at peak times to achieve a proper supply for industrial consumers. There are interruptible supplies under contract. As time passes the interruptions become more and more frequent.

  1619
  The chemical industry has protested about this matter, and the hon. Member for Bedford quoted evidence from another source.
  The electricity supply industry, with which I have connections—I am trying to be as objective as possible—has investment in capacity which is under-used and is to some extent eating its head off in interest charges.
  This is a puny Bill, and we have been promised further legislation.
  My right hon. Friend the Member for Plymouth, Devonport (Dr. Owen) referred to the prospect of a gas tax—a kind of levy would be the polite title for it— being imposed on the gas industry so that the surplus profits, which need not have come about, can now be taken into the Treasury. I think that is a shocking attitude and a bad policy altogether from the national point of view. It would be doing again what used to be done by the worst old municipal gas and electricity undertakings. If they were bad undertakings, they creamed off the profits to reduce the local government rates. This is the same principle: the profits are to be creamed off to reduce taxes. I understand the reason. It will help the political objectives of the Government.
  My right hon. Friend pointed out that there was much still to be done by the gas industry in development. Those spare moneys could be properly left with the gas industry. Alternatively, they could be used for other good uses in the energy context. The revenue from the tax could be used to improve energy conservation, for instance. That would be an excellent use for it.
  But these are deep and complex questions that we cannot fully develop tonight. I suppose that we must accept this poor Bill, but I urge the Government to look at the gas industry as a whole and to relate it to the general energy economy of the country. It would be as well to have a new and comprehensive Gas Act that would deal with a number of outstanding questions. Even at this stage, I think that there is much to be said for establishing a statutory gas purchasing and sales agency and relieving the Gas Corporation of its present ambiguous role of being both wholesaler and retailer.
  9.43 pm
  Mr. Gordon Wilson: I take serious objection to the Bill because, like the hon. Member for Bristol, North-East (Mr. Palmer), I regard it as insubstantial and unable to deal with the problems of the gas industry.
  More to the point, the Secretary of State made no attempt to justify the reasons for the Bill. He bluntly stated that we had to cater for problems that might occur at peak periods on cold winter days. He did not give any figures relating to this situation or when it was likely to arise, yet he indicated that the legislation was necessary.
  I think that some reference should have been made to the Department of Energy's statistical bulletin Energy Trends of March 1980. In the paragraph relating to gas it states:
  " In the three month period December 1979 to February 1980 "
  there was
  " a fall of 2 per cent. from the same period a year ago. This is the first decrease over a three month period for 15 months and reflects the milder winter experienced throughout this period but especially during the month of February when supply fell by nearly 8 per cent. compared with 1979."
  The interesting thing is that during that period indigenous supplies were lower by 7·6 per cent., while supplies of gas rose by 27·6 per cent. Presumably that last reference relates to the gas purchased from the Norwegians through the Frigg gas field and transported in. Nevertheless, it looks as though the problems that were experienced last winter were not experienced this winter, yet the Secretary of State seems to have skipped over that subject.
  The Bill ignores most of the main problems facing the industry, particularly the question of supply in the middle term and the long term. We have heard that there are vast deposits of gas which are to be developed. We know that the gas pipeline is on the verge of being announced by the Government. It was apparently correct for the Minister of State to make statements in Houston and in Dallas about the likelihood of this gas pipeline, yet we do not seem to have been given any information by the Government in the House of Commons. The Secretary of State is to be blamed for not having dealt with the gas pipeline and announced

  1621
  on the eve of this debate whether it was to go ahead.
  I ought also to draw to the attention of the House the fact that in the current edition of The Oilman of 10 May there is a statement that a row is developing between the Treasury and the Department of Energy over the role to be played by the British Gas Corporation and what kind of stake it should have in the pipeline, and it is said that this might delay the gas pipeline plans. I make it clear to the Under-Secretary of State that the last thing that we want is for a row to develop between two Government Departments when we seem to be running short of gas and when this pipeline is reputed to be viable in its own right.
  Mr. R. B. Cant: Am I right in believing that this terrific row that has broken out between these two great Departments of State is concerned purely with the effect of the nationalised undertaking increasing the public sector borrowing requirement? If private enterprise does it, it will not affect the PSBR. If the nationalised industry does it, it will knock the PSBR out.
  Mr. Wilson: The ways of the Treasury and the Department of Energy behind the scenes are sometimes beyond me, but I think it is reckoned that the cost to the British Gas Corporation, or to the Government, will be as much as £1,000 million or so. That would certainly have an effect, although again it should be stated that pipelines of this sort tend to be profitable and that there would be a return to the State from that money, so this is more an equity investment than a subsidy or an outlay of Government funds without due reason. But whatever the purpose, it should not delay going ahead with the pipeline itself.
  The problem that I see coming from the Bill and from the lack of certain conditions that should have been in it is that it attempts to deal with the availability of gas in relation to certain arrangements and obligations contained in the 1972 Act, but does not seek to tackle the problem of the availability of supply that is now appearing in Scotland. I give the House some cases in point. In the 1950s and 1960s, Scotland was at the end of
  1622
  the gas grid. It was the last to get the benefit of cheap natural gas. Indeed, the conversion to natural gas in Dundee took place only three or four years ago. Even today Scotland is still in the highest price bracket for gas, although it shares this unenviable distinction with a number of other areas.
  What has emerged as a result of that time lag since the discovery of gas in the southern basin of the North Sea is, apparently, that Scotland has a smaller proportion of consumers of gas for industrial purposes, and even in the domestic market, than the United Kingdom as a whole. Apparently about 4·8 per cent. of United Kingdom industrial users are to be found in Scotland. That amounts to about 4,000 industrial users out of 75,000 in the United Kingdom as a whole.
  I took up that matter with the Department of Energy. Instead of being an importer of gas, Scotland has become an exporter. Vast supplies of gas go through the country, yet Scotland is unable to get access to it. It has been unable to correct the unfair distribution and economic opportunities that have been given to other parts of the United Kingdom.
  I asked the Minister a specific question about Aliens industrial estate. That estate was to have been built near Aberdeen, and the factories on it were to have been supplied with natural gas. I believe that the Post Office was interested in putting money from its staff superannuation fund into that project. It was a condition of investment that the estate should receive natural gas. When the British Gas Corporation refused that supply, through its subsidiary, Scottish Gas, that investment did not take place.
  On 14 January I wrote to the Minister. The reply that I received was marked with the stamp of the Department of Energy requesting that a reply be given by 25 January 1980. I thought that that would have been a swift reply. However, I did not receive the reply until 10 March —I do not know what happened during the interim period—and the Under-Secretary of State, the hon. Member for Kingston upon Thames (Mr. Lamont), said that British Gas had
  " assured me that in implementing this policy they will take account of prior commitments or special circumstances such as industrial processes for which other fuels are not suitable."

  1623
  The hon. Gentleman gave no indication that the British Gas or the Department of Energy was prepared to make available additional gas supplies to Scotland. We receive a low share of the gas supply. If gas is the coming fuel and if an industrial estate would have provided more jobs, any available gas should have been supplied.
  The pattern of supply has changed. Three gas pipelines are now in full flow from St. Fergus, another pipeline is being built, and a fifth is planned. Those pipelines will carry gas from Frigg and Brent. Frigg already supplies about 30 per cent. of the United Kingdom's gas requirement. Although about 60 per cent. of the gas from Frigg is Norwegian, the rest would more than meet the anticipated increase in Scottish demand.
  I tried today to get some information about the amount of gas that will flow through the Brent pipeline, but I was unable to do so. However, we know that there is a 36-in diameter pipe. The western flank connection with Brent is to have a 16-in diameter pipe. A considerable amount of gas will come through Scotland. Why has the Department of Energy not interceded with the BGC to insist that that quantity of vital resources should be made available to Scotland for industrial purposes? I should like a specific reply. Many hon. Members regret that the Scottish Gas Board was abolished in 1972. If that body had been in existence, it would have acted as an intermediary or buffer. It might have pocketed Scottish interests against the central administration of the gas industry.
  I ask the Minister whether he is prepared to issue guidelines to the British Gas Corporation pressing it to emphasise supply in areas of high unemployment which have a lower proportion of gas than other parts of the country. Secondly, does he have any plan to export gas to the Continent, and what is the intended use of the Brent supply when it comes fully on stream? In relation to the buildup on Brent, will the Minister comment on the statistical bulletins which show that indigenous supplies have fallen? Does this mean that the gas from the southern gas field is declining at a faster rate than has been suggested so far? Will the Bill in any way affect the proposed developments at Moss Morran in Fife, or
  1624
  the developments in Ross and Cromarty?
  The Under-Secretary of State for Energy (Mr. Norman Lamont): No.
  Mr. Wilson: The Minister has said " No ", and I am glad to hear it. It was essential to get that on the record.
  I wish to raise the question of sheltered housing. Scottish Gas has indicated that under its new policy it might not be able to supply new sheltered housing developments with adequate gas. I received a letter on 19 December from the director of sales, Scottish region, who said:
  " There are a substantial number of new sheltered housing projects going on in Scotland at the present time, and we are aware that the housing associations are planning more. Because of prior commitment we are making gas supplies available to many of these and, of course, we shall continue to do so to new projects where they fall within the gas industry's statutory obligations to supply. This obligation, as you know, relates to projects which lie within 25 yards of an existing gas supply and where the consumption of gas will not exceed 25,000 therms per annum for an individual load. The industry's policy in respect of sheltered housing is being reviewed to see if we can assist housing associations, as we are fully aware of the difficulties and ramifications caused by this change of policy."
  I would be extremely grateful if the Minister could tell us what changes in policy have taken place since Scottish Gas wrote to me on this matter.
  If I do not receive satisfactory assurances, particularly on the supply of natural gas to Scotland, and because of the complete inadequacy of the Bill in dealing with the supply problem and the failure of the Secretary of State to justify this measure, I shall divide the House against it.
  9.58 pm
  Mr. Tim Eggar: It gives me particular pleasure to take part in this debate. I found the comments of the hon. Member for Dundee, East (Mr. Wilson) particularly ill informed in certain respects, particularly those relating to the Moss Morran and Ross and Cromarty developments, with which this Bill has no connection whatever. However, I share the hon. Member's concern about the way in which major announcements on energy are being slipped in as written answers to questions. I do not believe that this is the way in which important policy matters should be disclosed to the House.

  1625
  While I fully understand the logic of the Bill, I find it extremely unfortunate that the first legislative act of this Government connected with the gas industry should involve the restriction and change in terms of the supply of gas to industry. British industry is already charged higher prices than those prevailing on the Continent, and is less able to get firm supply contracts. We have significant reserves of North Sea gas, and therefore that position is not welcome.
  I regret that the British Gas Corporation has used interruptible supplies to British industry as a means of avoiding investment in storage capability to meet peak capacity.
  It being Ten o'clock, the debate stood adjourned.

BUSINESS OF THE HOUSE
Ordered,
That, at this day's sitting, the Gas Bill and the Sea Fish Industry Bill may be proceeded with, though opposed, until any hour.—[Lord James Douglas-Hamilton.]

BUSINESS OF THE HOUSE

  GAS BILL
  Question again proposed, That the Bill be now read a Second time.
  Mr. Eggar: One cannot but feel that the Government's decisions over British Gas have been taken in a piecemeal fashion. We first had the price announcement, which is welcome. We must move towards more realistic pricing of energy sources. However, it is flying in the face of logic for the Government to announce a system of price increases whereby the price of gas is not linked to the price of oil—and here I part company with the right hon. Member for Plymouth, Devon-port (Dr. Owen). It is also unfortunate that the second major announcement— the decision to introduce a levy on gas profits—again came by way of written answer. Additionally, it gave us so little information. We have had no opportunity to question the Government in detail prior, presumably, to an amendment being laid to the Finance Bill.
  The Government are facing what could be called the third stage of development of North Sea gas reserves. We are awaiting the announcement on the gas gathering pipeline, and there is an increasing number of interesting and
  1626
  significant find off the coast of Norway. There is increased United Kingdom demand for gas from domestic and industrial customers. It should be obvious to our Continental partners and to Norway that there would be a significant cost advantage in routing Norwegian gas through the United Kingdom mainland and down to the Continent rather than through Norway or by the sub-sea route into Ekofisk. All those factors combined give the Government the chance to make radical changes in the British Gas Corporation.
  I hope that we shall shortly be seeing an announcement of the end of the monopoly power of the BGC to purchase United Kingdom sector gas and, furthermore, that its monopoly power to distribute gas will be ended. Those announcements will have certain beneficial effects.
  First, there will be a significant increase in offshore exploration. The availability of higher prices forced on British Gas by competition will produce higher incentives for oil and other companies to explore for gas in the North Sea. Secondly, the ending of the distribution monopoly will in certain limited instances give private industry a chance to develop a pipeline system of supplies of industrial quality gas, although not necessarily mains quality. The announcements would also enable the Government and private enterprise to combine together to build and finance the significant major trunk pipeline systems that will be needed if gas is to be brought through the United Kingdom to the Continent and if more gas is to be available to United Kingdom domestic and industrial consumers.
  However, those two measures will not be sufficient. A more radical approach is needed and the Government should go further. The section on State industry in " The Right Approach to the Economy ", of which my right hon. Friend the Secretary of State was co-author, states:
  " The long-term aim must be to reduce the preponderance of State ownership and to widen the base of ownership in our community. Ownership by the State is not the same as ownership by the people."
  I heartily concur with that. I believe that the plans for privatisation—I apologise for using that word—that are widely talked about do not meet the indications given in that document of the way in which the Conservative Party would move in government.

  1627
  Privatisation would not offer every individual a direct stake in a nationalised industry. I understand that plans have been discussed for United Kingdom citizens to be offered shares in nationalised industries at reduced prices, through a share offering on the stock market.
  That would be regrettable, because the benefits of such reduced prices would probably go to those who are wealthy enough not to deserve them. Any scheme for privatisation should ensure that ordinary working people who are not normally involved in the stock market and the majority of whom have never owned a share, should be given—I repeat given— shares in nationalised industries and particularly in the BGC. In that way, ordinary people would benefit directly from our North Sea wealth.
  The Government should start making plans for a free rights issue of shares in the BGC which should be made available to every citizen of voting age. Without going into too much detail, may I say that I believe that the balance sheet of the corporation would make it possible for every citizen to be given shares with a market value between £10 and £20. Furthermore, there might be advantages in those shares being deferred so that after about five years their market value would have risen to three or four times the original value and the shares would be a reasonable block to be traded on the Stock Exchange.
  At the same time as the free issue, a general share offering should be made available and preference should be given to subscriptions from individuals, with a limit being placed on the maximum holdings of institutions.
  Such a scheme would have many advantages. The Government would have to take politics out of gas pricing and make clear in advance what the tax regime for the BGC was to be. In addition, the direct ownership of the corporation by the people could only be beneficial and would lead inevitably to increased interest throughout the country in the ownership of shares. There would also be an educational effect through a greater understanding of the need for profit.
  Not insignificantly, such a move would make it virtually impossible for the Labour Party to consider renationalisation. I do not have to remind my right hon.
  1628
  Friend of the considerable PSBR benefits that would flow from privatisation of the British Gas Corporation on this scale. There are criticisms of such a scheme. The major criticism always raised is the administrative problem that would be created in giving shares to over 40 million people.
  I am the first to admit that there would be considerable problems. I do not believe however, that they are insuperable. I note the ease with which such administrative problems were overcome in the Canadian province of British Columbia which recently gave away shares to its 2¾ million citizens. The hurdle is not impossible to overcome.
  A second criticism is that the shares, once issued to individual citizens, would in many cases be immediately sold before they were sold on the stock market and that some kind of secondary market would develop on street kerbs and in pubs. That may happen. Who are we to deprive people, given shares by the Government, of the right to sell them when they wish and how they wish if they want to realise the money?
  I regret that the Bill does not go further. I am convinced that the Government side of the House cannot, and should not, continue to take an ambivalent attitude towards nationalised industries. Radical change is needed. It is needed sooner rather than later.
  10.12 pm
  Mr. Harold McCusker: This debate and this Bill are academic to Northern Ireland Members. It must have interested hon. Members to see almost 50 per cent. of Northern Ireland Members present. It is a situation akin to children from an underprivileged home background who dearly want a particular plaything that they have seen given to their wealthier playmates. Hon. Members from Northern Ireland are here with our noses pressed up against the Englishman's double glazing, watching how he enjoys this plaything in the comfort of his gas-fired, centrally-heated home. This is no joke. Northern Ireland has been deprived of what is sometimes called this national asset.
  It was with rare amusement that I heard the Secretary of State talk about the fact that British companies were anxious to obtain a gas supply because

  1629
  there was work to be done and jobs to be created. That is true in Northern Ireland. We were anxious to get a gas supply. The Secretary of State talked about the increasing role that gas would play in energy supplies in the future and of the exciting innovations that lay before the United Kingdom. Those do not lie before the people of Northern Ireland.
  We have a gas industry in Northern Ireland—just about. The Government have declared that the industry will die. It has been interesting to hear hon. Members talk of the prices paid, and the potential prices to be paid, and what would or would not be desirable. I should like to inform them of the situation in Northern Ireland. The hon. Member for Bedford (Mr. Skeet) should not talk about relating the price of gas to oil. Why not take the logical step and relate it to the price of gas produced by other means—for example, by naphtha reformation? The Government have told the gas industry and the people of Northern Ireland that if they want gas they should pay the price of producing it by naphtha reformation. That is the method that was used in this country in some places such as Dundee until a few years ago.
  If that is done, people will pay, like those in the Bogside, 90p a therm for their gas. That is what the people in the Bogside are paying today, because they have no option. Coal is not much of an option, because in Northern Ireland it is much more expensive than on the mainland. Electricity is also much more expensive. In the Secretary of State's words, our electricity is generated by high-priced oil, whose price, as he described it, has gone through the roof.
  Northern Ireland is caught in the trap of meeting 90 per cent. of its electricity needs with oil whose price has gone through the roof and having to use coal, the price of which is much higher because of transportation costs and so on. The Government say " You have a choice. You can have gas at the price of producing it by naphtha reformation ", which is 90p today and could be 100p tomorrow. Hon. Members who take an interest in these matters will know that during the past decade the price of naphtha has risen from £6 or £7 a ton to £200 today. The price is increasing monthly.
  1630
  Therefore, the hon. Member for Bedford should perhaps suggest that the British Gas Corporation should pitch its price for gas at the cost of producing it by that method. That would be unrealistic, but the argument would be fairly logical.
  When we in Northern Ireland said that we should like a share of natural gas we were not even asking for it at the price at which our wealthier brethren on the mainland were getting it. Two years ago we proposed to the Government that we would take that natural gas for 50p or 60p a therm. Even then, that was four or five times the price at which people were obtaining it here. We felt that that was a price comparable with coal and electricity prices, and that with it we could perhaps continue our industry and maintain employment, our almost 2,000 people employed in the industry. But the Government said " No ".
  The Bill does not apply to Northern Ireland because the 1972 Act does not apply. Therein lies the rub. In 1972, a few months after Stormont was done away with, it was perhaps understandable that this House would not apply that Act to Northern Ireland. Eight years later, with no sign of our getting our Stormont Parliament back, continuing to refuse to apply such legislation to what is, after all, an integral part of the United Kingdom can hardly be justified.
  I hope that in winding up the debate the Minister will not simply brush aside what I have said as being of no interest. He is the spokesman for the Government of the whole United Kingdom. It is not enough for him to say " You will have to discuss this with one of my colleagues responsible for the situation in Northern Ireland." Ministers responsible in Northern Ireland when confronted with the fact that Northern Ireland gas consumers are paying 90p a therm for their gas say " That is a courageous pricing policy." Will the Minister say that one day when someone proposes charging 90p a therm for gas over here?
  I suppose that we are begging again, but we are only begging this time for a share of what is always described as a national asset, a United Kingdom asset. In effect, it is a Great Britain asset. We cannot help but wonder whether, if in years to come gas or oil is discovered

  1631
  off the coast of Northern Ireland, which is not beyond the bounds of possibility, there will be any hesitation in rushing in a pipeline to take it in the other direction. Shall we have the experience of hon. Members from Scotland, who watch their gas being pumped down to the wealthier parts of England and cannot even get their share of it? Would people be surprised if Ulster nationalism became a reality?
  10.19 pm
  Mr. R. B. Cant: I cannot remember in the 14 years that I have been in the House a single-clause Bill having spawned such a rich debate, dealing with such a wide variety of subjects.
  The technology of gas-gathering pipelines is quite beyond me. I do not understand the high finance of gas pricing but I found attractive the political theory which emerged at the end of the speech by the hon. Member for Enfield, North (Mr. Eggar). We have also heard a little of the agony of Northern Ireland and we must take that seriously.
  Having said that, I wish to make a simple speech. It will be a constituency speech and it will be a plug for one of the most remarkable successes in post-war British industry. I refer to the pottery or ceramics industry. I make this speech because I feel that, though the Bill may be too narrow to help that industry, it may not be wide enough to embrace the other facets and difficulties of the general pricing problem.
  The pottery industry is remarkable. Before the war everybody knew the typical bottle kilns which were crucibles not only for beautiful pottery but also of much human misery. Collectively those kilns in the Stoke-on-Trent area at that time consumed 1,500,000 tons of crude coal each year.
  Today we have an industry which, as I have said, is one of the success stories of British industry. It has increased output, and exports vary between 35 per cent. and 90 per cent. according to the product. Workers in the pottery industry do not go on strike, management is excellent and investment is running at a high level. However, without doubt, the industry is showing signs of strain. One of the problems it shares with most industries is the strength of the pound. An-
  1632
  other problem is the high interest rate, which is common to industry generally.
  Gas is absolutely critical for the pottery industry. Anyone who has been round a firm turning out Wedgwood, Spode, Minton or one of the other great products of the industry will know that pottery is produced in very long tunnel kilns and that those kilns are fired by gas. Two things are essential to the prosperity of the industry in relation to fuel. One is continuity of supply. If the gas has to be turned off or the supply breaks down, the effect on the earthenware and china passing slowly through the tunnel kilns, being heated in the process, can be catastrophic.
  I am interested—though strictly in parenthesis, as we are all politicians here —that nobody has really grasped the nettle of domestic consumption. I must tell the hon. Member for Armagh (Mr. McCusker) that in my house we have a primitive heating system. We have a single large coal fire and a few one-bar electric fires to heat the bedrooms. My wife is always asking why we cannot have the system that so many British people regard as their birthright—the delightful system of gas central heating. All my married children have such a system. When they come home they say "Oh, dad, for goodness sake, can we buy a gas central heating system for you?" I say " No. We are getting a salary increase next month—I hope."
  The Labour Government were responsible for introducing the wrong policy for a great industrial nation. It is just as well that I have a safe seat. It is a terrible thought that anyone with a gas pipe within 25 yards can receive 25,000 therms of gas per annum whereas some industrialists cannot have a guaranteed supply and some cannot even have a supply.
  When talking of the wide-ranging technological developments in the 1980s and 1990s we should come nearer home, if we have the courage as politicians. We must put industry first. The Bill, small as it is, loosens the supply problem for the industrialist because he can obtain a supply if he can afford it. The country might have to face the problem.
  The price of gas causes anxiety in the pottery industry. The pottery industry consumes 80 million therms of gas a year. The price of a therm of gas in 1971— in those halcyon days—was 3½p. That

  1633
  must have been the first price registered in decimal currency. The current price is 25·3p, and it is to go up again in September. Since 1974 fuel costs have risen from 4 per cent. to 11 per cent. of total cost.
  The paradox is that we are the inheritors of rich supplies of oil and gas and yet pottery competitors on the Continent are paying 8p a therm less than we in Britain. That might be all right for some industries, but the pottery industry is dependent on exports. Much of the competition is vicious—I was going to say that it is unfair. It is unfortunate that the industry suffers such a price disadvantage.
  I do not want to become involved in the principles which we have been discussing so learnedly. However, since we have a relatively plentiful supply of gas it should be our policy to sell it relatively cheaply. That should be a matter of policy. I do not know whether we can justify a policy that is based on the equalisation of gas and oil prices, or an attempt to equalise, in a broader sense, all fuel prices.
  Before we wake up one day and find that we do not have an industry, we must come to grips with the fact that if we have these advantages we should use them. Other nations do so. [HON. MEMBERS: " Which countries? "] Several countries, even some in the Common Market. If France had the advantage of relatively cheap fuel, it would maximise that advantage. We speak academically. We may talk more practically about import controls to guarantee our industrial and manufacturing salvation in the 1980s.
  I wish to make a naked plea to the Minister, on behalf of the pottery industry, that pricing policy should be directed to help those industries that are dependent upon this source of fuel. I do not make this argument in a generalised manner; I make it in terms of the needs of the chemical and pottery industries. We could say that they could have as much as they need up to 25,000 therms or, in contract price, beyond 100,000 therms. Why not say to the large pottery manufacturers " Let us start talking about those who consume 1 million therms, and see whether they could be given some advantage because they are such large consumers "?
  Mr. Michael Colvin: Why?
  Mr. Cant: The hon. Member for Bristol, North-West (Mr. Colvin) is another theoretician. I am talking about an industry that produces 400 million-worth of cups and saucers, and which exports, through a vigorous marketing policy, between 35 and 90 per cent. of its products. The industry is now under considerable strain because of the factors that I have mentioned. It may be that we cannot do anything about a strong pound, because of the commodity that we are discussing tonight, and because of the high interest rates that the stupid Government maintain at a higher level than needed. Because of the cost of gas, the Government might have to use that weapon to maintain the prosperity of the industry. That may not be theoretically or philosophically acceptable to those who believe in the pure doctrine of market forces.
  I am using this argument tonight in reference to the way in which we price gas. We are making certain changes. They are small changes, and I am asking that they should be extended. What I am saying will not only contribute to the future of the pottery industry but, if applied more widely, will assist us to prevent the deindustrialisation of Britain.
  10.35 pm
  Mr. Dick Douglas: My hon. Friend the Member for Stoke-on-Trent, Central (Mr. Cant) has indicated an area of concern in his constituency. I share some of that concern, because the Government are embarking upon a process that will destroy huge sections of British industry on the basis of a belief in market forces.
  If I follow the logic of the Secretary of State's argument, the Bill is designed to free the British Gas Corporation from certain statutory contractual obligations under which it must supply gas to certain industrial users in particular. The underlying argument is that if we relieve the Gas Corporation of its statutory responsibility, and have arm's length, freely negotiated contracts for supplies of more than 25,000 therms a year, somehow or other that will feed through into the oil industry, which is the main explorer for gas, and perhaps into the British Gas Corporation itself. It is argued that that will lead to a greater exploration activity

  1635
  in the northern and southern sectors of the North Sea, that more gas will be discovered and that eventually, in the long run, we shall cure the present apparent shortage.
  That may be the case, but the Secretary of State, wearing his other hat, is creaming off some of the funds, not only from the oil companies but also from the Gas Corporation itself, which might be used for exploration activity. I can see difficult theoretical arguments in relation to windfall profits, and I do not want to pursue them this evening. However, when the Secretary of State puts forward this small Bill, he has an obligation to indicate his expectation in relation to security of supply. That is his major obligation.
  In general terms, I do not demur a great deal from what some Conservative Members have said in relation to comparability of price, because I feel that energy prices in interventionist terms will have to be equated, although not strictly across the board. However, there will be a need for some form of loose equation, because gas and oil are in general found in association. Therefore, the Secretary of State has an obligation to indicate the number of industrial consumers who might be affected by these proposals, as well as the number of key industries which might be affected, as my hon. Friend the Member for Stoke-on-Trent, Central pointed out.
  The hon. Member for Dundee, East (Mr. Wilson) mentioned some Scottish concerns, and I do not necessarily cross swords with him. However, in parenthesis I should point out that in my constituency the Scottish National Party opposed certain gas and associated developments which will bring jobs and benefits to Fife.
  The Secretary of State has an obligation to indicate how, in association with the corporation, he proposes to ensure that industries which are already handicapped are not more severely handicapped because they are tied to gas as the most useful and beneficial fuel. If the result will be to increase gas prices to other public sector activities, such as hospitals and schools, he should tell us what proposals, in association with the Treasury, exist to secure an adjustment of cash limits to ensure that those other public sector bodies are able to pay the price increases.
  1636
  I have particular experience of that in my own constituency, where a hospital board in the Fife area wanted to embark on certain expansion activities but had to delay or alter them in order to accommodate other fuels because the gas was not available. Other areas have been helped by the Scottish section of the BGC. We have been able to make adjustments, and firms that could use only gas—considerable volume and capital expenditure were involved—have been met by the corporation. It eventually came along with the supply. A number of industrial estates have been set up in Scotland and elsewhere that are tied to obtaining gas supplies. Industrial expansion and new jobs might be delayed if the Secretary of State does not indicate clearly to the corporation his allocation of priorities.
  I shall not go into the technological fantasies of the hon. Member for Bedford (Mr. Skeet). The hon. Gentleman's argument for importing LNG is too fanciful for words. There are insufficient LNG tankers available, and if they were available we would not have the port facilities to accommodate them. We have one port facility that has a great question mark over it—Canvey Island. The corporation has great responsibility for enhancing the safety requirements on Canvey Island. I hope that the Secretary of State will make a statement on another occasion on what the corporation is doing to improve, in futuristic terms, the importation of LNG.
  Mr. Skeet: I had in mind the peak load, with which the Secretary of State was concerned. The House will probably recognise that LNG will be valuable in meeting the peak load. The facilities on Canvey Island could be used for that purpose. If we had increased the LNG supply from Somatrach in Algeria, as the French have done, it is possible that we would not be in our present position.
  Mr. Douglas: I shall not follow the technical argument about Somatrach and LNG. Somatrach has had extreme difficulty in exploiting its fuel. Let the hon. Gentleman tell the hon. Member for Essex, South-East (Sir B. Braine), who represents Canvey Island, that more LNG should be imported through that terminal. He will not be pleased to hear that.

  1637
  My right hon. Friend the Member for Plymouth, Devonport (Dr. Owen) indicated the crying need to get a statement from the Government on exploitation. I was present when the Minister of State uttered glowing statements in Houston to the assembled American-British audience about how well we are doing and saying that we shall get a gas-gathering system. However, not a word is said in the House about that. The Minister goes to Dallas before he says anything in the House on that score. I suppose that JR. and others might be pleased, but we are not told of the Government's thinking.
  It is essential that we should be given clarification. That is of importance not only to our sector of the North Sea but to the Norwegian sector. We are happy that the Norwegians are finding more gas. If more gas is found in the North Sea, that will benefit Britain and Western Europe as a whole. I shall be extremely grateful if the Under-Secretary of State makes clear that the overall provisions of the corporation's policy will not inhibit it in participating in a transmission system. There are companies that will want to be associated by means of a partnership arrangement. I think that the Opposition would mount massive opposition to any proposal to denude the corporation of the right to participate—I am not suggesting as a majority partner—in any additional transmission system for the North Sea.
  It is extremely important when talking about security of supply to be sure that every platform in the North Sea has enhanced recovery techniques deployment. We know that secondary recovery techniques are used. I am talking about water and gas injection. We know that the Offshore Energy Technology Board has a study on enhanced recovery. It is important for the future supply of oil and gas that we get a clear indication soon of the Government's policy on enhanced recovery techniques. It may be that by extracting quickly, or even storing it, we are destroying the possibilities of increased recovery of oil in place of natural gas in future. I submit that we are a bit late—two to three years late—with the gathering system. I hope that we shall not be late in ensuring that every platform that can take it in terms of its deck
  1638
  loading capacity deploys enhanced recovery techniques so that we can ensure supply well into the twenty-first century.
  10.45 pm
  Mr. Joseph Ashton: There has been a far-ranging and wide—worldwide—debate on every aspect of gas tonight. As there is still a lot of business before the House, I am sure that hon. Members will cheer when I say that I intend to confine my remarks to the one-clause Bill and put forward some of the matters that we want to question.
  We should have liked the Bill to go into Committee upstairs, because then we would have had more time to examine its effects on industry. But the Government have decreed that it shall be taken tonight on the Floor of the House, so we shall have to make the best of it.
  We do not oppose the Bill in principle, because we are in favour of flexibility for nationalised industries. We do not believe that nationalised industries, from our Socialist point of view, should be rigidly hidebound and penalised in any way. We are glad that the Government have come round to that way of thinking. Nevertheless, we want to talk about the Bill's effects on consumers and the Government's reasons for introducing it.
  Obviously the British Gas Corporation could not satisfy an increasing demand with 40,000 new customers each year. It was facing an annual increase of 400,000 new customers and seeing its sales increase by a quarter with a trebling of demand. There would be total chaos if no attempt were made to give the corporation these powers. Therefore, we are not arguing too much about its having these powers. But we are unhappy with the Government's policy of linking the gas price to the taxed, not the basic, oil price and their intimation that they propose to tax gas prices through their excess profits tax.
  We notice that the Government have no plans for an excess profits tax on the banks. I should have thought that, as with the ITV levy, some sort of excess profits tax on bank profits would have been acceptable.
  We cannot understand why there should be a need for an excess profits tax on the gas industry but not on banking. This is due to a change in policy, whereby energy is run by the Treasury, not by the Department of Energy. The

  1639
  attitude towards the nationalised industries now is not that of the 1970–74 Conservative Government, which was to keep their profits down to control inflation, but to milk them for as much as the market will bear and to allow the Chancellor of the Exchequer to use the cash to cut taxes to keep down the public sector borrowing requirement, or to do as he thinks fit. If old ladies have to pay increased gas bills to provide more cash for the Treasury with which to cut taxes for the rich, that is the sort of redistribution of wealth which we expect the Government to introduce.
  I turn to the price rises that industry will have to face. It seems sometimes from the attitude of the Government that industry is some grey, amorphous mass somewhere north of the Trent or starting at Stoke and that somehow it will bear these increases.
  The gas price has a massive effect on certain industries. For example, the chemical industry, which uses 44 per cent. of all industrial gas, is hammered by the big price increases and the gas tax that the Government have proposed. The glass, clay, ceramics and brick industries are affected. About 30 per cent. of the cost of a brick represents the cost of the energy. That affects building costs throughout the country.
  The ceramics and clay industries are concerned about the Bill. The refractory industry, from which British Steel has to buy, is also concerned. One of the biggest customers of the refractory industry is British Steel, because it buys the bricks for its furnaces and so on from that industry.
  Mr. Eggar: Will the hon. Gentleman give way?
  Mr. Ashton: I want to get on.
  Mr. Eggar: On this point.
  Mr. Ashton: I am not giving way. I am sorry. Sit down. The hon. Gentleman had his chance. He ranged far and wide, referring to Mexico, Canada and so on. The hour is getting late and my hon. Friends wish to speak on fishing and Northern Ireland. We must get on.
  Many firms in the glass industry are affected. One in my constituency has faced a 53 per cent. increase in the cost of its gas this year. Last year it was
  1640
  spending £2 million on gas. This year it is having to spend £3 million. Last year the exchange rate of the pound was below $2. Now it is well above $2. All of this firm's export trade has vanished. It has had to make about 25 per cent. of its employees redundant. It can no longer export because of the high level of the pound. The price of gas, which is essential for melting down the glass, has risen to such an extent that the firm is now laying off people and making them redundant.
  It may be that this excess profit is doing the Treasury a great deal of good. But it is not doing British industry a great deal of good. Many industries are suffering. The clay pipe industry—not clay pipes for smoking but pipes for agricultural drainage—is suffering. The tile industry is suffering. It exports 70 to 80 per cent. of its products. All these industries need massive amounts of energy. Even the beer industry needs it. Anyone who drinks draught Bass may be glad to know that the brewers use considerable amounts of gas—not to put in the beer but to use in the breweries.
  Many industries have committed themselves to extensive investment and they now find that because of that—much of it in modern equipment—they are having to pay very high charges. Again, many of them are dissatisfied with the sort of contracts that they have been forced to take on. The Minister knows that there are generally two types—although there may be more—of contracts with the British Gas Corporation: the firm price and the interruptible price contract. In general, the gas undertaking likes to negotiate on interruptible prices, with probably about 5p per therm difference. My hon. Friend the Member for Stoke-on-Trent, Central (Mr. Cant) mentioned how much this was costing.
  It can also be very awkward for an industry, to say the least, to be forced to accept an interruptible supply, which means that on the coldest day of the year when consumers come home from work and switch on their domestic gas fires suddenly the corporation telephones firms, literally with a few hours' notice, and says " We shall be putting you on interruptible supply tomorrow." The firms then have to look around for some sort of liquid gas, which is difficult to

  1641
  obtain and very expensive, in order to maintain their continuity.
  There are now about 700 companies, one-third of our industry, having to take on the interruptible supply. They are very concerned about it The Bill does not lay down any guidelines for the corporation on what sort of supply it must offer to industry. But the corporation is in a monopoly situation. We hope that it will take notice of industry, try to play fair with it, and not abuse its monopoly powers by insisting on totally interruptable supplies.
  Last winter seven out of 12 regions had cuts to industry because of the policy of interruptible supplies. Some of the contracts which the corporation insisted on negotiating insisted on interruptions on as many as 60 or 70 days a year. The average cut was 35 days. My hon. Friend the Member for Stoke-on-Trent, Central mentioned the interruption in the ceramics industry. He will be interested to know that Wedgwood's contract contains provision for 28 days of cuts in supply. Continuity is needed in industry to keep products at a certain temperature, but some of the new contracts provide for as much as 90 days of interruptible supply. This matter must be re-examined.
  The Secretary of State would not be going too far in taking powers to step in as a mediator perhaps and act on behalf of industry with the monopoly supplier. There must be some sort of appeal if the corporation abuses its powers.
  The price of liquid gas, which is the standby, even if industry can obtain it, has doubled in 18 months. Industry is facing a total lack of stability. It does not know where it stands with the price of gas shooting up, the interruption of supplies, the level of the pound, and high interest rates. It is one more, kick to British industry, which is not doing it any good. UKF, which uses gas as feedstock for fertiliser, reckons that interruptions cost it £100,000 last year. However, British Gas compelled it to take on an interruptible supply contract.
  Our industry faces fierce competition from the EEC. The level of our gas prices has already been mentioned twice. Our prices are the highest in the Common Market. The chemical industry has pro-
  1642
  duced figures. At first, the Secretary of State denied that we had the highest prices in the EEC. However, the statistical department of the EEC has generally accepted that our prices are the highest in Europe.
  If prices are considered in pounds sterling per gigajoule, Great Britain's prices represent 1·4, Italy 1·2, Germany 1·1 the Netherlands 0·9, and France and Belgium 0·8. The price of gas in France and Belgium is about half that in the United Kingdom. It has been mentioned that if the French had this situation they would use it to help their industry. That is exactly what they are doing. Our competitors in the glass and ceramics industries are finding competition very fierce. They are hidebound. Many firms are having to lay off workers. They are having to give up the export opportunities that they have enjoyed for many years.
  Why have the Government done this? The answer is that they want to tax gas. As has been said, there is no reason to tie the gas industry to oil prices. If gas is to be taxed to that extent, and if exporters are to be forced out of business, nothing will be gained. The extra tax will be used to pay unemployment benefit. Some of our energy supplies must be used to help our exporting industries. I am also interested in the Government's policy on energy conservation.
  We shall not vote against the Bill, because we realise that it is needed by the BGC. However, we shall probe the effects of the Bill further when the Government introduce their proposals for an excess profits tax on gas.
  10.57 pm
  The Under-Secretary of State for Energy (Mr. Norman Lamont): The most surprising comment that I have heard came from my hon. Friend the Member for Bedford (Mr. Skeet). I heard him shout " Back to the Bill." There has been no discussion of the Bill. At one stage I thought that we were still discussing the Whitsun Adjournment motion.
  I was surprised that the Bill was not discussed in more detail. However, as the hon. Member for Stoke-on-Trent, Central (Mr. Cant) said, given the considerable problems in the supply of gas which face British industry, it is not surprising that many hon. Members, representing different industries and interests, are here. It is

  1643
  right that they should represent their constituents' needs.
  The Government recognise that a serious problem has arisen over the supply of gas to industry. Strong criticims have been made to the British Gas Corporation. However, the demand for gas has run ahead of the BGC's ability to supply it. It has done so for two reasons. First, industrial gas remains cheap compared with competing products. Because it is so much cheaper, everybody wants it. Hon. Members should think before comparing the price of gas with industry's inability to get it. Because gas is cheap, industry wants it.
  Another reason behind the sudden acceleration in the demand for gas has been a lack of confidence in oil. There are world-wide fears that there will be interruptions in supply. It is feared that even a major oil producer such as Britain will not be immune from interruptions in the Middle East.
  The hon. Member for Bassetlaw (Mr. Ashton) placed great emphasis—and rightly so—on the complaints made by British industry about the availability and the price of gas. He placed less emphasis on the fact that one of industry's complaints has been the underpricing of domestic gas for many years. Domestic gas has been so underpriced that supplies have been diverted and the demand has run away.
  It is worth bearing in mind that over the past 10 years supplies of gas to industry have increased fivefold, whereas those to domestic consumers in the same period have doubled. Therefore, British industry has been supplied with a large amount of gas over the past 10 years.
  The right hon. Member for Plymouth, Devonport (Dr. Owen) repeated an argument that he has expressed before in the House—that gas prices should not be influenced by oil prices. In a way, it was surprising for him to say that, because it has been the policy of all Governments that the prices charged by British Gas should relate to those of competing products. There is sound logic in that. First, there is the fact that a lot of gas is sold by the producers at prices that relate to those of oil. We may not like that, but there is not much that we can do to alter it. Secondly, in the market many buyers of gas have the ability to switch from gas
  1644
  to oil, and unless there is some relationship between the two prices there would be no control over the demand for gas and the British Gas Corporation would find the situation unmanageable. That is the logic behind gas and oil prices being related.
  That policy is not unique to this country. It is noticeable that other countries have announced that they are relating oil and gas prices. Hon. Members will have read of the negotiations between Algeria and Gasunie in which Algeria has announced that it is relating gas and oil prices. That is not a policy that is peculiar to this Government.
  The right hon. Member also raised the question of a gas-gathering system and asked about the delay. The Government cannot be accused of delay and we appreciate the interest of hon. Members in the urgency of this matter. However, we have only just received the British Gas Corporation-Mobil study, and we are not yet in a position to make an announcement about it. I cannot give any more information. We are proceeding as quickly as we can, and an announcement will be made in a few weeks.
  The third point raised by the right hon. Member was one with which I agree. He said that the Opposition believed that industries for which gas was essential and for which there was no substitute should be handled with care by the corporation. The British Gas Corporation tries to give priority to those industries that have to use gas because there is no alternative. It tries to approach such problems with great care.
  My hon. Friend the Member for Bedford put forward far-reaching ideas, as did my hon. Friend the Member for Enfield (Mr. Eggar), with regard to the structure and ownership of the corporation. We shall study those ideas, but I cannot go into detail now. Both my hon. Friends asked whether the monopsony— the monopoly of the British Gas Corporation in the North Sea—should be repealed. The Chemical Industries Association feels strongly about the matter, and has made representations to us, which we are considering.
  My hon. Friends and the hon. Member for Dunfermline (Mr. Douglas) referred to the gas levy and the fact that

  1645
  we have not been able to announce details to the House. Objection was taken because the levy was announced by way of written answer. The Department of Energy is not the sole master and does not control the time of the House. We had to come not quite at the top of the queue with that answer. We announced merely the principle of the levy. There will be ample opportunity for debate when the proposals are put before the House. It is intended that the levy will operate in this financial year and over the period of the financial target set for the corporation.
  Mr. Skeet: I put the question to my right hon. and learned Friend the Chancellor of the Exchequer and expected him to reply. The situation is unique. I received a reply from the Secretary of State for Energy. Will the legislation be a peculiar animal prepared by the Department of Energy or will it be prepared by the Chancellor of the Exchequer?
  Mr. Lamont: The legislation is being prepared by the Department of Energy. I cannot make a commitment about the precise legislative vehicle.
  Hon. Members asked whether the levy would have an impact on BGC's investment programme. We entirely accept that it is not enough to choke off demand and get greater control over the off-take of gas, which is the purpose of the Bill. We also have to look at supply. We are satisfied that the levy has no impact on BGC's investment programme. It will be investing £600 million in 1980–81 and £4,000 million in the years up to 1984–85. That investment will not be affected by the levy.
  My hon. Friend the Member for Bedford also asked, fairly and relevantly, about the numbers affected by the Bill. About 4,250 existing contract customers, who use between them over 6,200 million therms per annum, and 7,000 premises currently on the non-domestic tariff will lose their pre-1976 statutory entitlement. A total of 11,000 premises, using 550 million therms per annum, currently on the non-domestic tariff will be offered a contract supply.
  Mr. Eggar: That is a substantial number of customers. Will my hon. Friend confirm whether the BGC will be prepared to give those customers firm con-
  1646
  tracts as opposed to interruptible contracts?
  Mr. Lamont: In the number of customers that I read out, I included those who already have contracts—and they will not be affected—and those on the non-domestic tariff who have a pre-1976 right. The latter group will be most affected and they do not use a large number of therms. The 7,000 people with a pre-1976 right account for only 380,000 therms. Of course, both groups matter, because it is thought that those on contracts may have a statutory right to a tariff supply. That is the point of the Bill.
  I turn to the points raised by the hon. Member for Dundee, East (Mr. Wilson). Nothing in the Bill affects Moss Morran, we do not have plans for exporting gas to the Continent and I do not intend to issue directives to BGC on how it should supply its customers.
  The Department did not intervene in the case of Altens because we all know that the supply situation is difficult and the BGC has to decide on allocation within its statutory duties. The corporation has assured us that it tries to be as helpful as possible, within supply constraints, with supplies to new industrial estates, especially in high unemployment areas.
  The hon. Member for Armagh (Mr. McCusker) raised the question of gas supplies to Northern Ireland, and I regret that I shall nave to disappoint him and repeat what he has heard before in such debates. He raised questions that are matters for the Secretary of State for Northern Ireland. That does not mean that we do not understand the problems that the hon. Gentleman has outlined, but he will remember that a study was made of the possibility of a pipeline to Northern Ireland and it was concluded that it would not make the gas industry there viable. The problems are of concern to the Government and I shall see that the hon. Gentleman's comments are passed on to my right hon. Friend.
  Much criticism has been made of the Bill. It has been said that it does not deal adequately with the problems of gas pricing and supplies. We must be realistic and recognise that the Bill is only one small step and a single measure that the corporation has asked us to introduce. The purpose of the Bill is specifically to

  1647
  move people who have inherited a privileged position off tariff and on to contract. This will give the corporation greater control over its off-take of gas supplies.
  Mr. Palmer: Is not the difficulty that the Bill was introduced at the request of the corporation? Are the Government intending to act on their own thinking to put right some of the obvious defects in the gas industry in relation to fuel economy?
  Mr. Lamont: My right hon. Friend the Secretary of State set out our thinking in his opening remarks. We have to deal with the pricing conundrum. Whatever else is levelled at the Government, we cannot be accused of not grasping the nettle of the imbalance between domestic and industrial pricing, to the dismay of some of our own supporters. The problem of increasing gas supplies depends on investment in the transmission system, the gas-gathering system and what happens in the North Sea. No one pretends that this Bill is the answer to the considerable problems of gas supplies.
  The hon. Member for Bassetlaw compared gas supplies in this country with those in Europe. He alleged that he was making comparisons between prices. I noted that he concentrated entirely on industrial prices. That was no doubt convenient. Whereas it is often alleged that our industrial prices are very high, it is also an undisputed fact that our domestic prices are among the cheapest in Europe. This is part of the problem. The hon. Gentleman quoted a number of Eurostat statistics alleged to show that our industrial supplies were priced higher than those in other countries. That survey was carried out on the basis of several cities in Europe. It was a comparison of tariff rates in different countries. Eighty per cent. of industrial supplies in this country are on contract, not on tariff. There is a 7p per therm difference on average between contract and tariff. The table to which the hon. Gentleman referred cannot be used as a basis for comparison.
  Mr. Ashton: I accept what the Minister says. If, however, the figures show
  the price in France at about 55 per cent. of ours and the price of a therm at about 25p, that is still a considerable advantage, even allowing for the 7p per therm that the hon. Gentleman mentioned.
  Mr. Lamont: Even if that was the position, the hon. Gentleman will have noticed that the French have just had their gas supplies cut off by the Algerians. The Algerians are asking for higher prices per therm than are common in this country.
  Mr. Ashton: Who can cut off our supplies?
  Mr. Lamont: The trend throughout Europe is for gas prices increasingly to be linked to oil prices. I have explained why that approach has sound practical logic—not doctrine, not theory—behind it. That is what the Bill is partly about. The purpose partly, as the hon. Member for Stoke-on-Trent, Central remarked, is to ease up the relationship of one price to another and to enable us to move to our market pricing strategy.
  Without a sensible approach to energy pricing, we shall consume our own natural resources more quickly and bring forward the day when we have to rely on much more expensive alternative sources. The Bill will give the corporation greater control over the off-take of gas supplies. It will not solve all the problems of British industry, but it will perhaps make it a little easier for the corporation to deal with the sort of problem that concerned the hon. Member for Dunfermline, the sort of emergency that might arise in a hospital in a period of peak demand. It gives the corporation more control over the supplies of gas, to see that gas is directed to those customers who can make the best use of it and who are in the most urgent need of it
  The Bill does not solve all the problems of gas supplies, but it is a measure that is very much needed.
  Question put, That the Bill be now read a Second time: —
  The House divided: Ayes 85, Noes 12.

  Division No. 306]

  AYES

  [11.20 pm

  Alexander, Richard

  Aspinwall, Jack

  Best, Keith

  Alison, Michael

  Beaumont-Dark, Anthony

  Blackburn, John

  Ancram, Michael

  Benyon, W. (Buckingham)

  Boscawen, Hon Robert

  Braine, Sir Bernard

  Howell, Rt Hon David (Guildford)

  Proctor, K. Harvey

  Brooke, Hon Peter

  Jopling, Rt Hon Michael

  Rees-Davies, W. R.

  Brown, Michael (Brigg & Sc'thorpe)

  Knox, David

  St. John-Stevas, Rt Hon Norman

  Cadbury, Jocelyn

  Lamont, Norman

  Shepherd, Colin (Hereford)

  Carlisle, Kenneth (Lincoln)

  Lang, Ian

  Skeet, T. H. H.

  Chalker, Mrs Lynda

  Lawrence, Ivan

  Speller, Tony

  Chapman, Sydney

  Lloyd, Peter (Fareham)

  Spicer, Jim (West Dorset)

  Clarke, Kenneth (Rushcliffe)

  Lyell, Nicholas

  Sproat, lain

  Clegg, Sir Walter

  Macfarlane, Nell

  Stevens, Martin

  Colvin, Michael

  McNair-Wilson, Michael (Newbury)

  Stradling Thomas, J.

  Dean, Paul (North Somerset)

  McQuarrie, Albert

  Tebbit, Norman

  Dorrell, Stephen

  Major, John

  Thompson, Donald

  Douglas-Hamilton, Lord James

  Marlow, Tony

  Thorne, Neil (llford South)

  Dunn, Robert (Dartford)

  Maude, Rt Hon Angus

  Townend, John (Bridlington)

  Eggar, Timothy

  Maxwell-Hyslop, Robin

  Viggers, Peter

  Faith, Mrs Sheila

  Moate, Roger

  Waddington, David

  Fookes, Miss Janet

  Morris, Michael (Northampton, Sth)

  Walker, Bill (Perth & E Perthshire)

  Fox, Marcus

  Morrison, Hon Peter (City of Chester)

  Waller, Gary

  Garel-Jones. Tristan

  Mudd, David

  Ward, John

  Gow, Ian

  Myles, David

  Watson, John

  Gower, Sir Raymond

  Needham, Richard

  Wheeler, John

  Gray, Hamish

  Nelson, Anthony

  Wickenden, Keith

  Griffiths, Peter (Portsmouth N)

  Neubert, Michael

  Young, Sir George (Acton)

  Hawkins, Paul

  Newton, Tony

  Hawksley, Warren

  Page, Richard (SW Hertfordshire)

  TELLERS FOR THE AYES:

  Hicks, Robert

  Parris, Matthew

  Mr. John Wakeham and

  Hogg, Hon Douglas (Grantham)

  Pollock, Alexander

  Mr. John Cope.

  NOES

  Alton, David

  Penhaligon, David

  Stewart, Rt Hon Donald (W Isles)

  Beith, A. J.

  Robinson, Peter (Belfast East)

  Bradford, Rev. R.

  Ross, Stephen (Isle of Wight)

  TELLERS FOR THE NOES:

  Freud, Clement

  Ross, Wm. (Londonderry)

  Mr. Gordon Wilson an d

  McQuade, John

  Steel, Rt Hon David

  Mr. Harold McCusker.

  Molyneaux, James

  Question accordingly agreed to.
  Bill read a Second time.
  Bill committed to a Committee of the whole House—[Mr. Boscawen.]
  Bill immediately considered in Committee.
  [Mr. Richard Crawshaw in the Chair]

  GAS BILL
    Clause 1

      SUPPLY OF GAS AT AN ANNUAL RATE IN EXCESS OF 25,000 THERMS TO BE SUBJECT TO SPECIAL AGREEMENT OF BRITISH GAS CORPORATION
      Amendment made: in page 1, line 9, at end insert:
      "(1A) Section 25(5) of that Act shall not apply in relation to tariffs fixed by the Corporation under subsection (3) of that section with respect to the prices to be charged for therms supplied to any premises in excess of 25,000 therms in any such period of twelve months; and nothing in section 24(1) of that Act shall be construed as affecting the power of the Corporation to fix such tariffs as they think fit with respect to the prices to be charged for therms so supplied."—[Mr. David Howell.]
      Mr. Skeet: I beg to move, in page 1, line 17, at end insert:
      " (3) An existing consumer who in the period of 12 months immediately preceding the pass-
      1650
      ing of this Act has been provided under tariff with a minimum supply of gas to any premises in excess of 25,000 therms shall have the right to require the corporation to enter into a special agreement with him. The terms specified in the agreement shall ensure continuity of supply of an annual volume not less than that supplied in the previous 12 months immediately preceding the passing of the Act and at a price to be agreed. In the case of a dispute as to any of the terms of such agreements an appeal shall lie to the Secretary of State."
      I listened with interest to the hon. Member for Bassetlaw (Mr. Ashton) talking about the flexibility of arrangements for nationalised corporations. I pay tribute to the Government, because their amendments help towards achieving my objective. I am concerned about consumers and how they fare. The number of consumers likely to be affected by the Bill is no fewer than 11,000 and the amount of gas involved is about 6 billion therms.
      The hon. Member for Bassetlaw discussed people who are not affected by the Bill. The British Ceramic Manufacturers' Federation states in a letter:
      " Whilst the strict objective of the alteration to the Bill does not affect any of our members as far as we can ascertain … all their consumptions are in excess of 100,000 therms ".
      The firms involved consume between 25,000 therms and 100,000 therms. The

      1651
      British Gas Corporation is obliged to supply existing users and new users within 25 yards of a gas distribution pipeline. That is provided for in schedule 4 of the Gas Act 1972,. Under section 13 of the Energy Act 1976 it must provide a volume of gas but it is not obliged to exceed 25,000 therms per year. That has the effect of giving priority to small industry and commercial consumers as opposed to industry generally.
      The corporation supplies gas at published tariffs up to an annual consumption of 100,000 therms per annum. Higher levels are supplied on the basis of special contract terms related to the market.
      Section 25(3) of the Gas Act 1972 provides:
      " the prices to be charged by the Corporation for the supply of gas… shall be in accordance with tariffs … and those tariffs … shall be so framed as to show the methods by which and the principles on which the charges are to be made as well as the prices which are to be charged, and shall be published."
      This Bill, unfortunately, goes along a different tack and provides that supplies of gas in excess of 25,000 therms per annum—that is, anything between 25,000 and 100,000 therms—shall cease to be on tariff but shall be under contractual terms, that is, contractual terms with the monopoly seller, the British Gas Corporation.
      My anxiety here is that there are certain disadvantages in oil-related contracts. The Minister has said that more consumers will move off tariffs and on to contract terms. These, of course, can be made subject to a minimum and a maximum take. Penalties can be imposed for exceeding the upper limit. There is no comparability with payments by other customers. There is therefore a lack of transparency in these contracts, because they are not published. The terms are therefore not at published rates. Furthermore, they are not tariffs, but I want to ask the Minister what contractual terms are likely to apply.
      I admit that at present new contracts are few and far between, but the rates prevailing are anything in excess of 35p and 41 p per therm. The latter figure is very high indeed. Are they to be moved from very attractive, or reasonably attractive, conditions to very much higher rates, which will be imposed by the corpora-
      1652
      tion? Should not we say that we will do something for their protection?
      My hon. Friend has indicated that he would like to know whether customers will be on firm contracts or interruptable contracts. The latter are very much cheaper and are related to the price of fuel oil, but firm and renewable contracts will be related to gas oil. I am not against the point in principle. I think that this is right, but here we find that a right is conceded by at least 11,000 customers. They get no compensation for their loss. There is no quid pro quo. This will help the corporation, but it will not necessarily help them, because they will be on higher contractual rates.
      I seek a number of guarantees from the Minister, some of which he has already conceded. Customers should have continuity of supply at the rate of the previous 12 months in excess of 25,000 therms per annum. Secondly, the price should be agreed inter se with an appeal lying to the Secretary of State in the event of there being any dispute.
      I stress the importance of an appeal, because I can tell the Minister that in Committee on the Continental Shelf Bill in 1964 I moved an amendment to clause 9 that a reasonable price should be given to the companies supplying gas to the BGC. If there had been a reasonable price and it had been agreed by arbitration, all the difficulties that have supervened would never have arisen.
      That is the analogy that I am using on this occasion, and all that I am suggesting to the Minister is that if there could be an appeal to the Secretary of State anyone who loses his rights and receives no compensation will have an opportunity to go to the Secretary of State to ensure that he gets justice.
      I can put this in two final points. What I want to do, and what the amendment seeks to do, is to protect the consumer against the abuse of the exercise of monopoly power by the corporation. I should have thought that those ideas would commend themselves to the Minister. Perhaps he will be able to give us further clarification on what is likely to occur.
      Mr. Eggar: I rise briefly to support my hon. Friend the Member for Bedford (Mr. Skeet). We are proposing to take away a statutory right that was granted by the House to certain industrial gas

      1653
      consumers. It is right that we should seek to safeguard and protect those industrial consumers who have come to rely upon the right given to them by the House. It is in that spirit that I seek some clarification from my hon. Friend the Minister about whether the customers affected will be granted a right to firm supply contracts, and some indication of the price that they will be offered.
      Mr. Norman Lamont: My hon. Friend the Member for Bedford (Mr. Skeet) acknowledged that our amendment has gone a long way towards meeting what he had in mind. As my right hon. Friend the Secretary of State said, we have received an assurance that the BGC does not intend to cut off or to reduce supplies to industrial customers. Obviously, I cannot say what the contractual terms will be, because they are negotiable. My right hon. Friend said that customers would be in a position broadly similar to that of new customers—it would be on that sort of basis.
      Our amendment—which has already been accepted by the Committee— ensures that the legislative provisions that prohibit discrimination between tariffs should not apply over 25,000 therms. The precise purpose of that is to enable the BGC to have a standby tariff which would be available to the pre-1976 customers using more than 25,000 therms. They will have a standby tariff where agreements may not have been fully reached on the terms of a contract. The tariffs will be published. They will be submitted to the consumer councils in the normal way. That is the
      1654
      mitigating factor. The difference between our amendment and that of my hon. Friend the Member for Bedford is that he wants a final court of appeal to rest with the Secretary of State, whereas we have said that there should be standby tariffs for special circumstances where an agreement may not have been reached.
      Mr. Skeet: I am grateful for the opportunity to say a few additional words on the matter. I had hoped that the Minister would concede a little further and say that he would not be against an appeal to the Secretary of State, who is the fount of all wisdom on energy matters. He would be able to arbitrate quite impartially on the matter.
      Obviously, the Minister will not be moved in the direction that I had hoped. However, he has conceded a lot of ground and. on that basis, I beg to ask leave to withdraw the amendment
      Amendment, by leave, withdrawn.
      Clause 1, as amended, ordered to stand part of the Bill.
      Clause 2 ordered to stand part of the Bill.

    Title
    Amendment made: in line 3, at end insert
    " and that charges for therms supplied to any premises in excess of 25,000 therms a year may be fixed by the Corporation under section 25(3) of the Gas Act 1972 without regard to the requirements of section 24(1) or 25(5) of that Act".—[Mr. David Howell.]
    Bill reported, with amendments; read the Third time and passed.

SEA FISH INDUSTRY BILL
Order for Second Reading read.
11.45 pm
The Parliamentary Secretary to the Ministry of Agriculture, Fisheries and Food (Mr. Jerry Wiggin): I beg to move, That the Bill be now read a Second time.
This is a short Bill to extend the White Fish Authority's powers to collect its general levy from the fishing industry. At present, the authority can raise a levy on fish which is landed in the United Kingdom. The Bill will enable it to collect levy also on fish which is caught by United Kingdom fishermen in our waters, but which is then trans-shipped direct to an exporting vessel without being landed.
This will be a familiar subject to many hon. Members present. The House has recently undertaken a thorough examination of the finances of the White Fish Authority, when considering the need to provide for an increase in its levy income. The Select Committee on Scottish Affairs took evidence on the case for raising the levy rate. In its report, the Select Committee noted that trans-shipped fish was not liable to the authority's levy, and it urged that this omission should be rectified. Fisheries Ministers were aware of the strong case for such a change in the law. When commitments to facilitate the passage of legislation where made on behalf of the Opposition, it became possible to envisage legislation this Session. The Government are pleased that events have turned out in this way, and credit is due to Opposition Members for their undertaking which has made the Bill feasible so quickly.
The contents of the Bill are, I think, self-explanatory, but if there are points of detail raised during this short debate I shall seek to answer them.
There are two points which I should like to underline in recommending the Bill to the House. The first is that it restores a measure of equity in the financing of the White Fish Authority. The development of trans-shipment was not usual in 1970 and it is clearly right, therefore, to take account of this and to make the change proposed in the Bill.
The second point is that as a result of being able to look forward to income from trans-shipments the authority has
1656
been able to plan to continue its work with a smaller increase in the levy rate than it was originally seeking. The levy is not large, but it is important to keep the rate as low as possible, particularly when fishermen have been experiencing real difficulties. Hon. Members will be aware that the Government have already announced that the proposed increase in levy can be halved. The new rate is 1·2p per stone of fish, and it came into effect on 8 May, the first increase in six years.
However, setting the levy at l·2p per stone means that the White Fish Authority is dependent for financial balance on the trans-shipment levy which the Bill will provide. The authority has estimated that if the levy can be applied from August the combined effects of the levy increase, the extension of the levy to cover trans-shipped fish and the internal economies which the authority is making in its operations should enable it to remain solvent until the end of 1981. For the longer term, the Government propose that the authority and the Herring Industry Board should be replaced by a new body. Fisheries Ministers expect to be able very shortly to invite the comments of the industry on the future arrangements.
Meanwhile, the introduction of the arrangements proposed in the Bill will contribute to a smooth development towards the new arrangements, and I therefore commend it to the House.
11.50 pm
Mr. Austin Mitchell: In a sense, we are almost burning the midnight gas to cook the midnight fish, and on a back burner at that. In welcoming the Bill on behalf of the Opposition, I should perhaps reiterate what the Minister said about the share of credit belonging to the Opposition.
The gap in the 1970 Act has become a serious anomaly in the light of the growth of the trans-shipments produced by the klondike of mackerel fishing. From the evidence of the Minister of State, Scottish Office before the Select Committee on Scottish Affairs in February, it is quite clear that the Government were originally thinking of tackling that anomaly as part of a process of amalgamation of the White Fish Authority and the Herring Industry Board. The suggestion for a Bill of this sort to be pushed rapidly

1657
through Parliament came from my hon. Friend the Member for Aberdeen, North (Mr. Hughes). The Opposition undertook in the Standing Committee on Statutory Instruments, etc. to back the suggestion and to facilitate such a Bill's passage through the House. If credit is to be given, the Opposition, as the party of equality, must claim their share.
I welcome the Bill. Our sole reservation is that it is too late. The lost revenue must amount to about £250,000 for each year that we have not had legislation in this form. The mackerel trans-shipments on which it will fall have seen their greatest days. It is only right and proper that the fishing of the mackerel stocks should be substantially reduced to remove the real threat to those stocks. It is a tragedy that British fishing vessels, including vessels from Humberside, should be forced into this fishing and into the transshipments purely because of the state of the industry, thanks to our position in the Common Market and thanks to the Government's obstinate refusal to defend British interests. The fact is that British vessels have nowhere else to fish and no other economic way of keeping going. It is a measure that comes late after the best days of trans-shipment.
Will the filling in of the gap, combined with the reduced increase in the levy, be sufficient to save the White Fish Authority from serious financial difficulties? The Minister tells us that it will keep it solvent, but what cutbacks in the work of the authority will be necessary? It is possible that the filling in of the gap will yield a revenue that is smaller than the estimated revenue.
I can only hope that the Government have serious proposals to ensure that the returns on transferred catches, on which the levy will be paid, are accurate and not the works of imagination—a negative form of imagination—as in the past.
I welcome the Bill because it makes a direct financial contribution to the work of the White Fish Authority. It is alarming to think that because of the Government's failure to help the industry it is now facing its second real crisis in five years. The first crisis was the result of losing Icelandic fishing opportunities. The new crisis is bringing the industry to the point of collapse. The authority is be-
1658
coming,or has already become, the whipping boy for a chorus of blame and despair that should properly be focused where it belongs, namely, on the Common Market, which is responsible for the problems that have beset our industry, and, secondly, on the Government for not acting earlier and more promptly to help the industry.
The chorus of blame was clear in the Scottish Select Committee and in the Standing Committee on Statutory Instruments, &c. It was being focused on the authority. It may become clear in the escalating programme of non-co-operation with the Government that the National Federation of Fishermen's Organisations has begun, which has been backed strongly in my constituency of Grimsby. I voice my own fear here. It is not the declared policy of the federation, but I fear that fishermen will refuse to pay the authority's levy. The anger that is mounting in the industry could focus on the authority in a way that could only be deplored.
That is the background. There is a crisis in the industry caused by the flood of imported fish combined with a decline in catches, especially in the market value of catches, with depressed prices as the result of high imports. The British industry is being asked to compete with highly subsidised Common Market fleets. It is being asked to survive in its present battered state with only the minimum of Government help. It is being asked to continue in that condition until the Government can absolve themselves from their responsibilities towards fishing by getting a decent burial grant for the industry from the Common Market as part of a common fisheries settlement. That is the background to the Bill. It is one that makes the Bill welcome, but it is rather like rearranging the deck-chairs on the " Titanic ". If this is the best that the Government can do while the whole industry is in this state, one must comment on the lack of preparedness for the crisis shown by the Government.
Mr. Barry Henderson: The hon. Gentleman has welcomed the Bill and that is much appreciated by Conservative Members, but will he give an undertaking about any measures that the Government might bring forward on the importation of fish?
Mr. Mitchell: If the hon. Gentleman will wait until a later part of my speech, he will find that there is such a welcome. But, to anticipate it, the answer is " Yes ". I reiterate our welcome to this measure.
I turn now to the state of the industry —to which this measure forms part of the background—particularly in Grimsby. In February, because of the laying up of eight large trawlers by Taylors, we saw the Minister of State to warn that more lay-ups would happen unless prompt aid was forthcoming for the industry. In the last two weeks six further trawlers have been laid up by Lindsey Trawlers and eight by Marrs. In other words, there has been a decimation of the fishing effort from Grimsby.
On Monday I met skippers in the port —even seine net skippers who have been doing very well in recent times—who are now making small, pathetic catches because of the overfishing going on in British waters due to the concentration of efforts from the Common Market. Skippers were coming back to face pathetic returns for their small catches and a market in which the prices had been driven down by the scale of imports. They are facing that situation at a time when most of them are in debt to the banks and paying hefty interest rates— 20 per cent. or more. They are caught on a treadmill of declining receipts and increasing interest rates and that is slowly driving many of them towards bankruptcy. I hate to think of the situation that will face the industry in June when the banks demand their interest rates. This is a formula for disaster in the industry.
I had a telephone call this morning from a fisherman's wife. She told me that her husband, after losing his last fishing job because the vessel was laid up, was out of work for five weeks, during which time he was looking every day for a new fishing job in the port of Grimsby. Eventually he found a job, went on a 12-day trip pair trawling, which normally is the profitable, efficient side of the industry, and came back £135 in debt as a result of a pathetic catch and a breakdown on that trip. The vessel is now to be laid up and he is out of work again. He is out of work—and this is a perennial cause of complaint in the industry—without any proper redundancy payment or provision at all. He is effectively thrown on the
1660
scrap heap because the Government are still dragging their feet on the decasualisation of the industry. It is tragic for me—
Mr. Albert McQuarrie: For the hon. Gentleman, yes. But what has it to do with the Bill?
Mr. Mitchell: It has to do with the state of the fishing industry, which the Bill is supposed to help. It is relevant to look at the background to the fishing industry. We should have the same latitude in discussing fishing as was accorded to discussing energy in the previous debate.
It is tragic for me—having seen skippers laid off three years ago, when I was first elected, because of the backlog of the Icelandic dispute and being able to say then " This is a tragedy, but proper provision for redundancy payments will be made in the same way as everybody else is getting redundancy payments "—to find that, now that the second wave of disaster has hit the industry, there is no provision for redundancy payments and for decasualisation of the industry.
This crisis is generating a backwash of feeling against the White Fish Authority. This measure will do nothing to allay that situation, even though it allows a necessary adjustment and improvement in the White Fish Authority's finances.
Earlier today Members criticised the TUC's day of action. The problem in fishing is that we have had a year of inaction by this Government. In this period of mounting crisis for the industry, what have the Government done about the two main causes of that crisis? What have they done about imports and aid for the industry? They have done the very minimum that they could get away with politically.
First, there is the crisis of imports. I am not talking of imports to the docks coming in on fishing boats. That is no problem. We welcome them because they make a contribution to the dock and port charges that we all face. I am talking of frozen and block imports, of fish coming in on the roll-on/roll-off ferries in containers, which are swamping our markets; imports coming in, with the jobs taken out, which make no contribution to our industry. [Interruption.] The hon. Member for Aberdeenshire, East

1661
(Mr. McQuarrie) may not want these complaints of the industry voiced, but I am sure that his constituents do, because they are very relevant to the present state of the industry. It is an industry in desperate need of financial help from the Government, from whom they have had next to nothing.
Mr. McQuarrie: On a point of order, Mr. Deputy Speaker. Are we discussing the Sea Fish Industry Bill or are we discussing a crisis in the fishing industry?
Mr. Deputy Speaker (Mr. Richard Crawshaw): The Bill refers to levies. In my view, it is important that we get the background to the industry and ascertain whether the levies will help or hinder. I think that what the hon. Member for Grimsby (Mr. Mitchell) is saying is perfectly in order.
Mr. Mitchell: Thank you, Mr. Deputy Speaker.
The answer to the pleas of the industry is the very small measure involved in the Bill, and next to no help for the industry. It has been offered £2 million-worth of help to the producers' organisations.
Mr. Donald Stewart: Is the hon. Gentleman aware that when the increased levy was placed on the industry a few weeks ago, most of the Conservative Members present, although they had been crying two days before for financial assistance for the industry, all trooped into the lobbies to support the increased levy?
Mr. Mitchell: I am aware of the fact that the hon. Member for Aberdeenshire, East was accused of being, and was, toothless at the time—full of hot air and complaint about the industry but prepared to do nothing about it. Indeed, he is prepared now to attempt to stop discussion of the problems and the grievances of the industry.
Mr. McQuarrie: It is the Bill that we are supposed to be talking about.
Mr. Mitchell: In response to the demands of the industry, how adequate is this minor contribution today and the £2 million of aid that the Government have produced? [HON. MEMBERS: "£3 million."] £1 million for exploratory voyages, which affects mainly the distant
1662
water effort, and £2 million of real aid for the industry, in the light of a situation in which it has been estimated by the British Fishing Federation that the German industry is receiving 60 million deutschemarks of aid in this year. Our aid is pathetic as a contribution to our industry's survival compared with that scale.
The Secretary of State for Scotland (Mr. George Younger): With great respect to the hon. Gentleman, we cannot let him get away with that. Is he not aware that his hon. Friend the Member for Edinburgh. East (Mr. Strang), speaking from the Dispatch Box officially for the Opposition, specifically asked the Government to give £3 million to the fishing industry? That is what we did. The hon. Gentleman ought to be honest about that.
Mr. Mitchell: That figure was not mentioned in the industry's representations. It has been plucked at random by the Government as one which they think is the minimum that they can get away with politically. It certainly makes no real contribution to the industry in its present state. As I have just pointed out, this figure compares not at all with the scale of aid that has been paid to Continental fishing industries by their Governments, both directly and indirectly.
Indeed, when I asked a question on the scale of aid in Continental countries, the Minister of State replied:
" The Government are aware of the main features of the measures taken. It would, however, be a major task to prepare a fully comprehensive survey of all the national, regional and local measures which could be considered to be direct or indirect aids or subsidies to the industry in a form appropriate for publication. I would not regard this as an appropriate use of my Department's limited resources."—[Official Report, 6 May 1980; Vol. 984, c. 59.]
In other words, he does not want to know about the scale of aid given to other industries, and yet this is the crucial factor for the survival of our industry. We are facing competition from subsidised fleets in a state in which we are not prepared and not able to face that competition. In the light of the real needs of this industry, £77,000-worth of aid per week is a mere nothing. Certainly it has done nothing to prevent the lay-ups which have been coming and which are still to come in Grimsby and the blows

1663
to the industry which come from these lay-ups.
About the other problem—imports— nothing has been done at all, except a vague promise that Commissioner Gundelach will act in July to affect one tiny part of the problem. This problem of imports is crucial. It is a problem caused by the EEC. For instance, there is the problem of Canadian imports and our agreement to take what amounts to 8,000 tons of fish in return for a catch in Canadian waters of some 400 tons. In Grimsby we are facing fish flooding in from Poland via Denmark, which is driving down the prices in the Grimsby market. The major share of those imports comes from Common Market countries. Those countries are catching our fish in our waters and dumping them on our market. That ruins our industry.
They are also using our vessels. France bought three Boston deep sea trawlers. The trawlers are eight years old and 80 ft long. They are now fishing in our waters. They are landing their catches in our ports. That insanity is supplemented by the low official withdrawal prices that exist on the Continent. Given the inflation rate since 1976, the pound is now overvalued by about 38 per cent. The market is artificially attractive. Fish are being dumped on a large scale. That is insanity. Fish stocks and the fish industry are being ruined.
Faced with that crisis, the Government have taken no action. Ministers have uttered a perpetual chorus of " Don't ask me ". On Monday a meeting was held in Grimsby to discuss the crisis. We have tried every means of influencing the Government. We have sent deputations. We have explained the crisis to Ministers. What do we get? We have heard professions of good will, but we have seen no action. The industry is declining rapidly. It is the Government's duty to stop that decline.
Ministers should get their eyes down and consider the state of the industry. They should ask whether it will survive to inherit the settlement that is anticipated from the EEC. They should divert their eyes towards this type of measure. The measure is small. In a sense, it is as relevant as a packet of crisps in a famine. The Government should devote
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their attentions to the industry's needs.
The industry needs a programme of aid towards operating costs comparable to the amount of aid given to Common Market fleets. That is a condition of survival. Secondly, there should be an emergency levy on frozen and block imports which do not come through the docks and which do not pay their share of the charges. That levy is necessary as a result of the state of the pound and as a result of over-fishing. It would also be compatible with the Treaty of Rome. The Government should take those two basic measures. If they do the Opposition will give them the same level of co-operation as produced this Bill. The Government must act, and act quickly.
12.7 am
Mr. David Mudd: I hope that the hon. Member for Grimsby (Mr. Mitchell) will forgive me if I do not take up his points. The hon. Gentleman and I will reach a measure of agreement only on the concern that he expressed about the methods, accuracy and monitoring of catches for trans-shipment. Such monitoring is essential if the levy is to be assessed. He fairly made the point that many members of the British fishing industry are frustrated and fed up because British fish are being taken into European markets and are then being sold back to the United Kingdom. As a result, they refuse point blank to cooperate with the Ministry of Agriculture, Fisheries and Food on catch figures and declarations. If that system is to survive, the Minister must indicate how monitoring will be carried out.
It is no secret that I have long been opposed to the trans-shipment industry. There has always been a massive credibility gap between the figures declared by visiting fishermen to Cornish waters and those recorded as having been taken by visiting ships.
Again, because of the British fisherman's feeling of frustration and non-cooperation, the entire recording of figures could be open to abuse. Therefore, I hope that the Minister will be specific about the monitoring procedures, and the spot checks and will give us a guarantee that the system will work. Above all, I hope he will be able to tell us something new tonight that will reassure the British fishermen that steps are being taken to

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restore their share of the market and their participation in the industry.
12.11 am
Mr. James Johnson: I shall not take up the remarks of the hon. Member for Falmouth and Camborne (Mr. Mudd), but in passing I must say that I am glad he did not attack my constituents and their vessels for fouling the nets and lines of his constituents off the Cornish coast.
I congratulate my hon. Friend the Member for Grimsby (Mr. Mitchell) on his first appearance at the Dispatch Box. In a Committee upstairs my hon. Friend mentioned that there was a bit of competition between Hull and Grimsby, and then went on to talk about Athens and Sparta. He did not specify whether Hull was Athens and Grimsby Sparta, or vice versa. At present I think that we are both Spartans, bearing in mind all the blows that are descending on our boats.
There is nothing in this one-clause Bill. We are looking at a past anomaly which could develop into a can of worms. I oppose what has been and will be said about the levy, because I assume that the Bill does not deal with any payments made before now under the 1970 Act.
I have firms in my constituency which have paid by mistake. Will the Minister confirm that almost £500,000 has been paid over the years, by mistake or because of lack of advice, to the White Fish Authority in Edinburgh? I have even heard it said that if the White Fish Authority were forced by the courts to repay this £500,000 to firms in my constituency it would bankrupt the authority. I am an admirer of Charles Meek and his staff in Edinburgh and I wish them well, but my people in Hull have a case because of the moneys paid in the past.
I caution the Minister that well-known firms in my constituency which are popular with the work force on the dockside will sue the White Fish Authority on this matter. Therefore, the can of worms is already lying around somewhere, and the Minister would be well advised to watch out.
The Minister said that the White Fish Authority wanted the money badly. It needs as much as it can get to expand its worthy and worthwhile work in Africa, the Middle East, Saudi Arabia, the
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Yemen, Somalia and elsewhere. I have nothing but admiration for the WFA. However, my constituents have a case. I understand why the WFA wants the legislation so badly.
Government Members have been told to be brief so that the Bill will go through quickly.
Firms in my constituency have been misled over the years by the WFA. I ask the Minister whether that is a fair statement. Does he agree that what has happened to my constituents is manifestly unfair and that some of the money should be returned to them? The money was paid unwittingly, and the Bill will close that loophole.
An area officer of the WFA will maintain that the money was fairly given, and that it was collected in good faith. However, firms in West Hull over the years have paid up to £500,000. Other firms, which were perhaps better or more carefully advised by astute lawyers, paid nothing. Will the Minister comment on that? My people are seeking counsel's opinion, just as the Minister has legal officers in his Department to advise him.
I want the WFA to have financial balance, but not with money owing to my constituents. These are good men— good vessel owners. If the money is not repaid, it will be a further nail in their coffins.
Why is the levy paid? The fish are not landed. Facilities are not required on shore. No help is afforded to our people. It is a confounded hindrance.
I have a letter from a well-known firm in Hull dealing with what has happened to its boats. The " Arctic Challenger " and the " Arctic Riever " were built with loans from the Shipbuilding Industry Board. Those are two of the best boats in the business. They have been fishing mackerel off the South-West coast, and broken all records.
Mr. David Penhaligon: Shame.
Mr. Johnson: They have grossed over £90,000.
Mr. Penhaligon: That is what they admit.
Mr. Johnson: They were taken off mackerel fishing when the Minister blew his whistle in March. They had been kept at sea solidly since September and

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it would have been impossible to better their performance. I know what they have done and what the men have received in wages.
There is nothing that we can do now. The boats have been taken to dock, and although it would have been impossible for them to fish more efficiently or to make more money, they cannot exist on those takings. They are being pulled out. Will the Minister intervene with the SIB to arrange a moratorium on the interest on loans taken to build such vessels?
The Government ought to be doing something about the problem. If they intend to put more imposts on our people fishing, they should think about giving concessions. I suggest a moratorium on loans.
12.21 am
Mr. Iain Sproat: I am glad to follow the hon. Member for Kingston upon Hull, West (Mr. Johnson), just as he followed me in the Whitsun Adjournment debate earlier today.
I should tell the hon. Member for Grimsby (Mr. Mitchell) that the tradition in fishing debates has not been to go in for vicious attacks on each other, because one of the great strengths of the House in relation to the Common Market and fishing is that we have always been united. The longer that remains the position, the better it will be.
Mr. Austin Mitchell: Is the hon. Gentleman suggesting that the industry has no complaints about the Government and that it is not almost hysterically asking the Government for help and for an emergency levy on imports? The industry is fed up with the failure to get any action from the Government.
Mr. Sproat: I am aware of that. If the hon. Member had cared to come to the House when the hon. Member for Kingston upon Hull, West and I were debating this matter, he might have had a chance to make a speech. The hon. Gentleman left the Chamber before his hon. Friend and I spoke.
Mr. Mitchell: I was here.
Mr. Sproat: Why did not the hon. Gentleman intervene?
Mr. Mitchell: Will the hon. Gentleman give way?
Mr. Sproat: No.; the hon. Gentleman has had his chance.
Mr. Mitchell: Will the hon. Gentleman give way?
Mr. Deputy Speaker: Order. It is clear that the hon. Member for Aberdeen. South (Mr. Sproat) is not giving way.
Mr. Sproat: We know of the many worries of the industry in Aberdeen, Hull and other places. The hon. Member for Grimsby does not have to tell us the troubles of the industry. But we must try to solve those problems in a united way and not bring party political differences into the industry. If those on the Opposition Front Bench listened to the wisdom of the hon. Member for Kingston upon Hull, West, they might do a little better in trying to help the fishing industry.
I thank my hon. Friends the Under-Secretary and the Minister of State for the speed with which they have introduced the legislation and the trouble that they have gone to to get it through the House much faster than normal.
I also thank my hon. Friends for taking so much notice of the Select Committee on Scottish Affairs. They will find that they have probably set an important precedent, because this is the first of what will no doubt be many Government Bills arising directly from the actions of a Select Committee. It is of considerable constitutional interest.
The hon. Member for Grimsby spoke in his painful speech of the Government having done nothing for the fishing industry. He does not seem to be aware that it was a member of his own Front Bench who first suggested the figure of £3 million. It was the suggestion of the hon. Member for Edinburgh, East (Mr. Strang), and it is a pity that he is not here.
The hon. Member for Grimsby also seems to be unaware that the Government spend an additional £20 million on the fishing industry in this country. He seemed to have no recollection of that. If he was in the House this afternoon, he might have heard the hon. Member for Kingston upon Hull, West, in a speech following mine, refer to the Prime Minister as a fairy godmother of great generosity for what she has done for the fishing industry. It would better become

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the hon. Gentleman to listen to his hon. Friend.
Mr. James Johnson: If the hon. Gentleman cares to read Hansard, he will see that I agreed that there were difficulties and that a fairy godmother was needed. The industry has been a Cinderella for years. I thought that we had possibly discovered a fairy godmother when the Prime Minister met the Hull delegation of shop stewards, bobbers and fish merchants.
Mr. Sproat: The hon. Gentleman confirms that the Prime Minister has proved a fairy godmother in the tough stand she has taken in refusing to allow the fishing industry to be used as a bargaining counter against the £1,000 million EEC contribution. We are grateful, as always, to the hon. Gentleman.
We know the difficult situation of the fishing industry, with its soaring costs, the loss of grounds and the problems of imports that have increased by 53 per cent. in the first three months of this year compared to the same period last year. We could be making speeches about that situation. It happens, however, that the Bill relates to the levy on trans-shipped fish. The levy goes a long way to solving the particular problem discovered by the Select Committee.
On the one hand, the fishing industry did not wish to pay more in levy to the White Fish Authority. On the other, the White Fish Authority was claiming that it could not exist unless it received a 100 per cent. increase in levy. As a result of representations made by my hon. Friends, together with one or two Opposition Members—the hon. Member for Berwick and East Lothian (Mr. Home Robertson) and the hon. Member for Glasgow, Garscadden (Mr. Dewar), whose help I acknowledge—and the Statutory Instruments Committee that followed, we convinced the Minister of State that the levy increase should be cut and, at the same time, that he would get this useful Bill through the House. That is what has happened.
The legislation does not solve the problem of the additional £92 million spent on imports in the last three months. That is not its purpose. It relieves a small problem that was bothering the industry. It is disgraceful that an Opposition Front
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Bench spokesman should use the occasion to try to introduce party political propaganda when the industry should be united. I hope that the rest of the House will solemnly back this splendid Bill.
12.29 am
Mr. David Penhaligon: It is worth considering how this peculiar and unique trans-shipment industry has grown. Over the years, the fishing industry has worked its way through species after species until it has now arrived at mackerel. As someone who was brought up on mackerel and regards it as part of the diet, I recognise the real problem is that the English simply will not eat mackerel. Markets have therefore to be found where it can be sold. The short-term answer has been to set up this remarkable trans-shipment industry and to sell to whoever takes part in it. I say " remarkable " because at the peak of the season, it is possible to go to Flushing, in my constituency, and also to Falmouth, and see more than 40 enormous factory boats all engaged in this industry. It is a remarkable sight, one that I never thought I should see in our country. Yet it appears that there is little opposition. It is certainly big business. Anybody who does not so regard it has not analysed it sensibly.
The levy is just £2 a ton, yet the Minister was talking of raising several hundreds of thousands of pounds by it. No doubt that applies only to the fish that he knows are caught, let alone the fish that I may refer to a little later.
Basically, the ships are of two sorts. One type, mainly the Russian part of the fleet, freezes the fish whole. It takes them on board by the hundreds of tons and freezes them in enormous freezers. Eventually an even bigger ship comes from Russia to take the fish back by the scores of thousands of tons.
Why do the Government allow the Russians to carry on this trade? The Government claim that they are annoyed with the Russians for going into Afghanistan, yet, like people prostituting themselves, we are forced in the South-West to allow the Russians within a hundred yards of the coast of my county to come and buy their fish. For what, for whom and why is this allowed? Why do the Government allow it in the present climate?

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The other half of the fleet process the fish in a different way. The fish are filleted and the meat is taken off the two sides and frozen. The rest is then ground up, boiled, dried and stored until it is carried away. That causes enormous problems of debris.
There are apparently based on Falmouth a staff of seven whose job it is to monitor this whole industry. They ask when one chides them for perhaps not doing their job as well as they might, "How do we know where the debris comes from in the dark of night? " There is no answer, because it can be seen that a staff of seven, spread over 168 hours a week, cannot possibly monitor the process at night, even if they can manage it during the day.
The Minister spoke of the Bill's dealing with an anomaly. There is another that needs attention just as urgently. How is it that if they are on the sea we allow factory ships to come within half a mile of the coast, with no planning permission or no consent required? If they are half a mile the other side of the seashore, on land, the planning procedure, the effluent controls and the general involvement of the public are enormous. Why are the Government not dealing with this problem in the Bill?
The problem that worries me and the West Country fishing industry most is what is happening to fishing stocks in the long term. They are simply being decimated. The long-line fishing industry has for long provided many jobs in the South-West. In the village of Flushing, in my constituency, not five years ago there were 100 boats going out. Now one would be lucky to find 15 or even 10. Other hon. Members from Cornwall can tell similar stories of their areas, though Flushing was so mackerel-based that it is without doubt the worst affected.
Long-line fishing is the perfect method for preservation of stocks. It involves throwing out of the back of the boat a long line with thousands of hooks on it which glisten as it is pulled through the water. The mackerel are so stupid that after all the years they still jump on the end of the hook, with no bait whatsoever. The fishermen wind the line in after a while and flip the mackerel on to the deck and if some of the fish are too small they flip them back into the water—alive, not after they have been crushed in purse
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seine nets; the fish do not go anywhere alive after that. The fishermen can pack the fish by size immediately. For a long time this method has provided jobs in the South-West, but no longer. Just a few fishermen still struggle along.
It is interesting to note the way in which the herring stocks and the annual catch went in the year before its virtual elimination. The period from peak to collapse was not more than two or three seasons. It was remarkable how the industry maintained an ever-increasing catch year after year until suddenly the industry fell apart.
I tell the Minister that I believe that there is a terrifying chance that this God-given finite resource—it is not something over which we have any control—will follow the herring into oblivion.
As I understand it, the official price for mackerel over the side of a factory ship is about £90 a ton. After one has caught the total allowable catch and one does not declare on the ship's record how much more has been caught one then gets £30 a ton cash for anything else caught that day. With just seven men checking the fish, the industry certainly catches an enormous amount more than it is allowed to do.
According to the official statistics of the White Fish Authority, Britain's fishing industry last year achieved the remarkable record of exporting twice as much mackerel as it caught. If only a few more British industries could manage a productivity record like that, we would not be in our present difficulties.
Those figures were boldly printed in the annual report of the White Fish Authority, though nobody believes them. It is an enormous fiddle, and unless the Government set up an entirely different system of monitoring the way in which these fish are caught the situation will get worse, largely because the general regard for the efforts made by Governments—I speak of Britain and abroad— to control their fishing industries is so low that the fleets are ignoring the regulations and rules and co-operating with each other in so doing.
I see no reason why a system could not be introduced whereby a single boat was stationed somewhere in the bay and every boat wishing to go in for transshipment would be required to call at

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that boat before being allowed to proceed. Inspectors know the shapes and sizes of boats. They could go on board and make a good guess of how much mackerel was on board any ship. A licence should be required before fishermen are allowed to go out and give the fish to the Russians, the Bulgarians, the Egyptians or whoever they are trading with on a particular night.
Such a system would at least assure the Government that they got the maximum number of £2 levies. In that way the amount of fish being trans-shipped would be known.
The official price of mackerel in Cornwall—and I am sure that the housewives of Britain will not believe this—is 4p a pound. That is what the Russians, the Bulgarians, and the Poles are here for. That is why the Minister is allowing this activity. There are 40 factory ships oft Cornwall decimating one of the few finite resources we still have—for 4p a pound. That is the price at which the Minister allows such activity to take place. He knows as well as I do that the whole enterprise is a fiddle and giveaway from one end to the other.
Mr. Robert Hicks: As the hon. Member knows, I have a certain sympathy with what he says. But does he not agree that those who represent Cornish constituencies face a fundamental dilemma in that the producer who sells for the fresh mackerel market obtains a price of about £110 to £120 a ton? If selling to the factory ships did not exist, the shortfall would be about £90, because they would get only £30 a ton for a catch going to the fishmeal factory. How do we resolve that dilemma in terms of supporting the inshore Cornish fishing industry?
Mr. Penhaligon: It is simple. Two things are required. First, we must have a massive effort to increase the amount of mackerel sold fresh—and the White Fish Authority should be responsible for that. Secondly, we must reduce the amount of mackerel caught in the South-West. I understand that the situation is not much different off the West coast of Scotland.
I tell my constituents that I would tolerate the whole thing collapsing like
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a pack of cards for a month or two because that might concentrate the Government's mind on what they are encouraging. Then they might be forced to sort out the problem. I can say with confidence that if the present level of fishing and fiddling continues—and I should have put the words the other way round—in another five or 10 years there will be no mackerel industry in Cornwall.
According to the chairman of the White Fish Authority, grants have been provided for the building of 131 fishing boats of various sizes and shapes. Just six of the grants went to Cornwall, less than 2 per cent. of the total. The boats built and assembled in Cornwall are small, up to three-mile inshore fishing boats, not the type to which the hon. Member for Kingston upon Hull, West (Mr. Johnson) referred. It is obvious that Cornwall is not getting its fair share.
The Minister must ask whether he can justify the present scenario. How do we justify it to athletes who have trained for years if the Government tell them that they cannot go to Moscow for the greatest day of their lives when we allow the Cornwall coastline to be littered with boats from the Soviet Union and its Communist allies? How can the Minister allow that ludicrous situation to continue?
12.42 am
Sir Walter Clegg: I appreciate the feelings of the hon. Member for Truro (Mr. Penhaligon), because he has a problem in the South-West. Trawlers from my local port have taken part in fishing off Cornwall. Had they not, they would have been tied up at the wall or possibly scrapped or sold. The hon. Member must realise that for the deep sea industry mackerel fishing off the South-West coast has been of infinite value.
I support what my hon. Friend the Member for Aberdeen, South (Mr. Sproat) said about the speech by the hon. Member for Grimsby (Mr. Mitchell). I have taken part in many fisheries debates, but I have never heard a more robust political approach. It does infinite harm. Some of his arguments were good, but seeking to apportion blame gets us nowhere. Both parties have had responsibility and they must both face the facts.

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When the measures were announced I said that I would examine them carefully because time was not on our side. It certainly is not. In Fleetwood we have made a great effort, but we are facing a crisis. The Minister knows that. Something must be done about imports. By and large, the industry would prefer its returns to come from the market, but that is impossible at present. I beg the Government to examine the imports problem. If nothing is done, more harm and permanent damage will be done to the industry. The Bill is not designed to deal with all the problems. Time is running out rapidly. I beg the Minister to examine the matter with care.
12.45 am
Mr. John Home Robertson: As a Labour Member of the Select Committee on Scottish Affairs, I take this opportunity to pay tribute to the Government for the speed with which they have come forward with legislation in response to a recommendation by that Committee on 14 February. It has taken only three months to introduce this measure, and I hope that all future recommendations of that Committee will receive a similar response. In all sincerity, I pay tribute to the Government, on behalf of all members of that Committee—the hon. Member for Aberdeen, South (Mr. Sproat) has already said this—for this achievement.
Conservative Members gave my hon. Friend the Member for Grimsby (Mr. Mitchell) a bit of a hard time when he spoke, and I thought that they were a little unfair. We can talk about the benefits of a bipartisan policy on fisheries, but Tory Members have sometimes not brought credit on the political profession when dealing with fisheries matters. I have no doubt that there have been tremendous speeches at Peterhead, Arbroath, Buckie and Lossiemouth and everywhere else about the powerful stand that would be made by Conservative Members for fishing areas, but where were they when the vote was taken on the original increase order for the White Fish Authority? As the right hon. Member for Western Isles (Mr. Stewart) said, they were voting for the order, while Labour Members were putting their votes where their mouths were.
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We have heard about the fairy godmother to the fishing industry. I do not think that fishermen believe in fairies, and I am afraid that it will take more than a fairy godmother to rescue the industry at this time of crisis—and, my goodness, it is a crisis. We all know about it. The hon. Member for Aberdeen, South earlier today made an excellent speech describing that crisis. It is fundamentally to do with imports, but it has a great deal to do with the interest rates that fishermen are having to contend with, and of course it has to do with the problem of over-fishing in our waters.
The industry is facing a major crisis. What it needs is an injection of money. The Bill will produce a little more money for the WFA, but it will not produce anything like the injection of cash that is desperately needed to rescue the industry at this stage of its difficult career.
I welcome the Bill, as I have said, mainly because my constituents in the fishing industry—inshore fishermen—are having the existing levy collected on every fish that they land—at least so they tell me. I see the hon. Member for South Angus (Mr. Fraser) shaking his head. I do not know whether he doubts that. It adds insult to injury to fishermen who are having the levy collected on their landings to sec large quantities of fish that have been caught in British waters being landed here without having to pay the levy. It therefore stands to reason that everybody in the House must welcome the Bill.
There are one or two questions that need to be asked, because it is essential that the valuable work of the authority should continue—the work on research and development and, indeed, the publicity. One point that cropped up during the deliberations in the Select Committee was whether it was appropriate that a levy should be used at all to finance research and development in the industry. A comparison was made with the agriculture industry, where a great deal of research and development goes on, but it is financed out of central Government funds. It is right that we should consider that point while discussing the Bill. There are powerful arguments which suggest that the essential work on research and development for the fishing

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industry should be financed by Government taxation rather than by a levy.
What will be the future activities of the amalgamated White Fish Authority and the Herring Industry Board? The Bill clearly provides a reprieve for the finances of the authority. What are the Government's intentions for the long-term future of what they scornfully refer to as a "quango"? In his opening remarks the Minister said that the provisions in the Bill would keep the WFA solvent. He did not say that it would maintain its existing standards of services. He did not even refer to the fact that many would say that the existing provision of services by the WFA may not be adequate. Those hon. Members with fishing boat building firms in their constituencies are aware that the WFA grant and loan schemes have been a little below par in recent years. I appreciate that Governments of both parties have been at fault on that matter.
That has given rise to a dangerous position, and British fishing boat owners have not been in a position to replace their vessels at the rate that is necessary for the long-term benefit of the fleet. Many vessels have been purchased from Norway because of a lack of WFA grants and loans for purchasing new vessels.
The Minister said that the Bill would enable the WFA to collect a levy on fish trans-shipped by United Kingdom vessels within British fisheries limits. Why does that apply only to United Kingdom vessels? Why can we not collect that levy on fish that is caught by foreign vessels within British fisheries limits and then trans-shipped? The industry would like an answer to that question. How does the Minister propose to monitor the catches made either by our vessels or by foreign vessels within British fisheries limits? The hon. Member for Truro (Mr. Penhaligon) referred to the difficulties of policing any scheme.
I return to my earlier remarks, in which I said that it would be more satisfactory to finance the WFA's activities in another way. If we are to finance them through a levy, we must be absolutely sure that we are collecting the levy in an equitable manner. I welcome the Bill because it is a step in that direction, but the Minister owes it to the industry and
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to the House to tell us more about his proposals on that matter.
12.54 am
Mr. Peter Fraser: I doubt whether those of us who met in Aberdeen only a few short months ago seriously expected that, on reporting to the House, within less than 10 weeks, the Government would come forward with a constructive proposal on the trans-shipment of fish at sea. I wish to say to the hon. Member for Berwick and East Lothian (Mr. Home Robertson) that it was worthy of him to pay tribute to my hon. Friend the Minister for bringing proposals before the House.
The Select Committee on Scottish Affairs, if not unanimous on all matters, was unanimous in the view that something had to be done to reform the legislation on this point. I quibble with the hon. Gentleman on one small matter. He made a point of taking up the remarks of the right hon. Member for Western Isles (Mr. Stewart) about the discrepancy in attitudes that had been adopted on this side of the House. I remind him that in the report which we laid before the House, on a motion that I put before the Select Committee, he agreed that
" We can see no other way in which the shortfall "—
of the White Fish Authority—
" can be made good except through some increase in the levy ".
He cannot escape the fact that that is what he signed and agreed to in the report put before the House.
Like my hon. Friend the Member for Aberdeen, South (Mr. Sproat), I very much welcome this Bill. In no way are we suggesting that this is the complete answer to the major problems which now confront the fishing industry throughout the United Kingdom. However, it is worthy of note that it was as a result of the Select Committee on Scottish Affairs —giving the impulse and drive from the North-East of Scotland—that this measure has come forward. If nothing else, that is indicative of the effort for the fishing industry which is being made from Scotland.
In an utterly superficial intervention from the right hon. Member for Western Isles—[HON. MEMBERS: " Where is he now? "]. Indeed. In that utterly superficial intervention, he showed absolutely

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no understanding of the evidence which was given to us, not only by the WFA but also by the fish processors and the fishermen themselves.
It is also worthy of note that we are discussing this measure in the presence not only of my hon. Friend the Parliamentary Secretary but of my right hon. Friend the Secretary of State for Scotland, who has been here throughout the debate. I have no doubt whatever that his support for the measure was largely instrumental in ensuring that it came before the House in about 10 weeks.
Like my hon. Friend the Member for Aberdeen, South, I regret that the hon. Member for Grimsby (Mr. Mitchell) sought to introduce a bipartisan note into the debate. Where was he during the years from 1974 to 1979? The only conclusion which anyone from the fishing industry can draw is that he was packed in crushed ice.
12.57 am
Mr. Wm. Ross: From listening to the debate so far, one could be excused for thinking that a lot of fishermen in the country are not all that happy about paying the levy. Of course, there may be many reasons for that. No one likes giving away hard-earned money to anyone, least of all to any Government or quasi-Government body. I believe that it is generally accepted that the White Fish Authority does some valuable and important work. Therefore, one must conclude that, if there is a reluctance to pay the levy, fishermen must be concerned as to how that money is spent and whether it is being wisely spent.
One of the reasons for the existence of that body is conservation of stocks. It is principally to that aspect that I should like to turn the attention of the House, especially in so far as it affects my own constituency and fishing on the north coast of Northern Ireland in general. There is a small fishing industry on the north coast of Northern Ireland. It is very much a family industry. In United Kingdom terms it is not a very important industry, but it is important locally. It suffers a great deal from illegal fishing and poaching by foreign vessels, which do not come from a country far distant from our shores but often from a country situated within the same island on which I live.
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Those vessels drift eastwards across the north coast, sometimes within a mile of the coast. They fish regularly and assiduously. One suspects that they fish not only for white fish but for other fish with pink flesh which have a much higher value. Recently one of those vessels was seen in broad daylight within a mile of the mouth of the River Bann, which is in my constituency, taking up a catch. The skipper took the precaution of covering all identification marks. He took up his catch and cleared off back to Donegal. That is not a matter that the British Government can accept lightly. However, it has gone on for years and nothing is done to stop it happening locally. Against that background, our concern for the future of our small industry grows.
Conservation policy in that area seems to be geared to providing fish for our opponents and competitors. Against that background, is it surprising that our fishermen show a reluctance to pay the levy? Why should they pay money when the benefits of the levy will be reaped by others?
The White Fish Authority provides a great deal of specialist advice to the industry. In the light of that, I hope that the Minister will not take it amiss if I offer him some advice. It appears to me, to the fishermen on the north coast and to the many others who make use of the industry on the north coast for recreation that protection vessels that are based in Scotland are totally useless. If something is not done to bring the protection between the poacher and his escape route, the fishing industry off the north coast of Northern Ireland will rapidly disappear.
In daylight a fishery protection vessel can be seen coming at least 20 miles away. It appears never to come by at night. The folk who live in the area find that their livelihood is being taken away from them. There is no levy paid, because it is paid on fish that are landed or trans-shipped within Northern Ireland or United Kingdom waters. The fish that are taken off the North coast are not transshipped, they are taken home. The fish are not landed at any British port, they are landed at a foreign port.
If the Minister and the Government are not prepared to take the necessary steps to protect the fishing in our waters, the fishermen in the area will see their

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livelihood disappear completely. They feel that their fish are being stolen from under their noses. They feel that they are utterly without protection. They feel that nothing has been done to protect their interests and livelihood. They feel that those who compete with them are getting away with it scot-free. They do not like that one little bit.
1.3 am
Mr. Robin Maxwell-Hyslop: It was just over three years ago, on 4 May 1978, that the old Trade and Industry Select Committee published its report on the fishing industry. Paragraph 22, perhaps forgotten, is now especially relevant. I shall read the crucial passage, which states:
" The same evidence suggests that, whilst the policing of shore landings is probably adequate, there are serious doubts about the policing arrangements for trans-shipment, and in reply to a question in the House by a member of the Sub-Committee a MAFF Minister could give only an estimate of the quantities trans-shipped. The Ministry claim that there is no evidence either that trans-shipments have been frustrating the intentions of the Mackerel Licensing Order or that mackerel is being dumped on a scale which does so: indeed they state that reports of dumped catches do not suggest that the practice is as prevalent as it was in 1975 and 1976."
The surprising feature is that some organs of government go to immense pains to ensure that not a halfpenny of what is due to public funds is evaded. We all know of industries in which identity cards with photographs on them have to be carried before people can be employed —for example, the building industry.
Mr. McQuarrie: Is my hon. Friend referring to 714 certificates?
Mr. Maxwell-Hyslop: Exactly. Yet we permit within British territorial waters— at present we operate a mere three-mile limit, which invites evasion—trans-shipment at sea, where there is and can be no effective supervision by agents of the British Government or the White Fish Authority.
I welcome the measure that the Government have introduced, but I do not see how it can be enforced effectively unless, as the Committee recommended three years ago, we consider that all fish caught, not just in the three-mile limit but in British waters, should pass through a fishing port or that there
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should be an intermediary vessel under the control of the British Government through which trans-shipments pass so that there can be an effective register.
This is necessary for two reasons. One is for revenue purposes, which is what we are considering in the Bill. The other is that the whole licensing system depends on a calculation of the attrition rate of the breeding stock and a distribution of the year classes within the totality of the fish stocks.
If there is a gaping hole of unqualified size in the instrument for measuring that rate of attrition, namely, trans-shipment—which is not and cannot be under the supervision of the British Government—we are basing our permitted quotas, even supposing that they were rigidly enforced on foreign vessels, on a guess rather than an informed figure. This is why it is essential, not only for revenue purposes but for the preservation of the breeding stock of our remaining fish population, that this glaring source of evasion should be stopped up effectively.
The measures that we are taking tonight—although they may yield some revenue—will presumably add a further incentive to evasion. If 100 tonnes of fish are booked as 80 tonnes when they are trans-shipped on to a Russian or Romanian trawler, it is the money due to the White Fish Authority which is saved and which is not paid on the undeclared 20 tonnes out of the 100 tonnes.
The thought that I leave with my hon. Friend is that, after the Bill reaches the statute book, it will be more, not less, necessary to adopt a system of effective policing. It is my considered opinion that there can never be an effective system of policing while there is direct shipment—not a trans-shipment at sea— not passing through a Government White Fish Authority or county sea fishery comittee controlled monitoring station.
1.9 am
Mr. Albert McQuarrie: Before I say anything about the Bill, I should like to reiterate the comments made by my hon. Friend the Member for South Angus (Mr. Fraser) about the absence of the right hon. Member for Western Isles (Mr. Stewart) and the

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hon. Member for Dundee, East (Mr. Wilson). Those two worthy members of the Scottish National Party, who allege that they support everything for the fishing industry in Scotland, think so little of this levy that they have not seen fit to come into the debate, other than for the very short controversial intervention made by the right hon. Member for Western Isles.
I make no comment on the speech of the hon. Member for Grimsby (Mr. Mitchell). When earlier I raised a point of order, Mr. Deputy Speaker, your predecessor in the Chair assured me that the hon. Member was ultimately leading up to the point of the Bill, on which I still await to hear the hon. Member. However, at this hour of the morning I think that we should have reached the stage at which someone should talk about the Bill. In the very short time for which I want to speak—as has been rightly said, we are here to speak for only a few moments— I shall endeavour to do just that.
I welcome the Bill because, if it does nothing else, it will remove a situation which has permitted fish to be caught in British waters and no levy paid for that. When a catch is trans-shipped at sea, it should be one on which a levy is charged. This is particularly so in respect of the mackerel catch. From the evidence which has been collected, it has been proven that two-thirds or three-quarters of all mackerel caught in British waters are being trans-shipped and exported free of levy. The present legislation permits this because trans-shipment falls outside the statutory definition of " landing ". This has meant that a considerable amount of money has been lost in income to the White Fish Authority, and the passing of this Bill should, we hope, close that loophole.
There are a number of questions, however, which I should like to put to the Minister. I hope that he will give answers not only to the House but to the fishing industry, because it is the industry that will be looking for these answers.
From the available figures, it would seem that the increased income from the charging of this levy on trans-shipment will amount to some £460,000. That is not an inconsiderable sum. How is that money to be spent? I hope that it will not be used to increase the administra-
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tion of the WFA or the new statutory body which the Government intend to put into effect very shortly. The fishing industry would not look kindly on that when the recent increase in levy has considerably added to the income of the WFA for the year that is to come, and this is at a time when the industry, as has rightly been pointed out by several hon. Members, is at its greatest crisis ever. Cannot the money be used to reduce the existing levy and thus give the industry some financial relief? Or will it be used to promote the domestic market? The Minister says that this has been done. With respect, it has not been done, because it is not the money that is being given now which is part of the additional money which will be taken in when fish are trans-shipped. That money can be used either to act as a relief for the industry, or for other purposes, such as to promote the domestic market, or to assist the processing industries or other outlets in the United Kingdom so that more food can be exported to Europe. This House is entitled to know exactly what plans the Government have for the spending of this increased income.
There is another factor which is of great concern to the industry. What will happen if, because of the decision to impose the levy on trans-shipped fish, the Russians and others who are at present the largest customers of trans-shipped fish decide to go away? From I January to 16 February this year, 55,000 tons of mackerel have been trans-shipped in British waters. What will happen to the fish if we have no customers? It is already a declining market, with a very small profit margin. If such a thing happened, what safeguards would there be for the fishing industry if nothing is being trans-shipped? I hope that the Minister can give an assurance about what support would be given if such a catastrophe should occur.
Then there is the question of policing, rightly mentioned by my hon. Friend the Member for Tiverton (Mr. Maxwell-Hyslop), of this levy on trans-shipped fish. It is recognised that this will be a very difficult matter to handle when transshipments are taking place at sea. Perhaps the Minister will say how this will be done.
Whatever methods are adopted in regard to the implementation of the Bill

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once it becomes law, the income must be seen to act as something to benefit the fishing industry in practical terms and should not be used for any other purposes. On that basis, and anticipating the Minister's assurances, the House should welcome the Bill.
1.14 am
Mr. Alex Pollock: In spite of my strong opposition to the day of action, I cannot help thinking that it would have been to our advantage if the hon. Member for Grimsby (Mr. Mitchell) had decided to take part in it.
Mr. Austin Mitchell Mr. Austin Mitchell rose—
Mr. Pollock: As long ago as 20 February 1980 the hon. Member said:
" I emphasise that I support the White Fish Authority and its work, because fishing is an industry which has for too long been unregulated, disorganised and divided."—[Official Report, Sixth Standing Committee on Statutory Instruments, &c, 20 February 1980; c. 9.]
I venture to suggest that his shoddy and divisive speech did nothing to help.
Mr. Mitchell: I appreciate the position in which the hon. Gentleman finds himself. He is caught between pressure from his constituents and pressure from the fishing industry, which believes that the Government are doing nothing to help. I appreciate his deference to his party. However, he can get up from his knees. Is the fishing industry in his constituency satisfied with the amount of aid that the Government have given? Is it satisfied with their action over imports?
Mr. Pollock: At this late hour we are debating the Sea Fish Industry Bill. I shall not use this occasion for a blatant constituency speech for home consumption. The Bill's merits should be considered.
I warmly welcome this measure. It reflects great credit on the Government and their ability to respond to the efforts of the Select Committee on Scottish Affairs. It demonstrates that there is mettle and political muscle in such Committees. Perhaps that has escaped the notice of the SNP, which has chosen to boycott and scorn the idea of a Select Committee on Scottish Affairs. It has also boycotted this debate, with the exception of one brief and ill-informed
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intervention from the right hon. Member for Western Isles (Mr. Stewart).
The hon. Member for Berwick and East Lothian (Mr. Home Robertson) criticised Conservative Members for their voting record in the levy debate. He may recall that I and several colleagues pointed out to the Minister that he would get our support only if he gave certain undertakings when he replied. He gave those undertakings. Indeed, one of them was honoured within 10 weeks. That is an example of the Government's good faith. It is an example to those of us who are trying to fight for the industry. In that spirit, I welcome the measure.
1.18 am
Mr. David Myles: I welcome this opportunity to speak. I shall be brief. I shall confine my remarks to the Bill and not to seven seas, but to three " c's ". The first " c " is congratulations—congratulations to the Government on having introduced the Bill congratulations to the Secretary of State for Scotland on showing his concern for the fishing industry and on attending the debate at this late hour; and congratulations to Conservative Back Benchers, who have been assiduous in their attention after yesterday's all-night sitting.
I can give no credit to the hon. Member for Grimsby (Mr. Mitchell). He made a contemptuous speech that was addressed to the front page of his local newspaper. I extend congratulations to the hon. Member for Kingston upon Hull, West (Mr. Johnson) on his contribution, and to the hon. Member for Berwick and East Lothian (Mr. Home Robertson), who at least tried to be constructive. I can give no credit to the right hon. Member for Western Isles (Mr. Stewart.) He has departed the scene after a shoddy intervention.
The second " c " is control. I welcome the control that the Bill will bring to the fishing industry. In case the Government think that I am getting soft in my support for the fishing industry, I must emphasise that I hope that this is only the first bit of control and that the Government will impose much more in order to ensure conservation and all the other "c's " that we must consider in the fishing industry.
The third " c " that I, as one who comes from not so far north of Aberdeen, must welcome is cash.
Mr. Penhaligon: I can see that cash will be raised—my father would have said " kash with a capital ' K ' "—but I cannot see what control the Bill incorporates.
Mr. Myles: There must be control before there is accountability, and there must be accountability if there is to be collection. I imagine that the Government, in their wisdom, have the methods to collect the cash. The cash is necessary for vital work being done by the White Fish Authority, and I hope that the authority can combine with the Herring Industry Board to make that body more effective.
1.22 am
Mr. Bill Walker: I had not intended to speak in this debate, as I do not have a fishing industry interest, other than that of salmon fishing in my constituency. However, after listening at some length to the speeches, I realised that the White Fish Authority was yet another quango.
Although hon. Members with fishing constituencies appear to welcome the Bill, I have reservations. I hope that the cost of adequate policing will not turn out to be too expensive and therefore reduce significantly the expected additional funds. It is my experience that, unless one thinks these things through very carefully, it often costs more to police than not to do so. I am very worried that we will give a quango additional responsibility and then realise that the cost of doing so is much greater than Parliament envisaged. I hope that the Government will bear this very much in mind.
1.24 am
Mr. Roy Mason: It is not my intention to refer to the many speeches that have been made in the debate, but I think that my hon. Friend the Member for Grimsby (Mr. Mitchell) has been unfairly attacked. He had a perfect right to express himself as forcefully as he did. Grimsby is his constituency, and Grimsby is a port. Fishermen are his constituents, they are suffering, and the situation is getting worse. Conservative Members have recognised that.
The reason why we have so many Tory Members sitting in on this debate in the early morning is that they are concerned, too. They know that if the situation deteriorates further their voices will be raised in anger against their Minister.
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Legal opinion has shown that the White Fish Authority did not have the powers to impose the levies on fish caught and trans-shipped at sea. This issue had been highlighted because of the experience off the South-West Coast over large amounts of mackerel that were caught in our coastal waters and then trans-shipped to the foreign factory vessels. In other words, the mackerel has not been landed on shore. It may not have mattered, and did not become an issue until these vast mackerel catches were trans-shipped from the South-West.
Apart from the argument about the future of the White Fish Authority, which was also part of the debate in the Standing Committee on Statutory Instruments, and the possibility of higher levels, the trans-shipment loophole needs blocking. If that is done effectively, it will provide the WFA with between £250,000 and £400,000 extra revenue, depending on the methods used to detect and police transshipment. The House recognises that the Select Committee on Scottish Affairs and the Standing Committee on Statutory Instruments urgently recommended such action. The Bill has our blessings, and we shall facilitate it through all its stages.
Regarding grants and loans, most of which are administered by the WFA, the Government will be aware that the situation in the fishing industry has worsened. On 13 March the Minister made a statement on financial aid to the industry. The £2 million for producers' organisations is seen in retrospect to have been of little value, especially when compared with the increased grants given to our competitors. The French fishing fleet has just been given £5 million to modernise its vessels to exploit new fishing grounds. We are receiving reports that the German fishing industry is being given up to £14½ million for the year 1980–81.
The £2 million for the ports, viewed on the basis of the share out, has had little impact. The port in the constituency of my hon. Friend the Member for Grimsby received an amount sufficient only to run the port for about a month.
The industry has two major concerns. The first is that an agreement on a common fisheries policy within the EEC is being further delayed. It is essential that the Government should once again consider urgently further grants to keep the

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industry alive. The industry is afraid that resolution of policy on the CFP is again slipping in time. A Fisheries Council meeting is planned for 27 May. That is one more meeting before the summit in Venice on 12 June. It is essential that the CFP is dealt with on its merits. There must be no trade off with fishing policy in an overall budget deal. The French will fight hard, and the Dutch, Germans and Danes will back them, if the negotiations prove tough and we persist in trying to get a better deal for our fishermen.
The Minister must be aware that the entire industry and all hon. Members representing fishing constituencies will not stand for compromise on preferential access in a 50-mile zone and exclusive access in a 12-mile belt. We all believe that those objectives are worth fighting for. We are worried that the timetable is slipping, and that more aid will be required.
The other main concern for the industry and the WFA is the constantly rising imports of cheap fish. In the first three months of this year we imported 100,000 tons of fish, which is a 53 per cent. increase over the same period in 1979. About 70 per cent. of the white fish on our tables in Britain is caught by foreigners and dumped in Britain. About 40 per cent. of that is cod, our traditional fish dish. That is a startling example of how our own deep sea trawlers are being barred from our traditional fishing grounds. More and more of them are being laid up. The industry, port by port, is being ruined. We just cannot allow that to continue.
All the organisations in the industry are banding together and presenting a storm of protest to the Government. Urgent demands are being made for a halt to the flood of cheap fish imports. The industry is demanding a doubling of the withdrawal and reference prices and it wants the Government to impose duties of at least 15 per cent. on imports of fish from third countries and to take measures to effect a cutback on fish imports to the 1978 levels.
Unless there is a substantial increase in quayside prices to stop or to neutralise the artificially low prices of imported fish caught by Common Market vessels, most of which are receiving official grants in
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excess of ours and subsidies, including fuel subsidies, our fishing industry will not survive the common fisheries policy negotiations.
I hope, therefore that these matters are receiving serious Government attention and that the Minister will give some assurances to the industry that the Government do not intend to waver or weaken in the common fisheries policy talks and that further financial aid will be forthcoming to keep the fishing fleets alive until our policy objectives have been achieved.
1.31 am
Mr. Wiggin: By the leave of the House, I shall reply to the debate.
I understand that the hon. Member for Grimsby (Mr. Mitchell) was making his first speech from the Opposition Front Bench on this subject. As a believer in the customs of the House, I congratulate him on that appearance, but the churlish and unforgivable note that he introduced into the debate was uncharacteristic of his party's attitude to date on the subject and of the fairly unanimous view of what is in the national interest.
For example, the hon. Gentleman started by complaining that the Government were late in dealing with the matter. The Bill amends an Act that was passed in 1970 and so far we have been in office for only one fishing season, the matter was published originally in the Select Committee report as recently as 14 February and we have managed to act this quickly in order to get the levy for this season. I cannot accept the hon. Gentleman's criticism.
Mr. James Johnson: Does the hon. Gentleman accept that my charge that, if a number of firms in Hull have been paying the levy and others have not, there should have been a second or third look at the matter in Edinburgh? Has there not been an unusual combination of circumstances?
Mr. Wiggin: The Bill is before the House because an unsatisfactory situation has developed as those who legislated in 1970 did not foresee the business of transshipment growing up. It has led to inequality and companies may be taking legal action to recover levies paid in the past. It would not be right for me to go into what may happen since it will

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probably ultimately be a matter for the courts to decide.
On the finances of the White Fish Authority, my hon. Friend the Minister of State has kept his promises in every way. He has sought to put this matter right, and to ensure that the authority is good in its own housekeeping. That has resulted in a reduction in the levy, as promised.
I hope that the hon. Member for Grimsby will reflect carefully before he repeats his remarks about non-co-operation and non-payment of the levy. Such action would not be constructive or helpful to the industry. Given the efforts that we are making to solve the problems, I am sorry that the hon. Gentleman did not see fit to deprecate any such suggestions. His statement that this matter stems from our negotiations over the common fisheries policy is not true. The Bill is simply to put right, as I have stated twice already, a technical development that was not dealt with in the 1970 Act.
My hon. Friend the Member for Falmouth and Camborne (Mr. Mudd) and many hon. Members raised the question of the accuracy of the returns and how it will be possible to monitor the quantities of fish that may be moved from one vessel to another, so to speak, out of sight of prying eyes. I also have some personal concern about this matter since there are clearly technical difficulties. I understand, however, that the White Fish Authority has an established system which it is satisfied is reasonably accurate and that the system has worked to date without presenting any insuperable problems. Details of its administration will be the responsibility, not of the Government, but of the White Fish Authority. The hon. Member for Truro (Mr. Penhaligon) laughs. He is perhaps not aware that the foreign vessels concerned do not always pay in hard cash; rather they pay in trading items. It is, therefore, more sensible for the fishermen to carry out much of their business through agents. This enables monitoring to take place. The White Fish Authority does not think that there will be great difficulties.
Mr. Penhaligon: Does the Minister think that the mackerel fishing is substantially fiddled? Will he give a simple " Yes " or " No ".
Mr. Wiggin: I do not understand the question. If the hon. Gentleman is ask-
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ing whether I consider that every last ounce of fish caught by his constituents will subsequently attract every last penny of duty, the answer is " No." If he thinks, in general terms, that the levy is worth collecting and that the White Fish Authority, to the best of its ability, will be able to monitor the quantities, the answer is " Yes."
A number of hon. Members gave a substantial welcome to the Bill, for which I thank them. The hon. Member for Truro raised a number of interesting points, not the least of which was the proposition that, in the light of the invasion of Afghanistan and the Government's attitude to trade, we should seek to question whether business should be conducted with Russian vessels. I remind him that the attitude of the Government was not forthcoming until after the mackerel season was over. I am certain that his points will be borne in mind within any constraints exercised by Common Market regulations.
The hon. Member for Berwick and East Lothian (Mr. Home Robertson) asked whether United Kingdom vessels alone would pay the levy. We are merely amending the 1970 Act. It would represent a substantial departure to change the levy arrangements to apply to all vessels, but the hon. Gentleman's point will be borne in mind. There will be a need for subsequent discussions with the industry and further legislation in due course on the whole matter.
The hon. Member for Londonderry (Mr. Ross) raised problems of fishery protection off the Northern Irish coast. These problems are shared in many areas. We seek to be present in the trouble spots as best we can with limited resources. But the more general issues that the hon. Gentleman mentioned relating to Northern Ireland will be taken note of.
My hon. Friend the Member for Tiverton (Mr. Maxwell-Hyslop) asked about quantities. The White Fish Authority estimates that, in 1979, about 223,000 tonnes of fish were trans-shipped, which represents about 67 per cent. of the United Kingdom catch by weight.
My hon. Friend the Member for Aberdeenshire, East (Mr. McQuarrie) asked what revenue was anticipated. It is difficult to give a firm answer because the

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catches and the method of marketing vary.
I understand that the budgeting of the White Fish Authority allows for a figure of £300,000 to be used. I cannot at this early hour of the morning enter into a debate about the workings of the White Fish Authority.
The House needs little assurance that my hon. Friend the hon. Member for Banff (Mr. Myles) is not going soft. He raised a valid point about conservation. I have no doubt that monitoring of figures in this context will be helpful to those who have to look after this part of the authority's operation. My hon. Friend the Member for Perth and East Perthshire (Mr. Walker) rightly made a point about the cost of monitoring. His remarks will not fall on deaf ears.
The right hon. Member for Barnsley (Mr. Mason) entered realms which I shall not go into tonight. He has made previously his ritual request always for more. He must well know the substantial efforts that my hon. Friend the Minister of State and my right hon. Friend the Minister have made—as did the right hon. Gentleman's predecessors —to bring about a satisfactory solution to this intractable problem.
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I finish on a note that has run through a number of speeches by Opposition Members, particularly that of the hon. Member for Grimsby, and was repeated by the right hon. Gentleman. It was to do with the way in which this Government have given assistance to the industry. I do not need to labour the point, but merely quote what the hon. Member for Edinburgh, East (Mr. Strang) said on 14 February:
" What is the fishing industry asking for? It asks for perhaps £3 million, or not much more."—[Official Report, 14 February 1980; Vol. 978, c. 1905.]
Six weeks ago the industry got £3 million, exactly. I find it extremely odd that no sooner has that figure been decided and paid than there is a welter of criticism, when we did precisely what the Opposition asked.
On that note, bearing in mind that the Bill is about a minor amendment to the 1970 Act, I commend it to the House.
Question put and agreed to.
Bill accordingly read a Second time.
Bill committed to a Committee of the whole House.—[Mr. Newton.]
Bill immediately considered in Committee; reported, without amendment; read the Third time and passed.

NORTHERN IRELAND (CRIMINAL JUSTICE)
1.44 am
The Minister of State, Northern Ireland Office (Mr. Michael Alison): I beg to move,
That the draft Criminal Justice (Northern Ireland) Order 1980, which was laid before this House on 28 March, be approved.
Before dealing with the content of the order I should like to explain that, following publication of the proposal, a few changes have been made to the order. One relates to the new procedure for pleas of guilty in the absence of the accused—schedule 1, paragraph 5.
The draft order, as originally published, provided that where this procedure is used a court shall not without adjournment order any disqualification. We have since added a requirement that in such circumstances a notice of adjournment shall be served on the accused to advise him of the reason for adjournment so that he will be aware of the gravity of his position and will have every opportunity to appear before the court and be heard.
In the same paragraph we have added a new section 37D to the Magistrates' Courts Act (Northern Ireland) 1964. Difficulties at present arise because a magistrates' court is unable to compel the attendance of an accused person at court if he repeatedly refuses to attend after conviction of an offence which is punishable with imprisonment. The new section 37D meets this deficiency by allowing the court to issue a warrant for his arrest in such circumstances.
The House may also wish to note that we have amended the changes to the Prosecution of Offences (Northern Ireland) Order 1972 which are now contained in paragraphs 65 to 68 of the order. The amendment narrows the effect of the changes to limit the power of the Director of Public Prosecutions for Northern Ireland to consent to prosecutions under United Kingdom Acts to those circumstances where the DPP for England and Wales can give consent to like offences here. Fears were expressed that to do otherwise would be ultra vires.
A few other minor changes have been added to pave the way for consolidation measures which will be laid before the
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House shortly or to clarify the provisions already contained in the order.
Two items have been omitted from the order because of reservations expressed during the consultation period. One was the proposed addition to the powers of the court to allow a close relative to appear on behalf of the accused and to enter a plea of " guilty ". This was included at paragraph 29 of the proposal. Some people were concerned that a relative might appear before the court without the authority or permission of the defendant and we decided that on balance it would be better to omit it.
The proposed amendment to the Children and Young Persons Act (Northern Ireland) 1968 referred to in paragraph 46 of the proposal has also been omitted. This amendment would have had the effect of removing the requirement that a magistrates' court refer a young person to a juvenile court to be dealt with after conviction. The report of the children and young persons review group—the Black committee—has now been published and we decided that in the light of that report such an amendment should be further considered in that context.
These changes in the content of the order since publication as a proposal, while perhaps minor when considered in the context of the order as a whole, nevertheless show the value of the consultative procedure for Orders in Council under the 1974 Act. Much useful and helpful comment was received on this order—particularly from the magistracy and the legal profession—and the final version of the order has been improved as a result.
The order encompasses a considerable range of items and I will mention now only a few of its more important provisions. Articles 3, 4 and 5 deal with compensation to victims of crime. The courts in Northern Ireland already have powers under various statutes to order compensation, and the order will replace these with a single comprehensive provision.
The principal changes from the existing law will be that application by the victim will no longer be required; that compensation may be ordered in respect of offences " taken into consideration " and that the financial limits will be

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increased from £200 to £1,000 in the case of magistrates' courts, and the existing limit of £400 for higher courts will be removed. It is hoped that this wider, single, comprehensive provision will have the effect of encouraging the courts to exercise their powers for awarding compensation to victims of crime more actively.
Article 6 will extend the powers of courts to make restitution orders where offences are taken into consideration and will remove the requirement of an application to the court by the victim of theft in certain circumstances.
Article 7 provides that the courts on convicting a person of an offence punishable on indictment with a sentence of two years or more may order the offender to be deprived of property which had been used or was intended for use for the purposes of crime. This would include such items as burglar's tools or even a vehicle used to dispose of stolen goods or used as a get-away car.
Article 11 provides for the return from the Lord Chancellor to the Secretary of State of responsibility for the State pathologist service, and will restore the position to what it was prior to the passing of the Judicature (Northern Ireland) Act 1978.
Part I of schedule I includes a number of amendments to the Magistrates' Courts Act (Northern Ireland) 1964. While many of these are minor or technical, some deserve special mention. Paragraph 5 of the schedule sets out a new plea of guilty by post procedure similar to that already operating in England and Wales.
The introduction of the new procedure will, I am sure, result in a saving of time and expense not only for the courts but also for defendants and witnesses. The House should note that the new sections 37B, 37C and 37D—which relate to proof of previous convictions, restrictions on the courts' power to impose sentences of imprisonment, and the power to issue a warrant for a person convicted of an offence punishable with imprisonment— are general provisions and will not apply exclusively to cases tried under the new procedure set out in the new section 37A.
The order also increases maximum fines which may be imposed by magistrates' courts under the 1964 Act. Para-
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graph 8 increases the maximum fine for offences also triable on indictment from £200 to £1,000. Paragraph 13 increases the maximum fine from £100 to £200 for a summary offence under any enactment which provides only for a sentence of imprisonment; for example, offences under the Vagrancy Act 1824. These increases are in line with changes made in England and Wales by the Criminal Law Act 1977. The order will also increase the maximum fine which may be imposed on a witness for failure to attend in answer to a summons and the penalty for disorderly conduct in court. These increases are to be found at paragraphs 17 and 26 respectively.
Paragraph 31 of schedule I sets out a revised table of the maximum periods of imprisonment which may be imposed in default of payment of fines and other sums imposed by magistrates' courts. The new table is similar to that now applying in England and Wales by virtue of section 59 of the Criminal Law Act 1977, and will pave the way for the bringing into operation of section 40 of the Criminal Law Act 1977, which deals with the reciprocal enforcement of fines throughout the United Kingdom.
We have also taken the opportunity to extend and clarify section 101 of the 1964 Act, which deals with the powers of the court to allow time for payment of fines, or to allow payment by instalments, or to allow remission of fines. Part II of schedule I contains a number of amendments to other enactments.
Paragraph 36 amends the Coroners Act (Northern Ireland) 1959 to facilitate the holding of a single inquest where a number of deaths arise from a single accident or incident. Paragraph 40 relaxes the restrictions on coroners so as to enable them to have a post-mortem carried out in any case where he considers an inquest might be necessary or desirable. Paragraphs 76 and 77 amend the provisions of articles 8 and 10 of the Treatment of Offenders (Northern Ireland) Order 1976. Article 8 is amended to provide that a community service order shall remain in force unless revoked by the court. This is intended to obviate the need to seek a formal extension of a community service order beyond the maximum 12-month period where only a small number of hours remain to be worked.

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Article 10 of the 1976 order is amended to give the court power to revoke a community service order and deal with the offender for the related offence where the person is convicted of a further offence during the period that the community service order is in force. Both these provisions are similar to changes made for England and Wales by the Criminal Law Act 1977.
I hope that the House will feel that I have said enough, at least at this late hour and at this stage, on what is a quite wide-ranging and in many ways technical order. Much of the content represents the result of a continuous process of reviewing the law in the absence of devolved government in Northern Ireland, while other aspects arise from experience in the operation of the existing provisions. Together they form a useful package which should prove a valuable contribution to the administration of justice in Northern Ireland, and I commend the order to the House.
1.55 am
Mr. Brynmor John: It had been my intention to deal purely with the merits of the proposals presented to the House and to give a general welcome to what, as the Minister of State said, is a useful package of improvements to the law. However, I must turn aside from that intention and once again register a protest about the hour at which Northern Ireland debates take place. In the pantomime Cinderella, the heroine disappears at midnight. An unpleasant reverse Cinderella syndrome is developing in this House, whereby those wishing to debate Northern Ireland matters do not even appear until midnight.
It is not good enough that our representations, which the Minister of State was good enough to undertake to bring to the attention of those in the Government who manage our affairs, that Northern Ireland business should be taken at a reasonable hour have not been heeded, and that representations made today, I understand, were not heeded either. This is no criticism of the Minister of State. He has no hand in the management of the Government's business, but I ask him to bring to the attention of the Leader of the House and of the Chief Whip our strong feelings on this matter, because it makes a mockery of sensible debate on what the Minister has described as a
1700
highly technical order if I rise at five minutes to 2 a.m. to lead for the Opposition.
One of the items to which I give a warm welcome is to be found in paragraph 5 of schedule I, namely, the ability of defendants to plead guilty by post. Under no circumstance can the Northern Ireland office be thought to have been over-hasty in bringing forward this proposal, since it has been enjoyed in England and Wales for many years. For the life of me I cannot understand why it has not been introduced before now into the criminal law in Northern Ireland, because not only does it save expense by not requiring the attendance of witnesses at court, but it saves the time of the court by its knowing that pleas of guilty will be tendered and read on written information rather than on representation. In addition, it will save the time and efforts of the police force, by not requiring police officers to be present in court, often on a fruitless two-minute case, for which they are out of the police station for a number of hours.
I welcome the gathering together in one enactment of all the powers that are available for the courts to order compensation and restitution. The Minister may not be able to respond tonight, and if so perhaps he will write to me, but I should like to know what use is made of these powers by courts in Northern Ireland. The Minister knows, as I do, that members of the public frequently complain that the courts do not use their powers sufficiently to order restitution and compensation.
When I was at the Home Office I looked into this matter and found that to be untrue, but there is, nevertheless, a strong impression among the public that that is so, and any figures that the Minister can give of the use by the courts of these powers will reassure those who believe that the deterrent lies in the power of the magistrates not only to punish but to order that the person to whom the wrong has been done is compensated.
I welcome the increase in the maximum fine that is able to be imposed by the courts. I could hardly do otherwise, since I was responsible for piloting the 1977 Criminal Law Bill through the House. It brings the fine more into line with what it should be and compensates somewhat for the loss in the value of money over

1701
the years. Unfortunately, the lapse of three years between the introduction of the £1,000 fine in England and Wales and its introduction now in Northern Ireland means that, in real terms, the value of the deterrent has suffered a little.
Why did the Minister and his advisers fail to take the opportunity to enact in this order section 61 (1) of the Criminal Law Act 1977? The Minister may not instantly recognise my reference to that, but it is the power given to the Home Secretary—which could be given to the Secretary of State for Northern Ireland under this order—to compensate for the loss in the value of money by order, subject to a negative resolution, without the undue necessity of frantic legislation after five or six years to provide for a huge jump in fines to restore the value of the deterrent in real terms. We thought it a good idea at the time.
The opportunties for legislation in the House are not frequent. Indeed, an opportunity at a decent time for legislation on Northern Ireland matters is almost impossible. I should have thought that the Minister would have availed himself of the opportunity to incorporate into the order a provision to enable the Secretary of State for Northern Ireland to raise the fines in line with the rate of inflation, so that the real value of the deterrent could be maintained.
We need a little more information about the payment of fines. Questions arise about the supervision of fines and the payment of them by instalments. Does the Minister recognise the extent of the problem? What special problems exist in Northern Ireland over the supervision of fines and the enforcement of penalties imposed by the courts?
I wish to devote the major part of my remarks to paragraphs 21 to 23 of the schedule, namely, those dealing with bail and bail default. We are talking about courts that do not come under the emergency powers Act. I understand that the Minister has grave reservations. Whenever we debate that Act he expresses reservations about the granting of bail in cases that come within the order. We are talking not about those cases, but about cases that are analogous to cases in England and Wales. That is why I am puzzled and wonder why, when we are
1702
sums up what the working party felt, states:
" We think it would be a more effective deterrent to absconding if it were a criminal offence for a person to fail to answer to his bail ".
It points out that when a man who is sentenced to imprisonment finally turns up or is arrested, it is unusual to forfeit the recognisance because he would be sentenced to custodial treatment anyway and there would be little chance of getting the money. Therefore, this is an strain on the budget of law and order, which could be better served in more constructive ways. If that is incredible, it is even more incredible that, in the order, we are to continue with the discredited system of taking recognisances either from the accused or from sureties for his surrender to his bail at due time.
As a prelude to the Bail Act 1976 a working party on bail and bail procedures was established in the Home Office, and it reported in 1974. Chapter 4 of the report, beginning at paragraph 95, dealt with, and analysed in great detail, the system of recognisances, whether they were working and whether they were a deterrent. It came to the conclusion that the system was illogical and not a deterrent. That is why a special criminal offence of failure to surrender to bail was inserted in the Bail Act.
Paragraph 102 of the report, which incorporating a great deal of the 1977 and 1976 legislation into Northern Ireland law, the occortunity has not been taken to incorporate the provisions of the Bail Act 1976.
That Act has cardinal requirements. The accused is presumed to have a right to bail unless the contrary is proved. The courts have ample powers to deny bail where, for example, they believe that it is probable that the accused will not surrender to his bail or that he will interfere with the course of the investigations while he is on bail. If they refuse bail they must give written reasons for doing so. That is a great advantage, and an advance in criminal law. Again, for the life of me, I do not understand why it is not being extended to Northern Ireland by this legislation.
If remands in custody are excessive, it adds to the strain from which the prison service in Northern Ireland suffers. Unnecessary bail is an added

1703
antiquated method which has not proved effective in practice, as the Minister will know. I again wonder why the opportunity was not taken to do away with that antiquated system and replace it with a recommendation that absconding from bail should be a specific criminal charge.
I end on that note. However, at the risk of wearying the Minister with something about which I do not feel very weary, I repeat that unless these matters can be discussed sensibly we risk passing measures that are ill-considered because we are in no shape to carry out our proper legislative function. That cannot be good, either for this Parliament or for Northern Ireland.
2.7 am
Mr. Robert J. Bradford: Before dealing with the contents of the order I should like to underline much of what was said by the hon. Member for Pontypridd (Mr. John) and protest at the time at which this order is being debated.
The business of Tuesday 13 May finished at 7 o'clock yesterday morning, yet here we are this morning dealing with the business of Wednesday. We are expected to deal with a comprehensive legal document, which has wide ramifications, not just at the end of one all-night sitting, but at the end of virtually a second all-night sitting. For that reason two of my colleagues who are most assiduous in their attention to duty are not with us, and their contributions would have been invaluable.
It is appalling that the Government did not respond to the request made by the Leader of my party, my hon. Friend the Member for Antrim, South (Mr. Molyneaux), when he apprehended the Leader of the House earlier this evening. The right hon. Gentleman was dressed in a pink silk shirt, with a white silk collar and a darker pink silk tie. He cut a fine psychedelic figure—some would say, sycophantic—and was on his way to a ball which no doubt began before 12 o'clock.
The right hon. Gentleman soft-shoe shuffled out of the Chamber to wherever he was going and left us without any hope that he was any more sensitive than his predecessor was to our approach to have this kind of business dealt with at a reasonable hour. We must not be treated like some colony. I impress upon the
1704
Minister that he must sort out his management of Northern Ireland orders. We shall tolerate this no longer. It is up to Her Majesty's Government to effect a relationship with minority parties, such as my own, to ensure that the whole of the kingdom is legislated for in a manner that is credible and not incredible.
In anticipation of the debate we requested views from professional bodies whose task it is to involve themselves in this sort of legislation or who are interested in it. In considering the order we have had regard to the views of organisations such as the Incorporated Law Society. That body has offered three observations, and I am pleased to hear this morning that the Minister has anticipated one of them and removed from the order the paragraph that would have enabled an accused person to be represented by an untrained relative and to have a plea entered by that person. We do not need much elaboration at this hour of the morning. It does not require much imagination to visualise the great difficulty that that paragraph would have caused and to realise some of the awful problems that the court and the accused would have faced. We are pleased that the Minister has withdrawn that paragraph.
The order bears on the Coroners Act (Northern Ireland) 1959 and inquests. It is felt that, in determining where an inquest should be held, regard should be had to the inconvenience of witnesses and relatives that may arise if the victim dies in the jurisdiction of a coroner some distance away from the victim's home or from the scene of the accident. There appears to be an increasing tendency to take seriously injured persons to one of the few hospitals that are equipped to deal with specialist medical problems. Such a hospital could be miles from the scene of the accident, and if the injured person dies in there the witnesses and relatives may have to travel considerable distances to attend the inquest. It would appear desirable that in such circumstances the coroners in the various jurisdictions should be able to agree in whose jurisdiction the inquest should take place, taking into account the convenience of those required to give evidence.
Finally, I comment on the order and the Children and Young Persons Act (Northern Ireland) 1968. The removal of the

1705
requirement that magistrates must remit to a juvenile court a case in which they find a young person guilty is regarded by the Law Society as a retrograde step, and my colleagues and I agree with it. The society considers that the juvenile courts are more skilled in dealing with young offenders. It feels that the requirement should not be removed.
I do not think that anyone is more concerned than myself about the need to apply justice and the law ruthlessly in Northern Ireland, but it is important to recognise that there are extenuating circumstances in Northern Ireland which do not obtain in many other parts of the United Kingdom and which unfortunately result in a number of young persons being sucked into crime, perhaps under the guise of a political movement. Therefore, it is important that juvenile courts, which are skilled in dealing with particularly young offenders, should deal with these young people. I make the plea to the Minister that the magistrates' court should remit such cases to the juvenile court and that that provision should not be removed.
I end on a note of censure. Whilst we do not hold the Minister responsible for the late hour at which the debate is held, we ask him to understand the sense of frustration and anger that is felt on both sides of the House, by all Members from the Province, and to convey in the clearest terms to his right hon Friends that we shall not tolerate this kind of treatment in future.
2.16 am
Mr. Wm. Ross: I make a brief intervention to ask the Minister what is meant by the article in the order which states that there is power to deprive a convicted person of property which he used or intended to use in the commission of a crime. I am curious to know how widely the term " property " is to be interpreted. The Minister mentioned tools or implements which might be used for burglary or breaking and entering, but it would not take a great deal of imagination to see where that could lead.
As the House is being asked to approve this measure, it is right that we should know what is meant by " property ". If a house or other building were used to plan the commission of a
1706
crime, or if weapons, explosives or burglar's tools were stowed therein, would that building or house come within the term " property "? Could it be confiscated in the same way as much smaller implements can be confiscated?
2.17 am
Mr. Alison: As the responsible Minister, I hardly dare to associate myself fully and completely with the remarks made by the hon. Members for Pontypridd (Mr. John), for Belfast, South (Mr. Bradford) and for Londonderry (Mr. Ross) about the late hour of the debate. However, I assure them that I am conscious of the anger and distress that they feel at having to take the order so late.
I made representations to the appropriate quarters earlier in the evening and serious consideration was given to not moving the order. The point was that hon. Members had already been here for some considerable time. We found ourselves confronted with a dilemma. Having sat and waited for so long, was the dish that arrived so late, even at the last moment, to be dashed from the diner's plate? We thought that it was better to proceed to complete the business.
I hope that the hon. Members for Pontypridd and for Belfast, South will understand that there are certain problems of timing the start of debates. We had every expectation—and reason to believe that expectation would be fulfilled, as a result of communications through the usual channels—that the previous business would be completed at a reasonable hour. I do not attempt to disguise that we are as distressed and upset as are hon. Gentlemen at the lateness of the hour, and I shall do everything that I can to draw this complaint to the attention of the Leader of the House and of the Patronage Secretary.
I turn to points made by hon. Members in commenting on the order. I am grateful to them for the general welcome they have given it. The hon. Member for Pontypridd asked about the extent to which the courts in Northern Ireland were exercising their powers, particularly in the matter of compensation. Comprehensive figures showing the full extent to which these powers are used are not readily available, but I have made some attempt to discover the state of play. A

1707
sample survey of cases dealt with in the three months ending 31 March this year revealed that out of approximately 36,000 cases dealt with by the courts, 600 compensation orders were made. It is difficult to evaluate these figures, however, because many cases—for example, traffic offences, which comprise about 50 per cent. of the cases dealt with—would not have been cases in which compensation orders would have been appropriate. It still works out at a fairly small percentage.
We hope that the wider single comprehensive provision which we are now making in this order will encourage the courts to make more frequent use of powers to award compensation to victims of crime. I am glad that the hon. Gentleman has given us an opportunity to dwell on this matter, because I hope that there will be reverberations in court circles in the Province as a result of the step forward that we are taking here.
The hon. Gentleman made a reasonable point about section 61 of the Criminal Law Act, with its provision for inflation proofing the range of fines. We are carrying out a general review of fines and the powers of the Secretary of State in this context. I shall bear in mind the hon. Gentleman's constructive suggestion. We shall seek to weave in something along these lines as soon as we can. It was a fair and reasonable point, and I am grateful to the hon. Gentleman for making it.
Perhaps I may drop the hon. Gentleman a note about the problem with which we are faced in collection and enforcement, but I do not have any reason to believe that it is a severe problem.
The amendments to the law concerning bail in Northern Ireland, contained in paragraphs 21 to 23 of the schedule, are relatively minor. They are not the result of a detailed study of the whole law of bail and do not purport to bring Northern Ireland law into line with that for England and Wales. Paragraph 21 should result in fewer people being remanded in custody. Paragraph 22 will widen the circumstances in which a surety may be discharged from his obligation. Paragraph 23 merely removes a doubt as to whether a court may remit a recognisance in full.
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I am interested in what the hon. Gentleman said about, for example, the reasonableness of introducing the criminal sanction in Great Britain in this context. I shall consider his point to see whether there should be a uniform provision. Not being a lawyer, having had to master the concept of this treatment of recognisance for the first time, I am inclined to do anything that will get us out of having to use that procedure.
The hon. Member for Belfast, South made a point on inquests, which I have noted. We are anxious to make the system as sensible, as flexible and as convenient as possible, but sometimes it is difficult to know to whom convenience should be directed in this context. Families and relatives are important, but they may find that they have to travel considerable distances. Witnesses and other people involved in the case are also important. We want to get the system, as we have tried to make it here, as flexible as possible to make for the greatest simplicity and convenience, but I take the hon. Gentleman's point.
On the part dealing with the Children and Young Person's Act, I think that we are pushing in the same direction. What we have done in the order since the proposals were published is exactly what the hon. Gentleman wanted. We are doing this because, apart from anything else, the Black committee, which the hon. Gentleman will know about, in an important and epoch-making document analysing the balance between justice and welfare in the Province, has come out with specific proposals and ideas about the need for an expert court to deal with juveniles. In this order we do not want to move at all until we have had a chance to digest the Black proposals.
I think that I have covered the points on which hon. Gentlemen have touched in going through this rather complex order. If there is anything which I have not picked up I shall look at Hansard and write to hon. Gentlemen about it.
I shall presently be conveying representations to my right hon. Friend the Leader of the House about the late hour at which this debate has been taken.
Question put:—

Division No. 307]

AYES

[2.26 am

Alison, Michael

Jopling, Rt Hon Michael

Stevens, Martin

Ancram, Michael

Lang, Ian

Stradling Thomas, J.

Best, Keith

Lloyd, Peter (Fareham)

Thompson, Donald

Blackburn, John

McNair-Wilson, Michael (Newbury)

Townend, John (Bridlington)

Boscawen, Hon Robert

McQuarrie, Albert

Viggers, Peter

Brown, Michael (Brigg & Sc'thorpe)

Marlow, Tony

Waddington, David

Cadbury, Jocelyn

Morris, Michael (Northampton, Sth)

Walker, Bill (Perth & E Perthshire)

Chapman, Sydney

Morrison, Hon Peter (City of Chester)

Waller, Gary

Cope, John

Neubert, Michael

Wheeler, John

Dorrell, Stephen

Newton, Tony

Wickenden, Keith

Douglas-Hamilton, Lord James

Parris, Matthew

Young, Sir George (Acton)

Freud, Clement

Penhaligon, David

Garel-Jones, Tristan

Pollock, Alexander

TELLERS FOR THE AYES:

Gower, Sir Raymond

Shepherd, Colin (Hereford)

Mr. Peter Brooke and

Hawkins, Paul

Squire, Robin

Mr. John Wakeham.

NOES

NIL

TELLERS FOR THE NOES:

Mr. Peter Robinson and

Mr. Robert J. Bradford.

Question accordingly agreed to.
Resolved,
That the draft Criminal Justice (Northern Ireland) Order 1980, which was laid before this House on 28 March, be approved.

DOWN'S SYNDROME
Motion made, and Question proposed, That this House do now adjourn.—[Mr. Waddington.]
2.35 am
Mr. Clement Freud: I seek to draw the attention of the House to the policy of the Department of Health and Social Security concerning people born with Down's syndrome.
It is fair to say that the first two questions that any mother asks when her baby is born are " Is it a boy or a girl? " and " Is it all right? " Even when the answer to the second question is that the baby is all right, most mothers will still count the number of fingers and toes just to be safe. The answer, perhaps unspoken at the time of birth, may be " No ". It is difficult to be precise because of the classification of borderline cases, but, roughly speaking, one child in 100 is affected by mental or physical handicap. Given that the average family has two and a half children, that means that one family in 40 is affected.
The high figure surprises many, because most people do not see the children. Sex, drugs, perversion and VD are all now drawing-room subjects, but
The House divided: Ayes 41, Noes 0.
handicap, particularly mental handicap, is still taboo and something that happens only to others. Even now the figures are inaccurate, because there is substantial under reporting of the incidence of mentally handicapped children. There is no registration. Each and every blind person is on a register, and the figures are there for all to find. It is somehow honourable to be blind, but not to be mentally handicapped.
Down's syndrome is the condition that is perhaps better known as mongolism. The incidence of Down's syndrome children is one in 680. In London the figure is one in 666. Carlisle has the lowest incidence in Britain, of one in 853. The highest is Cork, where it is one child in 588. It is, on average, one mongoloid child in a community roughly the size of this House of Commons. One hon. Member has a Down's syndrome child.
My purpose in raising the matter is to point out to the Government what is being done and what could be done. With 900 Down's syndrome children born this year, and with modern medicine and home insulation affording a longer life for these children, it is extraordinarily short-sighted to do as little for them as is currently being done.
In 1960, 60 per cent. of all Down's syndrome children died by the age of 5. Of the present crop, 4 per cent. die by the age of 14. When it comes to an average lifespan, they have as much chance, with modern medication and home heating—which is where they suffered—

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as does the average child. The cost of supporting a Down's syndrome child is a modest £4,000 a year. With a life expectancy of 60 and 900 born every year, it is a question of £100 million of Government support each year for each new crop of Down's syndrome children.
A Down's syndrome child suffers from a major genetic defect and nothing can be done, unless it were to be done by scanning the mother before the birth, because it is a chromosome deficiency. There is an opinion that such children are born to women over the age of 35. If that was true—and with the vast amount of under-reporting, one does not know—it is certainly no longer true.
What is needed above all is more communication between health authorities and health visitors and we also need a humane and proper attitude so that a mother is told realistically and sympathetically what has happened.
My wife, who is an enormous help to me in my constituency and is also chairman of our local Mentally Handicapped Children's Society, read a paper recently in which she dealt at one point with the notification of mental handicap to mothers. I should like to quote one of her case histories of a mongol child in my constituency who was born at 8.45 a.m. and
" the mother realised there was something wrong as the baby was not brought back to her and she saw the staff looking at her. She asked the midwife and the nurse separately what was wrong and was told the doctor would see her later. In the meantime, the maternity home telephoned the father and said: ' Your daughter has Down's syndrome; will you come in the morning '. He had never heard of Down's syndrome and neither had any of his mates. He said afterwards that he went through agonies during the night. His wife lay awake in the ward thinking that her baby was dying and in the middle of the night, got herself out of bed to go down the corridor to find out if she was still alive. The midwife told her the truth about the child at 6 a.m. and the husband came in later, but he was not by this time calm enough himself to be able to comfort his wife. The midwife and the doctor had both wished the mother to have a good night's rest before hearing the bad news."
My contention is that there is little knowledge about this condition on the part of doctors, whose only knowledge of mongoloid children is of those who are institutionalised. It is not until one is privileged, as I have been, to see children
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born into homes in which there is a sufficiency of love and support that one realises that the handicap of a mongoloid child can be taken as a challenge. I have figures, as I am sure the Minister has, to show what can be done for a Down's syndrome child.
I should like people to remember that under the laws of this land, a mother does not have to take her child home. If a mother has a child in a maternity hospital, she may leave that child in the hospital. I believe that children must be offered short or long-term help, and that if parents cannot cope, they too, must be given such support as the hospital is capable of providing.
All parents of handicapped children have a great fear about the future and financial worries. Most people do not realise the added financial burden that a handicapped child places on the family. It may mean that the mother permanently loses her earning power. It is not easy to get anyone to take the child in order to allow the mother to work. Long periods of inconvenience and destructiveness mean expense in replacing clothes, furniture and baby equipment. Strong toys are expensive and are used over a longer period than with normal children.
It would help if Britain could follow the lead of other countries, such as France, and recognise the added financial burden by giving more generous allowances and tax relief so that more children can be coped with at home and so reduce overcrowding in subnormality units. Parents also worry very much about what will happen to the child when they cannot look after it and about the effect on the siblings. If a child is not institutionalised, and if it is cared for and looked after, ideally in a home surrounding, the IQ can rise enormously. An untreated Down's syndrome child averages an IQ of 41 in an overall range of nil to 70. A child who is treated has an IQ average of 60·1 in an IQ range of 43 to 101.
What is missing is the understanding of massed groups in society. The greatest handicap is the label of a mongol child and the appearance. Teachers say " We do not take mongols at this school; the other parents would not like it". That is heard frequently. It is extraordinary that if a teacher said about a black child " We do not take black children; the other

1713
parents would not like it ", that would be a breach of the law. There is no breach— just intolerance. The normal child leaves home at 18. The Government must realise that the parents of Down's syndrome child have that child with them, probably, for life. A mother of 80 with a child of 50, unable to have the holiday or the retirement that she needs and deserves, is a problem that must be considered.
There is a clinic in Birmingham run by Rex Brinkworth, who has had the most sensational success. In all the recorded cases that have been treated by this man, with the support of the Down's Children's Association, children have been able to go not to educationally sub-normal " S " schools for the severely handicapped, which cost a vast amount more, but to the ESN " M " schools for the moderately handicapped. This is an investment which the Government should consider most carefully. The DHSS gave a grant of £7,000 for a period of two years so that mongol children could be trained to take some sort of place in society. That grant has now stopped, and I urge the Minister to re-examine the matter. The cost of helping one Down's syndrome child is averaged at £4,000 a year. Surely if one could reduce the price of that aid per child the investment in the association would be worth while.
As a patron of the association I have had a letter from a parent, who says:
" Perhaps you will wonder why we might not be happier under the umbrella of the much larger and financially stronger NSMHC. In fact most of us joined the NSMHC after the birth of our children as they were the organisation that one was immediately referred to. However it is quite clear that the aims of the DCA are quite different. We do not aim to give free trips to the theatre or caravan holidays free of charge although we would accept that this type of activity does fulfil another need. What we want for our handicapped children is really summarised in our comments on Warnock. Apart from the long term provision, which is of course the perennial nightmare, we wonder sometimes if we are doing the right thing in stimulating our children so much. We want them to lead a full life and to be as independent as possible, not to be a heavy burden on Society, but is Society ready to accommodate them at these higher levels? "
The first and most general way in which the DHSS can help is by affording screening much more widely than at present. After that, and specifically, it can help by providing extra finance for the
1714
association. I believe that the initial money was well spent, and the rewards were significant. The association lectured all over England, telling people of the potential of a Down's child. That is important.
The notification of parents must be looked at again. It is wrong that there should be whispering secrecy, and that the father and mother should not be told together at the earliest opportunity. Many voluntary societies would like to help, but because of medical confidentiality they do not have a chance to do so.
Stimulation at an early age is needed, and for that money is needed. I wish that in a debate of this kind one could do more than talk. I should like to show the Minister the difference between an institutionalised Down's child and one who has had the support of a loving family, guided by the wisdom of experts in the subject.
The children used to die. They will no longer do so; they will reach a reasonable age. I hope that with the help of the DHSS there will be even more who will reach that age and be able to play a significant part in society. In Austria, which is a smaller and poorer country than ours, there is an amazing clinic, funded with State money, in which visitors are encouraged to see what happens. The results have been miraculous. I am not asking for great new clinics. I am simply asking for recognition of a problem that used to go away and no longer will. I hope that the Government will help the 900 children a year who are looking to them for support.
2.53 am
Mr. Gary Waller: I am grateful to the hon. Member for Isle of Ely (Mr. Freud) for giving me a brief opportunity to say a word about a couple who are constituents of mine. The wife gave birth to a Down's syndrome child a month ago, and the father recently wrote to me on the subject. What he wrote confirms what the hon. Gentleman has said. Although the wife was 35, no amniocentesis test was suggested. I hope that my hon. Friend the Under-Secretary of State will say whether the age factor is important.

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After the birth of the child, little advice was given on what to do. My constituent writes:
" The only advice offered by the paediatrician was to bring the child up as a normal baby—all very well, but the needs of the mentally handicapped are special and require specialised supervision."
My constituent concludes:
" Your comments and advice would be welcome and any action you can precipitate to help other people in our dilemma, or to prevent these tragic circumstances happening to other prospective parents, would be a great service."
I think that the hon. Gentleman has done a great service in raising this matter, and I shall be interested to hear what my hon. Friend has to say in reply.
2.55 am
The Under-Secretary of State for Health and Social Security (Sir George Young): The hon. Member for Isle of Ely (Mr. Freud) has raised, in a compassionate and well-informed way, a number of important questions relating to the problems that we face in the area of mental handicap, and in particular those involving children suffering from Down's syndrome.
He was supported by my hon. Friend the Member for Brighouse and Spenborough (Mr. Waller). The incident which the hon. Member for Isle of Ely raised about how parents were notified of the birth of a child suffering from Down's syndrome was disturbing, and I hope to say a word or two later about the role of the medical profession.
The hon. Gentleman also spoke of the strains and stresses involved in looking after a mongol child. I think that it is worth saying that, unlike any other mentally handicapped children, mongols tend to be affectionate and friendly and, as the hon. Gentleman would be the first to recognise, very strong ties usually develop between the parent and the child.
As the hon. Member explained, Down's syndrome is a condition caused by a chromosomal abnormality. The majority of children suffering from this abnormality are severely mentally handicapped, they may have associated disabilities, including congenital heart disease, hearing and visual problems and tend in infancy to have recurrent respiratory infections.
The risk of having a Down's syndrome baby is related in most cases to the mother's age, and a mother aged 40 or
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more has 40 times more chance of having a Down's syndrome child than does a mother under 20. There is no cure for Down's syndrome, but it is a condition that can be detected antenatally through amniocentesis and tissue culture. The procedure does involve a slight risk to the continuation of the pregnancy, as well as some discomfort, and is therefore not suitable for the screening of all pregnancies.
The Department's policy is that there should be screenings for women aged 35 and 40 or who have a previously affected child. It is important that any such woman makes contact with the antenatal services at an early stage of pregnancy.
The procedure of amniocentesis can usually be undertaken at 16 to 18 weeks gestation, with the results available in two to three weeks. So, at the quickest, it is likely to be into the fourth month of pregnancy before Down's syndrome may be predicted. That is, of course, quite late, and the woman who does present late may find that, even if she wants it, she cannot be accepted for an abortion.
However, because older women give birth to far fewer babies than younger mothers, only a relatively small proportion of Down's syndrome births would be prevented in this way. Any decrease in Down's syndrome births seems likely to be counteracted by the increase in life expectancy, and the net result may be an overall increase in their numbers, and, related to the increase in life expectancy, the pressure on older parents.
The great majority of Down's syndrome children live at home with their families, receiving health, social and education services within the community in which they live. Where the parents can cope, that is clearly the best solution for everyone.
The hon. Member mentioned the possibility of a mother leaving a child in hospital and, as he says, that can happen. My Department in a circular issued in 1978, advised local authorities on ways of maintaining family links and what should be done if, unfortunately, contact is lost.
The hon. Member suggested that parents may not always receive appropriate advice, and he was supported in that by my hon. Friend. Whilst we are aware that parents do not get all the

1717
counselling, guidance and services that they need to enable them to help their child develop to his full potential, there is an increasing awareness of the need for these services. Comprehensive and multi-disciplinary assessment of all severely handicapped children in their local community was advocated in a circular issued by the Department following the publication of the Court report and such services are increasingly available.
Assessment nowadays means more than just the use of IQ tests. It is an assessment of the total child, his strengths, weaknesses and needs and his family situation and should be followed by specific programmes to assist him to reach his full potential.
Children with Down's syndrome are not a homogeneous group, and the degree of severity of mental handicap varies widely from child to child. The level of social and educational development of a child is substantially influenced by appropriate training and education programmes geared to his particular needs.
Many research studies with Down's syndrome children and other severely mentally handicapped children have shown the ability and willingness of parents to become involved with the development of their children, and significant progress has been made as a result, with consequent benefits to child and family. In many instances such research has provided the basis for the development of services for handicapped children. A number of such schemes, including Mr. Brinkworth's, are now functioning successfully. It is the Department's policy to ensure that all handicapped children, following assessment, receive appropriate individual developmental care and training.
A number of individuals and voluntary organisations do excellent work in helping parents with mentally handicapped children, providing services, reassurance and support, enabling parents to share experiences and problems and ensuring that they can make full use of the statutory services available. The National Society for Mentally Handicapped Children and Adults, with over 400 local societies in the United Kingdom, is the largest of the voluntary self-help organisations in this area and provides
1718
valuable help to parents and children. But of course other smaller organisations provide valuable help and assistance.
The hon. Member has raised the question of the future of the Down's Children's Association. The Department and I are, of course, well aware of the praiseworthy work done by Mr. Brinkworth and his association. Founded in Birmingham in about 1970, the association has as its aims the provision of an information and advisory service for parents of young children with Down's syndrome, promoting the care, nurture and education of the children, and study and research into the causes and effects of the syndrome.
My Department provided a grant to the association of £3,500 a year in 1977–78 and 1978–79 to assist in activities directed towards the support of parents of Down's syndrome children by offering advice and guidance based on personal experience and accumulated knowledge. While the Department was prepared to make a grant to assist this particular aspect of the work of the association, the Department's overall policy is that a fully comprehensive multi-disciplinary assessment should be provided for all severely mentally handicapped children, and our aim has been to encourage every district to set up its own assessment service with counselling and support. Many such centres already exist. In other words, while we recognise that Mr. Brinkworth and the association have done praiseworthy work to help Down's syndrome children and their parents, and we greatly welcome the involvement of voluntary organisations in such work, we consider that the multi-disciplinary approach which I have described offers the best way forward.
The hon. Member asked whether I would look again at the funding of the association. I am prepared to review the decision sympathetically. My Department wrote to Mr. Brinkworth on 18 July pointing out that he could apply for a research grant from the Small Grants Committee. We sent him the application forms, but I do not believe that we have had a response. I shall examine the question of assistance.
The hon. Member also made an eloquent case for measures that can be taken as alternatives—and often cheaper

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alternatives—to care in hospitals and residential homes and for the valuable part the voluntary sector can play in providing such alternatives. I support his case. It is much in line with Government thinking.
I have already said that we believe in a comprehensive multi-disciplinary service for all severely handicapped children which would provide an assessment and subsequent appropriate individual programmes and training to meet the needs of each child. A wide range of services from statutory and voluntary bodies will be needed to support the family and to enable the child to develop to his full potential. Too often in the past admission to hospital was the only alternative for families who are unable to care for their child. It is now, happily, recognised that practical help, advice and counselling and proper support services, including the availability of short-term care, can help many mentally handicapped children to stay with their family.
The hon. Member raised the question of cost-effectiveness, which is naturally a crucial consideration. The Government seek actively to ensure that scarce resources are used to the best possible effect—recognising the different needs of individuals.
The hon. Member suggested a direct relationship between the provision of support services and early intervention, and subsequent financial savings. It is difficult to demonstrate with any accuracy
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savings in costs in such circumstances, though obviously any savings would be welcome. However, I should like to emphasise the value of early intervention and support services in enhancing deeper developmental progress, improving the quality of life and enabling fuller use to be made of social, educational and vocational opportunities.
I should not wish to imply, however, that substantial improvements in the services that we provide for mentally handicapped children can be achieved without cost. A great deal remains to be done for these children, and in present economic circumstances progress, alas, must inevitably be slow. Health and local authorities face hard decisions on priorities, and such decisions are best made at local levels. However, my right hon. Friend and I have repeatedly made clear—and I reaffirm today—our hope that in considering how best to use the limited funds available, authorities will protect the interests of vulnerable groups, and, in particular, that group of whom the hon. Gentleman and my hon. Friend have spoken so movingly this morning.
The Question having been proposed after Ten o'clock on Wednesday 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 five minutes past Three o'clock am.

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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 Peterborough.

NORTHERN IRELAND: CRUELTY TO ANIMALS
Lord BLEASE: My Lords, I beg leave to ask the Question which stands in my name on the Order Paper.
The Question was as follows:
To ask Her Majesty's Government whether the Secretary of State for Northern Ireland is aware of the general public concern arising from recent reported cases of cruelty to animals and neglect for their welfare; and whether it is intended to review the legislation in Northern Ireland governing cruelty and welfare of animals.
The PARLIAMENTARY UNDERSECRETARY of STATE, NORTHERN IRELAND OFFICE (Lord Elton): My Lords, the Government are aware of the recent disturbing reports of the cruel neglect of the welfare of farm animals. These reports are being investigated and appropriate action will be taken, including amendment of the legislation if this is found to be necessary.
Lord BLEASE: My Lords, I should like to thank the noble Lord for a very helpful reply. Would the noble Lord not agree that there is an urgent need in Northern Ireland for the establishment of a Farm Animal Welfare Council similar to the body set up by the Government in July 1979 for England, Scotland and Wales; and if not a separate Northern Ireland Council perhaps there could be representatives from Northern Ireland on the existing council?
Lord ELTON: My Lords, there are no special aspects of animal welfare that are peculiar to Northern Ireland. The Department of Agriculture obtained details of the advice and recommendations
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of the Farm Animal Welfare Council and make use of that advice in considering legislative requirements. There are therefore satisfactory arrangements which have worked well in the past and I have no reason to believe that they will not continue to do so. The Department of Agriculture maintain very close liaison with the Ministry of Agriculture, Fisheries and Food for all matters of animal welfare, and if any changes in welfare legislation are being proposed in Great Britain my honourable friend will give serious consideration to similar provisions being applied to Northern Ireland.
Lord HOUGHTON of SOWERBY: My Lords, since animals in Northern Ireland are mercifully spared religious differences, the grievances of hgistory and membership of the IRA, what have these wicked people got against them? Does the noble Lord think that a delegation of humanists from England might help to restore the standards of animal welfare and kindness in Northern Ireland?
Lord ELTON: My Lords, I would hesitate to predict the reception that such a delegation would get.
Lord LEONARD: My Lords, would the noble Lord the Minister not agree that, if we could get an amalgamation of the approach to animal welfare North and South, it might have a bearing on easing the burden of cruelty that exists in the North and does not exist in the South to the same extent?
Lord ELTON: My Lords, we are concerned with human as well as animal nature in this question. Human institutions vary; animal nature is continuous across the border and across the water. As I said in my earlier reply, I do not think that the harmonisation of institutions will actually have any appreciable effect on the treatment of animals since the information which can be derived from all three sets of institutions is available to each.
The Earl of SWINTON: My Lords, would my noble friend not agree that perhaps in some ways animals are rather better off in Northern Ireland than they are here, as some of us learned last night during an order which was debated in this House, in regard to the penalty in Northern

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Ireland if one is found drunk in charge of cattle or horses? So perhaps some types of animals have greater protection in Northern Ireland than they do across the water.
Lord ELTON: My Lords, I do not think that it is from that sort of circumstance that the noble Lord who asked this Question wishes the animals to be protected.
Lord BLEASE: My Lords, if I may ask one further question, is the noble Lord aware that the Ulster Society for the Prevention of Cruelty to Animals has already made public the difficulties they are having in pursuing in the Northern Ireland courts 20 cases of alleged cruelty to animals? At the same time I welcome the approach that the noble Lord has made.
Lord ELTON: My Lords, I am grateful to the noble Lord for that point. As I have said, we are watching what happens in Great Britain and I will draw the attention of my honourable friend to the points made by the noble Lord.

THE "CHEVALINE" PROGRAMME
2.40 p.m.
Lord BROCKWAY: My Lords, I beg leave to ask the Question which stands in my name on the Order Paper.
The Question was as follows:
To ask Her Majesty's Government whether they are satisfied that the "Chevaline" project, costing £1,000 million, to enable Polaris missiles to penetrate the anti-ballistic missile system around Moscow is justified in view of the Soviet Union's dismantling of half of that system; and whether they will take advantage of this situation to propose renewed negotiations on missile exchanges before any possible Soviet restoration of the system is begun.
The MINISTER of STATE, MINISTRY of DEFENCE (Lord Strathcona and Mount Royal): My Lords, as the 1980 Statement on the Defence Estimates said, the programme code-named
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Chevaline is designed to respond to Soviet anti-ballistic missile capabilities which we know are being improved. Nothing has happened recently to alter our view of the need for the programme.
Under the 1972 anti-ballistic missile Treaty between the USA and the Soviet Union, each party may deploy up to 100 ABM systems. The Government believe that the restrictions imposed by the Treaty enhance strategic stability and for this reason would welcome any further restrictions on ABMs.
Lord BROCKWAY: My Lords, is it not the case that there is a great deal of uncertainty as to the intentions of the Soviet Union in dismantling half their protection around Moscow? It might be either that they are thinking of the ultimate endorsement of SALT 2, or they may be changing it in a way which will make our new missiles unable to penetrate. Could this not be resolved through the American- Soviet Standing Consultative Commission to which the Soviet Union announced this decision?
Lord STRATHCONA and MOUNT ROYAL: My Lords, first of all, I cannot comment on press reports about Russian dismantling of part of their anti-ballistic missile systems. Secondly, I would agree with the noble Lord that if indeed those reports were true there is a degree of uncertainty as to what the reason might be; but I have to say that it would be uncharacteristic of the Russians unilaterally to undertake a permanent reduction in their military capability in that area.
So far as disarmament is concerned, I have said many times in this House, to the noble Lord and to others, that while we believe passionately and sincerely in disarmament, we believe it must be a step by step process with concrete results which are verifiable at each stage.
Lord PEART: My Lords, will the noble Lord accept that it is essential that we should have a ratification of SALT 2 and then further discussions about SALT 3? When this point was put by different speakers the other day when we had our defence debate, I thought this was the right approach. We must not be negative on this.
Lord STRATHCONA and MOUNT ROYAL: My Lords, we have no intention of being negative about this. We have always supported the United States and we have always supported the wish to see SALT 2 ratified. But the noble Lord knows as well as anyone else that recent events have made that a little more difficult than it was.
Lord DERWENT: My Lords, will my noble friend enlighten me as to exactly what "around Moscow" means? What is the definition?
Lord STRATHCONA and MOUNT ROYAL: My Lords, we are getting into a difficult area. I can only say that my brief says some hundreds of miles around Moscow.
Lord CHALFONT: My Lords, may I ask the Minister if this amiable exchange is not based on a serious misconception? Is he aware that there has been no dismantling of Soviet missiles around Moscow? Is he aware that the 64 Galosh missiles which were there before 1974 are still there, whereas the United States has in fact dismantled all of its antiballistic missiles? Is he aware that all we have is an uncorroborated press report that the Soviet Union intends to dismantle them, and they will probably do so because they are becoming obsolete anyway? Is he aware that since 1972 the Soviet Union has been engaged in an intensive programme of research and development of new anti-ballistic missiles, and would he not agree that whatever may be our opinions about this debate we should at least get the facts right?
Lord STRATHCONA and MOUNT ROYAL: My Lords, as those questions come from the noble Lord— and, incidentally, I am glad to see that he has survived a unilateral assault without any apparent damage— of course we must treat them as a very interesting statement. I have said I cannot comment on press statements, but if the noble Lord is right I think my answer gains some force.
Lord BROCKWAY: My Lords, the Minister referred to press reports. Is it not the case that the Soviet Union announced this decision to the American Soviet Standing Consultative Commission last week? Cannot this opportunity be
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taken of some negotiations to end this missile rivalry?
Lord STRATHCONA and MOUNT ROYAL: My Lords, I am not aware whether indeed the Russians did announce it. All that I have been aware of have been press reports, on which I have said I cannot comment. I can only repeat that we wish for disarmament; but we wish for disarmament on a stable, verifiable, wholly credible basis, and only on that basis.

PROTEST STRIKES: STATUTORY IMMUNITY
2.47 p.m.
Lord ORR-EWING: My Lords, I beg leave to ask the Question which stands in my name on the Order Paper.
The Question was as follows:
To ask Her Majesty's Government whether the protest strikes taking place today are, in the words of Mr. Frank Chappie, "a political demonstration" and whether if so they are protected by trade union immunity legislation.
The LORD CHANCELLOR (Lord Hailsham of Saint Marylebone): My Lords, the statutory immunity under Section 13 of the Trade Union and Labour Relations Act 1974 is only applicable where the action is in contemplation or furtherance of a trade dispute. There is an additional immunity in tort, not extending to individuals as such, under Section 14, but this is more complicated than can be made the subject of a short answer to the Question. It is clear that the immunities in actions of tort under this section— that is, Section 14— extending to actions arising from situations resulting in personal injury, or from a breach of duty imposed in connection with the ownership, occupation, control or use of property, do not apply if no trade dispute exists.
Lord ORR-EWING: My Lords, while I thank the noble and learned Lord the Lord Chancellor for his very learned and detailed reply, did he see Mr. Len Murray in a BBC television interview— of which he has given many— last Sunday, when he claimed that it was the democratic

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right of 12 million trade unionists to follow the TUC's lead and stop work? One would ask how many of the 12 million trade unionists had in fact been democratically consulted and how many of the 112 unions affiliated to the TUC had also been democratically consulted before this futile day of action was called.
The LORD CHANCELLOR: My Lords, in answer to my noble friend's question, I did not in fact see the television programme to which he refers. I do not know at all what degree of consultation took place between Mr. Murray or the General Council and the rank and file, but I doubt whether there was much, if any. I do not myself see how you can effectively protest against the economic policies of the Government by taking it out of your fellow citizens.
Lord BLYTON: My Lords, is the Minister aware that after 61 years of the trade union movement we are used to legal enactments, injunctions, threats and using the establishment against the bona fides of the trade union movement, but we have still survived? Is the Lord Chancellor aware that the only mistake the TUC has made is that the day of action should have been on Derby Day, glorious Goodwood or Royal Ascot, so that trade unionists could have enjoyed a day of inaction with the wealthy who spend the wealth they create?
The LORD CHANCELLOR: My Lords, the sections of the Act to which I referred in my Answer were passed by a Labour Government. Therefore, I do not quite understand why the noble Lord should pose the first part of his question to me. It might, however, occur to him in his moments of contemplation that the trade union movement on this occasion has given the Tory Party the best propaganda weapon that it has had for 30 years.
Lord UNDERHILL: My Lords, instead of this pinpricking type of Question, would not the noble and learned Lord agree that it would be better if the Government got down to the real reason why millions of workers are dissatisfied with conditions today and why millions of workers are taking action and losing a day's pay in order to put their point of view?
The LORD CHANCELLOR: My Lords, so far as I know, the millions of workers were not consulted, but were told what to do, and there is increasing resentment on the part of the rank and file at the incompetence and stupidity of some of their leaders.
Lord ELWYN-JONES: My Lords, while not commenting on the joy that the noble and learned Lord the Lord Chancellor has apparently enjoyed from the political propaganda that comes to his party and his notable display of such political sentiments from the Woolsack, may I ask whether it is not now the important duty of this House, above all, to avoid further exasperation, further increasing of the tension and the confrontation which the Government are now building up between themselves and the trade unions of this country?
The LORD CHANCELLOR: My Lords, I cannot help noticing the failure of the noble and learned Lord to defend what has been done. As regards joy, I do not myself feel any joy at this discomfiture of my fellow citizens, but when one is bowled a long hop there is no reason why one should not hit it for six!
Viscount ST. DAVIDS: My Lords, will not the noble and learned Lord agree, especially after his exchanges with me on Monday, that this business has revealed that the ordinary private citizen, when affected by these actions against his will, has great difficulty in protecting himself legally in any way from them, and that this matter needs looking into if this kind of thing is to continue?
The LORD CHANCELLOR: I certainly agree, my Lords, that irresponsible action by any set of people leads to suffering on the part of our fellow citizens from which, not in every case, our fellow citizens can get individual redress.
Lord PEART: My Lords, may I say that I am rather surprised? Is the noble and learned Lord not aware that the people he has talked about are good British citizens? They were the men who, basically, produced the wealth of this country, and in a time of crisis they were the people who supplied the troops and the weapons which defeated the Nazis

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years ago. I dislike people attacking trade unionists in the way that the noble and learned Lord the Lord Chancellor has done.
The LORD CHANCELLOR: My Lords, I should have thought that it was the people of this country who produced the wealth and not the trade union council.
Lord WEDDERBURN of CHARLTON: My Lords, in making these remarks, would the noble and learned Lord be associating himself, or on behalf of the Government dissociating himself, from the scurrilous press campaign of the last two weeks against what the Daily Express called Mr. "Lenin" Murray? Secondly, would the noble and learned Lord take into account the fact that yesterday tens of thousands of Frenchmen demonstrated against social policies, equally upset at being unable even to talk with their Government, and that no one reached for a writ and called that unlawful? Therefore, while accepting his description of the law— as one does from him— may I ask whether it does not illustrate the very limited lawful area of activity for trade unions in this country?
The LORD CHANCELLOR: My Lords, as regards the Daily Express, the Government are not responsible for its statements of opinion. But if Mr. Lionel Murray is defamed by the Daily Express he has his remedy in the courts and I shall endeavour to provide facilities for the action to be heard. As regards the French, I do not think that we need imitate them.
Lord ORR-EWING: My Lords, does not the comparatively small response today show that the great majority of British people and good British citizens are sick to death of political gestures and want to get on with the job of rebuilding the prosperity and the power of Great Britain?
The LORD CHANCELLOR: My Lords, I think that the failure of the action which we have been discussing is probably the best answer that I can give to my noble friend.
Lord PAGET of NORTHAMPTON: My Lords, while expressing some sympathy with the noble and learned Lord the Lord Chancellor at being asked to answer a Question of this complexity in under two hours, I would ask him to apply his mind to the following. First, are the words "political" and "industrial" mutually exclusive? Cannot the two apply to the same thing? When one talks about not consulting members, does not the whole democratic system consist of people answering through the representatives whom they have elected both in the trade union movement and in Parliament?
The LORD CHANCELLOR: My Lords, what I do think is clear is that my Answer referred to action taken in furtherance or contemplation of a trade dispute or otherwise, and that the words either "industrial" or "political" were not used.
Lord ARDWICK: My Lords, can the noble and learned Lord find some sympathy in his heart for trade unionists who feel that they are facing an elective dictatorship?
The LORD CHANCELLOR: My Lords, I have often found myself facing what I regarded as an elective dictatorship, but I did not consider that the proper response was to take it out of my fellow citizens.

PROTEST STRIKES AND THE CIVIL SERVICE
2.57 p.m.
Lord DRUMALBYN: 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 any industrial dispute exists between them and their employees which would legally justify the latter in withdrawing their labour on 14th May.
The LORD PRESIDENT of the COUNCIL (Lord Soames): My Lords, there are some trade disputes between the Government and their employees. The existence of such disputes does not, however, legally justify employees in

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withdrawing their labour. Civil servants who have been absent without authority today will be in breach of their contracts of employment. They will lose pay as a result. But I am pleased to tell your Lordships that it seems that only an extremely small proportion of civil servants have not reported for work today. I think that noble Lords would like to join me in expressing appreciation for the attitude which the vast majority of civil servants have shown and for the efforts made in overcoming the transport difficulties which faced some of them.
Lord DRUMALBYN: My Lords, I thank my noble friend for that Answer, which it is quite clear has received great approbation in this House. Is he aware that the tradition in this country is a very precious one— namely, that it is part of the pride and stability of the country that the civil servants serve Governments of all complexions without distinction, and that they ought not to withdraw their labour on political grounds?
Lord SOAMES: My Lords, yes, and I think that this is a good example of that. I do not know the exact figure or proportion, but I believe that less than 2 per cent. of the total, in fact, did not turn up for work today.
Baroness SEEAR: My Lords, would the noble Lord not agree that, in thanking the civil servants for the effort that they have made to come in, we would like specially to mention the staff of your Lordships' House?
Lord SOAMES: Yes indeed, my Lords.
Lord UNDERHILL: My Lords, would not the noble Lord agree that there have been meetings throughout the country in factories and depots which have decided what free action the individual trade unionists will take today? Would he not also agree— and this does not apply to him— that the levity, cynicism and jocularity with which this matter has been discussed in your Lordships' House might have made many people change their views as to what they would do today if they had heard those remarks previously?
Lord SOAMES: My Lords, on the contrary, it is not only in this House that this particular proposal has met with a
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general feeling of dissent and a conviction that it is not in the national interest.
Lord BROCKWAY: My Lords, will the Minister not agree that the function of the Civil Service trade unions is to defend the standard of life of their members? As today between 30 per cent. and 40 per cent. of family standards are due to public services, is it not inevitable in the circumstances that civil servants should protest against the cuts in those public services?
Lord SOAMES: My Lords, as I said, there are some trade disputes going on at present between various Civil Service unions and the Government. But that does not mean that they should think it advisable— and in the event, I am glad to say that they did not think it advisable— to pursue those disputes on this particular day in the particular manner proposed.
The Earl of ONSLOW: My Lords, does the Minister not think that it is particularly depressing that the Labour Opposition has not condemned not only the general day of action but, above all, civil servants, who are supposed to be totally non-political and servants of all of us, going on strike on this occasion?
Lord SOAMES: My Lords, I do not think that it is for me to say what effect the attitude of the Opposition is likely to have on the political thinking of our fellow countrymen. That is for them to judge. Personally, I do not think that today they have increased their standing.

WATER CHARGES (LAUNDERETTES) BILL [H.L.]
Baroness PHILLIPS: My Lords— a slight anti-climax— I beg to introduce a Bill to make provision for the basis on which water authorities shall make charges in relation to the discharge of effluent from launderettes; and for purposes connected therewith. My Lords, I beg to move that this Bill be now read a first time.
Moved, That the Bill be now read 1a— (Baroness Phillips.)
On Question, Bill read la, and to be printed.

IRAN (TEMPORARY POWERS) BILL
Brought from the Commons earlier this day and printed pursuant to Standing Order No. 47; read la.

BSC: APPOINTMENT OF CHAIRMAN
3.3 p.m.
Lord BRUCE of DONINGTON Lord BRUCE of DONINGTON rose to call attention to the appointment by Her Majesty's Government of Mr. Ian MacGregor as chairman of the British Steel Corporation, and to the financial arrangements made with Lazard Frères, of New York, in connection with this appointment; and to move for Papers. The noble Lord said: My Lords, after the series of Questions and Answers we have had this afternoon on other matters, perhaps it would be in order for me to point out to your Lordships not only that this appointment which we are discussing was made without any consultation with Parliament, but it seems possible— and I put it no higher than that— that it was made without prior consultation within the Cabinet, or so it is said in some newspapers. The reason why we are calling attention to this matter is that the step that has been taken by the Secretary of State for Industry and the announcement that was made on 1st May last are of the utmost importance to the whole of British industry and have a very great significance for the economy of the country as a whole. As I see it, it is no small matter, and I think that I have read through most of the documents.
The position is that Mr. Ian MacGregor will be appointed from 1st July next for a period of three years at a salary of £48,500 per annum, and that as part of the deal a sum of £225,000 per annum is to be paid to the firm in which he would retain an interest as a limited partner. I further understand— and the noble Viscount will be able to correct me if I have my figures wrong— that there is to be a further sum of up to £1,150,000 payable to Lazard Frères on certain eventualities, dependent upon the results that are in fact achieved by Mr. MacGregor during his term of office.
This afternoon I do not propose to offer any observations whatever on the
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payment of £1,150,000, because one does not know— and I suspect that the Secretary of State does not yet know— the criteria which will govern the eventual payment of that sum. I pause here to say that in connection with the engagement of a public servant— because that, of course, is what he ultimately is— this provision is, to say the least, slightly odd. I do not propose to pass any further comment on its merits, and indeed one cannot do so until the committee— composed of a certain number of members of Lazard Frères and certain representatives from the Department of Industry— has reached its conclusion as to what, in fact, the criteria should be.
I shall only say that it would appear at the moment that whatever sum is ultimately paid to Lazard Frères— from £0 to £1,150,000— will in fact be paid in 1984 or 1985. The noble Viscount will correct me if I am wrong on this, but he will, of course, realise that there are certain taxation implications because, of course, after the completion of the assignment in this country, and again on the assumption that Mr. MacGregor is treated as being ordinarily resident in this country during his stay, on returning to the United States he will no longer be liable to any kind of British taxation. It would be useful to know whether that tax position has been explored.
I have already been informed that as the £225,000 per annum paid to Lazard Frères is being paid by way of compensation, in spite of the fact that Mr. MacGregor remains a limited partner in that firm, it is not subject to British income tax— at least, I think there has been what has been described as a "clearance" with the Inland Revenue. I believe that it is also provided that in the event of Mr. MacGregor not completing his three-year term with the British Steel Corporation, a refund will be made to the United Kingdom.
Furthermore, part of the terms of the agreement would be that he should retain directorships in a number of companies of which he is at present a director, which include Amax, Alumex, the Brunswick Corporation— all three United States firms— and the Atlantic Trust of Edinburgh. I should like to ask the noble Viscount whether there are any other

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companies of which Mr. MacGregor is permitted to retain directorships, because the noble Viscount will appreciate that in the Directory of Directors Mr. MacGregor is listed as having many more directorships than that. I hope therefore that we can have some elucidation as to whether there are any further additions to be made.
At the same time it has been agreed, so I understand, that he should relinquish his directorship with BL. I hope that, with perhaps minor amendments that the noble Lord may care to give, I have put the House in the possession of the facts of the agreement arrived at. I am given to understand also that he is working at the moment as a sort of deputy to Sir Charles Villiers at an annual salary of £15,000 prior to his appointment on 1st July. Those are the terms of the appointment of Mr. MacGregor.
Outside the implications of his title as Executive Chairman, we have not been given any kind of indication as to the terms of reference that have been given to him. Knowing the Secretary of State for industry, I imagine that there have been some. I do not want in any way to pass comment on the qualifications that Mr. Ian MacGregor possesses for this task. It is of course of the utmost importance, whoever is appointed to this position, that his task is not made any more difficult by any attitude that is taken here or in another place. It is, however, important also that in order to ensure that he is fully able to do his duties, we cast a critical eye over his relationship with the Secretary of State for Industry and make some judgment on his fitness to give directions to anybody.
So far as the qualifications of this gentleman are concerned, we understand from Sir Keith that he has spent most of his working life in an outstanding business career. We understand that, although he has had no experience in steel or in any major manufacturing industry, he is a very well-known metalurgist, and has some experience in the mining and supplies side of the mineral industry.
However, a certain degree of euphoria has crept in. Mrs. Thatcher, speaking on television on the Sunday before last,
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waxed almost ecstatic. She passed this judgment upon him:
"Everyone recognises that Mr. MacGregor is one of the outstanding industrialists in the world. "
Everyone? The Members in another place, when the appointment was announced on 1st May last, with few exceptions, had never heard of him. Although there must be a number of your Lordships who have the privilege of perhaps more than a passing acquaintance with him, I venture to suggest that not everyone in your Lordships' House recognises Mr. MacGregor as one of the "outstanding industrialists in the world".
The Prime Minister continued:
Everyone recognises that his record is superb— that he has taken businesses and built them up, he has created employment, he has expanded them."
Once again the term "everyone"! Allowing for a certain degree of euphoria that occasionally creeps into the public utterances of the Prime Minister, one cannot help feeling within this context that when she was saying "everyone" she was using the pluralistic in the sense that General de Gaulle used it, and was probably referring to the Secretary of State for Industry and herself. She went further in a fine rallying call at the conclusion of her broadcast and said:
"Everyone says he is a super guy." With such a testimonial as that I would think that Mr. MacGregor should go far.
However, a slightly sour note appeared in the Economist on 10th May, with which I feel it proper that your Lordships should be acquainted if you have not read it already, because the Economist, as is well known, is not particularly sympathetic to the party I have the honour to represent, and almost slavishly follows the line taken by the party opposite, and not least the line taken by Sir Keith Joseph himself. The Economist added a little caution on the matter. It said:
"Miracle working does not always work miracles; five years after Mr. MacGregor started rescuing Singer in America (where he chairs Singer's executive committee) the company is still writing off losses. "
This happens in the best of regulated families, and I have known many directors in my time of varying political persuasions

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whose misfortune it has been to write off losses. But it is necessary that the word of caution should be entered here that this "super guy" is still nevertheless prone to the ordinary managerial frailties which afflict most of managerial society in the United Kingdom. I do not hold that against him. I am however happy to inform the House, because there was some misunderstanding about it at one point, that since Mr. MacGregor had the good fortune to be born in Scotland he is of course a patrial and no work permit will be required for him to work here.
One of the matters which exercised the public and very wide sections of the press, including the Conservative Party house journal, the Daily Telegraph, which expressed itself completely outraged with the whole business, was the steps taken by Sir Keith Joseph in securing ultimately the services of Mr. MacGregor. Sir Keith said that he had been trying for nine or 10 months to find a replacement for Sir Charles Villiers. I can imagine that. Even Sir Keith from time to time has to take time off from his long seances with Professor Friedman in order to deal with the matters of his department, and indeed to pay some attention to the requirements of British industry.
An interview with the political correspondent of the Sunday Times, reported in the Sunday Times of 4th May, went much further into this. It was said:
"Is it really suggested there is no one in the whole of British industry with the ability to do the job? What sticks in the gullet is this payment to a foreign commercial bank ".
This was not uttered by a Member of this side of the House but by none other than Mr. Robert Adley, the Conservative Member of Parliament for Christchurch and Lymington. Sir Keith found himself in reply to Mr. Michael Jones, who is the political correspondent of the Sunday Times, saying as follows:
"The Department of Industry, using head hunters, had searched British boardrooms systematically and intensively to try and find a replacement to the present chairman, Sir Charles Villiers, but with no success ".
Just so. Your Lordships will undoubtedly remember the emphasis I ventured to place at that point on "systematically and intensively". At any rate, in the event on 1st November he hired a firm called Russell Reynolds Inc. They are on the
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fifth floor of No. 1 Mount Street, London, W.1, and are described as "executive research consultants". This body came up with 31 prospective candidates, of whom seven were considered suitable. Two declined— I will not speculate at this stage on the reasons why they declined— one was considered unsuitable and we have no information about the remaining two. No doubt the Minister will supply some suitable information about that.
Finally it was decided to select Mr. MacGregor, and the question I have to ask about that and to which your Lordships arc entitled to a reply is why the Government employed Russell Reynolds at all. I ask that because Mr. Ian MacGregor joined the board of British Leyland Limited on 3rd October 1975 and became a non-executive deputy chairman on 8th November 1977. So here was this brilliant man in British Leyland all the time, and here was Sir Keith Joseph searching intensively throughout the boardrooms of Britain. How is it that this man of brilliance, not to say of charm, remained unnoticed in spite of the shining light thrown on him by the compliments of the Prime Minister? How is it, if everyone knows he is one of the leading industrialists of the world, that he remained, I gather comparatively undisturbed on BL, and, as I say, became a non-executive chairman on 8th November 1977? Doubtless we shall have some information from the Government on that. They will, however, remember Sir Keith's statement that the engagement of Russell Reynolds came about because he had made this intensive search and was almost at his wits' end to find some body. In the end they found somebody sitting on a board, and he should have known about him all along.
Did the Government or Sir Keith Joseph engage any other firms apart from Russell Reynolds? And what is so special about Russell Reynolds? I have no doubt they are a firm of the utmost repute and integrity and I would not wish anything I say to detract from the glory in which they are basking, but they have competitors. Indeed, in a letter to The Times the other day their London chairman referred to the code of conduct they had to adopt in order to conform to the code adopted by competitors, so they must have had competitors. Did Sir Joseph,

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in his dire straits and searching, try to find a firm other than Russell Reynolds? If so, with what result? If he did consult other firms, how many prospective candidates were produced by them, what response was given and what action did the Department of Industry take? If he did not consult a firm other than Russell Reynolds, why not? I thought the Minister of Industry believed in free competition and liked to play the market. Why, then, should he confine himself to one firm?
I emphasise that there is no implication in anything I say. I am making a purely factual inquiry that contains no implication in its asking. I want to know whether Russell Reynolds Inc. are connected in any way, directly or indirectly, with Lazard Frères, and I require a specific answer. Is Sir Keith Joseph really telling the country that there was not a suitable British candidate? I have with me a copy of the 1980 edition of the Directory of Directors which is replete with some of the most illustrious names in British industry of all ages, from 25 possibly even unto 72. Is Sir Keith really telling British industrialists, who have a certain degree of pride in their craft, that there was not one who met his particular requirements?
I now wish to deal with the Minister's stance in the events leading up to the appointment. Does he think that the rewards offered to the chairmen of nationalised industries should be governed by any principles at all, other than the operation of the free market? We know the attitude of Lazard Frères because they were reported in the Daily Telegraph on 6th May:
"the partners in Lazard Frères and in Russell Reynolds are laughing all the way to the bank ".
The article later said:
"Mr. Thomas Wise of Lazard left no doubt it had the British Government in a corner and considered it only right to press for as much cash as possible. ' Do not overlook the fact that the British Government has been on a worldwide recruiting drive. They have been looking everywhere ' "—
said Mr. Wise, who also announced on that occasion:
"'We do not see joining BSC as public service. This is a company that aims to make money ' ".
Do the Government accept, willingly and enthusiastically, that attitude towards public service? I invite them to contrast
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the position with that of Mr. Atkinson of British Shipbuilders, who takes up the position of executive chairman at approximately the same time as Mr. MacGregor. What has happened there? Mr. MacGregor has taken a salary cut of £7,000 on taking up the appointment, and this is what he said about it:
"As far as I am concerned, I am and always have been an intensely patriotic person. I have always said, and always will say, I will serve my country wherever and whenever required ".
It is for your Lordships, and eventually for the public outside, to determine which is the kind of attitude within the British ethos and way of life they prefer, and I suggest that when the evaluation has been made it will not be difficult for the rest of the country to arrive at some conclusion as to the attitude they prefer.
Lord DRUMALBYN: To correct the record, my Lords, may I ask the noble Lord whether he did not make a mistake when he quoted the name of the author of that resounding sentiment? I think he meant Mr. Atkinson but I think he said Mr. MacGregor.
Lord BRUCE of DONINGTON: My Lords, I beg your Lordships' pardon. The gentleman I referred to as being the chairman of British Shipbuilders should of course be Mr. Atkinson; he accepted a £7,000 reduction in salary and expressed the sentiments to which I just referred.
Do the Government think that the chairmen of nationalised industries should account to the boards for directors' fees received by them from companies in which they are allowed to retain directorships? I am given to understand that it is the practice among most of the nationalised industries that those who accept appointments are permitted to retain directorships which they already hold on the basis that they account to their boards for the directors' fees they receive. Perhaps the noble Lord will correct me if I am wrong on that. I should like to draw attention to the fact that Mr. MacGregor is apparently being allowed to keep his directorships, and that, according to the Financial Times of 3rd May, his total income is likely to be in the region of £120,000 to £150,000 by virtue of the addition of his other directors' fees and shares on top of the salary that he is already receiving.

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The next question that I have to ask under this head is whether compensation ought to be paid to the nationalised industries in respect of the loss of the services of some of their distinguished directors. Apparently it is considered proper that Lazard Frères should be compensated for the loss of Mr. MacGregor. Is it in order for BL to be compensated for the loss of their most valuable and distinguished servant, who has been transferred to a higher position? Perhaps the noble Viscount would give that some thought.
The consequence of the action that the Government have taken is to plunge the whole executive and management structure of the nationalised industries into a period of uncertainty. Following the expressions of total confidence in Sir Charles Viliiers, as uttered by the Prime Minister as recently as February last, who can be sure that they are not next for the chop? A second consequence is that this action has further embittered industrial relations. Not all workers accept the viewpoint that remunerations of £48,500, or £44,000 in the case of Mr. Atkinson, are appropriate at times when they are called upon to make sacrifices. I repeat, not everybody thinks that these figures are other than too high, let alone the astronomical sum that has been made available to Mr. MacGregor and Lazard Frères.
Moreover, one of the other consequences— and I think that noble Lords here and MPs in another place know it in their hearts— is that Sir Keith Joseph has made an ass of himself over the whole affair, and therefore has brought no very great credit on the Government themselves. He put himself into a position where he thought that he could make a choice. To choose people for positions of this kind is very difficult, and I should not wish to underestimate the anxieties which he must have felt. However, we have it on the authority of the noble Viscount, Lord Trenchard, himself, albeit within a different context, that his department is not really in a position to make choices, or rather is not well placed to make choices. At a meeting of the National Economic Development Council he was asked whether he could select industries in which research should be directed—
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the volume of research, and so on; I have The Times report before me—
The MINISTER of STATE, DEPARTMENT of INDUSTRY (Viscount Trenchard): My Lords, I wonder whether I may interrupt the noble Lord. What he mentions relates to the selection of industries, not to the selection of an individual for an important nationalised industry.
Lord BRUCE of DONINGTON: Yes, my Lords; I entirely accept that. I appreciate, and I agree, that the noble Viscount's department is not well placed to pick winners; that is what he said. I entirely agree that this point is within the context of selecting individual industries. He may not believe that the choice of an important individual of this kind is of infinitely more importance in some cases than is the selection of an industry to receive research; and I do not think that they are in a position to make a choice.
We have been confronted by the Government with the position that they have demonstrated their full belief in the operation of market forces, and nothing else. The public service counts for very little. It is the market place that really counts. It is the market value that counts. On that basis Lazard Frères and Mr. MacGregor, on a salary remuneration basis, are in a much better position than the entire Cabinet; they are receiving more than the entire Cabinet. That market judgment should form the basis for our own, and I think that we accept it. They probably are better than the entire Cabinet, who are not worth a row of beans.
3.35 p.m.
Lord BYERS: My Lords, the noble Lord, Lord Bruce of Donington, has very much enjoyed his knockabout turn. On this occasion I do not want to speak from a party point of view, but I think it only right that I should speak against a background of a good deal of experience which I have been fortunate enough to have in international business. I think it a pity that the noble Lord, Lord Bruce, should have denigrated Mr. Ian MacGregor, who is going to have a very difficult task indeed—
Several noble Lords: He never did!
Lord BYERS: I am very sorry, my Lords, but one could not listen to that speech without realising that it contained a good deal of denigration. But let me develop this theme. I have known, and worked with, Ian MacGregor for over 20 years in the mining and metals field. He is a man of great competence. He has great ability. He is internationally renowned. Of course he is not known by everyone, but some of us, those of us who have worked with him, have come to respect tremendously his judgment and ability.
I think I am right in saying— the Government can correct me if I am wrong; I have not checked this— that Mr. MacGregor was the chairman of the International Chambers of Trade and Commerce only about a couple of years ago. One does not aspire to that position in the world without having something behind one. Therefore I think that we must be sensible about this matter, because there was much in what the noble Lord, Lord Bruce, said with which I agree, but I do not agree with trying to denigrate the ability and competence of the man who has been appointed.
What I take umbrage at is the hamfisted way in which Mr. MacGregor was introduced into the job of chairman of the British Steel Corporation by the Secretary of State for Industry. The manner of his introduction and the confused and misleading announcement about his hiring and remuneration can do nothing to help in grappling with the tricky problems of British Steel. Indeed, the climate for this situation was never good, and I believe that it has been made worse. I agree with the noble Lord, Lord Bruce: the lack of consultation here was absolutely disgraceful, because we know how important is an appointment of this kind, not only to British Steel, but to all the nationalised industries.
I do not criticise the Government for seeking the best man for the job, but my own business experience tells me that once one enters the international market, one has to accept the international conventions if one wants someone badly enough. I must say that the noble Lord, Lord Bruce, amused most of us by suggesting that there should have been two people acting as head hunters— and presumably, paid two lots of fees. I should not have thought that that would have been very
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sensible at all. But as I say, if one enters the international market, one must abide by its conventions.
Whether one should enter the inter national market is a different matter— a very different matter. I hate to have to say this, but I think that it is a bad reflection on British top management, if it is true, that no one could be found in Britain to accept this challenge. I feel very ashamed about that— very ashamed indeed.
I would not jib at exceptional expenditure if it would result in making British Steel profitable, but the way in which the terms of remuneration were presented to the House was to me quite incomprehensible. The new chairman is to receive the going rate of his predecessor. That in itself is almost certainly too low in times such as this, and I believe that the entire question of the remuneration for chair manships in nationalised industries must be looked at again. The pryamid is wrong at the moment.
Lazard Frères, Mr. MacGregor's present employers, are to receive £225,000 each year for three years. That statement itself offended many people in this country. But what was not made clear was that that sum was justified on two counts. First, it compensates Lazard Frères for the loss of the services of one of their most useful partners, who would have brought much new business to the partnership in that period due to the contacts and the background which he has and which he has built up over a long period.
The second reason— and this was not made clear until I heard it from Mr. MacGregor on the radio or television— is that the sum compensates Mr. MacGregor to some extent for the reduction which might occur in his expectation of income from the partnership of Lazard Frères during the rest of his life. I think one has to remember that many eminent businessmen working in the United States buy themselves into a partnership to ensure that they have adequate income in retirement. This is a perfectly normal United States arrangement, and they cannot be expected to give up that right just at the drop of a hat. This is not the way we work but it is the way they work, and, if you want an American, that is what you have to do.

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What I find inexplicable is the formula which provides for a payment to Lazard Frères of up to £1-15 million dependent on an undefined performance achievement which is to be judged by an arbitration panel. I think this is the Mad Hatter's tea-party. I do not believe it can work. What is needed to turn British Steel into a profit-making unit is not just an incentive for Lazard Frères, or even for the new chairman, but a personal incentive at every level of the organisation— an incentive which could be achieved by ensuring that as profits are made they are shared by all those who contribute, right from the top down to the bottom. This could be coupled with option schemes on shares— these are perfectly well known and perfectly well understood in America and Canada— for those who are employed; and the shares would increase in value as British Steel is slimmed down to its optimum size and is brought up to profitability.
As it is, we have a formula, a device, for assessing performance which cannot recognise the many complex factors which can affect the performance of British Steel in the future. Among these factors, the unknown is Government policy. The more the Government cut capital expenditure, the less will be the home demand for steel; the more we spend on the defence budget, the greater will be the demand for steel. These are factors beyond the control of Mr MacGregor; these are Government policies. Government import policy could directly or indirectly affect the whole future of the British Steel Corporation. What happens when the Government provide more capital for the British Steel Corporation, as indeed I am sure they will have to do? What happens if they agree to write off all or part of BSC's debts? Do Lazard Frères get the credit? Do they get the benefit? What a crazy system, if that is what is going to happen!
These are only a few of the unknowns which will affect the result. It would be far better, in my view, to get back to profits in a free market as the real test of success, and to use the prospect of profit-sharing within a reduced labour force as the main incentive to improve productivity and efficiency. Instead of that, we have this peculiar arbitration
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panel of two from each side with an independent chairman, and what we shall have is an embarrassing horse-trade. I must say, my Lords, that I should not like to be that independent chairman.
3.43 p.m.
Lord NUGENT of GUILDFORD: My Lords, I listened with interest and enjoyment to the speech of the noble Lord, Lord Bruce of Donington, and would make the same comment as Lord Byers has just made, because he obviously enjoyed himself very much in his "knockabout" and, I think, scored a number of points which were fair enough in the circumstances. But there are other aspects of the matter, and I warmly agree with Lord Byers that certainly at this stage of the game what matters most is that, this man having now been appointed, he should make a success of it, and, therefore, that nothing we say or do here or, I hope, in the other place should make that more difficult for him.
I thought it was immensely helpful to hear that Lord Byers actually knows Mr. MacGregor and can confirm that he is an outstanding businessman. He is a professional metallurgist, and has had a long and highly successful experience in America with AMAX, where in 11 years as chief executive he has achieved the recovery of this great minerals firm and, with a vast new delevopment, has brought it up to being one of the leading firms in the country. So he really is just the sort of man that we want to try to achieve a recovery in the British Steel Corporation, and to bring about a similar redevelopment here.
I do not propose to discuss the terms in detail, because I have no doubt that my noble friend Lord Trenchard will do so. I would only confirm from the little knowledge I have what Lord Byers said, that the sort of terms of remuneration which have been fixed are not out of line for top operators in America, although they seem so enormously high here. I took note of the comments of the noble Lord, Lord Byers, about the especial agreement with Lazard Frères, which relates to the possibility, I hope the probability, of success of Mr. MacGregor's efforts, and this has to be measured, as the noble Lord, Lord Paget, well knows.
Lord PAGET of NORTHAMPTON: My Lords, perhaps the noble Lord would allow me to interrupt him, because I actually had the opportunity to discuss this with the gentleman who was discovered before Mr. MacGregor. He told me that the Government must first make up their mind what they want. Do they want steel or do they want profits? In the organisation of the world today, the two are quite inconsistent. The Government must make up their mind what they want, and until they make up their mind what they want, how on earth can they measure the success of the gentleman?
Lord NUGENT of GUILDFORD: My Lords, one is always interested to hear the noble Lord's intervention, which was not exactly on the point that I was making. In any event, I think the compensation arrangement of the £225,000 a year to Lazards is not out of line with the international market, and I was glad to have Lord Byers confirm that. I would add just this with regard to the total figures, which (I accept the point made by noble Lord, Lord Bruce) hit the British public as a shock. If Mr. MacGregor is successful in achieving recovery in the British Steel Corporation, my word! he is going to be good value, even at these high figures. This Corporation is today losing some £1 million a day. Over the last four or five years it has lost £1,200 million of taxpayers' money. If he can begin to save even a tiny percentage of this, he is going to earn his money many times over. It is against that perspective, I think, that we must look at the terms that have been agreed.
I wish to discuss in my speech what I regard as the major reason why it is so difficult to appoint a man of top calibre to a position like the chairmanship of the British Steel Corporation. Because in my judgment this is not, as the noble Lord, Lord Byers, said, just a reflection on the leaders of British industry. It is a reflection on the structure and the atmosphere in which nationalised industries have to work, and the responsibility for this lies fairly and squarely on the shoulders of noble Lords opposite. I have served in one of these industries, and I know the problems. The fact is that this continues to be a political football. Nationalisation as an issue goes on one general election after another, and it arouses passions,
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not just among politicians but among the general public. Most unhappily, noble Lords opposite and their right honourable and honourable friends continually inflame this issue by their propositions to nationalise further and further aspects of industry and commerce. Today, still in the pipeline, as it were, we have banking, insurance, pharmaceutical, construction. You name it and it will go in, either because it is succeeding or because it is failing.
The result is that nationalisation continues to be a hot political issue. There was a short period of interlude some 20 years ago, when I was chairman of the Select Committee on Nationalised Indus tries in the other place, when the issue had calmed down and there were no more propositions for nationalisation. I believe that at that time the nationalised industries of the day were beginning to have a rather better break. They were beginning to be left a little freer to get on with the job of running these vast corporations. Unfortunately, that period rapidly came to an end with the 1964 and 1966 general elections, when the steel industry was once again to be renationalised.
The fact is that each time the issue gets fanned up, Ministers inevitably get more closely associated with the industries again; and, despite what the various Acts of Parliament say about the statutory independence of these industries, the general public regard the Government as responsible for them. The result is that anything that happens of interest, of surprise, of difficulty or of failure— like failure of performance, pricing increases, environmental offences, with drawal of services— immediately is used, inside Parliament and out, as a stick to beat the Minister concerned. Again, the sponsoring Minister with the Treasury is responsible for the capital provision for the industry, for what they require over and above self-financing. The result is that the Minister responsible for a nationalised industry must look to the chairman of that nationalised industry to keep him in close touch with what is happening in his industry— any action, present or future, which may have political implications which are going to cause the Minister trouble. This close supervision is something which the captains of industry do not like.
I turn now to the most difficult aspect of the nationalised industries, that of

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industrial relations. Special problems are there. No doubt, the founding fathers of the Labour Party, when they were creating these vast national corporations where all the men and women would be working for the national interest, felt that the ideal would be created that the feelings of those working in them would be so inspired by working for the good of the whole community that they would feel that loyalty which would devote them to their service and to the utmost exertion of their powers. This simply has not happened. The past 30 years has shown us that the primary loyalty of the workforce is to their trade unions rather than to the public good, and that the first priority of the trade unions is the interest of the members rather than the interest of the public good. This, unhappily, in recent years has been reinforced by the use of the gigantic industrial muscle which resides in these vast national corporations and is used as the ultimate bargaining weapon in the annual wage negotiations.
Thus, industrial relations management in nationalised industries has become a most difficult and complex problem. It is conducted in the full glare of publicity and any mishap is news immediately. It is far more difficult for the chairman of a nationalised industry to win the loyalty and confidence of his workforce than ever it is for the chairman of a large private industry, however big that may be; because there, at least, in the private business there is a common interest of survival and the management and workforce are bound together in striving to ensure that the business survives. But in the nationalised industries, unfortunately, the belief has grown up over the years that if there is financial difficulty the Government will always pay. This, unfortunately, has always happened— at least, until the last steel strike.
My Lords, I am defining the ultimate perameters of this difficult world. Within the total parameters, there are many millions of men and women who are public-spirited, hard-working, generous and doing the best they can— and not just the workforce but the trade union leaders as well— and are moved by public interest to do the best they can.
I should here confirm that in my own experience the trade union leaders with
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whom I worked gave me most generous and loyal support and made my task a relatively easy one in the water industry. I was sorry to see that last winter their record slipped a little, and I hope that they will get back on to the straight and narrow path next winter. The fact is that trade union officials' difficulty, even when doing their best in the public interest, is there because of the militants in their ranks who are always pushing from behind and asking them to use the industrial muscle when it is there.
This is the industrial relations scene, or a very short comment on it, for which the chairman of the industry is responsible. In my judgment, his best course is to do it himself. He will have to "carry the can" if it goes wrong; so that if he does not do it himself he must be close to it. But I say to noble Lords opposite that it is not made easier by the intimate personal relationships between all trade union leaders and either the Ministers or shadow-Ministers of the Labour Party who naturally take a close look at what is going on. In addition, the trade union leaders themselves regard the nationalised industries as their very special sphere of interest. For success in the nationalised industries, a chairman must grapple with these formidable difficulties and must win the respect and confidence of his workforce and of the general public if he is going to succeed.
My Lords, against this background, let us consider what qualifications a Secretary of State must look for when he is trying to find a successor chairman for one of these great industries. First, he must have a good technical grasp of the industry either by professional qualifications such as those of an eningeer, an accountant or, in this case, a metallurgist, or perhaps by long experience in the industry. Secondly, he must have a sound financial knowledge and be able to grasp the financial responsibilities of his industry. Thirdly, he must have the qualities of leadership to manage industrial relations and to win the confidence of his workforce and of the public. These are exacting specifications which would reduce a short list to single figures. We all know, any body who has had anything to do with Government knows, how difficult this is; and it is becoming more difficult. But when the extra dimension is added of political sensitivity and understanding,

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the short list really shrinks to vanishing point, in most cases, to get a person with the calibre that you want.
Very few captains of industry who might have been interested in a great national corporation will accept the relationship of continuous subservience (for that is as it must be) to the Secretary of State; because the relationship between the chairman and the Secretary of State must be one of absolute confidence. The chairman must study the wishes, the responsibilities and the problems of the Secretary of State all the time. That is not the way that industrial leaders work in their own indistries. They work on a basis of taking their own decisions, battling through and being judged by the success or failure of what they do.
I am delighted to hear about Mr. Atkinson— a jolly good chap! But there are very few people who will do it; and certainly not enough when you come to the difficulties of an industry like the British Steel Corporation. Let me add that the terms of the appointment arc not all that attractive: a five-year term, a salary usually well below market rate, a negligible pension and even the traditional "K" does not always turn up. Some nationalised industries are more difficult than others. The great national utilities, without a trading risk, are relatively easy and sometimes, quite often, someone will come up from the staff, ascend to the top and do a satisfactory job. But when we come to an industry like the British Steel Corporation, with a massive trading risk, facing every kind of commercial and industrial difficulty, it is not surprising how enormously difficult it has been to find any man at all with the necessary qualifications who is willing to do it.
I say squarely to noble Lords opposite that this problem is of their own creation. They created the nationalised industries and keep on creating them. It is because this goes on happening that this remains a "hot potato", if I may put it that way, that it remains so difficult for Ministers to dissociate themselves from the industries and to leave the industries more free for the leaders to run the industry themselves. I am sure most noble Lords opposite will agree with me that we have had quite enough nationalisation. It would be best to leave it as it is and try to get stability and not push out further. This
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would give a chance to the existing nationalised industries to make the best of themselves and give a prospect of getting the kind of men and women that we should like to have, to come in to run these industries.
I would say to noble Lords opposite that they should not be critical of the Government and the Secretary of State for what they are doing in this appointment. After all, the Secretary of State had the option, if he wanted to, to dispose of the assets of the British Steel Corporation. The major lesson that we learned from the strike was how very efficient and profitable and how contented the independent private firms were. They are all right; they can meet the export market and sell their steel in competition with the world. They have a contented workforce which is well paid.
Why not put the whole lot in those hands? Everybody would be better off. The Secretary of State did not do that. He has gone to immense lengths to try to find the man who could achieve the recovery, bring round this great corporation with this enormous investment of taxpayers' money, so that this can be developed for the benefit of the whole economy. Thus it is he has made the appointment of Mr. MacGregor. I say with all sincerity that it is an appointment that, having been made— even if we do not like every aspect of how it was made— We must all wish Mr. MacGregor every good fortune and success in his fearful undertaking.
4.2 p.m.
Lord BALOGH: My Lords, the noble Lord, Lord Nugent of Guildford, must have been far too young to observe British industries in private hands before the war when the railways ran to the Government to get capital and when the Bank of England had to shrink the steel industry which was making constant losses and merger after merger followed. I happened to be in the City in those days, not on this side of the watershed, and I well remember how much British industry was then in private hands subject to the same difficulties as it is now. To say that it is public ownership which has made the difficulties is ludicrously to disregard the history of this country in the past 100 years.

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Mrs. Thatcher's and Sir Keith's choice of Mr. MacGregor as chairman needs to be looked at— and my speech will be somewhat different from the preceding speeches— from three different planes. The first and much the most important of these are the terms of appointment and the light they shed on the quality of policy-making, especially policy-making in the public sector. Secondly, we should look at the way the recruitment was carried out and announced and ask whether it is acceptable from the view point of the reorganisation of the steel industry. It should be borne in mind that the corporation has suffered from an extremely acute and costly strike. Anything which exacerbates feelings should be avoided.
Thirdly, and finally, we have to look at the bargain itself. The noble Lords, Lord Byers and Lord Bruce of Donington, have spoken about that part of it. I will only touch upon it shortly. We were left in no doubt that the overriding aim of the Government for the steel industry is the elimination of the losses which are being incurred in whatever way this is possible. This would be a perfectly comprehensible goal for a grocer's shop round the corner; but we do not deal with a corner shop, we deal with a steel industry, the supplier of one of the most important— perhaps the most important— raw materials for the engineering and durable goods industries. The fact that it is nationally owned would seem to permit its utilisation for the management of the economy, helping to correct the balance of payments. This is the more important as its customers are the most vital fields of manufacture in which the recovery of foreign markets and the roll back of import penetration is the essence of any programme for Britain's recovery. Under these circumstances, the method chosen for the restoration of the profitability of the industry is of primordial importance.
We are at the beginning of the gravest depression that the non-Soviet world has experienced since the 1937 slump. The steel industry has been especially hard hit because its greatest customers— ships, railways, motor cars and consumer durables— have suffered more than the average. After a steady expansion there is a vast world excess capacity even in countries like Japan who have successfully built a low-cost industry. Simple
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profitability is no longer a sufficient indicator of social desirability. Current prices do not and cannot give the right signals. With heavy unemployment and vast idle capacity, the social cost is much below the private cost, if only because the state has to shoulder unemployment insurance and benefits.
The present Government's attitude to the public sector is to sell off the more profitable bits (the BNOC has been an exception but we do not know for how long) and impose rigid cash limits for the rest, not differentiating between investment and current outlays. Consequently, the public sector (but also most of the private one) will cut investment rather than current expenditure, the more as the very depression will discourage extension or modernisation of plant. There is no surer method of making certain that any recovery will find this country unable fully to utilise the main chance. This has been a cause of worry over a long period of time. Britain since the First World War never had sufficient reserve capacity to supply the needs of industry at full employment, and this lack of reserve capacity has caused shortages and led to a violent rise of imports whenever the country neared full employment and thus lost out to competition both on the domestic and on the foreign markets. No doubt a lot of steel capacity is over-age and obsolescent. Its elimination is inevitable. But the wholesale slashing of the overall capacity will land us with the same problems which had been the cause of our industrial decay.
We are confronted here with a nationalised industry which can calculate on the basis of long term requirements and which can and should be used to harmonise long-term needs with immediate financial considerations, which could help in maintaining or rather regaining competitiveness in the most important and most depressed export markets. The Thatcher Government are evidently throwing away one of the most important potential weapons needed for the long-run restoration of British prosperity. They are throwing it away in a field in which most of our competitors have overt and covert subsidies and in which the Japanese have increased their capacity from 0 in 1945 to over 120 million tonnes per annum while we were running down our capacity. So long as we plan for a level of demand which as of today

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implies massive unemployment and in which the present monetarist policy has resulted in a violent appreciation of the pound in a period in which the Japanese yen depreciated by the same proportion in real terms, our prospects are bleak.
A remarkable article in The Times claims that MacGregor's appointment is a sign of a new expansionary policy. I would welcome that but doubt it. If that is so, Mrs. Thatcher would have performed the most remarkable U-turn in a period in which U-turns have been rather extreme.
On the second aspect of this appointment, its immediate impact on the steel industry, the secrecy in which the deal was negotiated and the brusque manner in which it was announced could not have been more unfortunate. We have been suffering from a deterioration of the relations between classes, the turning of the British virtue of moderation into the British disease of ever-increasing rage and alienation of a large part of the population from the existing order.
I am shocked by the inevitable impact of the announcement of the choice of a chairman and of his remuneration in an industry in which the management claimed that a 2 per cent. increase in wages was the utmost they could afford. For the new chairman to have a remuneration which, being partly tax-free, when grossed up must represent, even at reduced top rates of tax, comfortably several hundred thousand pounds is indefensible. No doubt we shall be told that there is only one chairman— we have been told this already— and there are thousands of wage earners, that his salary could not swell inflationary demands and that if Mr. MacGregor is but partially successful he will have recouped for the state a large manifold of his swag. Nor can I claim that Mr. Sirs would change his bargaining tactics if Mr. MacGregor had been content with less; but Mr. Sirs will be in a very much weaker position to defend a reasonable wage bargain to his members.
In this new Tory world where merit is equated with profit, the chairmen of other successful state industries like gas and oil will be even further unsettled, having been throughout this period willing to serve at a fraction of Mr. MacGregor's take. I fear that therefore this appointment will end in a new round of salary
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revision, postponing dangerously the ceasefire in the present lethal wage trench warfare.
I come to my final point, which has been touched on already. It is peculiar that so-called "head-hunters" should have been employed on behalf of the Government, whose remuneration depended on the total take of Mr. MacGregor— that is, people who were interested in securing the worst possible conditions for the state. For people who believe in the price mechanism and the market process, this surely is a very odd method. The result is equally remarkable. I never imagined that I would be at one with the Government in condemning the paucity of talent among British managers. A £2 million rebuff to the CBI is shattering. From the fact that the Government have become parties to a plain tax avoidance scheme very much like that which was criticised by Mr. Heath when Prime Minister as the "unacceptable face of capitalism", one can only conclude that the appointment of Mr. MacGregor has become one more unacceptable face of Mrs. Thatcher's regime.
4.14 p.m.
The Earl of ONSLOW: My Lords, it is a privilege to be speaking between the only two members of your Lordships House who witnessed the coronation of the last Hapsburg Emperor. The noble Lord, Lord Bruce, was very right to call for this debate. When I heard the announcement on the wireless recently— I think it was during "Yesterday in Parliament"— of the appointment of Mr. MacGregor, I thought: "Sir Keith is an extraordinarily brave man". Then I thought about it a bit more and I thought: "Perhaps Sir Keith has shown imagination and he has gone outside the normal channels". My Lords, possibly that is something of which we should all approve.
As a small point, I am sure that the noble Lord, Lord Bruce, did not need two architects to build his house; otherwise it would have been half Gothic and half classical— and that surely counteracts the argument that we should have gone for two head-hunters. Surely, if you appoint one person to do a job for you, you ask him to do it and you do not then clutter up his business and make it impossible by appointing somebody else.

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That leads to lack of authority and lack of proper direction.
The noble Lord, Lord Nugent, has pointed out, totally correctly, the great difficulty that arises as a result of appointing nationalised industry chairmen. I suggest that perhaps it would be right then to pay more for the really difficult posts— which must be steel and shipbuilding. We demand more of the chairmen of nationalised industries in a difficult job. Steel is fiendishly complicated at the moment. There are loss centres, profit centres and ingots. I confess I have no detailed knowledge, or indeed anything but an intelligent layman's vague knowledge of steel; but surely the important thing is that, once we have found Mr. MacGregor, he is given very clear instructions by the Government as to exactly what they want him to do. I am sure that my noble friend Lord Trenchard will tell us what those instructions are. An article in The Times on Saturday posed some interesting questions.
To get back to the method of payment and the finance and how Mr. MacGregor was found, it does seem awfully odd that we are perfectly happy to pay barristers large sums of money to sue somebody for libel; we are perfectly happy for people to win vast sums of money on the football pools— you are regarded with sympathy and gentle affection if you win a million quid on the football pools; we are perfectly happy to pay film stars and pop singers, because otherwise they would not be interested in being film stars or pop singers; and I suppose that even the Roman senators probably complained bitterly that gladiators were paid more than they were. But surely it is an odd reflection on our society to say that we are paying Lazard Frères too much money for a man who we hope— obviously there is a great "if" about this— is going to turn this ghastly muddle which British Steel has become, through several faults of several people, into a success. If that happens then we are privileged to have his services and I hope, as he is patrial, he will get not only a "K" but perhaps an "L" as well.
There was something unfortunate, if I may say so, about part of the attitude and the tone of the speech made by the noble Lord, Lord Bruce. I thought to myself
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yesterday: "If I use the words 'loud whinge', will I be inaccurate and unfair about what I suspect Lord Bruce's speech is going to be?" Some of your Lordships may not know this expression "whinge", but it is a sort of petulant complaint and it is rather a good, modern, slang word. I was rather hoping that I was not going to have to say that the noble Lord, Lord Bruce, was indulging in a "loud whinge", but I am afraid I think he did. He has not realised that there is a change of attitude about this Government. He has not realised that what this Government are trying to do is to reward success highly and to make people confident of success, which will then produce high profits and a good industrial climate and, following that, the "goodies", the social wage which we all need, the hospitals and so on.
It is this attitude which underlies this appointment which I think the noble Lord has not understood. The noble Lord, Lord Balogh, pointed out that success is possible. As he says, the Japanese have raised production from nil to 120 million tonnes of steel in 35 years. We can do that; it is a question of changing our attitudes and we must therefore back up and give the right instructions to the people like Mr. MacGregor.
Lord BYERS: My Lords, may I ask the noble Earl? Does he really mean what he has now said twice; that is, that the Government must tell Mr. MacGregor exactly what to do? That is not the right concept of management at all.
The Earl of ONSLOW: My Lords, I beg your Lordships' pardon, I do not mean that they have got to tell him exactly what to do, but presumably he has to have a remit from the Government, "Go forth and run British Steel along certain policy guidelines". That is presumably what every Government give to any nationalised industry chairman. That is what I would presume this Government are going to do there. That is really all I have to say. It is a question of confidence, of wishing this man well and of not attacking him but making sure that he is capable and is helped to get the support he needs in a very difficult job, to produce high productivity in a well-paid, successful steel industry, producing the goods we all need.
4.21 p.m.
Lord KALDOR: My Lords, as a number of speakers have already pointed out, the transaction we are discussing this afternoon can be looked at from a number of different aspects. In my view, there are really two main aspects and I want to speak on each; that of ethics and that of economics. So far the discussion— except for Lord Balogh's speech— has concentrated far more on the ethical aspect and less on the economic, but in the long run, from the national point of view, the economic aspect is far more important.
There can be no question, in my view, that the arrangements which the Government have entered into in connection with this appointment are shocking and scandalous and, so far as I am aware, there is no previous precedent in the light of which they can be judged. I think I can do no better than quote the Washington correspondent of The Times who said, in the issue of 6th May, that one of Lazard Frères' partners, Mr. Disque Dean, once joked about the high compensation he and his partners received and he told Fortune magazine that his bank was "the biggest racket on Wall Street".
Lazards is a respectable name as a merchant bank both in London and in Paris; I think we all ought to be careful to note that the New York firm of Lazard Frères has nothing whatsoever to do with these other firms, and it is in a very different category. Russell Reynolds Employment Agency offer top jobs operating right across America, and they also operate in Europe. They say they generally get a commission of one-third of the first year's compensation which is paid by the employer. It would be interesting to know who pays this compensation and how it is to be calculated. Will it be on the basis of a salary or also of the various other forms of pay?
In any case, there is little doubt in my mind, as the noble Lord, Lord Bruce, has alrady said, that the whole construction was evolved not only as a means of extracting the maximum amount of money from the British Government, but of minimising the amount of money the British Government will receive back in the form of taxation. The United Kingdom will benefit through income tax by Mr. MacGregor's salary of £48,500, but the transfer fee of £675,000 will not be
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subject to British tax, except perhaps in some part; whereas for reasons explained by Lord Bruce the productivity bonus or performance bonus of up to £1,150,000 may not be taxable in the United Kingdom at all, because it has been so arranged that it will not be paid until he is out of the clutches of the Inland Revenue.
My Lords, that this is not a normal transaction, even in America, is shown by a remark of the correspondent of The Times which has already been quoted, that the American partners and the partners of the employment agency "are laughing all the way to the bank". That means they made an audacious bid which came off. I find it very difficult to believe that the benefit to Mr. MacGregor from these enormous sums other than his salary will be limited to a modest share in the profits of Lazard Frères. Is it known how his share will be calculated for the purpose of this particular transaction? The share of profits of a partner need not be the same under all circumstances. All I know is that Sir Keith Joseph told the other place— and I am quoting from the House of Commons' Hansard — that:
"This is a hypothetical question which cannot be known by us or predicted".
If I interpret this correctly, it means the Government have no idea how much of the money paid to Lazard Frères will sooner or later benefit Mr. MacGregor personally as against the rest of the firm, the other partners of this firm. Still less is it clear how far the bonus to the tune of £1,150,000 will be divided. Anyhow, it seems to me very odd that it should be divided at all. The compensation to Lazard Frères is the transfer fee; a performance bonus or productivity bonus is generally paid, whether it is to an ordinary worker or to the managing director of a firm, to the man who is responsible for it and not to his slave-owners or keepers, meaning Lazard Frères. So I believe there is far more behind this than has so far been disclosed.
It was also mentioned, and I merely repeat, that this is a very bad precedent from the point of view of all other nation alised industry chairmen, indeed from the point of view of all people in leading positions in British industry. It is a very bad precedent from the point of view of nationalised industry chairmen that some-

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body can be appointed, keep a number of his previous directorships and receive an income from them which is greatly in excess of his income from his main job.
Now Sir Keith Joseph used the analogy of the transfer fee paid to footballers, but in my view this is not an appropriate analogy. It is perfectly habitual among football clubs to pay for successful players and to receive payment for releasing them to others. But, fortunately, it is not part of the ethics of ordinary business to demand compensation for releasing a man who wishes to take another appointment or to pay such compensation to his previous employers. To quote a recent example, when Sir Michael Edwardes was asked to take over the chairmanship of British Leyland, he had to leave the managing directorship of another important firm. That firm received no compensation whatever; it was neither offered any nor demanded any for his release.
Indeed, Lazard Frères, which The Times describes as a
"secretive, small and highly opportunist bank",
specialising in "financial engineering"— all very odd terms—
"able to fix highly complicated and highly remunerative takeover bids and mergers,
obtained the transfer of this extremely valuable Mr. MacGregor only two years earlier from another far more respectable New York Bank, namely, Lehman Brothers; and Lehman Brothers got nothing from Lazards for losing Mr. MacGregor. Lehman Brothers were neither offered anything nor did they demand anything; it was natural to them that if Mr. MacGregor wanted to go to another firm, off he went. They put no obstacles in his way. We do not live in a slave society.
Let us suppose that it had been the other way round, and that a high-ranking civil servant wished to accept an appointment in private business. We all know that there have been a number of conspicuous cases in recent years, in which civil servants in high positions, far from retiring age, resigned from their appointments to take up directorships with private companies. So far as I know, there was no case in which the Government demanded compensation for releasing any
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of them. If there was such a case, I should be very grateful if the noble Viscount would tell us. If not, why not? What is the difference, from an ethical point of view, between the Government making a payment to a private employer to get a man, and demanding payment in exchange for letting him go? Plainly, there is none. Demanding a payment of this kind is just as scandalous as paying it.
Let me now turn to the economic aspect. What is there about this whizz-kid of 67, who can make such a unique contribution in three years— because his appointment is envisaged for only three years— that no one else in this country can make? I take it from the noble Lord, Lord Byers, who knows far more about him than I, or anybody else, presumably, in this Chamber, that he is indeed a very remark able man, and I do not wish to make any personal criticism of him at all. But the question is: What is he supposed to do? What can he do?
For the answer, we must turn to Sir Keith, both to what he said in the other place the other day and to what he said on many other occasions. The answer, subject to correction, is that he is likely to reduce the losses of the British steel industry— by shutting down plant, by reducing industrial capacity and by sacking people— more speedily and more ruthlessly than anyone else of British nationality could do. At least, in the view of Sir Keith, as a hatchet man he has no equal.
I am afraid that this whole business can be understood only on the assumption that Sir Keith Joseph and his colleagues regard profit-making— which, of course, includes loss avoidance; losses are negative profits— as the be-all and end-all of nationalised industries. Sir Keith's mental horizon does not extend beyond that of a provincial stockbroker. He is evidently quite incapable of distinguishing between social and private costs or social and private benefits. He is not capable of assessing the national interest, as against the particular interests of the owners of a business, whether they are private shareholders or whether it is the Government. Mr. MacGregor may, indeed, be cheap at the price of £2 million, if the only consideration which is relevant is the losses that he will save the Government; if the only consideration that is relevant is that he may

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succeed in getting rid of more hundreds of millions of "losses" than anybody else would have done.
The Earl of ONSLOW: My Lords, will the noble Lord cast his mind on this possibility, that up till now, since the war and nationalisation, we have placed social duties and social obligations upon nationalised industries which have, in effect, made them less competent? We have not been able to separate the social duties, which are the duties of a Government, and the duties of a corporation, which are to produce coal, steel, electricity, gas or to run railways. We have not been able in our minds to separate those two. Once you separate them, it is much easier, and that is what we should now do.
Lord KALDOR: My Lords, if the noble Lord will allow me I shall develop this theme at some length, and he will see that my use of the word "social" is rather different from what he has in mind. The social effects— I think that the noble Lord, Lord Robbins, will bear me out; he was a student of the works of Professor Pigou, and earlier of Alfred Marshall, who invented this distinction— are those which you obtain if you take into account not only the direct profits but the indirect benefits that accrue to other businesses and to the economy as a whole. That is a different meaning of the word "social". The important consideration is the additional loss which may amount to thousands of millions, and not hundreds of millions, in terms of lost national output, which will follow in the long run from the disappearance of a large part of the steel industry.
As I have said on more than one occasion in previous debates, decisions concerning the steel industry cannot be judged in terms of profits. Steel has a vital role to play, both in peace and in war; it is the most important single measure of the industrial potential or capacity of a country. I think that most economists are agreed on that. During the post-war years, when we increased our steel capacity from 14 million tons in 1946 to 28 million tons in, I think,1973, the Japanese increased their capacity from 5 million tons to 125 million tons. In other words, they did not double it; they increased it by 25-fold.
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Yet if you ask Japanese experts how they could do this— and if they could do it, why did we not do it?— they will tell you, as I was told by several people in Japan, that their extraordinary expansion in steel was made possible in the vital first decade after the Second World War only by the complete refusal of British firms to supply their traditional markets in the Far East, at a time when there was tremendous potential demand to be met. The British firms were loaded up with other orders, and they had no opportunity even to accept orders from their old customers in the Far East.
What the Japanese said was: "All we did was to step into your shoes, which we could not have done if you had gone on supplying your own markets." I have no doubt that if we had had the foresight, the drive, and the salesmanship of the Japanese, we could have expanded both our capacity and our exports very much faster; and if we had done that our industrial productivity as a whole, and not just in steel, would have grown much more rapidly.
What the Government are planning to do is a Jarrow or a Beeching all over again, but on a much larger scale; to close down plants and add to unemployment as quickly as possible. While the previous Tory Government under Mr. Heath went in for growthmanship, the present Government are hell bent on the very opposite— shrinkmanship. It is against that background that they have to explain the unique qualities of Mr. MacGregor.
The present huge losses of the steel industry, which the Government desire to eliminate so quickly, arise only partly on account of inefficiency, overmanning and the use of obsolete plant. The more important cause is the present artificially high level of the pound, combined with the fact that, on account of the Common Market, we are barred from protecting our industries against the flood of foreign imports. For the Government to sustain the losses of the steel industry in these circumstances is nothing else but a form of industrial protection, alternative to a tariff, and as such it is in the national interest that it should be kept and not liquidated. The Japanese industry, for example, in the first 20 years of its existence, was mainly supported by direct state subsidies and not by protective import duties.

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What a contrast there is with Tory policies in the 1930s when, following the devaluation of the pound and the competitive advantage thereby gained, the National Government imposed a heavy protective duty on steel. This was raised first to 30 per cent., and in 1935 to 50 per cent. As a result of it, steel production increased from 5 million tons in 1932 to 13 million tons in 1937, an increase of 160 per cent. in five years. Without that increase, I hardly think that we could have taken on Germany in 1939. The present Government profess that they are extremely keen on defence, but when it comes to the foundation of defence capacity, namely steel production, their minds are locked in a different watertight compartment.
The Noble Lords may have seen that the previous chairman of BSC, Sir Monty Finniston, described the existing plans for the rundown of steel capacity— and here he was referring evidently to the plans of Sir Charles Villiers and not any new plans that the new chairman may bring about— as "ridiculous". He said that while the United Kingdom plans to reduce that capacity to 14.25 million tons— and I quote,
"the world produced last year 800 million tonnes which is the largest amount in the history of mankind. The Japanese produce 120 million tonnes a year. Are they cutting back capacity to 80 million tonnes? They export 40 million tonnes against our total planned capacity of 15 million tonnes. That is marketing. We can make steel as well as anyone else, but somewhere we have lost our sense of trading. It is a problem not only of steel but of the whole manufacturing industry ".
In these circumstances, to appoint a man merely because he is a master of shrink-manship, more ruthless than others in eliminating losses and cutting capacity, is a form of national madness for which we shall have to pay very dearly in the future.
It is possible that I may be wrong about all this, and that Mr. MacGregor will turn out to be a growthman and not a shrinkman. There were some hints to that effect in an extraordinary and rather obscure article which appeared in The Times of yesterday. If this is so, I shall be only too glad to have the noble Lord's assurance in his winding-up speech tonight that what I said about the future of the British steel industry, or about plans that the Government have for the steel industry, was all wrong.
4.45 p.m.
Lord FERRIER: I followed the noble Lord, Lord Bruce of Donington's speech with lively interest. His speeches always interest me because they disclose how possible it is for a variety of deductions to be made from facts and various interpretations to be placed on statements. He asked a great many questions of my noble friend Lord Trenchard. I lost count at about 20, and so I am looking forward to Lord Trenchard's speech when I have had some tea!
But there are two other questions that I should like to add to Lord Bruce's. One is, to what extent did the Secretary of State beat down Lazard Frères before they went laughing all the way to the bank, as the noble Lord, Lord Kaldor, said? Further, am I not right in saying that when a "short leet", as we call it in Scotland, is selected, when you have to choose somebody, it is necessary to have a number in order to check that the man you want is the right one. However that may be I look forward to Viscount Trenchard's speech.
I am not reluctant to speak here for I have three good reasons. Over 30 years of my active working life were spent in a country where I was an expatriate, a Jock— just as Mr. MacGregor is. Therefore, I have some sympathy with his position and some knowledge of the advantages which being an expatriate can produce in dealing with people of another country. My second reason for wanting to speak is that by a concatenation of circumstances I found myself in the Peer's Gallery on 1st May when the Minister made his statement to the other place. Probably the less I say in this place about the behaviour of the House on hearing that statement the better.
Further than that, I speak because a major part of my working life was spent in different echelons of industry and industrial management from the bottom rung to the top. Therefore, the various attitudes towards the appointment of Mr. MacGregor are of lively interest to me. I worked as hard as I possibly could. Work was work, too, and how I scorn the fairly successful efforts of today's pundits to imply that manual workers are the only workers who count. We had an example of it today when a noble

301 Lord opposite was putting a question to my noble and learned friend the Lord Chancellor: it was implied that the only people who work are the manual workers. That is not the case, and I think the manual workers are the first to realise it, particularly when they are well led.
My own experience has taught me the importance of leadership. This is some thing that you cannot measure by any sort of figures. I was most interested to hear what the noble Lord, Lord Byers, said about his knowledge of Mr. MacGregor. I know of two other noble Lords in this House who know that Lord Byers was quite right, and that Mr. MacGregor is a man in a million. If leadership is the essence of the whole thing, and we can get its value, then it is like a precious pearl. I believe that in Mr. MacGregor we have succeeded in getting a true leader. When I say precious, what do I mean? Precious to whom? I mean precious to the workers, whatever the colour of their collar. This is a very important matter. It is important to the shareholders and in our case it is important to the state. There are various facets to that, but it seems to me that many professional people and some politicians do not grasp what leadership means. It means to whom? It means to the workers. They do not want to have to listen to Fabian pundits; they want a practical policy that works. They do not want a share in the profits if they have also to share in the losses. They want a top-level wage for a fair day's work with up-to-date tools and top-level conditions. I am pretty sure that that is what they are going to get under the new arrangements.
This seems to be an ingenious solution to a terrifying important problem, despite any faults in its presentation. I say that for the reason that I fully agree with the noble Lord, Lord Byers, and with the noble Lord, Lord Nugent of Guildford, when he pointed out that it might have been put quite differently. I was there in the gallery. I confess to being critical of the manner of it. I should have liked the fact that the search for a new chairman for BSC, when Sir Charles Villiers came to the end of his tenure, had lasted for nine or 10 months to have been treated as the opening. This was elucidated in subsequent exchanges.
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It is a pity that a central feature of the appointment— the noble Lord, Lord Nugent of Guildford, touched upon it— was not made clear: why did British possibilities refuse to take on this job? The reason, to my mind, is pretty clear. I think that the reason why so many people said no was because of the attitude of the socialist Opposition. The ordinary citizen of this country who is subject to this country's taxation and the like is simply not prepared to face what the chairmen of nationalised industries are having to face now. That fact must be faced. Does it not indicate that there is a serious flaw in the whole system of our nationalised indutries? Is this the culmination of years of frustration of management through parliamentary interference— interference so serious that British nationals of the highest calibre are not prepared to put up with it? But this man is prepared to, and is in a position to do so. That is what I meant when I referred to expatriates. Mr. MacGregor has an amazing career of success behind him, and my information is to the effect that he has a robust confidence which he will exercise in this important task.
Judging by what I heard in an interview by Robin Day on, I think, "The World at One ", it defeats me that the socialists are indulging in these almost hysterical histrionics at a moment when the very foundations of their precious nationalisation are being shaken to the base. The noble Lord, Lord Nugent of Guildford, touched upon this. What is going to happen? Is socialism preparing to disregard the writing on the wall?
Since I have referred to the "World at One", perhaps I could say that I do not think that the BBC are being very bright about the presentation of matters such as this. They seem to begin every item with a statement by a trade union leader— worthy men, no doubt, despite what they are doing today. I do not object to their being placed first provided that it is appreciated that these individuals are "singing for their suppers". We all know that they have got to toe the socialist line— or have they not? Is there a whirlwind of change growing out of the silly dust-devil of today's outrageous carry-on? Socialism has now robbed the till and it is empty. Is it possible that the true Labour Party and the theoretical socialists are going to be blown apart? Where lie

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the true interests of the workers? I believe that the position is desperate.
Mr. MacGregor's main task will be to rally his workforce round him. It is going to be no easy task and it will be rendered all the more difficult by the attitude of the parliamentary Opposition in the past week. My working life was spent as an expatriate Scot. As such, I welcome Mr. MacGregor's appointment and feel that all of us should give him a rousing welcome and pledge to trust the Government's judgment in this matter.
We look forward to laughing all the way to the bank in three years' time. I hope that is the way it will work out because the position before this happened was so dismal— the final distillation of socialism permeating the world from the Cuban refugees, through the Berlin Wall to Afghanistan and the Boat People. We must realise that this is what may lie ahead if this does not succeed, and it is our business to see that it does succeed.
4.55 p.m.
Lord LEE of NEWTON: My Lords, in my time I have appointed and reappointed several chairmen of nationalised industries. However, if we take notice of what both the noble Lord, Lord Ferrier, and the noble Lord, Lord Nugent of Guildford, have said, we are going to have one dickens of a job to get anybody to accept chairmanships of nationalised industries.
The noble Earl, Lord Onslow, was very critical of the speech made by my noble friend Lord Bruce of Donington. I thought he gave a splendid exposition of the problems which arise as a result of this rather stupid appointment, and I am sure that his speech will repay the very closest reading. The country will certainly want to know the answers to some of the questions which he asked. For my part, I am interested only in Mr. MacGregor as he is now to be the chairman of the British Steel Corporation. However, I am far more interested in the future of the British steel industry than I am in the future of Mr. MacGregor. Indeed, at the moment, Mr. MacGregor's future looks far more rosy than that of the British Steel Corporation.
I have other interests. Before coming to Westminster about 35 years ago, I
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earned my living by cutting up pieces of steel into various shapes and sizes. Indeed, as steel was the source of supply of my principal raw material and as my job depended upon it, I took a great interest in the steel industry. I submit that it is a great mistake to believe that before nationalisation the industry functioned on the basis of competitive private enterprise. I do not know whether the noble Lord, Lord Nugent of Guildford, thinks that it did.
The last element of competitive private enterprise disappeared from the steel industry when Richard Thomas and Baldwin, the great steel firm in South Wales, was forbidden to compete with other sections of the industry when it approached Sir Montagu Norman for a loan from the Bank of England. The condition upon which it got that loan was that there would be no more attempts to introduce competition into the steel industry.
There was then a period during which Government control was exercised by statute. It was a rather negative kind of control— a sort of "thou shalt not" kind of control. But during that period a very great deal of public money was poured into the steel industry. When one looks at some of the great plants that are now in being— for example, Llanwern and parts of Ravenscraig— one has to remember that they would never have been built had it not been for the inoculation of public money into the steel industry. I commend that thought to the noble Lord, Lord Nugent of Guildford. I thought at one time that he was in danger of making this into an anti-nationalisation debate.
The state of affairs which I have described in the steel industry was the state that I found when, in 1965, I produced the White Paper upon which the nationalisation Act of 1967 was founded. In those days, the industry was well behind the bulk steel industries of most of the other steel producing countries. Again may I remind the noble Lord, Lord Nugent of Guildford, that although he talked about the success of the private sector in British steel we deliberately hived it off because it was highly specialised steel which did not result in bulk steel production. It is a very different proposition indeed.
As I was saying, the industry which I discovered when I went to the Ministry of

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Power was a long, long way behind the modernisation which had taken place in a great many of the steel-producing countries with which we had to compete. The noble Lord will remember that at that time the new departure was the introduction of the oxygen process. There was precious little of it to be found in the British steel industry. We have heard a lot recently about the huge input of capital into the steel industry and that is perfectly true. In the main now it is a very fine, modernised steel industry but I would remind the House that Shotton is now being closed down and they are still using the old open hearth furnaces. So when we hear all the remarks about not being able to compete we should not believe that the modernisation programme in British Steel has gone anyting like as far as it will have to go.
What I wanted to argue was that we cannot really look at the affairs of the British steel industry in isolation. Indeed the steel industry is a vital cog in the whole structure of our manufacturing industries, and the Government must recognise its role as the genesis of a great deal of our manufacturing effort. In this consideration I think we are reaching the stage at which the chaos which the Government's sins of commission and omission have succeeded in achieving within the steel industry is rapidly deteriorating into absurdity and farce.
I have no doubt whatever that Mr. Ian MacGregor is a very capable industrialist, but are we entitled to expect that any man who has spent half a lifetime concerning himself with the issues which are peculiar to the United States of America can suddenly adapt his thinking to the very different problems of the amount of steel capacity and indeed the widely differing types of steel within that capacity which are essential for the requirements of our manufacturing industries? I put it to the House that no matter how capable a man is, it is utterly absurd and quite impossible to believe that he can do it.
My noble friend and others have asked what are the terms of reference. The noble Lord, Lord Kaldor and the noble Lord, Lord Balogh both asked that question, and I should like to know, too. From what I have read in statements made by Mr. MacGregor, he seems to think that his job is to continue to run down the capacity of the steel industry.
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It is now down to some 15 million tons. I have suggested that we cannot look at steel in isolation from the rest of manufacturing industry. How does Mr. MacGregor know that his job is to run down the capacity of British Steel? What chance has he had to make any study in depth of the requirements of our manufacturing industries? I should welcome an assurance from the noble Viscount, when he comes to reply, that Mr. MacGregor is a free agent to determine these matters in conjunction with other sectors of management which I know do not consider that the present attitude to capacity is either necessary or in the best interests of the steel industry itself, the wider interests of our manufacturing industries or, indeed, of the British economy. They just do not believe it, and I am speaking of men who have spent a lifetime in managing steel industries.
Even before the present world recession there was a very considerable surplus on a world scale caused largely by the indiscriminate expansion in Japan and the creation of new steel industries in a number of countries which are now trying to establish their own manufacturing industries. Because of this, steel exports have quite frankly been dumped at prices which are either below cost or which have left extremely small margins for those who sell them. Is it the case that this feature, the dumping of steel exports, has been an important factor in the decisions to cut back home production to what I have described as absurd levels? They presuppose either that we are reconciled to an even further large-scale reduction in the steel demands of our own manufacturing industries or that we are going to see a policy of increasing requirements of steel imports. It has got to be one or the other. At the present time, if we run down to the levels which are apparently intended, the supply certainly will not be sufficient for those manufacturing industries of ours, which I know very well. They will need a far greater amount of steel than we shall be able to produce in Britain.
So what are we doing? Is it, as I am suggesting, that because of the absurdly low level of the price of exports to us and to other importing countries we are writing off a huge, highly modernised industry and going to depend in a high degree on a far greater volume of imports

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than we have done before? The noble Viscount, Lord Trenchard, was telling us a few weeks ago what the balance of payments would be like now if we were to take out the oil revenues. Heaven knows what we shall get to if indeed we are now going to indulge in the cutting down of the home supplies of steel simply because we can import at a very low price indeed. Are we really so negative in our belief in ourselves that we no longer think an upturn in world trade would benefit us by increased exports of steel products?
Again, we seem to be looking at the present world demand against a world which is in recession and which is apparently going further into recession. Do we believe that, when that recession finishes and we can expect a more ebullient demand for steel, we are so uncompetitive, so backward, that we cannot look forward to any share in the increased demand which will arise for steel products? Is that what we are saying? If so, we can shut the shutters because we are finished as a great manufacturing industry.
The question as to why we could not get a British manager to take over was posed, but I do not think some of the questioners would chance their reputations while this Government are in power. Noble Lords opposite were telling us about the damage caused by Socialist nationalisation. One fine day I should like to debate with noble Lords opposite the true successes of the British nationalised sector. It is a bit thick to be told about the dangers of British nationalisation by a Government which has just annexed huge sums from the British gas industry in order to bolster up the public sector borrowing requirements. There would have been no coal industry left if we had not nationalised. Now it is one of the most highly modernised in the world and, what is equally important, the rate of accidents is lower than in most other coal industries throughout the whole world. Does that not matter? I shall not follow the two noble Lords who made these statements, but I saw present in the Chamber a little while ago the noble Lord who was chairman of Rolls-Royce: is that an exception, because the Tories nationalised it? If they had not done so, there would have been no Rolls-Royce left and why does not the noble Lord, Lord Nugent of Guildford, get to his feet and tell us how thrilled he is at the great
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success achieved by the nationalised Rolls-Royce company? Apparently those little items just do not matter.
Lord NUGENT of GUILDFORD: My Lords, if the noble Lord wants me to intervene in his speech I will do so. I was refraining from doing so because I was enjoying listening to him. I did not attack the nationalised industries: I attacked the noble Lord and his noble friends over the difficulties which they have created for the operation of the nationalised industries, which is a very different point. That was the point that I was making, but I shall not take up more of his time.
Lord LEE of NEWTON: My Lords, I do not want to get too nostalgic but from the days of the Attlee government the Tory Party has gone out of its way to denigrate every kind of nationalised industry that we have produced. They have felt that this was their way not only of denigrating public ownership but of bolstering up private ownership. So far as we are concerned, or a great many of us, we have no objections; my family lives on their own private industry, so I have no objections. But I detest this business of denigrating great public corporations which will determine, in coal, in steel, in gas, in electricity, in a whole host of things, whether or not Britain succeeds. Many noble Lords opposite are extremely interested in agriculture. The only reason why we have now been able to mechanise agriculture is that we nationalised the electricity industry. Would the Manchester corporation or any other municipal corporation have bothered pushing electricity into the rural areas if we had not had a nationalised industry?
Lord FERRIER: My Lords, while agreeing with my noble friend Lord Nugent of Guildford I never said that I was against nationalisation of electricity or of gas or of coal. Steel is quite different.
Lord LEE of NEWTON: My Lords, why denigrate nationalised industry? I have said that throughout the world bulk steel producing industries are in recession. The United States of America is no exception to this statement. Indeed, the last time I looked at some of the returns over there— for instance, the great Bethesda organisation— they were hun-

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dreds of millions of dollars in the red. They are therefore faced with precisely the same problems as we are. Now that the American car industry is in further and further recession it does not look as if there is a great deal the American steel industries are going to be able to do in the matter. But faced with such huge problems in their steel industry in the States, why is it that some genius did not do that which is so obvious to Sir Keith Joseph and hire Mr. MacGregor to come to the rescue. There he was, working in the States, an American citizen, having shown them his brilliance over a period of at least a quarter of a century, and they will not even enter the transfer system in order to try to retain him.
I have said that I do not doubt that Mr. MacGregor will do what he can to be helpful to the BSC. I come back to the issue of how is he to face this at a time when restrictions, financial and otherwise, are being imposed on the British steel industry. Genius is a remarkable asset, but it cannot do things under those conditions. I want the noble Lord to give us a straight answer. Is Mr. MacGregor a free agent? Supposing he has a look at the requirements of the British manufacturing sector, supposing he estimates that we will be out of recession within 12 or 18 months, is he able to put far more capacity into the British steel industry than it now has? It is only a few years ago I was estimating the requirements of steel as 35 million tonnes. I know that a great deal has happened since then and I am not arguing for that. I am saying it is still the basis of any hopes of success we can have in the manufacturing industries of Britain. If we starve the great engineering plants and so on, what chance have we got of getting back to a position where our balance of payments is in surplus? None whatever. I hope the noble Lord will tell us that Mr. MacGregor is not a prisoner, that he can in fact use his own initiative with regard to the size and capacity of the industry. If that is not so, he cannot possibly succeed.
5.15 p.m.
Viscount TRENCHARD: My Lords, I hope the House will bear with me if I try, as I have tried on previous occasions, not just to make the statement that I had more or less clear before I came into the
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Chamber, but to try to deal with the many important points noble Lords have raised. I hope they will bear with me if that does take a little time, bearing in mind that the noble Lord, Lord Bruce, when he introduced the Motion spoke for over half an hour, and the noble Lord, Lord Lee, has amplified many of his points in a speech of ordinary length.
My Lords, I think we have to divide this question into one fairly small aspect, in terms of its significance for the longer term, and then the problem of the actual substance of the matter of this Motion and the arrangements which concern the future, and I hope the good, of British Steel. The first and smaller aspect is the question of presentation, which the noble Lord, Lord Byers, particularly raised, and which has been criticised in a number of areas. But even before I do that, in terms of priorities, I just want to say that anyone who has met Mr. Ian MacGregor, anyone who has heard him discussing matters with experts who know this area, is immediately impressed not just with his realism but with his positive nature. And if you examine his track record you will find an immense amount of new additions that have been added to the companies over which he has presided. I shall return to the appallingly difficult position which he inherits and the initial need for realism.
In relation to presentation, let me say straight away that of course my right honourable friend consulted Cabinet colleagues and the Prime Minister. But let me say this— and I have not consulted my right honourable friend on these words— that he has characteristically apologised for the way he presented this appointment.
Lord LEE of NEWTON: My Lords, was not his apology merely directed to the Conservative Members?
Viscount TRENCHARD: My Lords, I think it is well known, and I think you will find in the opportunity he has tomorrow, that he has characteristically apologised for the way that he presented this appointment. I have learned in the time that I have worked with him that with his very quick mind— and, if I may say so, a much more perceptive mind than some noble Lords have, to my mind, exhibited today in criticising him— he sometimes follows a complicated path with very

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great clarity, and it sometimes takes time for the rest of us to absorb the process of his actions and his reasoning; so we fail, initially at least, to understand his correct conclusions, and they are very often correct.
In this case our minds were perhaps too encrusted in the framework of Britain, and perhaps in the perennial sickness of some of our nationalised industries. Perhaps we were too unimaginative to grasp the world dimension in which his mind had been working for some time in order to try to solve a very difficult British problem of already far too long a standing. Phrases like" ass of himself" were mentioned today. Of course, one can avoid being an ass if one avoids venturing anything. My right honourable friend is a man of great courage, intense intellect and great ingenuity. I personally believe that it will not be he who will be seen to have made an ass of himself. I shall answer, as best I can, in some of my remarks some of the detailed criticisms which have been made of the complicated arrangements which he has made. But, I would echo at the beginning of this reply that I agree with my noble friend Lord Ferrier that we have a man in a million.
I shall not go into certain remarks by noble Lords— indeed the noble Lord, Lord Byers, commented on some of the remarks of the noble Lord, Lord Bruce of Donington— which I do not believe are designed to give British Steel under Ian MacGregor every chance of recovery. I shall not give them extra publicity by repeating them, and I believe that they are not valid or relevant in the context of the whole situation.
It is significant that the Opposition have chosen this subject on this 14th day of May, on this day of stupidity, when, against the will of perhaps three-quarters of ordinary trade unionists, some of their leaders, encouraged by some Opposition politicians make it impossible for many of them to work as, according to opinion polls, they want to do. I see that estimates have been made suggesting that this day of stupidity could have cost the nation— if many had not come to work— hundreds of millions of pounds, and yet here today we debate the cost of obtaining a man in the range of £675,000 to £1,825,000, over and above his
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salary, to staunch the flow of losses running at over £1 million a day in British Steel. Yet this haemorrhage threatens the employment of every employee in British Steel. So why do we encourage jealousy for this man whose reputation stands so high and whose unquenchable Scottish spirit of flame still burns so brightly that at his age he is prepared to take up this daunting challenge? If he succeeds no gratitude could be too great, no reward too rich. The employees of the AMAX Corporation know his worth.
He tells me that the MacGregors come up in Parliament about every 200 years— note the words, "about every 200 years" and I hope indeed that, after the debate here today and the debate in the other place tomorrow, we shall not find it necessary to praise with faint damns, damn with faint praise and damn by insinuations a man of this calibre. Let me explain to what he was referring. He tells me that in 1607 King James 1 of England and VI of Scotland outlawed the MacGregor clan as a whole, but in 1775 we found that we could not do without them and Parliament welcomed them back by repealing their proscription.
Let us welcome another famous return of the MacGregors to their homeland. Let me hope that if there were any feud between the MacGregors and the Bruces that the noble Lord, Lord Bruce, will forgive Mr. fan MacGregor's ancestors. Ian MacGregor will not be deterred by this day and this debate— or contributions to this debate— of, in my opinion, stupidity. He will have noted that the men at Port Talbot and most other locations are working— there is no sign of embittered relations there. Let the wiser counsels which have been raised in this House today say to all employees that, if they support him and help him in making some very difficult, and for some of them, painful decisions, there is yet hope for the re-establishment of a proud, efficient and competitive British Steel Corporation— a different BSC, for certain in our age of change, with altered markets, but a secure one for the nation and its employees.
It will not be easy. The corporation has to regain its markets after a three-month strike, in conditions where the United Kingdom demand for steel is depressed and there is excess steel-making capacity in Europe and elsewhere keeping

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price levels down. The BSC has made large losses over the past five years and these losses must be brought to an end. The corporation has excess steel-making capacity which must be closed, and productivity at the on-going plants must be improved. I shall not in this statement enter into the argument about nationalisation except to say how can anyone contradict my noble friend Lord Nugent of Guildford on the fact that, with scale, with centralisation and with politics, the running of big and complicated industries is very hard. We do not think that it is impossible, which is why we have looked for the man with the greatest qualifications, we believe, who will undertake this job.
Thus, the outlook is not entirely gloomy. There has been a rapid build-up of steel production since the strike ended five weeks ago and the BSC, thanks to a major investment programme over the past 10 years, has modern, efficient steel-making plant. The task of restoring profitability, although difficult, is attainable. Mr. MacGregor tells me that he has seen nothing yet to request any change of general course for BSC and he is giving every support to Sir Charles Villiers and Mr. Scholey to press on with maximum speed with the implementation of their existing plans and agreements.
In order to achieve the objective of establishing BSC on a basis of enduring profitability, the corporation needs a chairman— and in my opinion, as I have explained, has a chairman— of great ability, experience and determination. I do not believe that there can be many people who have knowledge in this area who would disagree with that statement. His full particulars would take me too long to recount and they have been released. But he has very great experience in industry generally and particularly in the raw material field behind the steel industry, in metals generally and in the steel industry itself.
In my experience, on a much smaller scale, it has often been extremely difficult to find great ability and real knowledge of an industry in one person. It is particularly difficult to find someone to take on a recovery job of mammoth proportions who combines these two qualities— knowledge of the industry and real top-level ability. I believe, too, that it is
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generally accepted that Ian MacGregor has the qualities for the job. His qualifications have been mentioned today. He studied metallurgy at Glasgow University before the war, which he spent in Washington as a British expert dealing with purchases by the Ministry of Supply. He then pursued a highly successful business career, in particular with the US metals and natural resources company AMAX, where he was responsible for major diversification programmes and was chief executive officer from 1966 to 1977. I am afraid that Mr. MacGregor is an example of a kind of person of whom we have too few in Britain— a technologist who has become a really successful industrialist. Currently he has a very wide range of interests, including the post of deputy chairman of BL, which has given him considerable experience of the problems of a publicly-owned United Kingdom company. He is a member of the boards of a number of United States companies, including the LTV Corporation, the parent of Jones and Loughlin who are the third largest United States steel producers; and as the House now well knows, he is a partner in Lazard Frères and Company, the New York-based investment bank.
I can confirm to the noble Lord, Lord Bruce of Donington, that the non-executive directorships that he mentioned are the only ones that Mr. MacGregor retains; that the vast majority of his many non-executive and part-time directorships he gives up. I cannot accept the criticism of the noble Lord, Lord Lee of Newton, that he does not know this country. I have just mentioned his part-time connection with British Leyland. He has also never forgotten that he is a Scotsman, and I find him very well in tune with the affairs of this country. Sometimes perhaps one sees the affairs of another country more clearly from a position abroad.
Lord LEE of NEWTON: My Lords, can we assume that because of his connection with British Leyland most of the problems there will shortly be solved?
Viscount TRENCHARD: My Lords, I think that the House will agree that Sir Michael Edwardes, who, of course, is the chairman and chief executive officer, must take the majority of the

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credit, but enormous progress has been and is being made at British Leyland.
Anyone who has heard Ian MacGregor converse with English experts in this field knows that the fear of the noble Lord, Lord Lee, that he will be out of touch with the situation is not founded. I believe that there is, therefore, general agreement that in Mr. MacGregor we have secured a very well-qualified man to tackle these immense problems. I believe that we must keep this in mind when considering the terms of his appointment. For it is the unusual nature of the arrangements which have been made with Lazard Frères which have been the focus of attention. This is understandable, but we must not overlook the value of improve ment in British Steel if it is achieved.
I suggest that there have been three main concerns expressed in this debate and elsewhere about the terms of the arrangements with Lazard Frères. Perhaps the first is the size of the payment to be made. The second concern is that the payments to Lazards might be a device to make large payments to Mr. MacGregor indirectly. The final concern is that the payments, linked with the performance of BSC under Mr. MacGregor's chairmanship, might give rise to too great an involvement by Lazard Frères— and this has not been mentioned to any great extent today— in the determination of management policies at BSC.
The size of the payments to Lazard Frères, which could approach £1.8 million, are without doubt large by British business standards, but the greater part will not be paid unless results are delivered. However, in the United States of America it is not at all unusual for a chief executive of a major corporation to be valued by his corporation at over one million dollars a year. Therefore, it is not entirely surprising that the loss of a top man should also be valued very highly, particularly in this type of investment bank partnership, where partners of enormous skills earn for the partnership according to their knowledge and skills in many different parts of industrial experience.
My noble friend Lord Ferrier asked me whether I could reveal whether or not the bidding had started at yet bigger figures. I shall not declare what those were,
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but, yes, bigger figures were requested, and the result is, in our view, very good value for money, with the amount paid being highly dependent on results, which is a great protection for the taxpayers' interests in this country.
Lord KALDOR: My Lords, if the noble Viscount will permit me to interrupt him, it may be usual in America to value an important executive at 1 million dollars or more a year, but what is meant by that is that he is being paid that sum for his own benefit. Can the noble Viscount assure us that Mr. MacGregor's own benefit will be limited to something very much less? If it is so limited, does he regard it as a sensible and reasonable arrangement that Mr. MacGregor should get so little out of it, and that the bulk of the money should be paid to a somewhat disreputable New York bank?— which makes extraordinary lucrative take-over deals, according to the description in The Times.
Viscount TRENCHARD: My Lords, I had hoped that the noble Lord would have understood what I have just said. I said that I was dealing with the situation in three parts, the first of which is the size of the payment to be made. The second is the question whether the payments to Lazards might be a device to make large payments to Mr. MacGregor indirectly. I stated that, and in a moment I shall deal with that second question.
Therefore, the total cost— with which I am still dealing— is not inappropriate by United States standards. Mr. MacGregor has been contributing considerable amounts of profitable business to the Lazard Frères partnership. They will lose his valuable services when he ceases to be a partner on becoming chairman of BSC on 1st July.
At this point I should like to answer certain matters which the noble Lord, Lord Bruce, introduced; phrases about Sir Charles Villiers "receiving the chop" were mentioned.
Lord BRUCE of DONINGTON: My Lords, if the noble Viscount will allow me to interrupt him, I think he will find when he reads Hansard tomorrow that I made no mention of Sir Charles Villiers getting the chop. I said that in the light

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of the very fulsome praises by the Prime Minister in February, when she described Sir Charles Villiers as having her total confidence, and in the light of the treatment that he has subsequently received, many chairmen of nationalised industries would wonder when they were going to get the chop.
Viscount TRENCHARD: My Lords, the House has heard the noble Lord's reiteration of the phrase and the context in which it was used. I want to make it clear that the Government have been looking at many possibilities to replace Sir Charles Villiers, whose contract does not run out until later this year. Naturally, we have looked at the possibilities well in advance of that date. I should like publicly to thank Sir Charles Villiers and Mr. Scholey for their co-operation while we have been searching for a successor to Sir Charles. We have now completed the review of possibilities and have made an arrangement which allows the new chairman to familiarise himself and take up his appointment on 1st July— a date agreed with Sir Charles Villiers— which is, in fact, before the date by which we needed to find a new chairman. The whole implication that we were, if I may use the expression, flogging the hedgerows and in desperation coming at the end of the day to Mr. MacGregor is not only a travesty of the truth and an insult to Mr. McGregor but simply does not accord with the facts and the natural and correct procedure of my right honourable friend the Secretary of State in looking at all possibilities very early.
I should like at this point to deal briefly with the question of headhunters. We do in the Department of Industry use consultants— I hope they will not criticise me for calling them headhunters— for more than one purpose. It is to make sure that you consider not only the people you know about— and we knew about Ian MacGregor, and knew well about him— but also those you may not have known about. You do not use every head hunter on every occasion, and it would be quite impractical to do so. The department uses substantially more than one firm on different occasions.
Could we have secured a suitable British industrialist at a lower cost? My answer to this is quite simply, no. There were a considerable number of
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British possibilities who were considered for the chairmanship. Some were not free, and felt that their commitments to their existing interests were too great; some were not interested, and the reasons for their not being interested were varied, but they included those that my noble friend Lord Nugent mentioned today. But none appeared to have the combination of real knowledge of the industry and outstanding proven ability or to have better qualifications and be prepared to take on the job— than Ian MacGregor. So we selected from the possibilities the best man for the job in plenty of time for the takeover, and have secured it in fact, with Sir Charles Villiers' co-operation, a bit earlier than the appointed day.
It is no reflection on Britons. There are plenty of Britons serving in big jobs abroad, but we cannot wrap ourselves in a Union Jack and consider that for every job, no matter how hard and no matter what problems it presents, we must always look at home. Consider in a near monopoly position which we have in British Steel, where else one can look. Consider the size of the United States. Consider the size of the industry world wide. No, my Lords, I think that some are guilty of not following yet, though I hope they will, the processes of thought which my right honourable friend the Secretary of State has followed in coming to this conclusion.
Now consider the level of losses, which I have mentioned, with over £1 million a day being lost. That is a daunting task. Mr. MacGregor is prepared to have a real go, and it is, in my opinion, partly the patriotism towards his country of birth that has influenced him in taking this job. The second area of main concern, which the noble Lord, Lord Kaldor, asked me to deal with when I was trying to deal with the first, is the question of whether Mr. MacGregor might be the main beneficiary from the payments to be made to Lazard. As I have already mentioned, Lazard will be losing the services of a very valuable business-getter. At the same time Mr. MacGregor wishes to remain a limited partner of Lazard, for he has, I understand, invested a considerable sum of his capital in the partnership and wishes to be able to return to Lazard as an active general partner when his term of office at BSC is completed.

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It is clear that Mr. MacGregor's partners, and indeed Mr. MacGregor— and this is one of the answers to Lord Kaldor's points— have great confidence that he can succeed at British Steel. They back his judgment, and they have been right to do so in the past, and hence their acceptance of a performance-related compensation which also protects the British taxpayer from very high payments if the results are not achieved.
As a limited partner Mr. MacGregor will be entitled only to a small share of the profits of the partnership. This means that if the partnership were to make a loss— and I am not suggesting that this is a usual or likely event— he would be required to contribute to the losses up to the limit of the capital he has invested in the partnership. The only way during the period of his BSC service in which I understand Mr. MacGregor will benefit from the payments by the Government to Lazard is to the extent that such payments contribute to Lazard's profits, in which he has a very small share. My right honourable friend will tomorrow amplify that statement a little, because in fact limited partners of Lazard who have been general partners do of course receive sums according to their share in the partnership, and of course that share is unknown. There are 24 or 25 full-time main partners. I do not know the number of limited partners, who share to only a very small extent in the profits of the partnership.
All these details and all relevant information are known by the Inland Revenue. The consultations by Lazard Frères and Mr. MacGregor with the Revenue authorities have been fully and openly conducted with them. In so far as the payment of the performance-related compensation after his anticipated return to the USA is concerned, it is possible, but only possible, that he could benefit from increased profit share distribution as a full partner, if he should resume his duties as such. The details of this are for him and his partners, and they arise when he returns to New York.
The third main concern is that Lazard may exert too great an influence on the policies to be adopted by Mr. MacGregor as chairman of BSC, in order to secure the maximum compensation to Lazard. This perhaps overlaps with the question
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of whether Mr. MacGregor himself is— as noble Lords, if I may paraphrase their words, have suggested— a bit of a hatchet man. I have already referred to the fact that he is not a hatchet man by his background. He has built up businesses and built new avenues to business. Anyone who meets him and talks to him finds that he bubbles over with ideas for possible new markets.
However, it is not just a decision, as noble Lords opposite have suggested, between a negative and a positive policy. We have a situation in British Steel, as I have repeated so often in this House, with some first-class equipment and mills available. There has been an accumulated bill over the last four to five years of some £4,000 million to be met by the taxpayer. There is excess capacity and no one has been able to produce rational suggestions as to how demand could be raised in the next few years to utilise the capacity we have.
We have a non-competitive position, for all that noble Lords may say about subsidies for other nations. We have lost our share of world market not only for the reasons that noble Lords have suggested. After taking account of subsidies and coking-coal subsidies, and the like, we are not competitive. Realism, therefore, must come first. It is for this reason that Ian MacGregor has told the current management of British Steel that he sees no reason for any let-up in the momentum of their existing plans as a base for development. I equally have no doubt that if he is as successful here as he has been elsewhere in building a competitive industry— be it smaller, be it different— on that base he, more than any other man I have listened to on this subject, will be suggesting ideas for expansion beyond that.
Noble Lords do an injustice to my right honourable friend in suggesting that he can see only profit now and cut out everything else. The objectives will be discussed with the new chairman of BSC, as they have been with the last chairman, and there will not be intervention or interference. There will be the fixing of profit and cash objectives which it is the duty of the Government to do. The long term and the short term and the resources of the nation will be taken into account in fixing those. It is against the background of

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those arrangements that the performance of BSC under the chairmanship of Mr. MacGregor will have to be judged.
The general objective is to establish BSC as a strong and healthy entity, and I am quite clear that Mr. MacGregor accepts that. There will be specific criteria against which the improvements will be measured. I will not, in view of the time I have already taken, go into the criteria which will be discussed and against which performance will be measured. I would, however, say that while I accept the puzzlement of noble Lords of experience as to how objectives in a complicated and big industry like this can be set and how criteria can be agreed for performance judging— I understand those doubts and as an industrialist I have looked at the problem myself— and while I do not in any way underestimate the difficulty, I am quite clear that Ian MacGregor's outlook on this kind of situation will make it perfectly possible to arrive at agreed objectives with him as chairman of BSC.
This somewhat complicated system of payments will operate fully only if success is really there. Noble Lords opposite should perhaps not criticise us for intricate and complicated arrangements. They have never in public, and we have not in public, revealed the full details of the arrangements for the INMOS entrepreneurs, and I am in no way criticising noble Lords opposite. Nor shall I experience any jealousy should INMOS be highly successful and very large sums of money be earned by those entrepreneurs. The noble Lord can remind me to congratulate his party if that situation arises.
I am quite certain that, in this immensely complicated and daunting task, we have selected a man who retains immense vigour and stands the best chance of any candidate whom we considered— and we have been through lots of possibilities— of bringing this great British Steel Corporation back to profit ability and back to a secure and lasting base for the employment of its people.
Lord BOOTHBY: My Lords, before the Minister sits down, may I ask him to remind the House where the United States found the man to build their own steel industry? I have a notion it was Scotland.
Lord MISHCON: Also before the noble Viscount resumes his seat, my Lords, will he allow me to take advantage of the invitation he gave that we should endeavour to follow the processes of thought of the Secretary of State? May I ask him a question related to one process of thought which is connected with industrial relations and psychology? If part of the success of Mr. MacGregor— I repeat, part of the success— is to be measured by the manner in which he manages to close plants and persuade people that it is necessary for them to become redundant, does he think it is a suitable atmosphere for negotiation and persuasion that the closure of plants and redundancy will mean for employees a loss of money whereas for the gentleman concerned, if it is part of the success by which he is measured, it will be a gain of money?
Viscount TRENCHARD: My Lords, I have acquired very great respect for the noble Lord, Lord Mishcon, since I came somewhat new to this House, but I regret that intervention. I do not believe— I have to say this— that the stirring up of jealousy does any good whatever. I also have to say that in my industrial experience I have not found the average British employee to be jealous. Indeed, he thinks something is wrong with the concern if the governor is reduced from his Jaguar to a Mini. I believe he wants more than anything else to feel that the man at the helm is a really good leader and I think he puts that before even painful decisions which affect himself. As evidence of that, I would point out that one could not help but be impressed by the fact that only 15,000 employees of British Leyland, led so ably by Sir Michael Edwardes, voted against a plan which involved the redundancy of 25,000. No good will be done by stirring up envy, and I do not think the average man feels it to anything like the degree some noble Lords have suggested today.
5.58 p.m.
Lord BRUCE of DONINGTON: My Lords, this has been a most interesting debate. At one time it seemed from the tenor of the speeches of noble Lords opposite that they were blaming noble Lords on this side for having appointed the gentleman in question, which rather

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amazed me. I say with the greatest respect that the noble Lord, Lord Byers, seems to have got me entirely wrong in regard to my attitude towards Mr. MacGregor. Indeed, the noble Viscount, Lord Trenchard, has got me wrong also. Under examination today are not the merits of Mr. MacGregor— and weare very grateful indeed for the extra particulars that have been given. We all, from these Benches and from the Benches opposite, wish him well in his task. Under examination and criticism is the Secretary of State. He is the person who is under criticism, and I observe that the noble Viscount has some tentative misgivings at the back of his mind concerning the public actions of his own Secretary of State. He admitted them. He said his process of thought is often a little difficult to disentangle but that he is usually found to be correct in the end.
Viscount TRENCHARD: My Lords, I ask that the House should read in Hansard exactly what I said and the words I used.
Lord BRUCE of DONINGTON: I shall be delighted to do so, my Lords, and I sincerely hope that—
Lord BYERS: My Lords, will the noble Lord also take the trouble to read in Hansard what he said about Mr. Ian MacGregor, which was a total denigration?
Lord BRUCE of DONINGTON: My Lords, I think that when noble Lords read Hansard they will be able to judge for themselves. I am quite content. What I am concerned about, and what I think the House is concerned about, is the question of the Secretary of State himself. I observe that the noble Viscount did not answer the very direct question put to him by my noble friend Lord Lee of Newton: is Mr. MacGregor to be a free agent? Will he be able to make his own decisions within the parameters that he sets, as a very experienced businessman, whose qualities have been so thoroughly outlined to us this afternoon? The question is asked for the following reason. So far Sir Keith Joseph has given no indication of any flexibility in regard to relaxation of the cash limits that he has already set. If the cash limits that Sir Keith Joseph has already set are
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adhered to, and there is no U-turn and no flexibility, then quite clearly Mr. MacGregor, in order to raise the finance that he may at a later stage consider he himself needs, may have to follow a course of action to which Sir Keith Joseph and the party opposite are already committed; that is to say, "flogging" certain of the profitable assets already in the possession of the British Steel Corporation. If the noble Viscount opposite assures me that Mr. MacGregor will have complete flexibility, that he will be able to take the whole grand vista into his vision and make his own decisions, I shall be perfectly happy—
Viscount TRENCHARD: My Lords, I hate to interrupt again. I think that when the noble Lord reads Hansard he will see that I discussed the problems of long term and short term and of objective setting, and that I said that the Secretary of State and the new chairman would have to set the usual objectives together. The State cannot be divorced from the financial objectives of a nationalised industry, but I said that they would be set in the normal way. Does the noble Lord in his opinion of Ian MacGregor really conclude that such a man would accept a job on any other basis?
Lord BRUCE of DONINGTON: My Lords, I am not in a position to judge that because we do not know what the terms were, anyway, and we do not know the parameters. How can we judge? The noble Viscount may have his own opinion on that.
I return to the original theme which is the examination of the track record of the Secretary of State himself, who, I am given to understand, is to make an apology— which he delivered to the 1922 Committee— to Parliament itself when he presumes to address it tomorrow. When it comes to the question of the whole trouble with Sir Keith Joseph let us be quite frank. The misgivings are not confined to this side of the House. They are echoed in the corridors of the other place by Members of the noble Viscount's own party. They are widespread in the noble Viscount's own party press. So do not let him for one moment imagine that the misgivings concerning Sir Keith Joseph come from this side of the House only; the noble Viscount's own press would speedily correct that.

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What we are bothered about is Sir Keith Joseph's fixation. He has a track record. It might be said to be an epic on the theme "Go West, young man!" because noble Lords will recall that he was responsible for the 1972 health Act, and on that occasion he called in an American firm of consultants, McKinsey. Since that time he has increasingly come under American influence, with Friedman, and now we have Lazard Frères and Russell Reynolds. Sir Keith has a track record. We only hope that in the interests of the future of both Mr. MacGregor and the British steel industry he gets on to a different track altogether, far better than the one that he has followed so far. My Lords, I beg leave to withdraw the Motion.
Motion for Papers, by leave, withdrawn.

LICENSING (AMENDMENT) (NO. 2) BILL
6.5 p.m.
Baroness PHILLIPS: My Lords, I beg to move that this Bill be now read a second time. I make no apology for bringing it to the House. I have been asked by the Justices' Clerks' Society and the Magistrates Association to introduce the Bill. Mr. Neville Trotter, MP, piloted the Bill through the House of Commons. This is not a controversial matter— though nowadays one becomes doubtful when that is said— and all trade bodies have been consulted and have raised no objections, except in regard to one point which will necessitate an amendment, to which I shall make reference.
The Bill is designed to correct two anomalies in the licensing law. When Mr. Trotter introduced his Bill in another place he gave a fascinating review of the history of licensing law. I shall not take up the time of the House in repeating all of that, but I should like to remind your Lordships that the first licensing Act was passed in the year 1552, in the time of Edward VI, and justices were authorised to select people to keep houses
In 1722 it was said that 36 gallons of beer a year were consumed by every man, woman and child. But worse than that, there was a totally unrestricted sale of gin, which resulted in London and Westminster
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alone boasting 6,000 to 7,000 regular dramshops, and masters paid their servants in gin. Therefore, it was certainly true that you could be drunk for a penny and dead drunk for twopence. Seven million gallons of spirit were consumed in the year 1742, whereas today— and this is a little cheering— the figure is 6 million gallons, and the population is now five or six times greater.
In an attempt to discourage this wholesale spirit drinking, a Beer Bill was introduced in 1830. It enabled beer houses to be set up by almost anyone. Indeed, during the following five years 40,000 beer houses were established. In 1860 there was passed the Wine and Beer Houses Act which brought licensed premises under the control of the justices I think that that was the starting point of modern licensing law. Incidentally, there are now about 200 Acts of Parliament and Statutory Instruments concerned with licensing— I have here one of the numerous books on the matter— and I hope that your Lordships will not bring to me any technical points during the course of the passage of the Bill, because I should not be able to give a direct answer.
In 1961 there was passed a major licensing Act, which is the main Act in force today, and in 1964 there was passed another Act which modified certain of the sections of the 1961 Act. The first clause in the Bill is directly related to a section of the 1964 Act. That section provides that:
"on an application by the holder of a justices' on-licence, or on the renewal or transfer of a justices' on-licence and at the request of the person applying for the renewal or transfer, the licensing justices … shall vary the licence … ".
The word "shall", which your Lordships have debated on many occasions, was in that particular Act of Parliament very relevant. At the time that provision was intended to help those with limited licences to expand so as to have full houses, but it actually removed the discretion from the justices, so that if someone with a limited licence applied for a full licence he had to be granted one.
So we now come to the situation where, if an applicant applies for a licence for a small wine bar— even if he is selling only cider, and is serving sandwiches, and it is all very peaceful and simple— he can

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later apply for a full licence; in other words, he is "uprated", as it is called. It cannot be refused by the licensing justices. This causes trouble all over the country. Indeed— and this is a rather serious point— it can lead to justices refusing a licence to quite respectable wine bars because they fear that later on they will come back again and ask for upgrading to a full-scale publichouse. So Clause 1 seeks to give licensing justices the option to grant or refuse such upgrading. I apologise to your Lordships for the fact that it is couched in parliamentary language, but this is in fact what Clause 1 does.
Clause 2 deals with an anomaly— the special hours certificates. These are the basis of late night drinking, mainly, originally, in restaurants, but they are for establishments providing meals, music and dancing, on a regular basis. That is the description of premises receiving special hours certificates. The provision of dancing is supposed to be allied to the facilities for the number of people who can be received in the place at any one time. I am sure that many of your Lordships will have seen the kind of house where you certainly have a music and dancing licence but where, if all the thousand people present at one time tried to get on the small dance floor, some kind of chaos would prevail.
My Lords, these premises are often in residential areas, and I know of one such in my own area. This is where there has been caused great distress and irritation. I will not spoil your Lordships' dinner by speaking of some of the things which go on when the patrons leave these places. but it is not only noise; it is all kinds of other irritations and nuisances— and these are residential areas. In counties and areas where the justices are the music and dancing authority, they have the power to restrict the hours of drinking; but nowadays, as we know full well, local authorities are more and more taking powers under Private Bills to grant music and dancing licences. So Clause 2 will deal with this point, and it will enable licensing justices to impose conditions. Clause 3 is similar, but in this case it enables steps to be taken for the insertion of a similar condition in a certificate which has already been granted to premises without limit. I would say that,
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in connection with Clause 2, representations were received from the entertainments industry making the rather valid point that there should be the right of appeal to the Crown Court against decisions by licensing justices, and so an amendment will be moved in Committee.
My Lords, this is a small Bill. It deals with very narrow points, but they are points which affect many people. The Magistrates' Association and the Justices' Clerks' Society have seen the effects of some of these less happy establishments, and wish to put the matter right. I hope that your Lordships will agree that this Bill is worthy of support. In another place, I noticed, a Member said that it dealt with a refreshing matter but that it made for a dry debate. I hope that will not be true in this House. I beg to move that this Bill be now read a second time.
Moved, That the Bill be now read 2".— (Baroness Phillips.)
6.13 p.m.
Lord BOSTON of FAVERSHAM: My Lords, I should like to congratulate my noble friend Lady Phillips on having mastered what is an intricate branch of our law in a way which I think will be the envy of lawyers. I am also sure that we admire the care which has been taken by all those concerned to consult all the interested parties. I think it is significant, too, that such a broad measure of agreement, in a sphere which is notorious for controversy, has been reached. This in itself— and here I would also follow my noble friend— is perhaps a refreshing aspect of this matter. My noble friend might have referred in her historical survey to a reduction in the consumption of spirits, but certainly in the way that she has presented this Bill to the House I think she has, if I may say so, certainly raised our spirits.
My Lords, this is a useful reform, and I would certainly welcome the additional discretion given to licensing justices which they would have under this Bill if it becomes an Act. These are matters which are customarily left to individual Members of the House to decide upon, and I would only say that I hope that the Bill will receive here the broad support that it has received elsewhere.
6.15 p.m.
The PARLIAMENTARY UNDERSECRETARY of STATE, HOME OFFICE (Lord Belstead): My Lords, I should like to join in thanking the noble Baroness for her clear explanation of this Bill; and, of course, we are also indebted to my honourable friend Mr. Trotter for piloting the Bill through another place, so that it now reaches your Lordships' House. Fundamentally, this Bill is in two parts. Clause 1 deals with applications to the justices for extensions of the range of liquor that may be sold under an on-licence. Without going into detail, we have followed the noble Baroness in the explanation which she has given to the House— and the reference to this is Section 37 of the 1964 Act— as to how this has caused particular problems so far as wine bars are concerned. In saying that, I do not think that in many cases it is the fault of wine bars. Indeed, it leads to the unfortunate effect that licensing justices may look askance at some of the perfectly genuine applications from wine bars, fearful that the owner of the licence for a wine bar can then, under Section 37, have the power to come back and demand that the licence be upgraded in the way that the noble Baroness explained.
My Lords, the effect of Clause 1 of the Bill, then, is simply to limit the range of licences which may be extended in this way— that is to say, those in force or suspended on 3rd August 1961, the date on which the Licensing Act 1961 was enacted— and, if I may say so, in the view of the Government this is desirable. Perhaps I may just say that in giving support to this provision the only concern of the Government is to preserve the fundamental policy that the number of licensed premises should be increased only if an applicant can produce to the satisfaction of the licensing justices real evidence of need. I am anxious to say that because the noble Lord, Lord Boston, was quite right. In your Lordships' House we take our individual views of Private Members' legislation, and I felt it was right for me to explain why the Government take this particular view of Clause 1.
My Lords, the remainder of the Bill, as the noble Baroness again explained, is concerned with amending the present
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law on special hours certificates. Here again, I will not go into detail because the noble Baroness has explained, except to say that the Bill goes beyond the removal of the anomaly which exists, for the Bill not only strengthens the justices' power to revoke and vary existing certificates, but it also enables them to require drinking to stop earlier than 2 a.m., though not earlier than midnight. The provision that justices will be able to take into account the environmental comfort of residents in the neighbourhood of premises will be welcomed by many people, and the noble Baroness has made it quite clear that it will be welcomed by herself. However, the promoters have excluded the "special hours area" of Central London, so I understand, from the application of this part of the Bill. Again, if I may say so, I think this is probably right since certainly my right honourable friend's department has no reason to suppose that there have been any major difficulties in that area.
There are two things that I must add. The noble Baroness has drawn the attention of your Lordships to representations she has received from representatives of the entertainments industry. I noted the intention which the noble Baroness expressed in her speech to table an amendment to provide for the right of an appeal to the Crown Court against decisions by the licensing justices to impose conditions restricting the hours of a special hours certificate, or to revoke a certificate. Since the Bill will have the effect of giving the justices greater power over people's livelihoods, I think it is right that licensees and registered clubs should have this right of appeal. Conversely, I think it is right, too, that others affected by the decisions should have a similar right. That is the first thing I must add.
The second thing is this. With regard to the issue of a provisional extended hours certificate, having consulted the Magistrates' Association and the Justices' Clerks' Society, we think that this is not practicable. However, I should like to give an assurance to the industry that it is the firm intention of the Government to amend the present miscellany of enactments relating to music and dancing by extending to the whole of England and Wales a scheme which is based on that which operates at present in Greater London by virtue of Schedule 12 to the

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London Government Act 1964. As far as we know, this scheme works well, and among other things it contains (and we intend that it will contain) for the future, for the wider scope, a provision whereby an operator can obtain from the licensing authority, namely, the district council, a provisional music and dancing licence before he invests his capital. With that observation and that assurance, may I say that I agree that this Bill should be read a second time.
6.21 p.m.
Baroness PHILLIPS: My Lords, I should like to thank the Minister for his very clear explanation. I did not refer to the second point raised since we are not going to have the amendment on it. I am grateful to the Minister for explaining that. I am also grateful to my noble friend Lord Boston for his kind words. One is always diffident with a technical Bill of this kind. Incidentally, I was interested to see that the persons who can be disqualified from having a full licence are sheriff's officers, a legal process server, a person who has been convicted of forging a justices' licence, a person who knowingly used a forged justices' licence, a person who has been convicted of certain brothel offences and a ship's pilot; which seems to show that almost anybody else can hold a licence— unlike having a vote! I should like to thank your Lordships for having received this Bill in the way you have. I am not quite certain of the protocol, but I am grateful to the noble Lord's department for helping me in framing the amendment, and I look forward to the Committee stage at an early date.
On Question, Bill read 2a, and committed to a Committee of the Whole House.

LICENSED PREMISES (EXCLUSION OF CERTAIN PERSONS) BILL
6.23 p.m.
Lord INGLEWOOD: My Lords, I beg to move that the Bill be now read a second time. Like the noble Baroness's Bill, this Bill is short and clear and meets a real need. It passed through all its stages during the last Parliament and
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was a victim of the Dissolution. I believe that had it been a Government Bill instead of a Private Member's Bill, the rules would have allowed it to go through. As it was, it failed by a matter of seconds. I hope that this evening we shall not delay it further but see it on its way to the Statute Book. There is no difference of view, to the best of my knowledge, between the parties either in the other place or in this House, either in the last Parliament or in this Parliament. There has been no major difference between the Back-Benchers and the department; and Home Office Ministers of the last Government and of this Government have both been as helpful as possible. I do not think it is giving away any secrets to say that they have drafted several of the necessary amendments to help the clarity of the Bill.
Hence, there is no reason for a long speech from me— and even less of a reason because I have a cold and have all but lost my voice. But I must explain very briefly what this Bill intends to do. We all live today in an age of increasing violence and of some uncertainty as to what we can do and how we can help. This Bill, I maintain, offers one way. It is concerned with one problem and one problem only; and that is violence or threats of violence committed on licensed premises where such trouble can start all too easily. There are too many instances, tragic instances, as we all know, of harm to licensees, to staff and to guests.
The Bill has the enthusiastic support of the licensees and is in step with a resolution carried at the Trades Union Congress in 1976. Although it is not a police Bill in the narrow sense, I understand that it has their support, too, for it makes a part of their task easier. In short, what this Bill does is to empower a court in certain circumstances to impose an additional penality called an exclusion order, which may be for a period as short as three months or up to two years, where a person convicted of an offence on licensed premises has resorted to violence or has threatened violence. It lays down a further penalty where a person fails to comply with such an order; that is, enters premises from which he is excluded by such an exclusion order.
This is something new and there was a little uncertainty during the earlier

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stages as to whether the powers for making an exclusion order were drawn too widely or too narrowly; but after the discussions that we had during the last Parliament— and the noble Lord, Lord Boston, will bear me out in this— we arrived at probably the best solution, which is one that has been accepted by most of those concerned; although some would like a little more and others thought a little less would have been sufficient. It allows a court, whether a Crown court or a magistrates' court, to impose this additional penalty on a person convicted of an offence on licensed premises where violence was used or threatened.
I would submit that this proposal should be looked upon as a clear-cut, practical, first step. It could be that, in the light of experience, others may wish to take this further; but I am sure that it would be wrong today to make it more complicated than need be. It could so easily prove difficult to operate if it were made more complicated and, more importantly in my view, it could delay the passage of the Bill because, if this question were opened up again and the Bill had to go back to another place and further amendments had to be considered, it might find itself a long way down the ladder and unable ever to reach the top.
There is no question in this Bill of redefining any existing offence or reassessing penalties set out in existing statutes. All that it does is to make it possible for this additional penalty to be imposed. I would submit, too, that it attempts to make the job of a police constable a little easier. A police constable's task when called by a licensee to his premises where there is a threat of trouble or actual trouble can be confusing. They are private premises. Is the constable dealing with a clear offence or is he assisting the licensee in response to his call for help to remove a trespasser from his premises? It is not easy. An experienced police constable knows how to handle such situations but a young one often does not. Under this Bill, where a man subject to an exclusion order goes into licensed premises from which he has been excluded, he there and then commits an offence. If the licensee telephones a police station and says, I believe that Joe Bloggs, who is subject to an exclusion order, is back in this place of mine ", then it is not a case of waiting
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for trouble but one of, "Will you please come and remove him?" The police constable will go to those premises and, having identified him and being certain he has committed an offence, can require him to leave. If this Bill becomes law, the trouble-maker who breaks an exclusion order automatically commits an offence.
But there is no additional power of arrest in this Bill, which has been drawn so that it is in step with much of the law already affecting licensed premises. It has been drawn to make it as simple as possible. It refers to Scotland, and some noble Lords who studied the Bill during the last Parliament and now see it again may notice certain drafting amendments dealing with the application of the Bill to Scotland.
These are in the interests of clarity and nothing more. There are no further powers of any kind and I think I am right in saying that they were checked by the Home Office, even if not drafted by them. I do not want to overdo the argument, but I should like to make the point that this is a Bill which has now been before one House of Parliament or the other for some time and has always received help from the authorities. Further, there is nothing in this Bill to discourage private enterprise blacklisting procedures for men who are not wanted on any particular premises. The Scots, I am led to believe, have this procedure more highly developed than we have in England.
I am confident that the country will welcome this Bill as a step against unnecessary violence. It is a short Bill and clear, and I ask the House to give it a Second Reading. I beg to move.
Moved, That the Bill be now read 2a.— (Lord Inglewood.)
6.30 p.m.
Lord AUCKLAND: My Lords, amid the tremendously important national and international debates that we have had in the past few days, this Bill may seem very modest. My noble friend Lord Inglewood— not for the first time— has brought up a measure which I believe deserves the widest possible support. Any of us who know people who are publicans— and I have relatives of my own family and my wife's family who are engaged in the

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licensed trade; and my wife is a magistrate and sits in the licensing court— will especially welcome this Bill.
Anybody who has been to the Licensed Victuallers' Association's home for retired licensees in Buckinghamshire, and has seen pictures of some of the horrific injuries inflicted upon some publicans and those who work in pubs by hooligans, who have either had too much to drink or been asked to leave the premises at the appropriate time, will realise the absolute necessity for this Bill.
We all recognise that there is too much drinking by people under age. It is very often under-age drinking which is responsible for incidents which involve injuries and affrays towards publicans and those who work in these places. The British pub is something which is renowned and respected nationally and internationally. Those who have guests from over the Atlantic, from the Antipodes and else where, like to take them to a British pub, the majority of which are extremely well run. It is unfair to those who run and manage these pubs if they are going to be affected by a small but dangerous element of hooligans— whoever they may be and of whatever age— who arc going to disrupt the life of the pub, and threaten, frighten and injure the publicans, some of whom are quite young. I believe this Bill is just about what is wanted.
Of course, there are those, among whom I am one, who would like to see certain things strengthened. As my noble friend Lord Inglewood said, it is essential that this Bill gets on the statute book. I certainly wish it well on its way. I believe that it will be a valuable asset on the statute book and a lever to keep the very high standards which public houses in this country enjoy. The sooner that this Bill gets Royal Assent the better for the country as a whole.
6.35 p.m.
Baroness HORNSBY-SMITH: My Lords, I too welcome the introduction of this Bill again into your Lordships' House, though in a slightly different form. I should like to congratulate my noble friend Lord Inglewood on his persistence in sticking to his guns after the loss of the Bill that he endeavoured to get through last year. It would be an impertinence to add to the lucid explanation that he has
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given. I personally hope very much that your Lordships will pass the Bill in its present form today. I must confess I am one who thinks that last year's Bill has been watered down a little; but, nevertheless, half a loaf is better than none.
I should like to deal with some of the effects that have been suffered as a result of violence and hooliganism in pubs. In many ways the problems of violence at football matches and in pubs are complementary. In both cases, only a small minority of the public are involved. In both cases, the main cause is excessive drinking, invariably invoked by defendants as an all-pervading excuse if they come before the courts. Often football supporters, already drunk, invade the local pubs after a match to celebrate or to drown their sorrows, and too often they go on the rampage. In both cases, I believe that all Governments have been tardy in coming to grips with this increasing violence as a result of drink. Many magistrates— again, this is not merely my personal view, but that of many— have been dramatically lenient, particularly in the case of serious physical injury to publicans, some of whom have been maimed for life.
A broken bottle or a broken glass is an ugly and lethal weapon. Some 40 or 50 years ago this was a very common weapon in Glasgow, and a distinguished chief constable went to town on those who smashed bottles or glasses and attacked their victims with them. We should not forget our duty to the vast majority of decent citizens whose regular pleasure is to enjoy a visit to their "local", or those going to and staying sober at a football match who seek to avoid the getaway traffic congestion by visiting a nearby pub after the match, only to find rival team supporters throwing obscenities and beer at one another, if not actually indulging in a "punch-up".
I am still old-fashioned enough that I have never been in a pub unescorted; on the other hand, I enjoy going with friends to their "local", I have only once been in a pub when serious physical damage was threatened; although on another occasion in the quietest of country pubs I saw a drunk turn over a couple of tables and wrench the wall lights off a newly-decorated wall before he could be evicted.

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On the first occasion— and this was in a small and admirably conducted pub where all the true "locals" were on Christian name terms with the licensee— we strangers were most civily greeted and served. The pleasant atmosphere was suddenly shattered by an enormous crash of glass. All conversation stopped dead. All eyes turned to the two aggressive strangers squaring up to one another, one with a broken half pint glass menacingly held dangerously near the face of his then terrified colleague. Mercifully, behind the chap with the glass, and with their backs to him, were two stalwart gentlemen who had been playing the fruit machine. They looked like full backs from the local rugger club. They moved in faster than the landlord could get round the counter and, kicking and screaming, the agitator went through the swing doors, down the steps and was left sprawling in the car park, with a bellowing voice telling him: "Get out and stay out!" Then with a "hit signal" the other gentleman said: "And you too, mate! "— and his colleague slunk out on his own feet.
You may well think: "Incident closed and successfully dealt with"— but not so, my Lords. The aftermath interested me very much. As the landlord drew two pints on the house for the timely helpers, a dozen people gulped down their drinks and left. I must admit they were mainly those with women in the party: potential lost customers, possibly for a long time.
Secondly, the landlord rang up his two neighbouring publican colleagues and said: "Watch out for a couple of drunks", and described them. As he turned to the bar, one of his supporters said: "Well done, George. That will keep them from doing any more damage around here for a bit." But the landlord rather gloomily replied: "It's not them I am worried about, it is my customers sneaking off to another pub. It will be all round the village in half an hour. That little spot of bother will be turned into an adjectival row in half an hour, and it is very bad for my business."
I believe the penalties proposed in the Bill— three months to two years according to the offence— will have a salutary effect, as will the penalties for defying an exclusion order. I believe that a "no-
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go" area is far more of an humiliation and a deprivation for a regular drinker than what is so often a very paltry fine. The latter means so little to the man in question.
I would remind your Lordships that not only the publican but the orderly customer is entitled to protection. They, too, can be casualties as well as the publican and his staff, when one of these incidents occurs in a pub. In the run-up to this "day of inaction", we have seen trade union leaders exhorting railwaymen and busmen to stop transporting us to work and lorry drivers to stop taking exports to the docks, but we have not heard a trade union leader telling pubs staff to lay off for the day. I suppose pubs are regarded as selective employment or as an essential service.
My Lords, the English pub is unique in the world: particularly it is the poor and the lonely person's club. Tens of thousands of individuals for various reasons may find themselves landed in a strange town, probably in digs, and they do not know a soul at their new job except the boss. They find a local that they like; they become a regular and they meet other locals. At the same time, for a stranger in town, the pub is a mine of local information. You can learn there what is in the town; you can discover where to pursue your favourite sport, where to find a locksmith, an electrician or a plumber: somebody will tell you. There you cease to be an isolated stranger, lonely in a new environment, and become yourself a local, with acquaintances and, ultimately, probably with new real friends.
I believe that if we allow a minority of people, whether they are full up with drink or not, to use violence and destroy the traditional warm and friendly atmosphere of our pubs, not to mention letting them get away with material damage and physical violence, then we shall have destroyed a very great institution in this country— one which brings pleasure and comradeship to millions of people, as we have in fact, certainly in some cases, tragically destroyed the friendly sportsmanship of much professional football. I earnestly hope that this Bill will have a speedy passage through your Lordships' House.
6.45 p.m.
Lord LUCAS of CHILWORTH: My Lord, I rise also to support my noble friend and my honourable friend from another place, whom I see in the Gallery, from my own part of the world, in their endeavours in pursuing this matter from March of last year.
I regard the Bill only in so far as it is a punitive measure following an offence. I do not regard it in quite the same light as my noble friend Lady Hornsby-Smith. Indeed, it appears to me that a little too much accent is placed on pubs and bars in regard to hooliganism in or around sporting events. It is my understanding that the drunkenness which occurs on these occasions is rather as a result of drinking outside the premises.
Your Lordships are by custom extraordinarily indulgent on Second Readings, and if I may take up only a moment or two of your Lordships' time this evening, I should like to urge on my noble friend the Minister that in no way should the Home Office regard this Bill, or indeed the earlier one, as any palliative towards the problem of drunkenness. I am disappointed that Her Majesty's Government have not found time to examine and take action upon the Erroll Report on drinking and hours. I am frankly disturbed that in neither House of Parliament have we been able to tackle the problem associated with the ease with which an alcoholic beverage can be bought. I am particularly worried about the way in which beers and spirits can be bought in what are popularly called "supermarkets". There seems to me no let or hindrance as to who may go in and pass along the shelves, picking up a tin of baked beans with one hand and a bottle of gin, or whatever it may be, with the other. That I believe to be the danger of drunkenness.
The position can be exacerbated when one gets into a crowd, whether it is at a football match, a cinema or any place where people are gathered together and excitement runs high. The fever is now in the blood, excitement runs high and off we go to finish the evening in a pub. The publican may rightly say to someone: "No, my lad; you've had enough. I cannot serve you any more". Then we get into the kind of situation that my noble friends have described.
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Let it not be said that I am going to attempt in this Bill to introduce any amendment, because that would certainly put it back. I hope the Bill goes forward in the manner in which my noble friend Lord Inglewood has suggested. But I do hope that the Home Office and my noble friend Lord Belstead will take note of the alarm raised over this question of drinking, not only associated with driving— I have mentioned this before on a number of occasions— but to do with hooliganism, the breaking of the peace, the upsetting of people's normal pleasures. That is a worry to people and I hope that the passing of this Bill will not allow the department to think that they can wash their hands of the problem. I wish my noble friend the success he so richly deserves in pursuing this Bill.
6.50 p.m.
Lord BOSTON of FAVERSHAM: My Lords, I should like to join other noble Lords in congratulating the noble Lord, Lord Inglewood, for having reintroduced this Bill and for having done so in his customarily clear and concise way. I would also agree with what noble Lords have said about the need to take every possible step that we can to curb violence both in public houses and elsewhere, and indeed to protect publicans and others.
My Lords, as the noble Lord, Lord Inglewood, has said, this Bill is the same in all essential respects as the one which passed from your Lordships' House in March last year and which, but for the general election, as he said, would have passed into law more than a year ago. I feel it is probably only proper to recall that when that earlier Bill reached your Lordships' House from another place I expressed some misgivings about certain provisions. Happily, we were able to have some very valuable and constructive discussions, for which I was most grateful to the noble Lord, Lord Inglewood, and to others. Those discussions produced what I think we all felt was a very satis factory outcome, especially so far as Clause 1, as it is now in the Bill, finished up. It is in that form that the Bill now is, save for the technical changes which the noble Lord, Lord Inglewood, has mentioned. So, my Lords, I would warmly welcome the reintroduction of this Bill. This is another of those measures

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about which it is customarily left to individual noble Lords to decide, but I would hope the Bill would receive your Lordships' support.
6.51 p.m.
Lord BELSTEAD: My Lords, your Lordships have all expressed gratitude to my noble friend Lord Inglewood for introducing this Bill into your Lordships' House this evening, and we are grateful also, of course, to my honourable friend Mr. James Hill in another place. May I just say that my noble friend is being absolutely consistent in introducing the Bill this evening because, of course, it was he who was responsible for introducing the similar legislation last year which passed through all its stages and was in another place when the general election intervened.
My noble friend is being consistent in another way in that he is always ready to show his concern for the maintenance of law and order in this country. I should like to make it clear that the Government share my noble friend's desire in this respect and we are ready to respond to particular initiatives which, while concerned with a limited aspect of a more general problem in this case, offer none the less some prosect of contributing to the fight against crime.
This Bill reflects, I think, just such an initiative. The Bill protects a group of people who are open to violent assault— licensees and their staff. They are convinced that a power made available to the court to ban from licensed premises customers who have committed offences involving violence on these premises will offer them a measure of additional protection.
There is also another argument, I think, which perhaps my noble friend would like me just to remind the House of at the end of this debate; namely, that the availability of the power in this Bill could be said also to act as a deterrent. The Government recognise the concern of the licensed trade to protect their members from violent offenders, and I was grateful to my noble friend for acknowledging that my right honourable friend's department has responded to this initiative by giving this Bill the consideration required to make its provisions compatible with the existing criminal law and the rights of licensees,
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although I must say all the really hard work on this was done by the noble Lord, Lord Boston of Faversham, when he was Minister of State at that department before the general election.
If my noble friend Lord Lucas will forgive me, I will not follow him down the road, important though it is, of talking about the problems of alcohol in the context of the Erroll Report, if for no other reason than that I have ventured to touch on it in reply to parliamentary Questions about the Licensing Compensation Fund over the last few months. But, my Lords, I think perhaps your Lordships would like me to say this about the Bill. At present the owner of any licensed premises which are not an inn has a common law right to decide who he will admit to those premises, and he can eject any unwelcome customers. This right is in effect the same enjoyed by any citizen in relation to his own home.
In addition, Section 174 of the Licensing Act of 1964 permits a licensee to refuse to admit or to expel anyone who is drunken, violent, quarrelsome or disorderly and to call upon the police for assistance for this purpose. Thirdly, the police have the right, restored by the Licensing (Amendment) Act 1977, to enter a public house for the purposes of routine visits, whether or not they suspect an offence is being committed or is likely to be committed.
Now this Bill supplements those provisions and the normal penalties available under the law for violent offences by enabling the court before which a person is convicted of an offence involving violence, or the threat of violence on licensed premises, to make an order excluding that person from those premises and any other specified premises for a period of between three months and two years. I say no more about the details of the Bill because my noble friend has explained it all, and your Lordships, particularly my noble friend Lady Hornsby-Smith with her experience of the Home Office, have all supported it, and that is enough for one evening.
One thing is important— that is, that people who may have been taking an interest in this Second Reading should appreciate that the offence which this Bill is creating is committed simply by

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crossing the threshhold of the licensed premises in question without the express consent of the licensee. Any other conduct amounting to a criminal offence will be subject to the other provisions and penalties within the existing criminal law.
So, my Lords, the Government support this measure as an appropriate addition to existing powers and penalties and share the hopes of the licensed trade that it will help to curb violence in one of this nation's traditional places of enjoyment and relaxation.
Lord INGLEWOOD: My Lords, I rise only to thank noble Lords who have supported this Bill so generously and who also have said such kind things about me. I did not start describing what happens when you break a glass or break a bottle and put in in somebody else's face as I thought other noble Lords would almost certainly do so. I was not disappointed, for they have spoken about it.
I must make one point clear, in case it has been missed. This does not stop the first blow in licensed premises; it simply means that where somebody has been convicted of an offence where violence has played a part or has been threatened, he can be excluded from those premises. This means he is, like as not, excluded from drinking with his mates, which is part of the whole scheme. In other words, it is a deterrent, as has been said, and if he wants to have his drink he has to go some distance into a strange land which will be far, far less attractive.
My noble friend said he was not going to go down the road. I can assure any noble Lord who wants to see more of the problem we have been referring to that he only has to go down the road tomorrow to Victoria Station, because there will be fans returning from Paris or Brussels where a match has been played today. I believe trains will be coming in from about 7 o'clock in the morning, so if anyone wants to check that we have not been exaggerating here tonight, I am sure he will find plenty of evidence at Victoria Station tomorrow.
My Lords, I hope this Bill will have an easy passage through this House and will very shortly find its way on to the statute book.
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On Question, Bill read 2a, and committed to a Committee of the Whole House.

DIOCESE IN EUROPE MEASURE
6.58 p.m.
Lord SOAMES: My Lords, I have it in command from Her Majesty the Queen to acquaint the House that Her Majesty, having been informed of the purport of the Diocese in Europe Measure, has consented to place her prerogative and interest so far as they are affected by the Measure at the disposal of Parliament for the purposes of the Measure.
The Lord Bishop of LONDON rose to move, That this House do direct that, in accordance with the Church of England Assembly (Powers) Act 1919, the Diocese in Europe Measure be presented to Her Majesty for the Royal Assent. The right reverend Prelate said: My Lords, after the stormy seas in which we have been sailing in considering the Licensed Premises (Exclusion of Certain Persons) Bill, I am glad to be able to steer the House into the calmer waters of the Diocese in Europe Measure. In inviting your Lordships to give an affirmative assent to the Measure, I must ask you to bear with me for a short time while I describe the background to the Measure and the reasons that have led up to its preparation and approval by the General Synod.
In the year 1633 by an Order of the King in Council, King Charles I granted to the Bishop of London, then Bishop Laud, jurisdiction over congregations resident in foreign countries without a local bishop. This jurisdiction was granted to the See of London and not to the diocese, and therefore belongs to the freehold of the person occupying the See of London. At first, the duties cannot have been very burdensome, but with the extension of British influence throughout the world they became increasingly demanding. They were especially so in the 13 American colonies, where Bishops of London exercised considerable authority in matters such as the licensing of clergy and schoolmasters, and other issues concerning ecclesiastical law.
My predecessors were kept exceedingly busy exercising this authority in America

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from Fulham Palace, for none of them ever crossed the Atlantic, and their correspondence is now in the Lambeth Palace library, under the title of the Fulham Papers; and as such is one of the most important sources of the early history of the American colonies. Perhaps the most lasting memorial to this work is William and Mary College in Williamsburg, the second oldest institute of higher education in the United States, founded by my eminent predecessor, Henry Compton, who was the first chancellor of that university.
Gradually, for one reason or another, the Bishop of London's overseas authority was eroded as new provinces of the Anglican communion were created in different parts of the world. In recent history, the last vestige of this once worldwide authority is to be seen in the Bishop of London's jurisdiction over the chaplaincies in North and Central Europe.
Even this continental authority had been further diminished, since in 1842 the See of Gibraltar was founded by letters patent and a separate See, responsible directly to the metropolitical authority of the Archbishop of Canterbury, was created to provide spiritual oversight of the chaplaincies around the Mediterranean. There have, therefore, since that date been two Anglican authorities in Europe: the Bishop of Gibraltar, responsible for the area around the Mediterranean; and the Bishop of London exercising his jurisdiction in North and Central Europe.
Increasingly, it has been felt that this division of authority is, in these days, undesirable. My predecessor, Bishop Robert Stopford, had himself been Bishop of Fulham; that is to say, he occupied the office of the Suffragan Bishop of the Bishop of London, responsible immediately for the affairs of the chaplaincies in North and Central Europe. It was largely due to his inspiration and initiative that the vision of one Anglican diocese in Europe was created, and the two areas agreed to come together. One of the first steps that were taken was that the then Bishop of Fulham was also made bishop in charge of the Diocese of Gibraltar by the Archbishop of Canterbury, and so it is that the right reverend John Satterthwaite is at present Bishop of Fulham and Gibraltar.
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There remained, however, many problems to be worked out and progress was slow. In November 1975 the Archbishop of Canterbury called a conference to which he invited myself, the Bishop of Fulham and Gibraltar, the Assistant Bishop of Gibraltar and Bishop Howe, the Secretary-General of the Anglican Consultative Council and representatives from the continental chaplaincies. We met him and the members of the policy sub-committee of the Standing Committee of the General Synod. We produced an agreed statement and it is upon that statement that plans have gone forward.
Your Lordships will appreciate that the creation of one diocese, comprising the Diocese of Gibraltar and the jurisdiction of North and Central Europe, is an administrative matter and does not require the authority of Parliament. The constitution of such a diocese has been prepared and a copy of it has been placed in the Library of this House.
But should the Diocese in Europe thus conceived come into existence, it needs also to be given synodical status. It is conceivable that this diocese could assume the same status as the Diocese of Gibraltar has at the present time; that is, to be a diocese on its own, subject only to the metropolitical authority of the Archbishop of Canterbury. Such status, however, would be unacceptable for a number of reasons. The main one is that, in these days, it is rightly thought inappropriate and undesirable that there should be single dioceses attached only to the authority of the Archbishop of Canterbury and unrelated to any provincial government. Such dioceses are lonely and are deprived of the opportunities of consultation and fellowship, such as are provided by being members of a province and taking part in its synodical government. The process has been to unite them with a province with other dioceses, wherever it is possible to do so.
The obvious solution, therefore, is that the Diocese in Europe, which will consist of the jurisdiction of the Bishop of London and the present Diocese of Gibraltar, should be related to the Province of Canterbury in every possible way, and be able to take its part in the synodical government of the Church of England through its membership of the

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General Synod. It is this action that requires parliamentary sanction, since the Synodical Government Measure of 1969 does not make provision for the integration of such a diocese into the General Synod. The Measure which is before your Lordships' House will, therefore, make it possible for the Diocese in Europe, should it come into existence, to be integrated into the General Synod and thus become one of the dioceses of the Church of England.
The issues which are involved in doing this are very clearly and fully set out in the comments and explanations provided by the Legislative Committee of the General Synod, for the consideration of the Ecclesiastical Committee of Parliament. I do not think, therefore, that it is necessary for me to go into the minutiae of these very careful arguments and the reply which they have received in the report of the Ecclesiastical Committee of Parliament, which is available to your Lordships. I would, however, want to say, on behalf of the General Synod, that we are extremely grateful to the Ecclesiastical Committee for the great care with which they have examined the more controversial issues, and for the decision which they have reached, which is that whatever objections these points may raise, they are not sufficient to justify refusing an Affirmative Resolution for the Measure.
I would only comment that it is recognised that the Diocese in Europe will be an unusual diocese, so far as the Church of England is concerned. For the most part, it will not be concerned with the work of the Church in places which are within the United Kingdom. It will be a diocese of chaplaincies and not parishes. It will be extremely large, stretching from Oslo to Ankara and from Moscow to Gibraltar. For that reason, although it will have a fully representative machinery, it will not, for practical reasons, have a diocesan synod, such as is required in the dioceses of the Church of England at present. The Crown will not appoint the bishop and this, as has been indicated to your Lordships, has been readily agreed to.
I am glad to observe that the Ecclesiastical Committee does not consider these unusual features of the diocese to be
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sufficient to disqualify it from taking its part in the synodical government of the Church of England. I do, however, want to set this issue on a rather wider stage, and hope that your Lordships will appreciate the significance of the changes that have taken place in Europe in recent years, which make this step so desirable.
There are 38 chaplaincies in the jurisdiction of North and Central Europe, and 37 in the Diocese of Gibraltar. To these must be added other congregations which are attached to the chaplaincies, which make in all 180 chaplaincies of one kind or another. These are served by about 100 clergy working on the Continent. For the most part, these chaplaincies came into existence when expatriate English people settled on the Continent for one reason or another and desired to have the ministrations of their own church. The picture which many people still have of Church of England chaplaincies in Europe is that of small expatriate English people, inward-looking, providing for their spiritual ministrations through the churches and chaplaincies which were established by their forefathers.
But this picture today is very different from the truth. Our relationships with Europe have developed in a number of ways, and this has had an impact on the work and organisation of the Church. Our commercial connections with the Continent have expanded. Our relationships through the EEC and NATO have brought many British people to the Continent. There are Anglicans from all parts of the world of different colours and tongues, who are working on the Continent and who look to our chaplaincies for their spiritual ministrations and take their part in the worship. The chaplains are for the most part thriving and energetic. The work of the chaplains is highly responsible and they use to the full the opportunities which are provided not only for the ministry that they exercise towards Anglicans and others who seek their help, but also ecumenically in their relationships with other Churches. They are doing excellent work and it is highly responsible.
Your Lordships will therefore appreciate the desire of the chaplains and the congregations to be closely related to the life and work of their parent Church of England. Although they are so close to

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this country and communications are so quick and easy, yet they have no voice in the consultations of the Church of England and they have no opportunity to bring the experience and wisdom they have accumulated from their work on the Continent to the benefit of the Church of England in this country. Moreover, it is right that such questions as their pension rights should be adequately safeguarded. It will therefore be of the greatest advantage, both to the Church of England and to the clergy and people working in the chaplaincies on the Continent of Europe, that this new relationship should be created between the Diocese in Europe and the General Synod.
Here perhaps I should say something about the work of the American Episcopal Church on the Continent of Europe. The church known as ECUSA— that is the Episcopal Church of the United States of America— is of course a province of the Anglican Communion. There are five ECUSA congregations on the Continent served by seven clergy. They come under the authority of the presiding bishop of the American Church. They are all part of the American Church. The clergy working in Europe remain canonically related to their home Church. What we are hoping to achieve by this Measure is to give to the Church of England clergy the same status and relationship to their home Church as already exists for the American Episcopal clergy in relationship to their home Church. We expect, of course, that there will be the closest possible working together between our chaplaincies and the American congregations. It is not thought wise or possible at this juncture to seek to merge the two into one jurisdiction, but we hope and pray that the two branches of the Anglican Communion will work together in the closest possible cooperation with one another.
I do not think it is necessary for me to go further into the details of the Measure since, as I have said, these are so clearly set out in the documents which are before your Lordships. These matters are better studied in those documents than in a speech from myself. I would only add a personal word: when the time comes, it will be necessary for me to execute a deed renouncing my freehold of the jurisdiction over the chaplaincies of North and Central Europe. I shall do so with
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I some regret since I do not like bringing to ! an end something that has lasted for 350 years. I am glad, however, to note that the Bishop of London will continue to have a special formal relationship with the new diocese since he will be the visitor of the diocese. It should be borne in mind that in theory at any rate there are still large territories which could come under his jurisdiction, so my surrender does not mean that the Order in Council of King Charles I will be entirely spent.
I hope this Measure will commend itself to your Lordships. I have no doubt that the creation of this diocese and of its integration into the synodical government of the Church of England will be of benefit to all concerned, and I hope therefore that your Lordships will give it the necessary approval.
Moved, That this House do direct that, in accordance with the Church of England Assembly (Powers) Act 1919, the Diocese in Europe Measure be presented to Her Majesty for the Royal Assent.— (The Lord Bishop of London?)
7.15 p.m.
Lord SUDELEY: My Lords, I have no doubt that the principal benefits and the effects of this Measure will be considerable, and I shall not be concerned with that. I have no doubt, furthermore, that from a liturgical point of view, as the Bishop of Fulham and Gibraltar wrote to me in his letter of 17th April, the diocese is in most of those parts much more conservative than in any diocese here in the Church of England. I will not be concerned with that either. My purpose is merely to create a storm in a teacup, and therefore to intervene very briefly by drawing attention to a statement which was also given to me by the Bishop of Fulham and Gibraltar in his letter of 17th April, that in one or two isolated places in the diocese the clergy have the bit between their teeth over liturgical revision and have gone much further even than the bishop himself would have wished.
As vice-president of the Prayer Book Society, which seeks to reserve worship according to the Prayer Book for any who require it, I have received complaints from the Algarve in Portugal. The chairman of the Prayer Book Society has

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written up a memorandum concerning complaints he has received from St Paul's Anglican Cathedral in Valletta. It is on the contents of this memorandum that I would like to concentrate for a few moments.
The first page of the memorandum describes how the secretary of the Church Council, Mr. Charles Carnes, who prefers to worship according to the Prayer Book, was invited by the chancellor and people's warden to attend a special meeting of the standing committee of which he was a member and asked to resign his office.
Further on, the memorandum describes how the chancellor, Canon Strangeways, conducted a filibustering exercise at the AGM. To defeat the supporters of the Prayer Book the chancellor ensured that no voting should take place until nine supporters of the Prayer Book had had to go away for the sake of other engagements. Only then was the voting allowed. Even then the voting was in favour of retaining the Prayer Book for morning prayer on one Sunday in the month. So a second count was decided on, and the result of this was a tie. The result being a tie, the chancellor did not concede that the Prayer Book should be used even for morning prayer on one Sunday in the month.
According to my understanding of the letter which the Secretary-General of the Synod wrote to a member of the Synod, Mr. Ian Thompson, on the 17th October, about the constitution of the new diocese, as soon as the Measure before your Lordships' House today becomes law the essential provisions of the Worship and Doctrine Measure will apply throughout the diocese unless the bishop objects. This should bring some comfort to lovers of the Prayer Book because under the Worship in Doctrine Measure the decision whether to use the Prayer Book for all except the occasional services lies with the members of church council. According to the Church representation rules, no one can be ejected from a church council in the way Mr. Carnes was ejected from his church council out in Valletta. However, I am afraid there is nothing under the Worship and Doctrine Measure to prevent clergy who wish to impose the new services from conducting filibustering exercises in their church councils. This is a problem
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well known to the Prayer Book Society. Some of its aspects have been examined by Roger Homan in his article "Noli me Tangere" which appeared last autumn in the issue of Poetry Nation Review edited by Professor David Martin, who has done such magnificent work to provoke the renaissance of the Prayer Book. In the next few years the future of the Prayer Book must depend in some degree on the resistance which members of church councils up and down the land, and indeed in Valletta, are minded to oppose to the filibustering exercises of clergy like the chancellor out in Valletta.
7.19 p.m.
The Lord Bishop of LONDON: My Lords, I am grateful to the noble Lord, Lord Sudeley, for taking this opportunity of addressing your Lordships' House and for giving me notice of the points he wanted to make. I was greatly relieved to hear that the two instances which the noble Lord gave are in the Diocese of Gibraltar and not within the jurisdiction of North and Central Europe, so I hope that I may be held to be guiltless of any of the charges which he has raised. But the fact that the two cases he has mentioned are in the Diocese of Gibraltar places upon me the responsibility of being very careful what I say, because at the moment the Diocese of Gibraltar is a separate, independent diocese responsible only to the metropolitical authority of the Archbishop of Canterbury and has nothing to do with the Church of England or the General Synod. Therefore, I must not comment too forcefully upon what he has said, lest I should be trespassing on an area which is beyond my jurisdiction or my powers.
I have, however, made some inquiries about one of the cases which he mentioned, that of St. Paul's, Valletta. I am told that the 1662 Book of Common Prayer is used on certain Sundays in the month, that the cathedral is flourishing with a very lively congregation and that the bishop responsible does require that the conditions of the Worship and Doctrine Measure are observed. If this is not the case, then undoubtedly this should be drawn to his attention. I hope, however, that it will be a source of confidence to the noble Lord to appreciate that if and when this diocese does come under the authority of the General Synod, then of course the whole power of the Worship

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and Doctrine Measure will be applicable to the Diocese in Europe, and all the congregations and the laity will be under the safeguards which are provided in that measure. And they can use the whole legal set-up of the Church of England to ensure that their rights are protected.
I am afraid one can never protect everybody from the sort of clergymen whom the noble Lord has mentioned, because there are always some who will perhaps defy authority. But that is a very rare occasion in my experience. I believe that the noble Lord can take some confidence from the fact that if and when the Diocese in Europe becomes a part of the Church of England, subject to the General Synod and subject to the Canons of the Church of England, then there will be a considerable safeguard for those who may feel aggrieved. I hope that your Lordships will accept this Measure.
On Question, Motion agreed to.

ISLE OF WIGHT BILL [H.L.]
Commons amendments considered and agreed to.
  FRENCH FARMING: GOVERNMENT SUBSIDIES
  FRENCH FARMING: GOVERNMENT SUBSIDIES
  MR. HOLMES: PAROLE REVIEW
  MR. HOLMES: PAROLE REVIEW
  PRISON TERMS AND COUNTRY OF BIRTH
  PRISON TERMS AND COUNTRY OF BIRTH
  ARAB-ISRAELI DISPUTE: EUROPEAN POLICY
  ARAB-ISRAELI DISPUTE: EUROPEAN POLICY
  THE CHEVALINE PROGRAMME
  THE CHEVALINE PROGRAMME