Sitting of 15 December 1981

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

    HUMBERSIDE BILL [Lords] (By Order)
    Order for Third Reading read.
    To be read the Third time upon Thursday.

Oral Answers to Questions
  EMPLOYMENT

    Community Industry
    Mr. Spearingasked the Secretary of State for Employment if he has made any assessment of the effectiveness of the community industry projects; and if he has plans to extend the schemes.
    The Minister of State, Department of Employment (Mr. Michael Alison): A review was completed earlier this year of the role and objectives of community industry. The review made recommendations for improving the effectiveness of community industry and these have been generally welcomed by the Government. The future contribution which community industry can make in helping the young unemployed will be referred to by my right hon. Friend later today.
    Mr. Spearing: Does the Minister recall that on 28 July the Government conceded that community industry fulfilled a most important function? Has an application for a 2,000-place increase in community industry been received? If so, and if it is not to be granted, how does the Minister reconcile that with the Government's previous statement? Is it not important that the least privileged of the unemployed, which this scheme particularly helps, should continue to be helped by expanding this imaginative project?
    Mr. Alison: As to the future expansion of community industry, I must ask the hon. Gentleman to await my right hon. Friend's statement to be made later this afternoon. The hon. Gentleman will recollect that in 1981–82 there was an increase of 1,000 places in the programme.

    Industrial Training
    Mr. William Hamiltonasked the Secretary of State for Employment when his proposals for a new and comprehensive industrial training scheme will be published.
    Mr. Lathamasked the Secretary of State for Employment whether he is now in a position to announce firm decisions regarding the training of young people.
    The Secretary of State for Employment (Mr. Norman Tebbit): I hope to make a statement on training later today.
    Mr. Speaker: I shall make sure that the hon. Members are called at the beginning of questions on the statement. I do not make that promise often.

    Employment Statistics
    Mr. Skinnerasked the Secretary of State for Employment if he will make a statement on the latest figure for the number of unemployed persons; and what steps are being taken to reduce this number.
    Mr. Stoddartasked the Secretary of State for Employment what further measures he intends to propose to reduce the number of people unemployed.
    Mr. Tebbit: The Government are pursuing policies to tackle the underlying causes of economic decline and rising unemployment, among which have been excessive labour costs, restrictive practices, poor profitability, high inflation and a weak currency. More recently, unit labour costs have been rising more slowly, productivity is rising strongly, in October there was the highest monthly increase in industrial output for two and a half years, and exports are doing well. Industry and commerce are becoming more competitive and the prospects for regaining lost markets and, therefore, lost jobs are more encouraging.
    Mr. Skinner: Is that not a completely different picture from that which the Secretary of State and his colleagues painted in the general election campaign when they were concerned about the brain drain to America, the Common Market and other places? Is the right hon. Gentleman aware that, in the sorry mess that the Government have brought about, the Hammersmith jobcentre is now advertising for young people to go grape picking in France and fruit picking in the United States? How does the Minister reconcile that with his statement at the Tory Party conference about getting on one's bike and finding work?
    Mr. Tebbit: I do not have to reconcile it, because I did not make the statement in the words attributed to me by the hon. Gentleman.
    Mr. Stoddart: Is the Secretary of State aware that propaganda will not solve the unemployment problem? Propaganda is what he has given us today. Is he further aware that Government policies alone have piled home-grown recession on a world recession and caused one of the greatest slumps that Britain has had? Will he now repent and do something real for the unemployed?
    Mr. Tebbit: The hon. Gentleman mis-states the position. What he calls propaganda was a list of facts.
    Mr. Stoddart: No.
    Mr. Tebbit: The hon. Gentleman may not like the facts, but he cannot get rid if them by calling them propaganda. If he believes that the weakness in our industrial practices of the last 25 years, our consistently lower rate of increase in productivity and our consistently higher rate of increase in unit labour costs have nothing to do with the level of unemployment, he is deluding himself and, even more importantly, the unemployed.
    Mr. Adley: Can my right hon. Friend confirm, as a fact rather than as propaganda, that unemployment in Britain is now rising more slowly than it is in most OECD competitor countries?
    Mr. Tebbit: My hon. Friend is right. That may have something to do with the fact that the percentage increase in wage unit costs from 1970 to 1980 in the United Kingdom was three, four or five times as great as that of our competitors, whereas in the first six months of 1981 it had levelled off and was below the rate of escalation in most competitor countries.
    Mr. John Grant: What positive steps or initiatives have the Government taken within the EEC's Labour and Social Affairs Committee to try to tackle unemployment on a Community-wide basis, bearing in mind the representations made by the European TUC?
    Mr. Tebbit: I do not believe that the tackling of the underlying causes of unemployment will be achieved in the Social Affairs Committee of the Community. Indeed, if there were any place where the underlying causes would be discussed in the Community, it would probably be among Finance and Industry Ministers. However, we have brought forward many useful initiatives regarding the future of the social fund and how that can be used to alleviate the effects of unemployment and perhaps to give us some pilot schemes for improved job creation.
    Mr. Golding: Can the Secretary of State tell us how many redundancies have been notified to his Department as being likely to take place within the next three months?
    Mr. Tebbit: I do not have those figures with me. If they are available, I shall do my best to help the hon. Gentleman.
    Mr. Forman: Is it not clear that, even with the benefit of the matters that my right hon. Friend has mentioned, as well as the need for a revival Budget next spring, it will take a long time for unemployment to be satisfactorily reduced? In those circumstances, does my right hon. Friend agree that the Labour Party's policies, in so far as one can judge them, would make worse, not alleviate, those problems, bearing in mind the Opposition's commitment to import controls, further nationalisation and massive increases in public spending?
    Mr. Tebbit: My hon. Friend is absolutely right. I do not know why he referred to one Labour Party. He could have referred to any of the three or four Labour Parties that we now seem to have.

    Industrial Relations
    Mr. Knoxasked the Secretary of State for Employment if he will meet the Confederation of British Industry to discuss the long-term improvement of industrial relations.
    The Under-Secretary of State for Employment (Mr. David Waddington): My right hon. Friend has had a number of discussions with representatives of the Confederation of British Industry about the long-term improvement of industrial relations. He expects to meet them within the next few weeks to discuss his proposals for legislation.
    Mr. Knox: Does my hon. and learned Friend agree that greater employee participation has an important role to
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    play in the long-term improvement of industrial relations? Is he satisfied that the CBI is doing enough about that? When he meets its representatives, will he emphasise the urgency of the need for action in the matter?
    Mr. Waddington: I agree that one cannot overestimate the importance of new initiatives in employee participation. It is important to try to get rid of the "them" and "us" attitude in industry and to create an atmosphere of partnership. Recently the CBI carried out a survey that showed that progress was being made and that there was a recognition in industry of the benefits that can come from greater participation. There is no reason to be complacent. Every possible effort should be made to proceed further along those lines.
    Mr. Bidwell: Does the Under-Secretary realise that many industrialists are fearful of what is rumoured to be the Government's forthcoming legislation on the closed shop? Is he aware that they see it as a needless diversion in industrial affairs which will cause much upheaval in normal industrial relations and as a sort of distraction that will have nothing to do with greater efficiency in industry?
    Mr. Waddington: I assure the hon. Gentleman that I have spent many hours reading the enormous number of representations that we received following the Green Paper. The vast majority of those who made representations called for action on the closed shop. The CBI put the matter at the top of its list of things that needed to be done.
    Mr. Lyell: In furtherance of the cause of participation, will my hon. and learned Friend reconsider the proposal that company annual reports should contain a statement from the chairman about the action that has been taken during the year to further participation and progress in that direction?
    Mr. Waddington: We shall certainly consider that proposal. I would add only that not all the problems can be solved by legislation. I am sure that my hon. Friend agrees with that. It is essentially an area in which there must be new initiatives from management.
    Mr. Harold Walker: Is it not regrettable that in all the discussions that the Government claim to have had, Members of Parliament have not been consulted? We have not been given the opportunity in the House to debate either the Green Paper or the proposals put forward by the Secretary of State last month. Is it not clear that the Government are proposing an open attack on the trade union movement, which will have disastrous consequences for those afflicted by the Industrial Relations Act 1971 and is nothing more than an attempt to distract attention from the appalling economic consequences of the Government's policy?
    Mr. Waddington: It is remarkable that the right hon. Gentleman should complain of not being able to make his views known. The Opposition could at any time have used a Supply day for a full debate on the Green Paper. Any Opposition Member could make personal representations to us. The right hon. Gentleman's views on the matter are well known. They are not our views. We do not believe that it is an attack on the trade union movement. These are essential measures to improve the competitiveness and performance of British industry and to ensure that individual rights are safeguarded.

    Engineering Apprenticeships
    Mr. Ron Brownasked the Secretary of State for Employment how many engineering apprentices have lost their jobs during the past 12 months.
    The Under-Secretary of State for Employment (Mr. Peter Morrison): Complete figures are not available, but between 22 November 1980 and 13 November 1981 the Engineering Industry Training Board received reports of 2,648 engineering apprentices being made redundant.
    Mr. Brown: Does the Under-Secretary appreciate that the engineering industry is facing a crisis? Is he aware that it has been reported that each month about 200 apprentices are losing their jobs? Those are the ones we know about. Does he appreciate that many employers are using the so-called training schemes—the cheap labour schemes—in preference to giving youngsters real jobs as apprentices? Is it not time that the Government laid down a quota and insisted that employers should take on the recognised number of apprentices? Is that not essential, or is it a matter for the trade union movement to take up and force the Government to adopt, because—
    Mr. Speaker: Order. The hon. Gentleman has taken enough time for two supplementary questions.
    Mr. Morrison: I am sure that the hon. Gentleman is aware that the Government have earmarked a substantial amount of money—more than £20 million—to help the engineering industry to recruit apprentices. He may also be aware that this year 4,000 people are being trained in addition to those being trained by employers.
    Mr. John Townend: Does my hon. Friend agree that if employers and the trade unions could agree to reduce the starting rates for apprentices to below £40, so that employers can take advantage of the Government's £15 a week subsidy, there would be more apprenticeship opportunities for young people?
    Mr. Morrison: I agree with my hon. Friend that one reason why there are not so many opportunities is that wages for school leavers are disproportionately high.
    Mr. Foster: Will the Under-Secretary now unreservedly condemn the sacking of apprentices and pledge to bring forward a scheme and sufficient money for them to continue their training until they have finished their apprenticeships?
    Mr. Morrison: As I said earlier, the Government have earmarked a substantial sum of money to help apprentices who are made redundant, of whom there were 2,800 this year, with more money to be made available, if necessary.
    Mr. Barry Jones: Notwithstanding the appalling shortfall, what is the Under-Secretary doing directly to help ethnic minorities to obtain engineering apprenticeships?
    Mr. Morrison: Opportunities are open to every member of the community. I wish to ensure that that continues to be so.

    Industrial Relations
    Mr. Adleyasked the Secretary of State for Employment whom he has consulted about his proposals for changes in industrial relations legislation; and whom he intends further to consult.
    Mr. Tebbit: My proposals for further legislation are based on the responses to the Green Paper on trade union immunities from over 300 organisations and individuals. I have asked for comments on the proposals from any interested organisation or individual by the end of the year.
    Mr. Adley: Has my right hon. Friend noticed the discrepancy in the attitude towards his proposals between the trade unionists polled by "Panorama" and the TUC? How does he intend to discover the real attitude of working people rather than the tired, old, warmongering noises that we hear from the TUC which do not appear to represent the views of working people?
    Mr. Tebbit: The MORI poll conducted by "Panorama" confirmed that there was great public support for my proposals, not least among trade unionists. That has been so in every opinion poll conducted for many years. There is widespread support for the reform that I propose, which was a plank of the Government's election manifesto in 1979.
    Mr. Eastham: While the Secretary of State is busying himself with introducing punitive anti-trade union legislation, will he consider having discussions with employers about their black list of trade unionists? Is it not time to introduce legislation in that area?
    Mr. Tebbit: As I am not considering introducing punitive anti-trade union measures, the hon. Gentleman's question does not arise. It may help if I tell him that the increased compensation that will be available to those dismissed for not being members of a trade union will be extended to those dismissed for being members of a trade union. That marks the fair and even-handed approach that I adopted in reaching my conclusions.
    Mr. Robert Atkins: Will my right hon. Friend confirm that he has received a large number of varied representations from Conservative trade unionists, from all walks of life and from different unions? Will he further confirm that he valued the contributions that came from a wide variety of people in a wide variety of activities?
    Mr. Tebbit: My hon. Friend is right. It is no surprise to find the views of Conservative trade unionists clearly reflected in the opinion polls. That suggests that many trade unionists do not agree with the wildly political announcements of some of their leaders.
    Mr. Radice: Does the Secretary of State accept that a number of management, industrial relations and other employers organisations, including the Institute of Personnel Management, the Industrial Society and the Engineering Employers Federation, are disturbed about the direction of his proposals? Is he aware that many people believe that the main purpose of his legislation is to appease the hard men and women in the Conservative party, not to improve industrial relations?
    Mr. Tebbit: I do not accept the hon. Gentleman's remarks, which are untrue. I have explained the purpose of the measures. First, they will deal with the abuses of the closed shop as they affect individuals. Secondly. they will underpin a better climate of industrial relations. The hon. Gentleman is selective about those whom he quotes. Sir Ray Pennock, the chairman of CBI, has described the package as just about right. Presumably the hon. Gentleman accepts that the CBI speaks for the employers.

    Training
    Mr. Bill Walkerasked the Secretary of State for Employment if the Government's new training initiative will contain proposals to improve vocational training for school leavers and under 20-year-olds in Scotland.
    Mr. Alison: My right hon. Friend hopes to catch your eye after Question Time, Mr. Speaker, and make a statement concerning training in all parts of Great Britain.
    Mr. Speaker: I shall ensure that the hon. Member for Perth and East Perthshire (Mr. Walker) is called after the statement.

    Job Losses
    Mr. Leightonasked the Secretary of State for Employment if he will estimate how many jobs have been lost since May 1979 by (a) the operation of the closed shop, (b) victimisation for trade union activity and (c) the rise in unemployment due to the recession.
    Mr. Waddington: It is not possible to quantify or distinguish the effects of the various factors cited in terms of their contribution to the current level of unemployment. Quite apart from those who have been directly driven out of their jobs because of the closed shop, I have little doubt that the closed shop has had an adverse effect on employment, being one of the weapons used to maintain restrictive practices and to force strike action on a reluctant work force.
    Mr. Leighton: Does the Under-Secretary accept that that is one of the weakest replies that we have heard in the House for many a long day? Will he confirm that under the 1980 Act there has been only one case of a worker appealing to a tribunal against unfair dismissal due to the closed shop—I refer to Mr. Lowrey, who lost his case—whereas there have been many cases of selective redundancies of active trade unionists? Does he further accept that it does not lie in the mouth of the Government to accuse the closed shop of jeopardising the right to work when they, through their policies, have denied the right to work to millions of people?
    Mr. Waddington: Many people feel that there is not much point in appealing to a tribunal for a remedy that is not available. Until the 1980 Act, because of the grossly anti-libertarian Act of Parliament passed by the Labour Government, there was no point in appealing to an industrial tribunal for a remedy. In view of the decision of the European Court, are Opposition Members now prepared to come to the House in sackcloth and ashes to apologise for that disgraceful piece of legislation?
    Mr. Kenneth Lewis: Does my hon. and learned Friend agree that many more jobs will be lost if trade unions, supported by Opposition Members, continue to press for higher and higher wages?
    Mr. Waddington: My hon. Friend is right. That is one reason for unemployment. Another reason is the restrictive practices, which are one result of the closed shop.
    Mr. Harold Walker: Is the Under-Secretary of State aware that the Solicitor-General argued powerfully before the European Court that the law relating to the closed shop was adequate and that no changes were necessary?
    Mr. Waddington: The right hon. Gentleman knows that the Solicitor-General argued that the 1976 law did not
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    contravene the European Convention of Human Rights, but that it was the view of the Government and all right-thinking people that it was a disgraceful measure, and that was why the Government repealed it.
    Mr. Ioan Evans: Will the Under-Secretary of State take this opportunity to condemn employers who sack employees because of their trade union activities?
    Mr. Waddington: I thought that my right hon. Friend the Secretary of State had already made it plain that the Government are determined to be even-handed. That is why the enhanced compensation that we intend to make available to the victims of the closed shop will be made available to those dismissed for trade union activities.

    West Cumbria
    Mr. Campbell-Savoursasked the Secretary of State for Employment whether he will consider the introduction of further employment support measures so as to increase the number of employment opportunities in West Cumbria.
    Mr. Waddington: My right hon. Friend the Prime Minister in her announcement on 27 July gave details of a package of measures to assist the unemployed. My right hon. Friend the Secretary of State for Employment will later this afternoon provide the House with further information about special measures for next year and beyond.
    Mr. Campbell-Savours: Does the Minister realise that my constituents and the constituents of other hon. Members representing Cumbria are desperate for work? Is he aware that they are tired, weary and fed up with parliamentary written and oral replies that suggest that they must wait until the Government have resolved the problems of inflation in the economy? Will he press his right hon. Friend the Secretary of State to go to the Cabinet and support calls for a selective programme of regional public expenditure projects that will put our constituents back to work, because that is where they want to be?
    Mr. Waddington: Everyone realises that the problem in West Cumbria is extremely serious. Only a fool would fail to take measures to get rid of unemployment tomorrow if such measure were ready to hand. The truth, as the Labour Administration found, is that there are no simple answers to these problems. At last, as a result of the measures that have been taken by the Government, there are signs of recovery. There is an improvement in competitiveness, manufacturing output has increased, short-time working has decreased and overtime has increased.
    Mr. Radice: Does the hon. and learned Gentleman agree that one of the roles of the Secretary of State for Employment is to argue inside the Cabinet for a stronger regional policy? Is the Secretary of State doing that?
    Mr. Waddington: My right hon. Friend is performing his proper duty, which is to support policies which will revive the economy and provide real jobs.

    Women (Employment)
    Mr. Hooleyasked the Secretary of State for Employment what percentage of women of working age,

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    between 15 an 60 years, are currently in employment; and how this figure compares with the figure in December 1978.
    Mr. Alison: Information in the precise form requested is not available. However, I estimate that in Great Britain in June 1981 the number of women aged 16–59 years in employment represented about 56 per cent. of the total female population aged 16–59 years. The corresponding percentage for June 1978 was about 59 per cent.
    Mr. Hooley: Does the hon. Gentleman agree that the figures, although limited, show that unemployment among women is much more serious than is revealed by the registered unemployment figures because many women do not register? Does the hon. Gentleman agree also that the activity rate is a much better indication than plain unemployment figures? Is he aware that unemployment among women is extremely serious because for many families their wages are vital to the standard of living of their families?
    Mr. Alison: I deeply regret unnecessary unemployment among women. The figures show that the fall in employment among women is rather less deep than the corresponding percentages for men for the same two years. The latest figures cause us to estimate that about 250,000 women are not registered as unemployed. That is about the same as it was between 1970 and 1979..
    Mr. Stokes: Should not some working women whose husbands are in well-paid jobs consider giving up their jobs so that unemployed fathers can take them up?
    Mr. Maxton: The Prime Minister?
    Mr. Alison: My hon. Friend has made a point which in the human dimension is perfectly valid and plausible, but it must be left to every individual family to decide for itself.

    Unemployment Statistics
    Mr. Edwin Wainwrightasked the Secretary of State for Employment what is the number registered as unemployed at the latest available date.
    Mr. Tebbit: At 12 November the number of people registered as unemployed in the United Kingdom was 2,953,340.
    Mr. Wainwright: Does the right hon. Gentleman agree that his complacency towards the 3 million unemployed, a figure that has held now for months and months, is upsetting the British people? When will he and the Government do something to create harmony in industries throughout the country instead of introducing legislation that will cause dissatisfaction, because of the Government's wish to bash trade unions?
    Mr. Tebbit: The hon. Gentleman should not accuse us of complacency. I might equally well accuse some of his hon. Friends of being disappointed each time the unemployment figures are announced, when they find that they have not increased beyond 3 million. I think that the hon. Gentleman is wrong in his description of Government policies. The measures that I propose to introduce on industrial relations law reform, as I have explained on several occasions already, have the support of the great mass of the public, including the majority of trade unionists. Why, therefore, should they cause any dissent?
    Mr. Goodhew: Will my right hon. Friend make an intelligent guess of the number of persons who are registered as unemployed and receiving the appropriate benefit yet who are working in the black economy for cash and not paying tax on any of that income?
    Mr. Tebbit: The problem exists but we have no valid figures to tell us the extent of the problem—
    Sir Charles Fletcher-Cooke: Why not?
    Mr. Tebbit: My hon. and learned Friend asks "Why not?" If someone is working illegally in the black economy and is illegally drawing unemployment benefit, we shall prosecute him if we catch up with him. We do not know how many are in that position, because we have not caught them all. That seems to be fairly clear. There is a strong case for measures such as those that we have announced, to allow those who are in receipt of unemployment benefit arid who seek to go into self-employment to have the additional support of being able to continue to draw benefit for some months to enable them to become established. In that way we help people to take their place in, presumably, the white economy instead of entering the black economy.
    Mr. Allen McKay: Will the right hon. Gentleman accept that the unemployment figures that he has produced are falsified because 1 million are not registered as unemployed who in fact are unemployed, 750,000 are on temporary employment and many women are not registered as unemployed? Is it not a fact that if the Government run to the end of their period in office, about 4·5 million will be unemployed if the present trend continues?
    Mr. Tebbit: No projection of that sort, which is based on false premises, can be a fact.
    Mr. John Townend: Does my right hon. Friend agree that the number of young unemployed will be reduced if the wages councils can be persuaded to reduce their starting level of wages so that employers can take advantage of the £15 subsidy? What initiatives does he intend to take to influence the councils?
    Mr. Tebbit: I think that my hon. Friend is right. There is little doubt but that labour, like any other commodity, will find a more ready market if its price is lower than at present. I am considering how the wages councils can best be influenced to make recommendations that will benefit those concerned, especially young persons, by extending their chance of getting jobs.
    Mr. Barry Jones: Has the right hon. Gentleman forgotten that the figures for long-term unemployed have doubled since last year? Does he appreciate that, on the basis of the current course of Government policy, the long-term unemployment figure will total 1 million by June 1982? What does he intend to do about this human tragedy?
    Mr. Tebbit: The only cure for the scourge of unemployment is to recreate conditions in which there are willing buyers for the goods which can be produced by those who are now unemployed. That means that we cease to export our jobs to other countries by persisting in being less competitive than they are and in charging more for our goods than they are charging for theirs.

    Engineering Apprenticeships
    Mr. Douglasasked the Secretary of State for Employment if he will make a statement regarding the current intake of apprentices into engineering in the United Kingdom.
    Mr. Peter Morrison: The Engineering Industry Training Board estimates that engineering employers will recruit about 10,300 craft and technician apprentices in the 1981–82 training year. The Government have provided funds for the Engineering Industry Training Board to meet the costs of making grants and training awards to produce an additional intake of 4,000 trainees.
    Mr. Douglas: Does the Minister agree that the current intake of engineering apprentices is far below our long-term demand? If and when the economy gets going, we shall run into a shortage of skills. Surely this is a terrible indictment of the Government in relying on the so-called market system to make up for skill shortages. Can we do something about this?
    Mr. Morrison: I agree with the hon. Gentleman that it is important for us to ensure that we do not have any skill shortages. I hope that he accepts the figures that I have given. There are 4,000 extra trainees, at a cost of £14 million. That is the sum that the Government have set aside for that purpose.
    Mr. Renton: What lessons does my hon. Friend draw from the fact that in the past year in the United Kingdom only about 80,000 apprentices started their first year of apprenticeship, as compared with about 680,000 in West Germany? Could this be due, at least in part, to the fact that the starting rate for an apprentice in this country is 50 per cent. that of a skilled craftsman, whereas in Germany it is only 20 per cent?
    Mr. Morrison: I was hoping to give my hon. Friend the answer that he has given himself. Certainly I draw the same lesson as he has drawn from the German experience.
    Mr. Craigen: Has the Minister discussed with the Engineering Industry Training Board the increasing number of apprentices caught by redundancy?
    Mr. Morrison: I have not spoken directly to the board about that. I am not sure whether the hon. Gentleman was present when I answered a question on the same matter earlier, but he may know that, through the Engineering Industry Training Board, we are supporting 2,800 redundant engineering apprentices.

    Employee Involvement
    Mr. Madelasked the Secretary of State for Employment if he has any plans to meet the general secretary of the Trades Union Congress to discuss greater employee involvement in decisions at the work place; and if he will make a statement.
    Mr. Waddington: No, Sir, but I and my right hon. Friend are willing to meet the general secretary at any time to discuss this most important subject.
    Mr. Madel: With regard to a new initiative on employee participation, does my hon. and learned Friend agree that the time is now right for ACAS or the Government to publish a code of practice, since this would certainly help industrial relations?
    Mr. Waddington: There is a relevant ACAS code of practice, and other bodies have also published codes of practice. I can only repeat what I said earlier. Plainly, anyone who can put forward new initiatives in this sphere will be doing a most useful job. That is how it should be done, not through legisation.
    Mr. Greville Janner: Does not the Minister recognise that the only initiative with any possibility of success is one produced through legislation? Will he support the EEC fifth directive in its efforts to require member nations to take this step towards participation in industrial decision-making?
    Mr. Waddington: As the hon. and learned Member knows, the fifth directive has been about for a long time, and it may well be a long time before it is eventually approved by the Council of Ministers. It has also changed a great deal over all those years. I doubt very much whether the way forward is by legislation, when the circumstances of industry are so varied that it would be dangerous to lay down a rigid pattern.
    Sir Charles Fletcher-Cooke: Is my hon. and learned Friend aware that the fifth directive, nevertheless, has been much improved by the work of Mr. Amédée Turner, the Member of the European Parliament who is on the Legal Committee? Does he agree that the fifth directive as it now is should be taken seriously by the Government, as it is now a far better answer to the problem than the Bullock report?
    Mr. Waddington: My hon. and learned Friend is right. One of the options contained in the fifth directive is for work councils elected by the shop floor. That cuts entirely across the policies of Labour Members, who want not employee-directors but trade union directors. They do not want employee involvement. They want more trade union power.

    Unemployment Statistics and Job Creation
    Mr. Ioan Evansasked the Secretary of State for Employment how many registered unemployed persons there are in the United Kingdom; what percentage this is of the working population; and whether he has any further proposals to improve employment prospects.
    Mr. Alison: At 12 November the number of people registered as unemployed in the United Kingdom was 2,953,340, representing a rate of 12·2 per cent. I refer the hon. Member to the reply that my right hon. Friend the Secretary of State gave earlier to the hon. Members for Bolsover (Mr. Skinner) and for Swindon (Mr. Stoddart).
    Mr. Evans: As the Tory Party, with the aid of Saatchi and Saatchi, made great play at the last election about the level of unemployment at that time, can the Minister tell us when, with the measures taken today, the Government will achieve that level? Will it be within the lifetime of this Parliament?
    Mr. Alison: At the last election we analysed the greatest single cause of unemployment as being the rate of inflation. We have attacked the rate of inflation directly and have halved the rate of increase. We are well on course to cut the tap root that is the cause of unemployment, by bringing down the rate of inflation.
    Mr. Myles: Does my hon. Friend agree that in our battle against unemployment a priority must be to make

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    it more attractive for employers to employ by sweeping away many of the disincentives introduced by the Labour Government?
    Mr. Alison: I agree with my hon. Friend. Our programme for improvements in industrial relations legislation is one element in our progress in that direction. My hon. Friend will also be aware of the young workers scheme that is soon to be launched, which will produce direct incentives to employers to recruit young employees.

  PRIME MINISTER

    Engagements
    Mr. Stanbrookasked the Prime Minister if she will list her official engagements for Tuesday 15 December.
    The Prime Minister (Mrs. Margaret Thatcher): This morning I had meetings with ministerial colleagues and others. In addition to my duties in the House, I shall have further meetings later today. This evening I hope to have an audience of Her Majesty the Queen. Later I shall attend a dinner to celebrate the 220th anniversary of the Board of Deputies of British Jews.
    Mr. Stanbrook: Has my right hon. Friend seen the news reported on the front page of The Daily Telegraph today that the rate of industrial output had increased by 1·7 per cent. in October, the highest rate for two-and-a-half years, and that the rate of output in the construction industry increased by 2½ per cent. in the same period? Does that not show that my right hon. Friend's policies are working successfully and that it would be foolish to change them?
    The Prime Minister: Yes, I confirm what my hon. Friend says about increases in industrial output. There were also increases in manufacturing output and in the construction industry, and very large increases in output in the oil and gas industries. This is encouraging news. The increases have continued for well over a quarter and in some cases for five months. This shows that the policy of making British industry efficient is bringing about improvements, with the increased output that we now see.
    Mr. Foot: Has the right hon. Lady any further information to add to what was said in the House yesterday about events in Poland and the anxiety that we all feel at reports that the leader of Solidarity may have been placed under arrest?
    On another matter of grave international concern, what representations have the Government made, or will they make, about the proposed annexation of the Golan Heights by the Israeli Government, which is certainly contrary to resolution 242, which this country has always supported?
    The Prime Minister: With regard to the two big questions raised by the right hon. Gentleman, the Foreign Ministers of the Ten, at present meeting in London, have issued the following statement with regard to Poland:
    "The Foreign Ministers of the member States of the European Community are concerned at the development of the situation in Poland and the imposition of martial law and the detention of trade unionists. They have profound sympathy for the Polish people in this tense and difficult time. They look to all signatory States of the Helsinki Final Act to refrain from any interference in the internal affairs of the Polish People's Republic. They look to Poland to solve these problems herself and without the use of force, so that the process of reform and renewal can continue."
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    Foreign Ministers of the Ten are continuing to follow events in Poland with particular attention and agreed to remain in close consultation on this question.
    With regard to what has happened to the Solidarity leadership, our knowledge is incomplete. We believe that a large number of Solidarity leaders have been detained, including the leadership of the Warsaw region. Earlier reports suggested that Mr. Walesa may not have been detained but may have had talks with the authorities in Warsaw. We have received no independent confirmation of that, nor have we any further reports. It is not easy to get accurate information out of Poland at the moment.
    With regard to the decision of the Knesset in Israel yesterday about the Golan Heights, the Foreign Ministers have issued the following statement, to which we subscribe:
    "The Foreign Ministers of the member States of the European Community strongly deplore the decision of the Government and Knesset of Israel to extend Israeli law, jurisdiction and administration to occupied Syrian territory in the Golan Heights. Such an extension, which is tantamount to annexation, is contrary to international law, and therefore invalid in our eyes. This step prejudices the possibility of the implementation of Security Council resolution 242 and is bound to complicate further the search for a comprehensive peace settlement in the Middle East to which we remain committed."
    Mr. Rhodes James: With regard to the menacing crisis in Poland, which inevitably is occupying a great deal of the attention of my right hon. Friend, does she recognise that the factors that prompted a generous approach by Western countries towards Poland's grave economic difficulties in the past under the previous Government do not obtain in the view of many of us in the present circumstances? Does she accept that many of us do not see why we in the West should give aid and comfort to such a regime in these circumstances?
    The Prime Minister: As I said earlier, we are all very concerned about the imposition of martial law in Poland. As my right hon. Friend told the House yesterday we believe that it is too early for anyone, either Governments or banks, to make any changes in arrangements for the rescheduling of Polish debt repayments or the provision of new credit. For the moment, therefore, we shall leave things as they are, without making any changes in the financing provisions. As my hon. Friend knows, we have ourselves, and through Europe, provided a great deal of food throughout the last year. We believe that it is better to leave things as they are but to keep a close watch on what is happening in Poland.
    Mr. J. Enoch Powell: The Prime Minister will today no doubt be putting the finishing touches to her address to the European Assembly. Will she, in all candour and fairness, include in that speech a passage making it clear to the Assembly that this country's membership of the Community is contrary to the profound opinions of the majority of people, who wish to see their friendly relationships with the countries of Europe in a different framework from that which the European Community provides?
    The Prime Minister: No, I cannot give the right hon. Gentleman the answer that he seeks. I profoundly believe that membership of the European Economic Community is in the best interests of this country, above all, for political reasons. It means that there is an area of democratic stability in Europe, which is vital in the interests of Europe and the larger world at present.
    Mr. John Townendasked the Prime Minister if she will list her official engagements for 15 December.
    The Prime Minister: I refer my hon. Friend to the reply that I gave a few moments ago.
    Mr. Townend: Does my right hon. Friend agree that one of the causes of the present high level of unemployment is the growing practice of the trade unions of being prepared to trade jobs for higher wage increases? In that context, will she comment on the recent offer of the local authorities to manual workers, which is way ahead of the cash limits and which, in the words of the employers' representatives, can be paid for only by a reduction in the number of jobs and cuts in services?
    The Prime Minister: It is vital to recognise that there is a link between higher pay that is demanded without higher output and the number of jobs that can be provided. Frequently, higher pay without higher output leads to fewer jobs. Where that happens with a local authority it can also lead to fewer jobs in small and even bigger business within the curtilage of that local authoriy. Many employers could afford to take on more young people if they were not paying higher wage rates. With regard to the recent considerable increase that has been offered to local authority manual workers, I understand that employers' representatives said that it was more than they could afford. I note that the offer was made as a result of the casting vote of a Labour chairman.
    Mr. Skinner: Will the Prime Minister condemn the report that during her visit to the European Assembly tomorrow there will be laid on for her and others, during the three-hour visit, a champagne "do" costing £50 per head? Is that not a scandalous waste of money?
    The Prime Minister: The entertainment that I am offered is a matter for my hosts.
    Mr. Chapmanasked the Prime Minister if she will list her official engagements for Tuesday 15 December.
    The Prime Minister: I refer my hon. Friend to the reply that I gave some moments ago.
    Mr. Chapman: If my right hon. Friend reflects upon the speech that she is to make to the European Assembly in Strasbourg tomorrow, will she consider, in the light of what the right hon. Member for Down, South (Mr. Powell) said, that since this country joined the EEC the value of our exports to the member States of the European Community has increased more than sixfold in the last eight years, that we are now in surplus on our visible balance of trade and that our largest customer is West Germany? Does she agree that any action to withdraw from the EEC, at least on trade and economic grounds, would be an act of supreme folly?
    The Prime Minister: I confirm in general terms what my hon. Friend said about our trade with the EEC. In economic and trading terms it would be an act of folly to withdraw. Our trading figures with Europe will be even better when we secure that liberalisation of insurance, banking and so on, in which we in this country excel. Any suggestion that we should withdraw is highly damaging to the inward investment that we need, especially the investment that we need to secure more jobs.
    Mr. Gordon Wilson: Does the Prime Minister realise that the level of urban deprivation in Scottish inner cities
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    is among the highest in the United Kingdom? In view of the silence since the announcement of her right hon. Friend the Secretary of State for the Environment that £95 million will go to the English inner cities, will she tell the House of the Government's intentions towards the Scottish cities, which so badly need help and sustenance?
    The Prime Minister: I was under the impression that my right hon. Friend the Secretary of State for Scotland already had an excellent scheme in operation in Glasgow. We are looking at that scheme with a view to learning lessons from it in order to be able to apply them in cities in this country. The hon. Gentleman may rest assured that my right hon. Friend is not slow in coming forward for any benefits that apply to England.
    Dr. Mawhinney: Will my right hon. Friend find time today to offer her encouragement to the 12 new businesses that have just been started by people in Peterborough—who were formerly unemployed—under a local scheme financed by Barclays bank at my request? Does my right hon. Friend understand and appreciate that that scheme complements the Government's loan guarantee scheme, which is greatly appreciated by my constituents?
    The Prime Minister: Yes, I congratulate everyone concerned, especially my hon. Friend, not merely on talking about these matters but on taking action to secure more jobs for his constituents. I know of the scheme to which he refers. He persuaded a large bank to set aside money for those who were able to set up small businesses. Twelve new ones have been set up, providing jobs that would not otherwise have been provided. I hope that every hon. Member will take note of that and follow my hon. Friend's example.
    Mr. John Grant: In view of the disgraceful announcement yesterday that the overseas aid budget is to be cut by more than ever before in a single year, does the Prime Minister recognise that she will be known as the Job's comforter of the Third world? Does that not mean, in effect, that the Government have buried the Brandt report?
    The Prime Minister: No, Sir. It is true that the net aid programme next year will be £950 million, which represents a reduction in planned expenditure of just under £20 million—and an adjustment for overspending in 1980–81. The gross aid programme next year will still be over £1 billion and the Commonwealth Development Corporation is being allowed to borrow abroad up to £15 million in each of the next three years.
    Mr. Lawrence: Will my right hon. Friend take this opportunity to congratulate all those responsible for the excellent performance of British Shipbuilders? Is she aware that the company has increased its productivity by 15 per cent., that industrial disputes are practically at an all-time low, and that the order books on merchant shipping are extremely high? Does that not vindicate the activities of her Government in relation to nationalised industries?
    The Prime Minister: Yes, Sir. Once again that shows that the Government's policy of ensuring that industries—whether private or nationalised—become efficient and competitive is paying off. I congratulate British Shipbuilders on securing so many good orders and hope that it will soon become profitable.

Employment and Training
3.30 pm
The Secretary of State for Employment (Mr. Norman Tebbit): With permission, Mr. Speaker, I should like to make a statement on training and special employment measures, further to the measures announced on 27 July by my right hon. Friend the Prime Minister.
We have decided to extend the special job release scheme, open to disabled men of 60 and over, until March 1984. Job release allowances will be increased next April by 9 per cent. At the same time, the conditions of the scheme in the public and private sectors will be brought into line. The temporary short-time working compensation scheme will also be extended by two years and will then close, with the last application being taken in March 1984. From July 1982, the maximum period of support will be six months. Provision for the community enterprise programme will be increased to 30,000 places in 1982–83.
The total provision for these three special employment measures in 1982–83 has now been increased this year by £140 million to over 520 million, with an additional £61 million for the young workers' scheme which starts on 4 January 1982.
I deal next with training. We have today published a White Paper on the action needed to bring our system of industrial training up to date. We have drawn substantially upon the recommendations made by the Manpower Services Commission in its report, also published today, on the response to the consultative document "A New Training Initiative." The White Paper provides a framework for action by all concerned in industry and education, and sets out the lead that the Government are giving in a 10-point agenda. I should draw to the attention of the House three of those points in particular.
First, there will be a new £1 billion a year programme for unemployed young people, which will guarantee a full year's foundation training to all those leaving school at the minimum age who find themselves without jobs. Over the next 18 months this entirely new youth training scheme will progressively replace the youth opportunities programme and will give these young people training in basic skills which employers will need in the future. We are determined to lose no time in reaching the position where every 16-year-old school leaver is in work, or in further education, or has a genuine opportunity of a year's training. By taking the decisions now, we are able to ask the Manpower Services Commission to ensure that this new youth training scheme is in full operation by the autumn of 1983.
Meanwhile, the youth opportunities programme will be expanded and developed to provide about 100,000 of the new-style training places in 1982–83 and the allowance under it will be increased to £25 a week from next January.
Young people in the new youth training scheme in their first year after leaving school at 16 will have "trainee" status. From 1983 they will cease to have eligibility of their own for supplementary benefit, except for the special groups, and so will be treated like those who remain in full-time education. While on the scheme they will, however, receive a training allowance from the Government. [HON. MEMBERS: "How much?"] It will reflect the value of the training and relevant further education they receive and their learning role, and, although its precise level will be decided nearer the time,
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it is likely to be something over £750 a year. For older trainees who remain eligible for supplementary benefit, the allowance will be higher, probably around £1,250 a year. These allowances will not apply before 1983, when the scheme comes into full operation, and I am asking the Manpower Services Commission, in working out the detailed implementation of the scheme, to advise on the level of allowances which is appropriate within the resources available for the scheme as set out in the White Paper.
Employers, trade unions and educationists have all rightly expressed concern for the young unemployed. The Government therefore trust that we can now depend upon their wholehearted support in making this new scheme a success. The new scheme breaks entirely new ground in the training of young people in this country, and it is directed to young unemployed people as a first priority. But our ultimate objective is proper training for all young people, whether employed or unemployed, and to bring more young people into jobs with proper training. For those in jobs, we are increasing the financial encouragement to employers to provide foundation training and release for education so as to cover some 50,000 trainees in 1984–85. We are also continuing into 1982–83 our support for some 35,000 apprenticeships
The new scheme that I have announced will now go ahead quickly to ensure that there will be universal provision for unemployed school leavers. But the Government hope that the further study of youth training to be undertaken by the MSC will identify fresh ways in which to help get many more of the young unemployed into paid jobs with proper training. To the extent that their training needs can be met in such ways, we should be willing to transfer resources proportionately from the new scheme.
Secondly, we wholeheartedly support the MSC proposal that employers and unions should accept, and implement, the objective that by 1985 all training should be to standards without regard to age. We shall make Government assistance for skill training increasingly conditional upon steps towards that objective and the removal of unnecessary restrictions.
Thirdly, we have asked the Manpower Services Commission to develop an Open Tech programme to make technical training more accessible to all with the necessary ability. Other points of action are set out in the White Paper, including steps to improve preparation for working life in schools and colleges.
In pursuit of all these commitments we have during this year increased the provision for training expenditure in 1982–83 by £399 million to a total of over £1·1 billion, in 1983–84 by an extra £517 million to a total of nearly;£l·3 billion and in 1984–85 by an extra £648 million to a total of nearly £1·5 billion, incluing over £1 billion on the new youth training scheme. The provision for 1982–83 is included on the expenditure plans for that year announced by my right hon. and learned Friend the Chancellor of the Exchequer on 2 December. The amounts for later years will be accommodated within the totals to be announced in due course.
We are therefore providing resources totalling nearly £4 billion over the next three years to bring our training arrangements up to date. With the assistance of the Manpower Services Commission, we have now set out a clear framework within which employers, unions, local authorities, education services and trainees themselves can

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play their part to modernise our training system. These steps are long overdue. Let us set out to provide training fit for a great industrial and trading nation.
Mr. Eric G. Varley: Is the Secretary of State aware that we greatly welcome any proposals to provide additional comprehensive training, particularly for the young? Is he further aware that the MSC is to be heartily congratulated on bringing forward its document "New Training Initiatives—Agenda for Action" which has been published today together with the Secretary of State's White Paper? However, the White Paper and the MSC's document raise complex issues. Will the right hon. Gentleman arrange for the proposals to be debated in the House in the near future? Does he accept that we welcome the improvement in the provision of the job release scheme, the temporary short-time working compensation scheme and the community enterprise programme?
Will the Secretary of State outline how he intends to fulfil the objectives of the Manpower Services Commission, which, I understand, will be the main agency to carry through the Government's new arrangement? Will he give a specific commitent that the MSC will have the financial resources to monitor the proposals and to engage people to supervise the scheme, in view of what has happened to that body over the past two and a half years?
There is a part of the statement which needs clarification and which will be regarded as controversial. Is the Secretary of State trying to launch the new youth training scheme on the basis of allowances in 1983 of perhaps only £15 a week? Most people will regard that figure as miserly and will greet it with derision. Even the increased allowance in the youth opportunity programme of £25 for next year is nowhere near adequate, because most young people on that scheme expected the allowance to go up to the £28 recommended by the MSC some time ago.
Will the right hon. Gentleman confirm that those who go on the youth opportunities scheme next year will receive the new but inadequate £25 a week allowance but that a brother or sister going on the new scheme in 1983 will get only £15 or £16 a week? What justification is there for that? In the new scheme, most of the work and training will be on the employer's premises, just as it is under the existing YOP scheme.
Will the Secretary of State accept that youth employment is the most desperately urgent problem facing our nation? To try to launch this scheme on the basis of some compulsion but inadequate allowances will bring dismay to those working in the careers service and may anger the young unemployed. the MSC brought forward imaginative and far-reaching proposals and the Secretary of State is in danger of wrecking its initiative by a completely inadequate response.
Mr. Tebbit: That statement was characteristic of the right hon. Gentleman. He chose not to offer any word of credit to the Government for taking the decision, in these hard days, to allocate to a training scheme more than 1 per cent. of the total of public expenditure. It is something which the Labour Government toyed with and failed to introduce. There was no reason for the failure except that they could not find the resources. The Opposition are simply jealous of the fact that we now have the resources.
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The right hon. Gentleman talks of the contrast between brother and sister, but he might care to ask how much most parents give to their children in the sixth form at school. He could then compare it with the amounts which the Government are willing to offer in training allowances for the youngsters who will be in a full-time training scheme. I remind the right hon. Gentleman—in case he has not yet been able to work it out—that the amount of money devoted per youngster on the training scheme, as opposed to the youth opportunities programme, and excluding the allowance, is almost four times as great. If the right hon. Gentleman wishes to dilute the value of the training only to give the youngster more money that is for him. Equally, if he thinks that the Government ought to find more money, it is up to him to suggest where it should come from.
Mr. William Hamilton: Does the Minister agree that by the time the scheme comes into operation there will be nigh on 4 million unemployed, if not more? Viewed in that context, is not the scheme wholly inadequate to meet the challenges which will face us in the next decade or two?
Does the Minister recognise the enormous anger that there will be among ordinary people about the element of compulsion? It is a form of compulsory national service, and if people do not accept it they will not even get supplementary benefit. Does the Minister recognise that he is playing with fire if he believes that the proposals will go through unscathed?
Will the Minister give an assurance that the sum of £15 will be entirely flexible and will be increased if the trade unions and others agree that it is inadequate?
Mr. Tebbit: Since I do not agree that there will be 4 million unemployed by 1983, the adequacy of the measure, in the sense of the hon. Gentleman's question, does not arise. It is changing the meaning of words to describe the scheme as compulsory; it is not compulsory. The hon. Gentleman is staking a claim for those who do not choose to take advantage of a suitable training place to be eternally granted support by the taxpayer at large. I do not believe that that is a proposition that appeals to most people in this country.
I have made it plain that within these expenditure figures I have provisionally allocated sufficient money for an allowance of £750 and £1,250 a year respectively. If it emerges that it is possible, for example, for employers participating in the scheme to contribute more than that, well and good. Alternatively, if the trade union movement can be made without either diluting the training content or increasing the cost, I shall be delighted to hear of it.
Mr. Michael Latham: Despite the carping and niggling attitude of Labour Members, is my right hon. Friend aware that on the Conservative Benches there will be a warm welcome for the statement and for the steps he is taking to deal with the giant social evil of unemployment? Will he particularly ensure that the 12 month's training will lead to certification, and will he look at the 18 months' phase-in period to see whether it can be speeded up?
Mr. Tebbit: As for my hon. Friend's second point, it will be a formidable task for the MSC and the others concerned to ensure that the scheme is available by September 1983 to every youngster who needs it and

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desires it. We shall increase the number of places available under this type of scheme, as opposed to the YOP, from the autumn of next year, and we shall at any rate aim at 100,000 places.
With regard to certification, we are aiming to have national standards but local delivery. We shall do our best to ensure that every trainee, at the end of his year, will have a certificate setting out what he has achieved during that time and what standards of training he has managed to maintain.
Mr. David Alton: I welcome the fact that we are now moving away from the youth opportunities programme, which many young people regard as highly unsatisfactory. I also welcome the fact that there will be more training built into the scheme, but does the Secretary of State agree that there will be profound disappointment among many young people that the opportunity to introduce statutory apprenticeships—such as those covering over 400 occupations in West Germany—has been lost on this occasion? Does the Secretary of State believe that it is realistic for people to be paid £15 a week, bearing in mind the enormous commuting cost that many people have in travelling to their place of occupation?
Mr. Tebbit: I thank the hon. Gentleman for his general remarks about the scheme. We have not lost the opportunity that he referred to, because it was never found, and could not yet realistically be found, within the possible resources available.
The step that we are taking is one step towards ensuring that the young work force will be as well trained and prepared for work as those of many of our overseas rivals. I emphasise to the hon. Gentleman that the allowances are not pay. The youngsters will not be at work in the conventional sense; they will be receiving training. In that sense, their position is perhaps more comparable to their brothers and sisters who are at school or in colleges of further education.
Mr. Bill Walker: My constituents will be very pleased with this imaginative scheme, particularly the parents whose children are seeking work. Such a scheme is long overdue. However, would my right hon. Friend consider that it is only the first step in the massive job that we face of bringing about the training requirements for the next century? We must consider ways of using this imaginative scheme—I believe that it will be very successful—to bring about changes in the salary scales of all trainees up to the age of 20, so that a period of training can be seen for what it is, and so that allowances will be paid rather than wages.
Mr. Tebbit: I thank my hon. Friend for his remarks. If we contrast Britain's youngsters with those in Germany, it is true that German youngsters are willing to accept a lower proportion of the skilled men's wages, but as a consequence of the extra training that that makes it possible to carry out, as they become skilled men they are capable of earning higher wages than we are able to pay.
Mr. John Golding: Will the Secretary of State confirm that the maximum period for the short-time working compensation scheme is being cut, as his statement said, from nine months to six months? Is he aware that the withdrawal of that scheme in two years' time will bring great hardship to British firms and to workers and their families?
Mr. Tebbit: The hon. Gentleman should remember that I have extended the scheme by two years. In the rundown of the scheme, as he correctly said, I have cut the maximum period of benefit from nine to six months from next summer. The amount of short-time working is now falling very rapidly and, therefore that scheme— [Interruption.] I am sorry if the Opposition do not like good news, but it happens to be true—short-time working is falling. [Interruption.] I shall say it three times in the hope that the Opposition will understand the point. Short-time working is falling and, therefore, there is less need for the scheme.
Mr. Alan Haselhurst: The Government deserve congratulations for elevating the importance of training in the way that my right hon. Friend has outlined. Does he agree that for such a scheme to be fully relevant it should carry the full commitment of employers and the unions? Does he believe that, for the package to be balanced, we must, over the course of time, see further steps on the pre-vocational side of education?
Mr. Tebbit: I thank my hon. Friend for what he has said. He is right in saying that the scheme must carry the full commitment of educationists. Indeed, my right hon. Friend the Secretary of State for Education and Science is ensuring that the curriculum in schools will be increasingly adjusted to ensure that youngsters are fully prepared for work.
Mr. David Watkins: How soon will the scheme be introduced in a constituency such as Consett, where there are more than 100 unemployed school leavers for every available job and where the Government's policies have destroyed the local economy?
Mr. Tebbit: There may be long-term causes for the weakness of the local economy in Consett, and it would be only fair if the hon. Gentleman accepted that. Those causes were showing during the Labour Government's term of office, and even before that. The new scheme will work in the same way as the YOP scheme has worked—seeking employers as sponsors—but it will also bring in the resources of the colleges of further education, Government training centres and private sector training centres, if they are available, to train youngsters so that they will have a better opportunity of finding jobs when they finish the scheme.
Several Hon. Members rose—
Mr. Speaker: Order. I propose to call questions until 4.15 pm, which is in 20 minutes' time. If hon. Gentlemen are brief, most of those rising should be called.
Mr. David Madel: In the many improvements that my right hon. Friend is seeking, can he confirm that there must be much greater co-operation between careers officers and local education authorities and that local education authorities should substantially step up in-service training for teachers, so that when the curriculum for 14 to 16-year-olds becomes more vocational there will be adequate teachers to do the job?
Mr. Tebbit: Yes, my hon. Friend is right; there is a crying need for local education authorities, schools and teachers to get much more closely aligned with employers so that the teachers understand more about the world of work that will face the average school leaver.
Mr. Robert Hughes: Is the Secretary of State aware that the Select Committee on Scottish Affairs yesterday published a unanimous report signed by many of his own Back Benchers? That report advanced the concept of the training year, and to that extent the training year is welcome. Is he aware also that the Committee made it clear that any element of compulsion in the system would destroy the efforts to get people to participate in the scheme?
Is the Secretary of State saying that if youngsters do not go into the training year they will lose their eligibility for social security benefits? Is that not compulsion? Secondly, if the suggested new scheme is to replace the YOP scheme, what is the justification for increasing the YOP allowance to £25 a week, only to reduce it to £16 a week per trainee in later years? Is that not flying in the face of reason: paying £25 a week for the training, but reducing it to £16? Why is that being done?
Mr. Tebbit: First, I noted the Select Committee's report and, as the hon. Gentleman fairly said, what I have announced is much in line with the Committee's recommendations, except for what he calls "compulsion". I do not accept that it is compulsion.
Mr. Frank Allaun: Of course it is.
Mr. Tebbit: If the hon. Member for Salford, East (Mr. Allaun) wishes to change the meaning of words, would he mind doing so on his own and not try to play the "1984" game of changing the meaning of words in order to distort them? The reasoning behind increasing the YOP allowance to £25 is to maintain an adequate differential between that and the levels of supplementary benefit available to 16 and 17-year-olds. That is why the allowance for the 17-year-olds on the youth training scheme will also be higher—in order to maintain that sort of differential, because the 17-year-olds will remain in receipt of supplementary benefit.
As to the logic of the whole scheme, I again feel that what is being offered in the youth training scheme is so different from that available under the YOP that the youngsters concerned should put more value on it. Secondly, it will be available to every youngster of 16 who presents himself for training.
Mr. Gordon Wilson: The level of payment will be a disincentive under the scheme, but does the Secretary of State realise that the quality of training being offered will decide whether the scheme is a success or not? Does he think that one year is adequate to give the training that young people require, and what type of improved training in basic skills has he in mind to avoid the scheme becoming a souped-up version of the previous scheme?
Mr. Tebbit: I thank the hon. Gentleman for his comments. I am sure that he is right when he says that the quality of training will either make or break the scheme. Of course it would be possible to have a two-year scheme, but that would cost £2 billion instead of £1 billion a year and I frankly do not know where I would find the extra £1 billion. It would be best if I referred the hon. Gentleman to the White Paper on the question of the construction of the training, which will be of a modular nature. Perhaps he will be kind enough to offer us his thoughts on what should be included, because I am certain that the decision
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on which modules should be conducted in any place must rest on the local labour market and not be dictated from the centre.
Mr. Tim Renton (Mid-Sussex): I warmly welcome the new training initiative, particularly as all that the Labour Government were able to do was to introduce three consultation documents. What financial contribution might the Government make to the employer for his training element, and will it be in order for the employer to top up the Government allowance of £750 a year by his own payments to the trainee once he has got to know and like him or her?
Mr. Tebbit: Of course there would not be anything to prevent employers from topping up. Indeed, they may think that that is desirable. I recollect that that was part of the scheme put forward by some of my hon. Friends in the Lifeline group. That would be fair enough.
On the transfer of resources, if the MSC and employers can devise a scheme under which we could get more youngsters as normal paid employees of firms, though with a clear, unbreakable commitment to a year's training contract, I should be willing to transfer a proportion of the resources, since such a scheme would reduce the amount of expenditure required under what we call the Government-MSC scheme.
Mr. Allan Roberts: Is the Secretary of State aware that the DHSS pays what it considers a basic minimum subsistence living allowance, and that it is more than the £15 a week allowance that is to be paid to young people on the training scheme? Is he also aware that young people will view the scheme as nothing less than enforced slave labour? Bearing in mind the Government's cynical way of reducing DHSS expenditure and taking young people out of the unemployment figures in election year, have we not reached a pretty pass when the Government have to introduce civil national service?
Mr. Tebbit: I suggest that the hon. Gentleman should talk to some of those east of the Iron Curtain in countries on which he is an expert and ask whether they would regard the scheme as enforced slave labour—in contrast to the enforced slave labour that exists in some of the countries that he admires.
Mr. Jim Lester: I congratulate my right hon. Friend on the introduction of a much-needed White Paper and the sense of urgency that he has shown in providing the right number of places for 1983 when the number of young people leaving school will reach its peak. Does my right hon. Friend realise that in order to achieve that number of places he will need the maximum good will of those in local areas who will have to work together to provide the places?
One of the key issues is the rate of allowance that will be finally settled in 1983. My right hon. Friend welcomed the suggestion that employers should top up the allowance to make it more realistic. The whole proposal will stand or fall on whether we have a sensible scheme with the right training element and the right allowance so that people want to join it and the question of supplementary benefit will become irrelevant.
Mr. Tebbit: I am grateful for my hon. Friend's comments and for the immense amount of work that he and some of his colleagues have done in developing such ideas. I hope that his ambitions for the scheme, which I

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share, will come to fruition. I believe that a sensible arrangement will arise over the allowances. I was even encouraged by the fact that when the hon. Member for Chester-le-Street (Mr. Radice) was asked on the radio this morning whether he would have increased the allowance, as some have advocated, he said that he would not have cut it in that way. That left me wondering in which way he would have cut it.
Mr. Andrew Faulds: What specifically does the term "foundation training" mean as far as qualifications are concerned? Does the right hon. Gentleman understand that the gravity of the situation is such that the delay in the implementation of the scheme until the end of 1983 is far too tardy?
Mr. Tebbit: Before accusing me of delay, the hon. Gentleman should ask the MSC whether it believes that it could have prepared a scheme any earlier than September 1983.
Mr. Faulds: You tell us.
Mr. Tebbit: I can tell the hon. Gentleman that the MSC could not do that, and that is why I have chosen the schedule that I have.
Mr. Faulds: I do not believe it.
Mr. Tebbit: The hon. Gentleman says that he does not believe it, but I suspect that he is only acting up as usual and that he knows that what I am saying is the truth.
Mr. Faulds: What about my other question?
Mr. Richard Needham: I am sure that my right hon. Friend is aware that in Germany no training allowances are provided by the Government. I congratulate my right hon. Friend on introducing a scheme which puts the main emphasis on training. He is absolutely right to ensure that most of the money for the scheme goes to the training section, because young people want a proper traineeship that will give them a proper skill and the opportunity of a proper job. I was interested in and glad to hear my right hon. Friend's comments about the allowance. Surely he accepts that there must be a commitment by the employer to the youngster, which means that, wherever possible, the employer should pay a contribution to increase the allowance, which my right hon. Friend rightly sets at a level which the Government can afford. Will my right hon. Friend say that he looks forward to employers contributing something on top of the allowance to get the necessary commitment from the company and from the youngster to the company?
Mr. Tebbit: My hon. Friend is right to draw the House's attention to the fact that in Germany employers carry the burden of training, but, as has been pointed out, there is in Germany a much more realistic attitude to the wages that should be paid to trainees, which, no doubt, helps to get the right attitude on the part of employers as well. I assure my hon. Friend that, as I said in my statement, I have asked the MSC to advise me on the level of allowance that it thinks would be right, and I have made plain how much I believe the Government can make available for that purpose. Like my hon. Friend, I look forward to anything that employers can do to contribute towards covering the costs of training and ensuring that the scheme is the success that my hon. Friend and I want it to be.
Mr. John Grant: Will the right hon. Gentleman agree that the MSC deserves considerable credit for paving the way for the Government to make what may be a major breakthrough in training? Does he accept that, however welcome his statement may be, it raises serious doubts and reservations, particularly about the quality of training and the resources that will be made available for monitoring it?
As for the inadequacy of the allowance and the compulsory element, will the right hon. Gentleman confirm that they were not proposed by the MSC and will he accept that it would be a tragedy if such a mean and penny-pinching attitude jeopardised and undermined the whole scheme?
Mr. Tebbit: Even at this time of the year, I hardly expected the hon. Gentleman to welcome me as Santa Claus, but trying to cast me in the role of Scrooge when I have found £4 billion over three years is a bit much. It is characteristic of the way that the hon. Gentleman wants to point in all directions at once and to offer everything to please everybody. Of course, we are deeply grateful for the work that the MSC has done in developing ideas for the training scheme. I have adopted much of what it asked for, but it is one thing when one is not responsible for finding the resources to suggest how much—
Mr. Dennis Skinner: It is not new money.
Mr. Tebbit: The hon. Member for Bolsover (Mr. Skinner) clearly did not hear or did not understand my statement. Perhaps he would allow me to answer the hon. Member for Islington, Central (Mr. Grant).
Mr. Varley: That is how the right hon. Gentleman used to behave.
Mr. Tebbit: If I may say so, I have proved a very good teacher because now the right hon. Gentleman is behaving like that. It is much easier if one is not responsible for finding the resources to suggest ways of spending. We have found resources and made them available. That is the best way in which we can go forward.
Mr. Frank Allaun: Is the right hon. Gentleman aware that I received an hour ago a phone call from a lady in Salford who administers a scheme for the young unemployed and who is very close to them? She was in tears because she had read in this morning's newspapers two accurate prophecies of what the Secretary of State has stated—first, that the young people she is looking after will come down from £23 a week to £15 a week, and, secondly, and much more seriously, that this is a compulsory scheme and that otherwise the young unemployed receive nothing. She said to me that these young people will riot and will regard themselves as Hitler Youth.
Mr. Tebbit: I think that the hon. Gentleman has a responsibility to explain to the lady the extent to which this scheme produces a training opportunity that is not available under the present YOP scheme, the extent of its value, and the extent to which extra money will be spent on these youngsters. If the hon. Gentleman believes that the appropriate response of youngsters offered a year's valuable industrial and vocational training is to riot, it speaks volumes for his line of thought.
Mr. Nigel Forman: Is it not clear that the £4 billion programme over three years is a sizeable and

163
timely response to one of the nation's primary needs? Will my right hon. Friend bear in mind two important points? First, it is possible that the education system is not yet sufficiently well equipped on the vocational side to back up this splendid programme. Secondly, it is vital that the content of training should be highlighted through accent on standards rather than time served.
Mr. Tebbit: I agree completely with my hon. Friend. It is important to understand that we aim to achieve this concentration upon standards not only in this first year's training scheme but also in what until now have been the traditional apprenticeships. We should be concerned not with the age of a man or the length of time he has spent in training but with the standards that he has achieved. That must be the right way forward. The achievement of those objectives, particularly through this one year training scheme, when youngsters will have spent upon them no less than £55 a week in total, would be the first and most important step towards catching up with our Continental rivals that we have taken.
Mr. Jim Craigen: Since the Secretary of State has told hon. Members the proportion of public expenditure that is going towards training, will he also tell us the proportion of public expenditure that is going towards sustaining unemployment?
As one who listens to young people on youth opportunities programmes, I can say that there is a considerable degree of frustration among them. Has it really taken the Government almost a year to come up with a State indentured training scheme that appears to conscript young people off the dole queue and pay them less than the present inadequate YOP allowance? Does not the right hon. Gentleman fear that this will completely distort the traditional idea of training in this country?
Mr. Tebbit: It is not only because I am conscious of the need to improve training that I have brought forward this scheme. I am also conscious of the criticisms that have been made of the YOP schemes. Some are very good; some are less than good. In no case is the YOP programme fundamentally a training programme. It was never intended to be one. My scheme is intended to be a full one year's vocational training scheme. That is why the allowance is different. That is the whole argument for it.
The hon. Gentleman says that it has taken the Government almost a year to come up with the scheme. He should be a little more reasonable. It was in February that the MSC published its consultation document. It is only today that it is publishing its conclusions as a result of those consultations, and I am ready to meet what the MSC has asked for with this massive injection of Government funds.
Mr. Barry Jones: As for coercion or otherwise, will the right hon. Gentleman say whether there is to be a change in the law affecting eligibility for supplementary benefit for 16-year-olds? Is he able to say now, after talking at great length about the value of training, whether entrance to the young workers' scheme will affect eligibility for training?
Mr. Tebbit: Yes. There is to be a change in eligibility for supplementary benefit of 16-year-olds.
Mr. Christopher Price: Even if they are not at home?
Mr. Tebbit: If the hon. Gentleman will allow me to finish, I may be able to answer the question that he has not had the courtesy to ask except from a sedentary position.
The change rests on the assumption that youngsters of 16 years of age will be primarily dependent on their families while on a training scheme in the same way as if they were still at school. All the special groups retain their entitlement to supplementary benefit. In the event that the family itself is receiving supplementary benefit and therefore not in a position to sustain the youngster at home, the family's supplementary benefit will remain as it is at present and the youngster will receive the training allowance in addition. It is possible for an employer to take advantage of the young workers' scheme and to give training to the young man or woman he takes on to the pay roll. I hope that we shall be able to devise something more far-reaching than that alongside the scheme that I have outlined.
Mr. Nigel Spearing: On a point of order, Mr. Speaker. Hon. Members will recall that in answer to question 1, the Minister asked me to await the statement. The answer to my question was not contained in the statement. It is to be found only in paragraph 33 of the White Paper which was not published until 4 pm. I was therefore unable to ask a supplementary question of the Secretary of State, quite apart from the fact, Mr. Speaker, that other hon. Members were seeking to catch your eye. Is there anything that you can do to encourage Ministers to stop delaying the publication of documents in order effectively to dodge answering questions?
Mr. Speaker: I am sure that what the hon. Gentleman says will have been heard. I do not know the circumstances.
Mr. Faulds: On a point of order, Mr. Speaker. Is there some way in which the House can prevail upon the deeply-concealed decency of the Secretary of State to answer the question I put about the qualifications that would stem—
Mr. Speaker: Order. The House knows when its rules are being abused. They are being abused now.
Mr. Alexander W. Lyon: It is within the privilege of the Secretary of State to determine at what time he will issue papers such as White Papers. Many Departments make White Papers available in the Vote Office at 2.30 pm. The Secretary of State for Employment has failed to do that until 4 pm. Is there not a rule which the House can enforce to ensure that papers are available at 2.30 pm so that we can look at them before Question Time?
Mr. Speaker: I shall see whether there is anything I can do, but I doubt it as it is not my concern. It is the concern of the Minister.
Mr. Christopher Price rose—
Mr. Speaker: Order. I have said previously that I take a very poor view if hon. Members who have been rising repeatedly but have not been called then submit to me a series of points of order. However, I understand their frustration, and we shall try it.
Mr. Christopher Price: Further to that point of order, Mr. Speaker. Are you aware that since the proliferation of

165
parties in this House a wide range of Members have copies of statements in advance? It is enormously frustrating if Ministers insist on delaying putting papers into the Vote Office for half an hour so that they are not available until the end of the statement, especially if one is squashed next to someone on the Front Bench who has the statement. May we have a more even-handed approach to hon. Members?
Mr. Speaker: The hon. Member knows the custom as well as I do. It is a courtesy, which Governments have always extended to other parties, to provide copies of statements on certain occasions. That is a courtesy which has nothing to do with me. However, the hon. Gentleman's argument will have been heard.

House of Commons (Televising of Proceedings)
4.22 pm
Mr. Jack Ashley: I beg to move,
That leave be given to bring in a Bill to provide for the televising of the proceedings of the House of Commons.
The case for televising the House of Commons is more compelling now than it has ever been because we are becoming remote from the people. We are losing touch with them and we no longer affect, impress and influence their opinions. That is a very damaging and dangerous state of affairs for any kind of democratic assembly. It is a trend on which we should take action because the House of Commons cannot stand idly by and see itself pushed aside, as is now happening. We are being alienated from the people.
This problem has arisen not because of any change by the House of Commons—we are probably no better and no worse than previous Parliaments—but by the rise of television, which has been stunning in its impact. Television enters people's homes; it wins their hearts and their minds. It is with them every day, and it has a tremendous influence on them. Its dominance is absolutely unassailable.
Most people get their news, and many get their views, from television. But this House is not part of that process and that is what is so damaging to us. People know very little about the constructive work of this House, of the Select Committees and of the Standing Committees. All that they get, apart from a few minor reports, are a few arguments on television between a few Members of Parliament, performers who are selected by the television producers. If people are asked what they think of politics, they never refer to the debates in the House but always to the professionals who appear on television.
In these circumstances it is incredible and remarkable that we are creating a barrier between ourselves and the people by rejecting television. Television today is the most important medium of communication, and we disregard it at our peril.
The refusal to televise our proceedings is based not on rationality but on fear. The fear is three-fold. First, it is a fear of the exhibitionists in the House who may play to the gallery. Secondly, it is a fear of those groups that would seek to further a cause, or to further—hon. Members may point to themselves—a constituency interest. Thirdly, there is a fear of the broadcasting organisations, because people feel that they may misuse extracts from our debates.
I believe that these three fears are groundless. In addition, they have been shown to be groundless elsewhere.
We have our share of exhibitionists, just like any other assembly, and they are entitled to be heard and to be seen if they have something to say. However, pure exhibitionism on the part of people who have nothing to say simply irritates the public, including the constituents of such people, so it can backfire on the exhibitionists. So that kind of criticism is quite misconceived. Televising the House would cool them rather than encourage them.
The same thing applies to the fear that some hon. Members may create wild scenes in the House for their cause or for their constituency. I recognise that this

167
behaviour can be a problem. But stunts are seen to be stunts. They are very quickly recognised by the public. People see through them. So they, too, will backfire on those who try them. They can become counter-productive. I do not believe that that is a valid criticism against televising our proceedings either.
As for the charge that the broadcasters would trivialise our proceedings, I believe that here the critics of my proposal twist the truth. The suggestion that the inclusion of entertainment in television programmes means the exclusion of responsible programmes is misguided and unfair to both the British Broadcasting Corporation and the Independent Broadcasting Authority companies. They are all capable of putting on serious programmes about political and economic issues, so it is wrong to suggest that they would necessarily misuse our proceedings.
A moment ago I said that it has been shown that these fears are groundless. I want to back up that comment, because precisely the same claims have been made in many other countries which have considered televising their Parliaments. The fact is that apart from the Republic of Ireland and ourselves, every country in the Western world now televises its parliamentary proceedings—the big countries such as France and West Germany, and the United States' House of Representatives, as well as small countries such as Luxembourg and Israel—and none of them has experienced the catastrophic or comical consequences about which we shall hear shortly. In none of these countries have the great comedians or the great tragedians managed to make any impact. I ask the opposers of the motion to bear that in mind.
I do not believe that we are incapable of doing what has been done in every other country in the Western world. I do not believe that we have more irresponsible exhibitionists or that we have procedures that are not as good as those in other countries. What they have done, we can do. We should take advantage of this great new medium.
I am not suggesting that the House of Commons is perfect, but it is important that the House should be seen as the major forum of debate in Britain. In order to be seen as such it must use the major medium of communication, which is television.
We would have the additional safeguard in the Bill of a parliamentary broadcasting unit which would be independent of the broadcasting organisations and would be responsible solely to a House of Commons broadcasting Select Committee. That unit would supply the material to the broadcasting organisations, but the methods and the procedure, under the Speaker, would be determined by that Select Committee and not by the broadcasting authorities.
I hope that the House will accept the televising of its proceedings, because I believe that the drift from Parliament is damaging to us. We should try to restore faith in the House of Commons. We must recognise reality and stop the drift.
4.32 pm
Mr. Joseph Ashton: I oppose the motion on the grounds that Parliament is about words, not moving pictures. If the Chamber were being televised now and someone switched on at home he would think: "There are only 70 or 80 members; so where are the rest?" Many hon.
168
Members who were here half an hour ago have had to leave because they have received a green card, such as I have been sent, from a lobby by a trade union, because there are committees taking place or because they have important business. They may be in their constituencies or attending a by-election which, if one has to stand on cold doorsteps, is much worse than being here.
However, viewers do not know that. They believe that this is the be all and end all of Parliament, and it is difficult to get it across to them that a large amount of work goes on outside the Chamber. My right hon. Friend the Member for Stoke-on-Trent, South (Mr. Ashley) mentioned showing off. About six weeks ago we had cameras here to record the State opening of Parliament. The leader of the SDP, the right hon. Member for Plymouth, Devonport (Dr. Owen) damned near broke his neck while pushing people out of the way to get to the front of the procession with the other party leaders. I read the newspapers the next day and saw the television news. The television news was not about the Queen's Speech in Parliament. It was about Lady Diana's tiara and how lovely she looked. The cameras were on her.
I have been a Member of Parliament for 13 years and I have been mentioned many times in The Daily Telegraph, usually not flatteringly. The day after the State opening of Parliament my picture was in The Daily Telegraph because I was sitting here with my feet up on the Bench. They were allowed to take a photograph. The caption of the photograph was that the hon. Member for Bassetlaw was awaiting the Queen's Speech. That is the sort of thing that we should have to face.
If, during the State opening of Parliament, the Leader of the Opposition had worn his donkey jacket that would have taken the cameras away from everyone and everything in the Queen's Speech. Television companies are concerned with pictures, not the content of speeches. The hon. Member for Antrim, North (Rev. Ian Paisley) demonstrated from the Side Gallery when you, Mr. Speaker, had to send for him and eventually ejected him from the Chamber. There would be much more of that if we had television cameras here, because people would try to make cheap political points. Television is naturally interested in combat, fighting and the controversies that we see on "Match of the Day", where a player is sent off or has a row with the referee, rather than in the humdrum. Television is not interested in the boring pros and cons of the Common Market, industrial relations legislation or sensible and responsible debates, such as the one we had a few moments ago. It is interested in the "Candid Camera" aspect.
My right hon. Friend talked about a broadcasting commission. To believe that any television producer would have a camera trained only on the Speaker is nonsense. There is not a producer in the business who would have dared not to show the sort of incident when Bernadette Devlin seized the then Home Secretary, Reginald Maudling, by the hair. He would get the sack if he did not show it.
If we let cameras into the House it would turn into the equivalent of the party conferences. Anyone who has seen party political conferences will know that the speeches do not matter. The "Candid Camera" aspect matters. When the right hon. Member for Sidcup (Mr. Heath) was verbally garotting the Prime Minister at the Conservative Party conference, the cameras were not on him but on the Prime Minister to see what her reactions were. It would

169
be the same here. If my right hon. Friend the Member for Bristol, South-East (Mr. Benn) was sitting here and my right hon. Friend the Leader of the Opposition was making a speech, the television cameras would be on the former. Any producer or editor who did not do that would be sacked immediately. Another example was the occasion when the present Secretary of State—then the Opposition spokesman—for the Environment swung the Mace around his head. That would be the sort of "Match of the Day" close up or slow motion cutting and editing that we should see. No television producer could resist it.
Many of my friends in the Press Gallery seem to be in favour of cameras being introduced into the Chamber. They had better beware, because with electronic newsgathering techniques and breakfast time television, the previous night's happenings in the Chamber will be on television the next day. Political reporting in newspapers will be dead, because no one would wish to pick up his morning newspaper and read about the previous day's Prime Minister's Question Time.
Already journalists must indulge in gossip. Stories about what has happened in the Tribune Group and leaks from 10 Downing Street are the sort of matters now being concentrated upon. If we have cameras in the Chamber it will be much more difficult to get across the serious issues.
Another major reason why I am against the proposal is that two Members of Parliament have been killed in the past two years. Two bombs have gone off here. IRA funerals and the blowing up of static motor cars by the IRA are deliberately staged for television. Television companies are tipped off when something will happen. President Kennedy was assasinated on television, as was President Sadat. When President Reagan was shot a photographer was handy. When the Queen had blanks fired at her at the Trooping of the Colour, it was seen on television. If the House of Commons is televised, sooner or later some martyr will undoubtedly take a pot shot from the Gallery at the Dispatch Box.
Those are a few reasons why we should beware. Despite what my right hon. Friend said, I am convinced that the best method of cross-examing Ministers is not necessarily in the Chamber. Often the three-minute interview on television by Sir Robin Day, where a Minister cannot wriggle and dodge the question because he is then asked supplementary questions until he provides an answer, is the best method of public accountability. That is the better way in which the public can realise what the Minister is trying to do than questioning in the House, which is often a charade. We are highly seasoned professionals and often we know what the questions and answers will be.
If all the Back Benchers try to ask questions during the 15 minutes of Prime Minister's Question Time one can understand why tempers become frayed and people shout out. Often the merry quip gets into the Michael White or Andrew Alexander columns.
The cameras would look for the sort of conduct referred to a few moments ago by my right hon. Friend the Member for Chesterfield (Mr. Varley) in describing the behaviour of the Secretary of State for Employment when he was on the Back Benches a few years ago.
Back Benchers should not fool themselves that television will help them. If the House is televised there will be three or four statements a day on every Government policy, because that is what the Front Benchers want. There will be less time for the Back Benchers and a better
170
platform for Government and Opposition Front Benches. We on the Back Benches will suffer, as will the responsibility and integrity of the House.
Mr. Tristan Garel-Jones: On a point of order, Mr. Speaker. At the risk of drawing undue media attention to the hon. Member for Newcastle upon Tyne, East (Mr. Thomas), he is out of order in bringing a package on to the Floor of the House.
Mr. Speaker: I did not see a package.
Mr. Mike Thomas: Further to that point of order, Mr. Speaker. I have inadvertently brought a package on to the Floor of the House, for which I apologise. I had intended to remove it during the course of the Division so as to cause no offence and no interruption to the hon. Gentleman.
Mr. Speaker: Order. Perhaps the hon. Gentleman will put us all at ease by taking the package out now.
Question put, pursuant to Standing Order No. 13 (Motions for leave to bring in Bills and nominations of Select Committees at Commencement of Public Business):—
The House divided: Ayes 158, Noes 176.

Division No. 25]

[4.39 pm

AYES

Alexander,Richard

Farr,John

Allaun,Frank

Fletcher, Ted(Darlington)

Amery, Rt Hon Julian

Fookes, Miss Janet

Ashley, Rt Hon Jack

Foot, Rt Hon Michael

Atkinson,David(B'm'th,E)

Foster, Derek

Atkinson,N.(H'gey,)

Foulkes,George

Baker, Kenneth(St.M'bone)

Fowler, Rt Hon Norman

Barnett,Guy(Greenwich)

Fraser, J. (Lamb'th, N'w'd)

Barnett, Rt Hon Joel (H'wd)

Fraser, Peter (South Angus)

Beith, A. J.

Garel-Jones,Tristan

Bennett,Andrew(St'kp'tN)

Golding,John

Benyon,Thomas(A'don)

Grant, John (Islington C)

Bidwell,Sydney

Hamilton, W. W. (C'tral Fife)

Booth, Rt Hon Albert

Haselhurst,Alan

Boothroyd,MissBetty

Hattersley, Rt Hon Roy

Bottomley, RtHonA. (M'b'ro)

Hayhoe, Barney

Bottomley, Peter (W'wich W)

Healey, Rt Hon Denis

Bray, Dr Jeremy

Heffer, Eric S.

Brocklebank-Fowler,C.

Henderson, Barry

Brooke, Hon Peter

Hogg, N. (EDunb't'nshire)

Brown, Hugh D. (Provan)

HomeRobertson,John

Brown, Ron (E'burgh, Leith)

Homewood,William

Buchan,Norman

Hooley, Frank

Butcher,John

Howells,Geraint

Canavan,Dennis

Hoyle,Douglas

Carlisle, Rt Hon M. (R'c'n)

Huckfield,Les

Carmichael,Neil

Hughes, Robert (Aberdeen N)

Chalker, Mrs. Lynda

Hunt, David (Wirral)

Chapman,Sydney

JohnsonSmith,Geoffrey

Concannon, Rt Hon J. D.

Kaufman, Rt Hon Gerald

Cope,John

Lambie,David

Crouch, David

Lester,Jim (Beeston)

Cryer, Bob

Lestor, MissJoan

Cunningham, DrJ.(W'h'n)

Lewis, Kenneth (Rutland)

Davis, Clinton (Hackney C)

Litherland,Robert

Davis, T. (B'ham, Stechf'd)

Lloyd, Ian (Havant & W'loo)

Deakins, Eric

Lyons, Edward (Bradf 'dW)

Dempsey, James

Mabon, Rt Hon DrJ. Dickson

Douglas-Hamilton,LordJ.

McKay,Allen (Penistone)

Dover,Denshore

Macmillan, Rt Hon M.

Dubs,Alfred

McNally,Thomas

Dykes, Hugh

McNamara,Kevin

Eadie, Alex

McQuarrie,Albert

Eastham, Ken

McWilliam,John

Edwards, R. (W'hampt'n S E)

Marshall,D(G'gowS'ton)

Ellis, Tom (Wrexham)

Marshall, DrEdmund (Goole)

English, Michael

Marshall,Michael (Arundel)

Ennals, Rt Hon David

Martin,M(G'gowS'burn)

Evans, Ioan (Aberdare)

Mawhinney,DrBrian

171

Maxton,John

St. John-Stevas, Rt Hon N.

Maynard, MissJoan

Sheldon, Rt Hon R.

Meacher, Michael

Sims, Roger

Mellish, Rt Hon Robert

Skinner,Dennis

Mikardo,Ian

Soley, Clive

Miller,Hal(B'grove)

Speller,Tony

Morris,M.(N'hampton S)

Squire,Robin

Needham, Richard

Steel, Rt Hon David

Newton,Tony

Stewart,A.(ERenfrewshire)

O'Halloran,Michael

Stott,Roger

O'Neill,Martin

Strang,Gavin

Paisley,Rev Ian

Taylor,Teddy (S'end E)

Palmer,Arthur

Temple-Morris,Peter

Park,George

Thomas,Dafydd(Merioneth)

Parker,John

Thomas,Mike(Newcastle E)

Patten,Christopher(Bath)

Thorne,Stan(Preston South)

Penhaligon,David

Tilley,John

Powell,Raymond(Ogmore)

Torney,Tom

Prescott,John

Varley,Rt Hon Eric G.

Race, Reg

Wainwright,R.(Colne V)

Radice,Giles

Ward,John

Rathbone, Tim

Watkins, David

Rees-Davies, W. R.

Watson,John

RhysWilliams,SirBrandon

White, Frank R.

Richardson,Jo

Wigley,Dafydd

Rifkind,Malcolm

Wilson,Gordon(Dundee E)

Roberts,Allan(Bootle)

Wilson,William(C'try SE)

Rodgers, Rt HonWilliam

Rooker,J. W.

Tellers for the Ayes:

Ross,Ernest(Dundee West)

Mr. Austin Mitchell and

Rost,Peter

Mr. Jonathan Aitken.

NOES

Abse, Leo

Adley,Robert

Coleman,Donald

Alton,David

Cormack,Patrick

Archer, Rt Hon Peter

Costain,SirAlbert

Ashton,Joe

Cowans,Harry

Atkins,Robert(PrestonN)

Craigen,J.M.(G'gow,M'hill)

Banks,Robert

Crawshaw,Richard

Beaumont-Dark,Anthony

Cunliffe,Lawrence

Bendall,Vivian

Dean, Joseph(Leeds West)

Bennett,SirFrederic(T'bay)

Dixon,Donald

Berry,HonAnthony

Dormand,Jack

Biggs-Davison,SirJohn

Duffy, A. E. P.

Blackburn,John

Dunn, James A.

Body,Richard

Dunn,Robert(Dartford)

Boscawen,HonRobert

Durant,Tony

Bowden,Andrew

Elliott,SirWilliam

Briton,Tim

Emery,Peter

Brittan,Rt. Hon. Leon

Evans,John(Newton)

Brotherton,Michael

Fairgrieve,SirRussell

Brown, R. C. (N'castle W)

Faulds,Andrew

Budgen,Nick

Fell,Anthony

Bulmer,Esmond

Ford,Ben

Burden,SirFrederick

Fox,Marcus

Cadbury,Jocelyn

Freeson,Rt Hon Reginald

Campbell-Savours,Dale

Garrett,John (Norwich S)

Carlisle, John (Luton West)

Glyn,Dr Alan

Channon,Rt. Hon. Paul

Goodhew, Victor

Clark,Dr David (S Shields)

Goodlad,Alastair

Clark,Sir W. (Croydon S)

Gow, Ian

Cockeram,Eric

Gower,SirRaymond

Cocks,Rt Hon M.(B'stol S)

Grant,Anthony(Harrow C)

172

Grant,Geroge(Morpeth)

Neubert,Michael

Greenway,Harry

Newens, Stanley

Grist, Ian

Ogden,Eric

Grylls,Michael

Onslow,Cranley

Gummer,JohnSelwyn

Orme, Rt Hon Stanley

Hamilton, HonA.

Osborn,John

Hamilton,James(Bothwell)

Page, John (Harrow, West)

Hamilton,Michael(Salisbury)

Parris,Matthew

Harrison, Rt Hon Walter

Pavitt,Laurie

Havers, Rt Hon Sir Michael

Pawsey, James

Hawksley,Warren

Percival, Sir Ian

Haynes, Frank

Pitt, WilliamHenry

Holland,Philip(Carlton)

Porter,Barry

Hughes,Mark(Durham)

Powell, Rt Hon J.E. (S Down)

Hughes,Roy(Newport)

Prentice, Rt Hon Reg

Hunt,John(Ravensbourne)

Price, C. (Lewisham W)

Irving, Charles(Cheltenham)

Price,SirDavid (Eastleigh)

Janner,HonGreville

Pym, Rt Hon Francis

Jessel, Toby

Roberts,Albert(Normanton)

John,Brynmor

Roberts,Gwilym(Cannock)

Johnson,James(Hull West)

Roberts, M. (Cardiff NW)

Jones,Barry (East Flint)

Ross, Wm.(Londonderry)

Jopling, RtHonMichael

Sever, John

Kaberry,SirDonald

Shaw,Michael(Scarborough)

Kilfedder,James A.

Silverman,Julius

Kitson,Sir Timothy

Silverman,Julius

Knight,MrsJill

Skeet, T. H. H.

Lamborn,Harry

Smith,Dudley

Lamond,James

Spearing,Nigel

Lang,Ian

Spence,John

Langford-Holt,SirJohn

Stanbrook,Ivor

Lawrence,Ivan

Stanley,John

Lennox-Boyd, HonMark

Stevens,Martin

Lloyd,Peter (Fareham)

Stewart, Rt Hon D. (W Isles)

Lofthouse,Geoffrey

Stewart,Ian (Hitchin)

Lyon,Alexander (York)

Stoddart,David

McElhone,Frank

Stokes,John

Macfarlane,Neil

Stradling Thomas,J.

MacKay,John (Argyll)

Summerskill,Hon Dr Shirley

McNair-Wilson,M. (N'bury)

Thompson,Donald

Marlow,Antony

Thorne,Neil(IlfordSouth)

Marshall, Jim (LeicesterS)

Tinn,James

Marten, Rt Hon Neil

Townend, John(Bridlington)

Mason, Rt Hon Roy

van Straubenzee, Sir W.

Mather,Carol

Viggers,Peter

Maude, Rt Hon Sir Angus

Waddington,David

Mawby, Ray

Wainwright, E.(DearneV)

Maxwell-Hyslop, Robin

Walker-Smith, Rt Hon Sir D.

Miller, Dr M.S. (E Kilbride)

Waller, Gary

Mitchell, R.C. (Soton Itchen)

Wells,Bowen

Moate,Roger

Wheeler,John

Molyneaux,James

Williams,D. (Montgomery)

Monro, SirHector

Winterton, Niocholas

Montgomery,Fergus

Woodall,Alec

Moore,John

Younger, Rt Hon George

Morgan,Geraint

Morris, Rt Hon C. (O'shaw)

Tellers for the Noes:

Morris, Rt HonJ. (Aberavon)

Sir Ronald Bell and

Mudd,David

Mr. Christopher Murphy.

Myles David

Question accordingly negatived.

Orders of the Day

  Social Security (Contributions) Bill
  Order for Second Reading read.
  Mr. Speaker: I have selected the amendment in the name of the Leader of the Opposition.
  4.50 pm
  The Secretary of State for Social Services (Mr. Norman Fowler): I beg to move, That the Bill be now read a Second time.
  In his statement on 2 December my right hon. and learned Friend the Chancellor of the Exchequer announced that the Government proposed to raise employees' national insurance contributions by 1 per cent. from April 1982, and at the same time to reduce the Treasury supplement to the national insurance fund by 1·5 per cent. to 13 per cent. He also announced that the lower and upper earnings limits for contribution liability would be raised.
  On the same day as my right hon. and learned Friend made his statement, I placed in the Vote Office and in the Official Report a statement setting out in detail the changes in contribution rates and earnings limits proposed for 1982–83 and a breakdown of total payments for that year compared with the current one. I have also laid before the House the report of the Government Actuary containing the assumptions on which the Government's proposals are based. The Bill gives effect to those proposals.
  The Bill contains a number of changes which could have been made by statutory instrument. These include the changes in earnings and profits limits for contribution liability, the small earnings exception and the contribution rate for classes 2, 3 and 4. The reduction in the Treasury supplement could also be made by order. But because primary legislation was required for two of the most important changes—the total increase in the class 1 employee's contribution and the introduction of an employment protection allocation into it—it seemed right to include all the changes proposed for 1982–83 in a single piece of legislation.
  The House will know also that the legislation must receive Royal Assent by the end of January for the good reason that we need to give employers sufficient notice of the contribution changes to enable them to implement them by next April. Clearly I am conscious of the time constraint that this places on the House and I would prefer a slower pace. It may be of some help that I have arranged that notes on clauses should be available now in the Vote Office. I know that this issue was raised in last year's debate.
  Perhaps I could start by setting out some of the main aims and themes of the Bill. First and foremost, it is a Bill to provide payment for the very large amount which the Government will be spending on social secruity benefits next year. All told next year we shall be spending almost £30 billion on social security benefits—an increase of £2½ billion. Of this, about £19 billion will come from the national insurance fund and the rest from general taxation.
  Of the estimated spending from the national insurance fund of about £19 billion, £13½ billion will be spent on the retirement pension—about £1½ billion more than this year. This will enable us to fulfil our pledge to pensioners that
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  their pensions will keep up with the cost of living. It recognises our obligation to the pensioners which The Times set out fairly in a recent editorial when it said:
  "The elderly contain the largest single area of poverty and sickness in Britain. They lack the strength and mobility to adjust to the inflationary gale."
  The second important theme is the increase in the National Health Service contribution of 0·1 per cent. That will enable us not only to maintain spending on the National Health Service but to increase it. It cannot be emphasised too often that the Government, far from cutting back spending on health, have increased it by 5 per cent. in real terms since 1979. One result is that we now employ many more doctors and nurses. I believe that this extra provision is right. I also believe that it is entirely reasonable to ask for an extra contribution which will raise £100 million from those in work which will be earmarked specially for the National Health Service. I should emphasise that, of the £12 billion that we shall now be spending on the National Health Service, no less that 85 per cent. comes from general taxation. By contrast, under 12 per cent. comes from the National Health Service contribution, which compares with 17 per cent. in the early 1960s.
  Mr. Mike Thomas: Will the right hon. Gentleman tell the House what proportion of the increased employment of nurses is a real increase in nursing manpower and what proportion is merely a response to the reduction in working hours to 37½ hours a week?
  Mr. Fowler: I can give the hon. Gentleman the broad figure from memory. There are now 21,000 extra qualified nurses and midwives working in the National Health Service. Clearly that is partly due to the latter reason, which the hon. Gentleman put, and surely it is to be welcomed. It cannot be denied that 21,000 extra nurses and midwives now work in the National Health Service. My point about the 0·1 per cent. increase in the National Health Service contribution is that in this way we can not only maintain spending on the National Health Service but increase it.
  The third theme concerns a change in the arrangements for financing the redundancy fund, from which payments are made to employers to help finance their redundancy payments. Inevitably, the increase in redundancies over recent years has meant correspondingly heavier calls on the redundancy fund.
  The House agreed last month to increase the statutory borrowing limit of the redundancy fund to £300 million. But, even though there are indications that the peak for redundancies has passed, it is clear that extra finance for the redundancy fund will be needed to keep within the borrowing limit. The case for an increase in the employment protection allocation, as the financial base on which the redundancy fund stands, is therefore not really in dispute.
  Mr. Andrew F. Bennett: Will the right hon. Gentleman give the House his estimate of the number of people who will be made redundant during the next two years?
  Mr. Fowler: I shall ask my right hon. and learned Friend the Chief Secretary whether he can provide more accurate information, but we would expect a progressive

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  reduction in the number of redundancies over the next 12 months. If I can provide more information during the debate I shall do so.
  The crucial point is that in the past there has been an employment protection allocation—which, as the hon. Gentleman knows, includes a payment to the maternity pay fund—only in the employer's share of the contribution. At present it stands at 0·2 per cent. But we have decided that the time has come to share the burden of financing the redundancy fund between employers and employees. It seems to me that to ask employees to contribute to the cost of redundancy payments is a perfectly logical extension of the principle of social insurance. It is asking those in work to make a contribution towards redundancy payments to people who lose their jobs. The alternative of refunding less to employers would have an immediate adverse effect on the cash flow of firms, which could only risk further redundancies.
  Mr. Brynmor John: An obvious alternative would seem to be to maintain the Treasury contribution rather than dropping it by 1·5 per cent.
  Mr. Fowler: The hon. Gentleman anticipates a part of my speech to which I shall come shortly. He is certainly entitled to argue that point, but I hope that he will also tell us what policy he intends to put in place of this.
  The Bill proposes that employees should pay 0·35 per cent. of their liable earnings to the employment protection allocation. Employers will continue to put in 0·2 per cent. But I stress—and it is important that the Opposition take this on board—that the employer will still meet the lion's share of redundancy payments. At present all the costs of redundancies are met by employers. They can recover only 41 per cent. from the redundancy fund, but as the fund is at present constituted employers collectively are the sole contributors.
  Our proposal will save employers only the new burden of finding the extra finance for the redundancy fund. They will still bear the brunt of redundancy payments. Even with employees contributing, employers will meet three-quarters of the cost of statutory redundancy payments. In addition to all this, of course, many employers pay amounts well in excess of the statutory requirement. So I do not think tht we could be accused of imposing unfairly on employees by asking them to put in 0·35 per cent. of their liable earnings and to share with their employers the cost of financing the redundancy fund. Their contribution will bring in £353 million in 1982–83, and this figure can be found in appendix 2 of the Government Actuary's report. This extra income should be sufficient to keep the borrowing of the redundancy fund within the £300 million limit agreed by the House for the year.
  The fourth theme, on which the hon. Member for Pontypridd (Mr. John) has touched, is the reduction in the Treasury supplement—in other words, the amount of money being paid from the Consolidated Fund to supplement the national insurance fund. There are no hard and fast rules about the amount of that supplement. Here we are recognising the position where the taxpayer's share of the cost of benefits has increased. This is because expenditure over the years on the non-contributory benefits—the social security benefits outside the national insurance scheme—has grown substantially and that expenditure is met entirely out of taxation.
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  Therefore the question that the Government have had to ask is not the simple one of how much the Consolidated Fund should boost the national insurance fund, but the wider one of how much benefit expenditure it is reasonable to expect the general taxpayer to finance. Over the years, the proportion of benefit expenditure met from general taxation has tended to rise. It was about 37 per cent. in 1975–76. It is 45 per cent. in the current year and, even with the 1·5 per cent. cut in the Treasury supplement, it will still be about 45 per cent. in 1982–83
  Mr. David Ennals: Does the Minister agree that throughout almost the whole period since national insurance was introduced the figure has been about 18 per cent.? He is, of course, right to say that there is no statutory requirement. Nevertheless, it has been about 18 per cent. throughout the whole period. Why does he say that it is more unfair to put the burden on the taxpayer than to put it on a limited number of workers?
  Mr. Fowler: The case that I was making—and I note from the Official Report of last year's debate that the right hon. Gentleman made precisely the same point to my predecessor—is that we must consider two aspects. The first is the Treasury supplement. The second is the amount that the taxpayer pays for benefits in general. It seems to me reasonable that the Government should take that wider aspect into account when reaching their decision. We may debate these matters, but as we estimate that the amount of benefit expenditure met from general taxation in 1982–83 will still be about 45 per cent.—an increase from 37 per cent. in 1975–76, just before the right hon. Gentleman became Secretary of State—I believe that that is a fair balance.
  I claim that in reducing the supplement we are not so much altering the balance of burden between the general taxpayer and people in work as redressing that burden. The reduction in the Treasury supplement will save £260 million.
  The fifth theme is that we have sought as far as possible to protect the employer and the self-employed, on the ground that, although we are talking here of benefits, the major economic, industrial and social aim must be to secure a recovery of industry and a reduction of unemployment. That is the Government's aim, and surely the House will agree that that must be the priority of all policy at the present time. It is for that reason that in the Bill we have protected the employer from the increase in national insurance contributions—although not, of course, from the increase in the upper earnings limit. Similarly, as the Government Actuary's report sets out, we have modified the effect on the self-employed—again reflecting the Government's recognition of the role played by the self-employed, especially small businesses, in economic recovery and the creation of jobs.
  Those are themes which occur in this Bill and which the House should remember in considering the detail of it.
  Turning to the detail, clause 1(1) raises the lower and upper earnings limits for class 1 contribution liability from £27 and £200 a week to £29·50 and £220 a week respectively. As I mentioned earlier, this is one part of the Bill that forms part of the routine annual exercise for reviewing national insurance contributions and which would ordinarily be done by order. The lower earnings limit is linked by the Social Security Pensions Act 1975

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  to the basic rate of retirement pension. The upper earnings limit must be between 6½ and 7½ times that rate. The upper limit proposed in the Bill' is 7·43 times the basic rate.
  Clause 1(2) raises the employee's contribution from 7·75 per cent. of liable earnings to 8·75 per cent. I shall give a breakdown of that figure. It consists of the additional National Health Service allocation of 0·1 per cent. and the additional employment protection allocation of 0·35 per cent. A further 0·25 per cent. is to compensate for the reduction in the Treasury supplement and 0·3 per cent. is to keep the national insurance fund broadly in balance. The 1 per cent. increase applies equally to contracted-out employees as to others.
  In proposing these changes, the Government have been at pains to keep additional burdens on employers to a minimum. Employers will, however, pay more as a result of the increase in the upper earnings limit, but the only way this could be avoided would be by not raising the upper earnings limit at all. The effect of holding the upper limit down would be to increase the contribution made by lower-paid workers. The low paid rightly expect that the earnings limits should rise with inflation so that those at the upper end of the earnings scale meet their fair share of costs. So by avoiding any increase in the employers' contribution rate we have gone as far as we reasonably might and can to protect employers.
  Consequently, of the estimated £652 million increase in employers' contribution in 1982–83, only £140 million arises through the Bill as a result of the changes to the earnings limits. The remaining £512 million has nothing to do with the Bill and would have happened anyway without any changes in it. It is simply the result of contributions increasing as earnings increase. In other words, it is the natural result of having an earnings-related contributions scheme.
  Clause 1(3) raises the contribution payable by married women and widows with the right to pay the lower rate from 2·75 per cent. to 3·2 per cent. In 1977—the last year in which women could decide if they wanted to keep their right to pay lower contributions—opted-out women had to choose between a rate of 2 per cent. compared with a full rate of 6·5 per cent., so in 1982–83, we will have preserved the advantage that opted-out women were promised in 1977.
  The increase in rates for opted-out women will also include the increased National Health Service allocation and the employment protection allocation. That is fair, as they benefit from both the National Health Service and redundancy payments.
  Contribution rates for self-employed people are dealt with in subsections (4) and (7) of clause 1. Perhaps I could make this initial point about the self-employed. The House will know that we launched a review of the self-employed and national insurance in October last year, with the publication of a discussion document. My hon. Friend the Minister of State has been involved in these discussions. The Bill's provisions in no way pre-empt or imply the outcome of that review. Decisions on that are still to be taken.
  On the provisions in the Bill, just as I have been concerned to spare employers the main impact of changes in contribution arrangements for 1982–83, I have also sought to give some protection to small businesses. For lower earners among the self-employed the Government Actuary's report has made it clear that application of the formula for calculating the class 2 contribution, which has
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  been used since 1978, would have led to a rate of about £4. In fact, we propose a rate of £3·75 a week as set out in clause 1(4).
  For the higher earners among the self-employed, the level of profits at which class 4 contributions will become payable will be raised in line with inflation. I propose in the Bill to raise the class 4 contribution rate by 0·25 per cent. only, less than the 0·35 per cent. that the Government Actuary has concluded would be warranted by the application of the usual formula. Again, I do this to offer a small extra protection to the self-employed. The most that a self-employed person would have to pay extra would be £1·49 a week, which is for someone at the upper profits limit.
  Clause 2 provides for the Treasury supplement to be reduced from 14·5 per cent. to 13 per cent. I have already set out the general background to this change. The reduction in the percentage of the Treasury supplement will not appreciably reduce the amount of 'Treasury supplement going into the national insurance fund. This is estimated by the Government Actuary as £2,591 million for 1982–83—only £9 million less than in 1981–82.
  Clause 3 is in two main parts. The first will increase the National Health Service allocation in the primary class 1 contribution and in the class 4 contribution by 0·1 per cent. As I have said, we shall be increasing our expenditure on the National Health Service substantially in the corning year. The figures are worth repeating. Expenditure on the National Health Service in 1982–83 will be just over £12 billion, compared with just under £11 billion in 1981–82. In other words we are planning for an increase of just over £1 billion to be spent on health. A contribution of £104 million towards that growth will be provided by what amounts to an extra 15p a week for a man on average earnings. I hope that will be accepted as a reasonable contribution to the continued growth of the National Health Service.
  The second main part of clause 3 will, as I have already indicated, introduce an employment protection allocation for the redundancy fund from the employee's contribution.
  Those are some of the Bill's main objectives and detailed provisions. I want to say a word about the Opposition amendment, which seeks to criticise the Government on three counts—the level of benefits being paid, the contribution by the employed population, and the reduction in the Treasury supplement. I have already dealt with the second and third points.
  As to the level of benefits, I remind the House of the Government's commitment to price-protect the retirement pension and related benefits, which accounts for about 60 per cent. of all social security expenditure. This we have done.
  Mr. Andrew F. Bennett: The right hon. Gentleman has referred to 60 per cent., but that is no consolation to the other 40 per cent. Last week we pressed his colleagues for a statement on short-term benefits. There have been many rumours. Will he now confirm that he will not let the cut in short-term benefits made for this 12 months continue in the future?
  Mr. Fowler: The hon. Gentleman raises the very point to which I was about to refer, but before doing so I should like to make an additional point. Not only have we price-protected the retirement pension, but other benefits such as FIS and mobility allowance have enjoyed increases

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  considerably better than the rise in prices. We have promised to make good the shortfall for pensions because of our absolute commitment to ensure that they are fully price-protected in the lifetime of this Parliament.
  At the next uprating we intend to increase all benefits by what we estimate to be the increase in the RPI by November 1982.
  Mr. Mike Thomas rose—
  Mr. Fowler: I cannot give way again.
  The final figure will not be determined until the spring of next year, but the present estimate is 10 per cent.
  Mr. Thomas: Will the right hon. Gentleman give way?
  Mr. Fowler: I am sorry; I have given way many times and I cannot do so again.
  I now come to the point raised by the hon. Member for Stockport, North (Mr. Bennett). As to the shortfall for other benefits, my right hon. and learned Friend the Chancellor of the Exchequer made it clear in last week's debate that final decisions will be taken on all these matters next spring. We shall, of course, listen carefully to the views of hon. Members, but at this stage I can go no further than what my right hon. and learned Friend has already said.
  The changes for which the Bill provides are required to maintain the basic shape and funding of the national insurance scheme. It is an essential feature of that scheme that it is funded on a pay-as-you-go basis—that income should match spending. The Bill maintains the principles of social insurance—that people who are in work today fund the benefits for those who need them today in the expectation that they will be similarly provided for when they need them. It also helps to ensure that the PSBR is kept within reasonable bounds while ensuring that the national insurance fund remains in balance.
  These are the responsibilities of the Government, and I ask the House to support the Bill as the sensible minimum that a responsible Government could put forward.
  5.20 pm
  Mr. Brynmor John: I beg to move, to leave out from "That" to the end of the Question and to add instead thereof:
  this House declines to give a Second Reading to a Bill which increases the burdens upon employed persons and decreases the Treasury contribution to the National Insurance Fund at a time when the real value of many benefits is being cut.
  Our amendment encapsulates what we feel is wrong with the Bill which, despite the way it was caressed clause by clause and subsection by subsection by the Secretary of State, is a miserable, squalid Bill, and the product of gross financial and economic incompetence under its presiding genius the Chancellor of the Exchequer. The Chancellor's statement combined a leaden stubbornness wih complete insensitivity towards those who have been the most unfortunate casualties of his catastrophic period in charge of the British economy.
  As the Secretary of State said, there are three major provisions in the Bill, which we believe to be its major defects, as well as a general scene that is debasing the whole Welfare State concept. The first defect is the 1 per cent. increase in national insurance contributions for employed persons, raising them to 8¾ per cent. I remind
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  the House of the recent history of national insurance contributions. When the Government came to power, the contribution was 6½ per cent. of earnings. In April 1980 it rose by 0·25 per cent. In April 1981 it rose by a further 1 per cent. and that increase is to be followed next April by a further 1 per cent. increase. In other words, in three years the rate will have increased by over one-third, despite the fact that wage settlements will bring in more money.
  As the Chancellor of the Exchequer said—and as the Secretary of State repeated—he has not raised the effective rate for employers. But they will have to pay more in total because of the changes proposed in the Bill. He did not say that the national insurance surcharge will be abolished. To employed persons, the increase in national insurance contributions means added burdens. It is a form of taxation, not insurance. It is a particularly regressive form of taxation for two reasons. First, it does not have the allowances available to taxpayers, so it starts at a lower income level—£29·50 a week. Secondly, having crossed that low threshold into national insurance contributions, a person starts paying at the full rate of 8¾ per cent. immediately.
  The harshest effect of the measure will fall at the lowest end of the scale. The Financial Times stated on 3 December:
  "Those earning £3,000 a year were harshly treated last month."
  This month has seen a repeat dose. The real net spendable income of those people has declined by 3 per cent. since just before the last Budget. Those people earning average wages of £150 a week will have to pay £1·50 more, those earning £100 a week will have to pay £1 more until the ceiling is hit for those earning £220 a week and over. This is a tax, because the lower figure fails to take full account of inflation. It should be £30, not £29·50. The increase will particularly affect part-time workers. A person earning as little as £30 a week will have to pay £2·63 a week in national insurance contributions because of the Treasury fiddle in not adequately and fully updating the amount.
  I shall reiterate later my belief that those in employment would not mind paying an extra amount if they thought that thereby they were securing or paying for additional or improved benefits. The Secretary of State tried hard this afternoon, but out of the whole of the Chancellor's package, the only increase in real benefits to which he could point was the 0·1 per cent. being paid additionally to the National Health Service. We welcome that, but 0·9 per cent. of the 1 per cent. increase is for other purposes. About 0·3 per cent. is to balance the national insurance fund and 0·35 per cent. to keep the redundancy fund solvent.
  It is right to highlight this matter. For the first time since the 1975 Act, employees are being compelled to contribute to the fund that was set up to compensate them for loss of jobs. The Government, whose woeful economic miscalculations have irresponsibly shed jobs, are now coining a new slogan: "Pay now, be redundant later". The employee is now shouldering a large section of the burden for his own redundancy. When that 0·35 per cent. is added to the 0·3 per cent. it can be seen that two-thirds of the increase now being imposed on employed persons is to cover the worsening unemployment position. The right hon. Gentleman should reflect on the morality of expecting employees to bail out their man-made—or, rather, their "Howe-made"—disasters.

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  Our uncrushable Chancellor—not so much an iron Chancellor, as a rubber Chancellor—said on 2 December 1981:
  "It is, moreover, right that those in work should shoulder the additional costs".—[Official Report, 2 December 1981; Vol. 13, c. 239.]
  He repeated those words in last week's economic debate as if that were a self-evident truth. Is it? I remind the House of another way in which the Government have muddied the concept of the Welfare State and are again doing so with this Bill. It was envisaged by Beveridge that the responsibility for the scheme should be tripartite. Certainly, employers and employees should fund the scheme in the main, but it was never envisaged that employed persons should be responsible for all the extra burdens on the fund, particularly when the Government create those burdens. All society, not merely people in employment, must shoulder that burden. That means the taxpayer, too.
  The Bill continues the resolute march of the Government away from the Beveridge principle of funding the scheme. The Secretary of State said that the amount was never fixed. I remind him that in 1975, the amount of the Treasury contribution was written into statute at 18 per cent. It was as fixed as anything else that this legislature manages. In November 1980, it was reduced to 14½ per cent. and now, under clause 2, it is being reduced to 13 per cent. That is by far the lowest contribution that the Treasury has ever made to the national insurance fund. It is far lower than it was in the 1950s when receipts from national insurance contributions far outweighed the calls upon the fund. It is lower—by 3 per cent.—than the lowest previous figure that I can discover. In the last two years, 0·75 of 1 per cent. has been added to the employed person's national insurance contribution in order to gain a 5 per cent. saving for the Treasury.
  The Secretary of State had an answer for that. He said—there is truth in what he says—that some part of other taxation is devoted to non-contributory pensions. However, I challenge him on that point. Is the diminution from 18 per cent. to 13 per cent. in the last two years in the Treasury's contribution to the insurance fund solely equal to the amount of non-contributory pension provided from general taxation? I doubt it. As ever, the Treasury is, in a hidden and covert way, clawing back money to its maw in order to transfer the burden of financing the scheme from general taxation and the general taxpayer, to those who are worse off.
  Mr. Fowler: My right hon. and learned Friend the Chief Secretary will get some of the latest figures. However, in my speech I pointed out that over the years, the proportion of benefit expenditure met from general taxation had risen. As I pointed out to the right hon. Member for Norwich, North (Mr. Ennals), in 1975 the figure was 37 per cent. That figure is now 45 per cent. and was about 45 per cent. last year. Therefore, the trend is quite contrary to that suggested by the hon. Gentleman.
  Mr. John: The Secretary of State challenged me about an alternative strategy. On a muted scale, he returned to the old "TINA" theme—there is no alternative. However, if, only a year ago, it was right for the Treasury to contribute 14·5 per cent. to the national insurance fund, why should that not be maintained? That would avoid additional burdens being placed on the employed, who
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  face hard times because of the Government's mismanagement of the economy and their under-estimation of the rise in inflation.
  Mr. Ennals: Does not the Secretary of State's reply imply that if supplementary benefits increase—because more people are unemployed, or for any other reason—there may well be a further diminution of the amount paid by the Treasury to the national insurance fund, even below the figure included in the Bill?
  Mr. John: I agree with my right hon. Friend. The rise in the percentage figures is largely explicable for that reason. The Secretary of State's remarks prove that under this Government there has been a steady march away from the acceptance of the tripartite principle of funding the national insurance fund. Indeed, that is the second point on which we criticise the Government in our motion. The Treasury is opting out of its duty to help to keep the fund in being and solvent. That can only mean higher and higher contributions from those who are employed. The rationale of the Secretary of State's remarks is that those who are employed can look forward to another 1 per cent. in about a year's time. Steadily, they will have to finance themselves.
  The Secretary of State wants to advocate that people should pull themselves up by their bootstraps. According to the Secretary of State, those in employment should pay an increasing part of the burden in order to help relieve the misfortunes of those out of work. That is better than nothing at all, but it represents a regression from the philosophy that the Conservative Party put forward in the 1930s. Therefore the Bill's defects can be amply demonstrated.
  The Secretary of State was wise to maintain a low key when introducing the Bill. He and I know that the measure conceals an economic reality that he must have fought against, to the best of his ability, in Cabinet. However, he must have lost and the measure represents a defeat for him and for his Department. The motion states that the Bill has been introduced
  "at a time when the real value of many benefits is being cut".
  I said that employees would not react adversely if they believed that they were paying for improved services and benefits. However, people believe that they are now paying more and more for less and less. In the package of measures announced by the Chancellor of the Exchequer some benefits were not protected in full from the rise in inflation. That follows the Chancellor of the Exchequer's unhappy precedent of the previous year. If any Conservative Member is in any doubt about the Government's failure to maintain the real value of benefits during the past year or so, he should read early-day motion 127 which stands in my name and those of my right hon. and hon. Friends. It calls attention to the Social Security (No. 2) Act 1980 which, for many people, cut the real value of benefits. The 2 per cent. cut today does not stand in splendid isolation from the rest of the package. It has been made in addition to the earlier cuts.
  During last week's debate on the economy many Conservative Members directed their attention to the Government's iniquitous proposal to cut unemployment benefit. By any standard, that proposal is indefensible. Indeed, this morning's edition of The Times states that the plight of the unemployed is the worst that it has been in the past decade. Conservative Members made powerful

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  speeches on this subject. We are glad that they joined us and made such speeches, but they came a bit late in the day.
  Last year the real value of benefits, including unemployment and invalidity benefit, was cut by 5 per cent. No Conservative Members threatened rebellion then. Last year, a whole benefit—earnings-related benefit—was abolished, to take effect in January 1982. It will have taken effect before we return from the Christmas Recess. Again, not a worm turned then on the Government Benches. In the past year, Conservative Members have connived at an even greater cut in the real value of benefits than the cut that they cannot stomach now. However, the unemployed were just as deserving and the sick were just as blameless when more things were done as they are now.
  What a difference a year makes! This year, Conservative Members are far less confident, united and certain that the great economic design, embarked on with such confidence, will work. We hear murmurings of dissent from all parts. That is why there were many murmurings when, this year, the 2 per cent. was clawed back.
  I should make it clear that it is not only unemployment benefit that is suffering a shortfall of 2 per cent. compared with inflation. We debated this subject on 3 December. The Under-Secretary of State made it clear that other benefits would suffer a 2 per cent. cut. It may be interesting for hon. Members to hear about the type of benefit that will not be uprated in line with inflation. Long-term supplementary allowances will not be uprated in line with inflation. Thus those in dire need will be compensated differently according to whether they are of pensionable age. During the Adjournment debate the Under-Secretary of State held out the hope that that would be reconsidered. Has that reconsideration led to any change of heart? Sickness benefit will also be subject to a cut in real value of 2 per cent.
  There is also injury benefit, maternity benefit, child benefit and family income supplement. The Secretary of State has claimed the credit for the earlier increase in family income supplement in real terms. But he omitted to say, when he was dealing with the amendment, that the family income supplement now suffers by being compensated by 2 per cent. less than the expected rate of inflation for this year. Finally there is the mobility allowance, one of the jewels that he claimed, but which only compensates this year for 10 per cent. inflation instead of the full 12 per cent. of inflation.
  My hon. Friend the Member for Stockport, North (Mr. Bennett) reminded the Secretary of State of press reports that have come with a suspicious consistency. They claim that the Government Chief Whip has been trying to earn his salary by assuring the dissidents that the Government will not proceed with the clawing back of the 2 per cent. By convention, the Chief Whip is silent in the House, so we do not know how soothing his syrup can be. The Opposition want to be soothed and assured, and to have information as to whether the Goverment will proceed with the clawing back of the 2 per cent.
  The Secretary of State said that if we waited for the Budget all would be revealed. This merely makes the Opposition suspicious because that statement will add to the misconceptions that clearly exist in some parts of the press and on the Government Benches. The Government
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  rebels, or dissidents, clearly believe that they will have a legislative opportunity to register their protest against this cut. However, I have news for them—they will not. The Government's cut of 2 per cent. does not need primary legislation, and when the orders come before the House the effect of voting against the failure to uprate by the full amount of inflation will also mean voting against the uprating by 10 per cent. Therefore, it will be extremely difficult for the dissidents to fight in that way.
  In practice, the Government will allow no legislative opportunity for the rebels to register their dissent. Unless the Opposition can manufacture an opportunity, there will be no chance for the dissidents to show the passion that they showed in the economic debate last week by voting against the Government. We promise that when the Social Security and Housing Benefits Bill is debated on the Floor of the House on Report, and in the absence of a firm undertaking by the Government, either today, or before that stage is reached that they will fully uprate all the benefits that I have mentioned, we shall create such an opportunity for the dissidents. We shall then expect the fine words of the right hon. Members for Sidcup (Mr. Heath), Chesham and Amersham (Sir I. Gilmour) and Chelmsford (Mr. St. John-Stevas) to be turned into votes. We shall expect Tory agonising to turn into Tory activity, because otherwise they will once more confess themselves, however agony-ridden, to be the captives of the monetarist doctrine which besets this Government.
  The debate is not an arid swapping of statistics, nor is it an academic exchange of obscurities. It is a matter that vitally affects the living standards of many millions of people, many of whom are among the poorest sections of our community. The Chancellor of the Exchequer has increased the burden on employed persons and cut the benefits of those receiving them. He has betrayed those whose care he has held in trust. For these acts of political vandalism we ask the House to support the Opposition and to deny this squalid Bill a Second Reading.
  5.45 pm
  Sir Brandon Rhys Williams: I shall begin by congratulating the Member of Parliament in whose constituency lies my permanent address—the hon. Member for Pontypridd (Mr. John) — on his first major contribution on this fascinating subject. He has made a good start and, as I told him when I first congratulated him on his new responsibilities, this is a subject that grows in fascination, and those who really take an interest in it are never able to leave it. I look forward to listening to him on many occasions in the future. I believe that he will enlighten the House more and more as he goes deeper and deeper into the principles of our wretched national insurance system that is so desperately in need of reform.
  The Bill appears to be a modest measure of only five clauses and two schedules; but it is a Bill that affects tens of millions of people and aims to bring about transfers of hundreds of millions of pounds a year. Therefore, Parliament ought to ask the big questions affecting the policy of the Government on the Welfare State and I hope that the Department will reply to the big questions, if not tonight, then sooner rather than later.
  I have often asked the question, when dealing with the distribution of income—who is paying what, to whom and why? I have put that question so often in this House and outside that I begin to feel that one has to operate on the Jericho principle when dealing with questions of national

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  insurance—if one goes round and round the subject often enough the obstacles will all disappear; but I am sure that those besieging Jericho would have given up long before this if they had gone round and round the subject as often as I and other hon. Members.
  I should like to mention the general policy of the Treasury's accounting methods. Having had some opportunities of looking into the ways that other national Governments and international institutions handle their accounts, I feel all the more disposed to question the way that our own Treasury deals with our accounts. I should like to see a perfectly plain, straightforward and comprehensible statement of the current account of the nation; an entirely separate but also transparently clear statement of the capital account; and an absolutely clear statement of the transfer account.
  All too often, people slip into the way of saying that the Government spend a great deal of money on pensions or child benefit. But the Government do not spend any of that money—the pensioners spend their pensions and the child benefit is spent by the mothers. It is not the Government who have the responsibility for spending the money; they are simply responsible for organising the transfer of income between one set of citizens and another. It ought not to be regarded a part of Government expenditure when an increase in child benefit or pensions takes place. It is merely an extension of Government activity, which ought to be kept entirely separate from the current account and the capital account of the nation. The Government Actuary's analysis of the national insurance fund is an inextricable mixture of taxes, contributions, borrowing and the build-up and the rundown of funds without any apparent guiding principle. As each year goes by, the National Insurance system gets worse and more inscrutably dark, complex and unpopular.
  Next, I would like to look at the relationship of the Bill to the economic policy of the Government. Are we trying to reflate or deflate the economy through the withdrawal or release of purchasing power? The Bill has the aim of diminishing the purchasing power of workers, no doubt to enable the Government to increase the purchasing power of certain other categories in need.
  Should the national insurance budget balance? Should the whole budget of the economy balance at a time such as this? Should we be taking more money from the workers when the economy is so flat? In times when we were dominated by Keynesian thinking, it used to be thought that raising taxes—or reducing the spending power of the workers by some other means such as increasing their national insurance contributions—would tend to make unemployment worse. Now that we make a more sophisticated analysis, I am bound to say that I think that the Government are not wrong in the measure of increased contributions that they are introducing in the Bill, because in the context of their economic policy we ought to be tilting the balance of the economy away from current consumption and in favour of investment. But that is almost as far as I can go in favour of the Bill as it stands, because there is so much to be done and the Bill makes such a limited beginning.
  I agree that a rise in contributions or in taxes is right at this moment, and that it is right to avoid financing current spending by borrowing capital and crowding out investment, which can be shown to have happened last year—I hope for the last time.
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  What are the principles of the national insurance scheme, now that it has been changed so very much from what it was when Parliament set it up before the First World War? When it was first introduced, the Lloyd George concept was of a national scheme based on actuarial principles such as would be followed by any prudent company in the private sector. That was the aim, but even from the very start it was not achieved, because there had to be a Treasury contribution in order to make it sufficiently popular to be acceptable to the voters. Since that time we have drifted so far that I do not believe that there is anyone who can now expound the principles on which the national insurance scheme is being run.
  I will put a simple question. If contributions go up, do benefits also go up, or do they remain the same? Or is it even possible that contributions could go up at the same time as benefits actually fall? It would seem that in some respects the Government have it in mind that contributions should go up and benefits fall simultaneously, and that is bound to cause the House to ask questions. I cannot help feeling that the contributor to the national insurance system has now got into a squirrel cage—so that the faster he goes, the more he remains where he was. The higher his contributions, the more quickly he sinks to the bottom.
  What is the relationship between earnings-related contributions and flat rate benefit? I agreed at the time—and I am sure that it was right—that contributions had to be put on an earnings-related basis, because the farce of relying on flat rate, poll tax contributions to pay for the Welfare State was obviously unable to be sustained any longer. But once we have moved on to earrings-related contributions and flat rate benefits, what is the citizen's right? What can he claim from the insurance fund, and what does he have to give towards it out of his income?
  At this point, if I had time, I should have liked to dwell on the question whether the national insurance fund is a real fund or purely notional, and whether it would be more advisable to adopt the Continental principle of re-partition rather than continuing with the idea that somewhere in the national insurance fund there are real assets that have been built up through contributions and which are available to meet the national need.
  I want to return in a moment to the reality or otherwise of the national insurance fund, but clearly we must establish what is the basis of the entitlement to benefit that the contributor builds up in the course of his years of contributions.
  I have often tried to analyse the source of entitlement to benefit under the Welfare State, and I think it is obvious that there are three different methods of assessment. One is on the record of contributions, one is on the basis of citizenship, and one is through the establishment of need.
  Since we have gone over to earnings-related contributions and flat rate benefits, the earnings-related aspect of the contribution relates only to the second pension. The Government have done away with the earnings-related element in unemployment benefit and other short-term benefits, so what we have is simply a tax on income that does not directly confer a different entitlement to benefit on the member of the scheme, whether he has a high or a low income, whether he has a long and unbroken contribution record or whether it is patchy and inadequate. In looking at national insurance as a system for financing citizenship benefits, it is obvious that what comes through at this point is the old principle

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  "From each according to his capacity, to each according to his need". I have never quarrelled with that principle, which is now the principle on which the national insurance fund seems to be founded.
  We have then to ask why the citizen's duty to contribute to society suddenly comes to an end at £220 a week, when as a taxpayer he goes on having to pay more beyond that point. Where does the figure of £220 come from? Do we find it in the Koran, or is it simply an artificial level that has been dreamed up because a certain amount of money has to be produced in the immediate future and that is a convenient round figure to adopt for some reason?
  Using the maxim "From each according to his capacity"—up to £220 a week—"to each according to his need", how do we then go on to define need? Is our concept of need absolute? Do we have a perfectly clear concept of the minimum standard of living that we regard as the basis for our income support policy, or is our standard of what constitutes the minimum sufficient income for the citizen something rather transitory and related to the general standards of society from time to time? After all, there are many people in this country who feel that they could not possibly be living at a lower standard than they are, yet in Naples their standard of living would be regarded as comparative affluence, in a country where, unhappily, much lower standards are regarded as the normal thing.
  If we are to have two standards of basic need when we are assessing uprating—that is to say, where we establish the national insurance minimum income and where we set the supplementary benefit minimum income—we are entitled to expect from the Secretary of State a much clearer statement of what he thinks is the absolute concept of need and where we are going with it in the future.
  There are many reforms that I should like to recommend in the national insurance scheme that ought to be put in hand. The question of uprating has occupied the House a good deal in the last few months. The fund has to pay for it with the added contributions for which we are asked to vote tonight. As I understand the position, child benefit has been increased by less, since the last general election, than the rise in the general level of prices, and by some percentage less even than the rise in the gross national product, so we are definitely taking benefit away from the children at this time. I wonder whether that is a sensible policy, bearing in mind the pressure for higher wages that inevitably results from the fact that people with more mouths to feed become more desperate during times of inflation, and more insistent on an increase in their wages. If they were helped through child benefit, we would have a selective method of raising wages, and the advantage would go to the people with the biggest real requirement for income.
  Pensions meantime have risen more than the gross national product. That is because the Government are trying to honour a pledge to keep pensioners' incomes level with prices. Obviously, we must honour that pledge until the election, but I believe that pensioners would do better in the long run if the uprating of the national insurance pension were related to the changes in the gross national product rather than to the cost of living. Our optimism tells us that over a period of time the standard of life of the whole country will rise, but if we stick to the
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  principle that pension upratings are based only on changes in the cost of living index, the pensioners will ultimately be left behind.
  Will my right hon. Friend also give a fuller explanation in due course of precisely what he sees to be the role of the Treasury contribution? When I first started making speeches on this subject, the contribution was 18 per cent. or possibly more. It is now 14½ per cent. and the Bill will reduce it to 13 per cent. Where do we find that 13 per cent. written in our consciences? What exactly is that 13 per cent. doing? Where does it come from? If we set national insurance on the basis of impeccable rectitude and complete translucency, I am not certain where that 13 per cent. will fit in.
  I should like to end the farce of the national insurance fund altogether. It has lasted long enough, outlived its usefulness and become an inscrutably complex, unhappy and unfair organisation for the redistribution of income on principle which nobody understands or accepts. We should establish a transfer income account in the national budget and do entirely away with the national insurance fund. I would go further than that and reform the whole redistribution-of-income industry by putting the Inland Revenue and the cash side of the DHSS into a single transfer income department. The numbers engaged in the transfer-of-income industry have grown to 160,000 or 180,000 of every 200,000. It is not a happy industry; it is miserably under-equipped, terribly obsolete in its methods, grossly overmanned and desperately in need of reform. I hope that my right hon. Friend will prove to be the administrative genius who will take the redistribution-of-income industry and put it on a thoroughly modern and acceptable basis.
  Taking a further look at the rationalisation of administration, we should amalgamate the income tax allowances with the cash benefits payable in the absence of, or in support of, income. I have called for that many times and we have made limited progress in that direction, but that progress has obviously been brought to a halt.
  We should provide a minimum income guarantee as an automatic citizenship benefit. The computer is ready and to hand, able to deal automatically with vast arrays of information; it is ridiculous that we should still go on with the rigmarole of the national insurance benefits, supplementary benefit assessments, local authority allowances, tax allowances and all the other methods by which we ensure that citizens enjoy a minimum income guarantee. That job ought to be done in a modern way and I hope that the Government will not boggle at the reforms that are so urgently needed.
  We should also integrate the income tax and national insurance contributions in a single universal income-related tax. We should end the farce of the Chancellor coming to Parliament with a Budget with changes in income tax in April, and later in the year requiring changes in national insurance contributions, that are collected through the same mechanism as the income tax. How much longer can that idiotic survival remain part of the regular annual routine?
  We have already made some progress. We have amalgamated the child tax and family allowances in a single child benefit. We made the second great step forward in recent months—and I congratulate the Government—by introducing the concept of unified housing allowances. That was the necessary next step and

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  I am glad that they took it. However, we still have a long way to go if we are to rationalise all the housing subsidies. That is another urgent job.
  We should devolve to local authorities the attention to case work that is handled through the DHSS local offices. When the DHSS last published a year book—in 1977—I recall that the Department had about 1,000 offices throughout the country, full of dedicated and earnest people doing their best with an absolutely obsolete system. At the same time, local authorities had offices dealing with housing matters and subsidies and benefits in kind, and people were available to help in personal and family crises. For the life of me, I cannot understand why we still have DHSS offices supplementing and duplicating the work being done by local authorities.
  In the assessment of supplementary benefits in very many cases the only reason why applicants need to apply for supplementary benefit on top of other income is because of their rents. It is because rents vary so much from one part of the country to another that a minimum income guarantee across the board is not adequate in many cases. We have made a start on the unification of the housing allowances and by so doing we have transferred to local authorities much of the responsibility for the case work and individual attention that must be given to those who fall to the bottom of the income scale. We should now put that whole function on a rational basis and proceed to wind up the 1,000 local offices of the DHSS.
  I have put some points to my right hon. Friend, that I particularly wanted to make, but I have not dealt with the redundancy fund and the relationship I see developing between payments on redundancy and the transfer payments due to those who move from one pension fund to another in the course of their employment. My right hon. Friend may revert to that subject in due course, although it certainly arises under the Bill. If my right hon. Friend is not disposed to answer all the arguments today, I nevertheless hope that he will turn his mind to them and make it a major preoccupation of his Department to introduce reforms on the lines that I have recommended. I hope we shall see them introduced before the next election.
  6.6 pm
  Mr. David Ennals: I have great respect for the hon. Member for Kensington (Sir B. Rhys Williams), but also a sort of deep sympathy. He always puts the big questions, but he never gets the big answers. He was never satisfied with the answers that I gave to him, and I suspect that he will not be satisfied with the Chief Secretary's reply.
  However, I welcome the fact that the Chief Secretary will reply to the debate because this is clearly a Treasury Bill. It is said that the Bill is presented by Mr. Secretary Fowler and supported by Mr. Chancellor of the Exchequer, but it was sponsored, backed, initiated and everything except presented as a Treasury measure. It is the first measure to give effect to the Chancellor's wretched inflationary and deflationary—I agree with the hon. Member for Kensington that it was a deflationary package—mini-Budget on 2 December.
  The Chancellor's package bears all the hallmarks of a Government who have got the economy into an appalling state and have neither the wit nor the imagination to provide a remedy by reflating the economy and creating real jobs. All that the Government can do is pile an ever
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  heavier burden on the hard-pressed workers, struggling as they are to keep their jobs, as they see their mates losing theirs, and resisting steadily falling living standards.
  We must understand that the effect of the package on working people is a new deduction from their pay packets of £1 a week on average, although that figure is much more for others. We must consider that, together with a whole range of other burdens imposed by the Chancellor on 2 December.
  First, workers face a sharp rise in rates. The Government's further cut in the rate support grant has reduced their expenditure from 59 to 56 per cent. and that will mean a rent increase on average of about £2·05 per person. We see the Government, step by step, contracting out of the tax-bearing burden, not only as regards national insurance in the Bill, but in relation to local government. Secondly, we see a further increase of 30 per cent. in prescription charges that bears no relation even to the high rate of inflation that the Government have been unable to check. The increase to £1·30 will have a serious effect on many of those who do not qualify for exemption but who suffer sickness and who will often have to make the choice of the prescriptions that they will accept.
  The Prime Minister denied only recently in the House that she had given a pledge at the last election not to increase prescription charges. It is true that she did not make a pledge that she would not increase prescription charges. All she stated was that she had no plans to increase prescription charges. Other people, of course, did have plans, but the Prime Minister did not. If her first name is TINA then I suppose that NPTDI—if she has "no plans to do it"-must be her second. I am sure that the Prime Minister did not have plans to raise unemployment to 3 million. I am certain that she did not have plans to ensure that the inflation rate throughout the first two and a half years of the Government's period in office remained above the level that she inherited. She did not plan for those things, but they have happened.
  The Prime Minister certainly did give a pledge that the National Health Service would be protected. But that is hardly true either. The Treasury has cut its expenditure on the National Health Service and has forced the Secretary of State to recoup the losses, first, by the increase in prescription charges and, secondly, by the increase in national insurance contributions in the Bill to pay for the National Health Service. The Secretary of State knows that he would have had to make cuts in the National Health Service if he had not found another way to place the burden on the backs of people who can ill afford to bear it.
  Another example of the fact that it is a Treasury Bill is the cut to 13 per cent. in the long-standing Treasury grant to the national insurance fund, a cut which is worth a £261 million increase in revenue immediately to the Treasury. That is the benefit that the Government Actuary says will come from the Bill. There has been a steady erosion of the Treasury supplement from the 18 per cent. that existed under previous Governments, including the Conservatives. I agree with the hon. Member for Kensington that there is nothing sacrosanct about 18 per cent. There is, however, a great difference between 18 per cent, and 13 per cent. Next year, it may be 12 per cent.
  If the argument used by the Secretary of State has any validity, the more the Government pay in non-contributory benefits the less they will contribute to the national insurance fund. Unless there is to be a cut in

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  supplementary benefits—a step that hon. Members inevitably fear—there will obviously be a higher supplementary benefit bill. This process will be continued as unemployment increases and as more pensioners come to depend on supplementary benefits because their level of income does not keep pace with inflation.
  The Secretary of State argued that the Government were price-protecting the pensioner. I invite the right hon. Gentleman to tell any pensioner this year that he is being price-protected. They are not. They receive a benefit from last month that is roughly 3 per cent. less than the inflation rate. The assurance given to pensioners that, at some stage in the future, the 3 per cent. will be made up to them may be reassuring. It does not actually pay for the daily food. It does not help to pay the bills. During the next 12 months, whatever the Government may do in November, the standard of living of pensioners will inevitably decrease by roughly 3 per cent.
  The Secretary of State has shown himself to be even more responsive to the pressures of the Treasury than his predecessor. Time and again, I referred to his predecessor as still being a Treasury Minister. I suppose that the Secretary of State for Social Services must be a budding Treasury Minister. The right hon. Gentleman must have ambitions. Why anyone should have ambitions to go to the Treasury I cannot imagine. However, his behaviour so far suggests that this is the destination that lurks in his mind.
  What does the Bill mean to ordinary working people? It pushes up the deductions from the pay packet to the highest level ever at a time when people's standard of living is being steadily eroded and when they are expected to accept pay settlements way below the level of inflation. It is recognised that unemployment is still on an upward trend. An additional 300,000 was, I believe, the figure anticipated by the Chancellor of the Exchequer. On that basis, the Government Actuary makes his assumptions about adult unemployment. That figure represents a further 10 per cent. increase.
  The Government Actuary is working on the basis of an increase of 5,000 in unemployed school leavers and students where the number is already at an horrific level. Whether he made his assumptions with any knowledge of Government plans I do not know, but those were the assumptions in his report. It is a reminder that those still lucky enough to be at work have to pay more in order that next November there will be some compensation to pensioners and other national insurance beneficiaries who received a rise last month, if reckoned against the retail price index, that was about 3 per cent. less than the rate of inflation. The rise was 5 per cent. less than the rate of inflation if one uses the tax and price index. Since that index was introduced by the Government as a fairer method of determining people's real income in relation to taxation and prices, that is the figure, I suppose, on which the Government should be judged. It is the figure that I shall use.
  The level of taxation on the average population of Britain has never been higher under any Government at any time in spite of the Government's election pledges. The only people to receive some benefit from tax reduction promises made at the time of the election have been those on high incomes.
  The hon. Member for Kensington is right to inquire about this magic figure of £11,000. I suppose it is roughly
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  the magic figure above which the higher paid would start to see the tax benefits that they have already received eaten into if they were asked to pay more than the percentage that everyone else pays. There exists here a source of additional income. If the upper level were set at £20,000 or £25,000, instead of £11,000, that would produce substantially more income from people who can afford to pay. I hope that the Minister who is to reply sees that this would be fair. I hope very much that my hon. Friend the Member for Pontypridd (Mr. John) and other hon. Members will press strongly in Committee that this upper figure should not remain as it is. I am glad that this matter has been included in the motion to which I shall be glad later to give my vote.
  6.20 pm
  Mr. Andrew F. Bennett: I hope that my right hon. Friend the Member for Norwich, North (Mr. Ennals) will be present for the Committee stage, which is to take place in the House on Thursday. It would be a big advantage to have him with us on that occasion.
  Mr. Ennals: I shall be here.
  Mr. Bennett: Measured by any standards, the Bill is appalling. It will be interesting to reflect at the end of the debate whether anyone, apart from the Minister who introduced it and the Minister who is to reply, actually speaks in favour of the Bill. I suspect that no one else will do so, and that it will be only the Ministers on the payroll vote who will put forward a case.
  Even judged by the Government's central aim, the Bill is a total disaster. We heard from the Dispatch Box earlier today that the Government's main aim is to conquer inflation. If that is their central target, why do they impose an extra 1 per cent. tax on everyone earning between £29 and £220? That increase of 1 per cent. is one of the first ways of guaranteeing that people will want extra wage increases to meet it. Therefore, it is the Government who are busily fuelling inflation. They have set out with this measure to defeat their own programme.
  It might be possible to argue that people ought to pay more in contributions if they were to get more in benefits, but it is absolutely clear that this increase will not produce more benefits. It is coupled with a major cut in benefits. For the Government to claim that their central objective is to conquer inflation and then to add an extra 1 per cent. to the payroll tax, is asking people to press for higher wage increases, to put up costs generally, and to defeat the central aim of the Government's policy.
  The Bill is called a social security measure, but does it increase security? It does not. It is asking people to pay more so that wage earners have a little less security and, in fact, it will give beneficiaries less. Therefore, it clearly gives less security to most groups of people who are at present dependent on benefits.
  The Bill is also considered to be an insurance measure. Over the last three or four years we have seen the total farce of the whole question of national insurance. There is no insurance principle left in the scheme.
  It is a straightforward taxation measure. Any pretence that there is insurance disappears when one considers the way in which the Government feel that they can vary the level of benefits at will.
  Moreover, the Bill does not even qualify as an insurance measure through its effect on individuals. I shall

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  refer later to several of my constituents because that might have an impact on the Ministers when quoting figures does not. One of my constituents who came to see me has been unemployed for 12 months and is at the level where he has to depend on social security. However, he is unable to draw social security because his wife earns 20p above the level where they would qualify for social security. So he receives no benefit at all.
  This man has not had a day off work since this scheme was introduced in 1947 until he was made unemployed 12 months ago. He was in work, luckily had good health, and although made redundant several times in that period, he always managed to go from one job finishing on the Friday to a new job on the Monday. He may have been lucky. In the whole of that time he had no time off until he was made redundant. He has now had 12 months' benefit and exhausted his entitlement.
  My constituent has a brother who works in the building trade. That brother, over about the same 33 years, has averaged five weeks off each year, mainly because of the problems that exist in the building trade—the difficulty of working in the winter—but also because he has had several major illnesses. The brother has had 150 weeks off work over that period and if he is out of work again now he is entitled to another 52 weeks. That is roughly 200 weeks of benefit over his working life, yet his brother, having had only 52 weeks, exhausts his entitlement.
  Both brothers have probably contributed roughly the same amount, but one brother during his lifetime has had merely a year of benefit and the other could have had almost four years of benefit from the scheme. What justice is there in that? What insurance principle is there over a lifetime, because the scheme is worked out on a basis of contributions over a 12-month period?
  The credits for the earnings-related contribution were paid last year. The Government are abolishing the scheme in January. That will be a major cut for those people who are coming on to benefits. But was there any cut in the contributions? Of course not. So people were asked to contribute at the same rate on the basis that the earnings-related schemes would disappear. The Government have collected insurance contributions from people who in previous years would have been entitled to sickness, unemployment, injury, maternity or widow's allowance, all on the contributory principle. They have contributed to earnings-related benefits. Now it is said that they have gone.
  Again, we have the farce that there are people who have contributed for 10 or 11 years to those benefits and they have enjoyed them some time in that period, but someone who so far has not required them but requires them from 1 January will find that they have disappeared. So, whereas one person may have benefited over the period of the scheme's 10 or 11 years, and may have benefited on many occasions from those benefits or a combination of them, if a person wants to benefit in the eleventh year, he will get no benefit because the Government have decided to abolish them.
  Again, that is an illustration of the way in which the insurance principle has become a farce.
  Another of the Government's cuts is that about which they have said "In logic, unemployment benefit and sickness benefit ought to be taxed", and then they have said "It is far too complicated administratively to do so, so we shall cut everyone's benefit by 5 per cent. and that will he rough justice."
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  For those who are sick only occasionally and those unemployed for only short periods, there may be rough justice in it, but anyone who is out of work or sick for long periods will lose as a result of the measure.
  The Government gave undertakings when they introduced this measure that they would make good the loss—although so far they have not given a clear announcement that the 5 per cent. will be made good—once they had introduced measures that would allow them to tax sickness benefit or unemployment benefit. So there is that 5 per cent. because the benefits have not risen and there is a 5 per cent. shortfall.
  The Government say that they are looking at the question of making the shortfall good next November. But what is happening now? From the uprating on 20 November last we have now had three weeks during which people have got 2 per cent. less benefit than they needed to keep pace with inflation. Some of them will be back in work or on to other benefits by the end of this year. For them there will be no making good the shortfall. However one interprets the Government's words, those people have lost about a week's benefit if they have been receiving it for 12 months—or 2 per cent.
  It does not matter whether one listens to the Government Chief Whip saying "It will be made good for all benefits next November", or to Ministers who are saying "No, it will not be made good, unless, perhaps, in the Budget, and then only for some benefits". Those on sickness benefit and unemployment benefit are losing 2 per cent. now.
  The same applies to pensions. Pensioners are losing 2 per cent. In his introduction the Minister proudly said that we are now spending £13½ billion on pensions, but he has cut them by 2 per cent. for this year. It is all right him saying that he will make this good in the future, but many pensioners will die during the period. They will never see their pensions restored. We cannot put the money back into their pockets. The Chancellor is not talking about doing that. He is simply saying "We shall bring the benefit back to the level that it ought to be next November". There is no talk of giving any money back.
  We can also consider the way in which the Government changed the rules of the national insurance scheme for the linking of benefits. The period was cut from 13 weeks to eight weeks, which saved the Government £10 million. The Government did not offer a cut in contributions because of that. The Government also changed the supplementary benefit rules for redundancy payments. if someone receives more than £2,000 that is taken into account when calculating his social security payments. That is another area in which the Government have changed the rules and saved a considerable amount of money.
  The position is that we must pay more and receive less for it. Why is that necessary? It is because the Government are steadily changing the rules. We could argue strongly that there should be cuts in contributions in some areas. During the past two years, fewer people have qualified for sickness benefit. It appears that, because of high unemployment, fewer people are working and those with the poorest health record, such as the elderly, have been pushed out. That should have been a saving to the Government and should be a justification for cutting back the contributions. There is also the built-in inflation factor. As wages go up, contributions go up because they are on

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  a percentage basis. There should have been an increase in most of the figures because of inflation and also in the upper limit, if that can be justified.
  The Government have some problems. There are areas of greater expenses and more pensions. That should have been foreseen and if we had a true insurance principle it would have been taken into account over a longer period. There are also far more people unemployed. That is a result of Government policy, so the Government should contribute and not demand more money from those who are in work.
  We could have found a group of people to compensate for that. The Government could have received more money from those just coming on to the pay roll. There is a bulge of youngsters leaving school now and coming on to the labour market. If the Government had found jobs for that group they would be making national insurance contributions and helping to balance the fund.
  I wish to put a specific question to the Minister about the statement made this afternoon. What will be the position of all those who participate in the new youth training programmes? Will their national insurance contributions be credited to them? What is the position about those on the youth opportunities programmes? Their income is below the lower limit and they do not make a contribution. There is considerable confusion about whether their contributions should be credited to them. If they are, that will affect their future entitlement to sickness and unemployment benefits. Sadly, because some young people are out of work for long periods, it may well begin to affect their entitlement to retirement pensions.
  The Government should be able to tell us whether young people in the youth opportunities programmes and the proposed training schemes will have their national insurance contributions credited, as is the case with some students, or whether they will be short of some contributions. If the Government wish to maintain the national insurance principle, those young people are entitled to have their contributions made up.
  The Government are also demanding that a larger part of the national insurance contribution should go to the National Health Service. That is a straightforward taxation measure. The Government are saying that there is more justice in national insurance contributions than in the general tax system. Everyone accepts that national insurance contributions are much more regressive than income tax. Yet the Government are saying that they wish to switch the system of tax from a progressive to a more regressive form. That is again an indictment of the Government.
  It is odd that those on low incomes find that, as a result of the poll tax of national insurance and income tax, they have deducted from their wage packets almost as much as they may get back in family income supplement. It is crazy that the Government should deduct money in the form of national insurance and then say that if someone completes the complicated procedure of filling up forms he can get it back in the form of family income supplement. The Government should consider the low tax threshold. This measure makes the low tax threshold rather worse.
  Turning to the question of the low paid, I have mixed views about the Government's proposals to raise the lower limit from £27 to £29·50. If one is earning only £27, at first sight it seems attractive if one can save on national
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  insurance contributions. However, as long as we have the national insurance principle, those people will lose benefits. As the figure has yo-yoed, people contribute for some time and then find that they do not contribute. Instead of receiving benefits based on half a year's contributions, they receive nothing, because they do not have enough contributions in any one year.
  The position at the moment is that someone who earns just over £27 pays national insurance contributions. When the Government raise the limit, they will no longer pay contributions. They may then receive a wage rise and begin to contribute again. If they pay contributions for less than half a year they receive no benefit because they do not have enough contributions to qualify under the test. That is a farcical situation.
  I realise that there are difficulties, but if the Government raise the limit they should at least consider a system of crediting those people who do not pay contributions by reducing the test period. It is a trap. It is mean to ask someone to pay tax of about £2·50 on a salary of £27 and say that it will be deducted for six months, but that the limit will then be changed and the person will not benefit from it.
  I would wish to make many other points, but I turn now to the matter dealt with in the Opposition motion, which is essentially to criticise the Government for the shortfall in benefits announced this year. The Government should at least have said that they would do something about it. We have heard many figures quoted. I wish to give the Government one or two examples from my constituency. I shall call them poverty profiles. I admit that I have changed the names and one or two of the details, because it is unfair to those in such difficult circumstances to put the glare of publicity upon them. My examples illustrate the difficulties and I should have thought that Ministers, in their advice bureaux, will have seen such cases.
  I refer first to Mrs. X. She was persuaded that she and her husband should buy their council house. They did so four years ago. The mortgage was carefully worked out by the local authority on the basis that the husband was then 54 years old and that it would be repaid during his working life. The capital repayments were set fairly high. No one would offer them life insurance to cover the mortgage. Sadly, last year, the lady's husband died and she was left with the mortgage. She no longer had his income to pay off the mortgage and depended on social security. Of course, social security will pay off the interest on the mortgage, but it will not pay anything on the capital. As it is a short mortgage, the lady has considerable capital payments to make.
  Now she does not know what to do. She could try to sell her house, but as it is on a council estate it is not very popular. Also, because of the attractive discounts being offered at the moment by the Government, other council houses on the estate are being sold to sitting tenants for less than she needs to cover the repayments. She finds it almost impossible to sell. However, at the same time she finds it almost impossible to keep up the capital repayments, towards which social security makes no contribution. I am not suggesting that, had she had the additional 2 per cent. this year, it would have completely eased her problems. I am simply giving an example of the way in which people are caught in a trap from which they cannot escape.
  That lady is but one example. She and her son spend less than £10 per week on food because she is trying to pay her mortgage. If she is forced to sell her home she will

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  have to join the council house waiting list. She does not have enough money to buy another house. She will probably end up with one of the least attractive council properties.
  Another constituent of mine has many problems. He can best be described as a little simple. He has a dog that he has looked after for a long time. Indeed, in a sense, the dog has looked after him. When walking round the streets he is picked on by children who tease and torment him. If he has his dog on a lead it discourages the children from being a nuisance. He has been in receipt of benefits for a long time, and gradually his debts have built up. He has been advised that the only way to solve his problems is to give up his dog, which would save him 50p or 60p a week on dog food. That may not be enough, but it would help to balance his budget. However, if he does so, he will be prey to all the kids who torment him. Had the Government raised benefits in November by 2 per cent. to keep level with inflation, he might have kept his dog.
  There are many other examples, but I know that other hon. Members wish to speak so I shall not cite them. The Government's failure to uprate benefits by 2 per cent. in November is causing real hardship. Concern has been expressed on both sides of the House that that money must be put back next November. There should be equal concern that money should be provided this year for this set of benefits. It is not enough simply to uprate benefits next year.
  6.42 pm
  Mr. Mike Thomas: We have not seen a rush of inordinate enthusiasm by Government Back Benchers to support the Bill. The hon. Member for Kensington (Sir B. Rhys Williams) made a sensitive, thoughtful and intelligent speech, and I agreed with many of his remarks. However, I could not discern much support for the Government, however tactfully he made his points. I also agreed with the points made by the right hon. Member for Norwich, North (Mr. Ennals) and the hon. Member for Stockport, North (Mr. Bennett). The paucity of support for the Bill has even led the Government to invent a new Member to sponsor it. I find myself in a slight procedural predicament as the new Member does not have a constituency and I must refer to him by name. I see from the back of the Bill that "Mr. Hugh Ross" has now joined the Government. No doubt the Government will continue to have difficulties in finding support for such measures.
  The social security system does not do its job properly. It does not provide proper income support to those who need it. The Government have cut even the inadequate levels of support that existed in 1979. In the case of long-term benefits there has been not only the shortfall and delay in make-up, but the 5 per cent. abatement. For short-term benefits, the shortfall on inflation proofing will not be made up. It is not only that the level of benefits is too low. The Government and the system no longer provide for people to receive income support in a way that allows them to keep their self-respect. Many feel humiliation at the process and rigmarole of applying, establishing entitlement and receiving many social benefits. Successive Governments have done little to put that right.
  One reason why we are debating the Bill today is that the idea of the national insurance fund and the contribution system, as laid down by Beveridge, should, in part, help with that problem. It should give people the feeling that
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  they are contributing to benefits to which they are entitled. That has become so far from reality that it is farcical. Most individuals in our community believe the measures that we are discussing to be simply an additional taxation deduction from their pay packet. They do not perceive any insurance principle to which they are making a contribution. Indeed, they are puzzled when, at the age of 60 or 65, someone tells them that 3½p is being deducted from their pension because of a hole in their contribution record in, say, 1957.
  The Under-Secretary is not present. In the debate last year she said that
  "it was important that, even at low levels of earning, these people had the opportunity, with those low levels of earnings, to be contributing."—[Official Report, 11 December 1980; Vol. 995, c. 1681.]
  She said that that was a major principle of the Social Security Pensions Act 1975. That is arrant nonsense. Neither the House nor the Government should perpetuate that any longer.
  It is clear that the financing system for our social security and pension benefits make the whole arrangement infinitely worse. We must consider certain facts about the income taxation of the lower paid. The income tax threshold is now 38 per cent. of the average wage, whereas it was 45 per cent. in 1978. The last Budget put 1¼ million low-paid workers into liability for tax. The numbers caught in the poverty trap are 40 per cent. higher than they were in 1979. It is not good enough to have a Bill and arrangements for collecting revenue that will make the impact of all that on the lower paid even worse. The facts do not need to be quoted. They have been charted accurately in the Chancellor's reply to the hon. Member for Blackburn (Mr. Straw), by the low pay unit, the Child Poverty Action Group and other organisations. The right hon. Member for Norwich, North was right to say that the Bill is a mini-Finance Bill raising taxation through what is probably the most regressive form of taxation in the British taxation system.
  I wish to say a few words about the approach of the Social Democratic Party to these matters. We must do what successive Governments and the two old parties have ducked for so long, and that is to consider the questions of poverty, social security, pensions and taxation together. We shall have to find other forms of taxation that will raise more fairly the revenue required for the State component of benefits. We must also consider the appalling gaps on the pension front created by the present system between employees in the public sector and the private sector and between those contracted out into occupational schemes and those dependent on the State scheme.
  The Social Democratic Party believes that the Social Security Pensions Act 1975 should not be regarded as the final word. It needs careful review. Any analysis of the provisions in the Bill will show ample evidence for that.
  Mr. Andrew F. Bennett: The hon. Gentleman is making an interesting speech. He said that his party would look for new forms of taxation. That sounds attractive, but what new forms are there? Everyone involved in politics would love to find a new form of taxation that had no objectors to it.
  Mr. Thomas: The hon. Gentleman is right. No taxation will have a complete absence of objectors, certainly not among those required to pay it. I thought that I detected in his speech some agreement with me that even

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  to raise the revenue through progressive income tax might be better than to raise it by the crude, arbitrary, semi-flat rate basis that we are debating today.
  Mr. Andrew F. Bennett: I agree that that is income tax, but it is not a new form of taxation. Indeed, it is a traditional form.
  Mr. Thomas: I beg the hon. Gentleman's pardon. I readily agree with him. My rhetoric and the inclusion of "new" may have carried me away. But it would be a new form of raising revenue for this part of public expenditure and it might be a better form of so doing. I am glad to see that the hon. Gentleman agrees with me. There are new forms of taxation that we should consider such as a sales tax.
  My right hon. and hon. Friends will vote against the Bill. That is because the proposals before us are part of the Government's game of "Find the Lady." The Bill appears to make provision on the public expenditure front to satisfy the Government's Back Bench rebels—those whom the hon. Member for Pontypridd (Mr. John) referred to as the "dissidents"—although it will take more than it gives. Therefore, the net effect of the Chancellor's proposals will in the end be deflationary.
  As the right hon. Member for Norwich, North (Mr. Ennals) said, this is a Treasury Bill that in reality has only a Treasury purpose. Even the Secretary of State could not find a way of moving the Second Reading convincingly without falling back on the shibboleth of the public sector borrowing requirement. The technical arguments that will be conducted today and on Thursday will no doubt have their value. I have no doubt that hon. Members on both sides of the House will seek to reduce the impact of the Bill on the lower paid, and we shall support them, but I hope that occasionally they will try to see the wood rather than the trees.
  The Bill is a tax-gathering measure and it will gather tax from the wrong people, from the wrong places and for the wrong economic purpose. It is essentially a tax on jobs and it will help to create inflationary pressures. That is why the Social Democrats will oppose it.
  6.52 pm
  Mr. Ken Eastham: The Bill is part of the long saga of cuts and tax increases. I support the Opposition's amendment, which states that the
  "real value of many benefits is being cut."
  I have vivid memories of the Social Security (No. 2) Bill in Committee. It was subjected to lengthy consideration in Committee and the Opposition were busy for many sittings over several weeks in exposing the impact of the small print and the consequences of some of the shabby cuts that would confront the poorest and the most needy. The media were interested only in the small clause that was designed to cut down to size so-called strikers and their benefits. We had great difficulty in trying to convince the public of the extent of the damage that the Government wished to cause. We said that invalidity benefits and earnings-related benefits would be subjected to serious cuts.
  It is right to remind the House that this is the International Year of Disabled People. By the end of the year serious cuts will be felt by all sections of the disabled. That was brought vividly to my attention last week when
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  a group from the North-West came to Parliament to lobby on behalf of those who have been damaged by vaccine. It argued that real benefits had been cut by current legislation, including the £2,000 limit and the £10,000 grant. The grant means that if vaccine damage is certified and confirmed, the unfortunate individual will receive £10,000, but will be disqualified from receiving other benefits because he will be over the £2,000 limit that is part of the Social Security (No. 2) Act 1980.
  At a recent constituency surgery I had a visit from a constituent who presented real and genuine problems. He said that he would not mind in the least if I quoted him as someone who is suffering continuing cuts. Mr. W. S. C. Sutherland of 12, Thurlby Avenue, Blackley was a fireman. He was seriously injured and he received an injury pension. Due to the £35 limit in the Act, he is suffering a cut-off limit, although unemployment benefit has been increased by 9 per cent. It is a shabby affair and it is difficult to convince him that he is suffering because of the measure which was introduced in 1980, which was designed to save a mere £25 million.
  I undertook to raise this issue with the Minister. Mr. Sutherland argued that if other benefits have been increased by 9 per cent. it would not be unreasonable to increase the £35 limit, which if increased by 9 per cent. would mean a limit of £38·15. I tabled a question to the Secretary of State for Social Services on 14 December. It asked:
  "if he will review the Social Security (No. 2) Act to take into account inflation; and if he will take steps to increase the £35 and £55 limits."
  The Under-Secretary of State replied:
  "The provisions of the Social Security (No. 2) Act 1980 which have a continuing effect are kept under review, and inflation is one of the factors which are taken into account. We will bear the hon. Member's specific suggestions in mind in the course of preparing detailed proposals for the 1982 uprating, but final decisions will depend on economic circumstances at the time."—[Official Report, 14 December 1981; Vol. 15.]
  I am sure that Mr. Sutherland and thousands of other citizens feel that they are being cheated and are experiencing a reduction in their genuine purchasing power. It is not good enough for the Government to say that they will carry out a review in 1982 and bring the uprating in line with inflation, for example.
  We are all politicians, and we understand that 1982 will be a magical year for the Government. In all probability, they will make a large handout in readiness for the oncoming general election. We should not be shocked or surprised at the motive for the delays which will continue for a year or 18 months before they are replaced by the so-called give-away. That will be a great display of generosity with which the Government will hope to win the day when they meet the electorate.
  This is not satisfactory. We are being insulted by the Bill. In effect, we are being told that there will be further increases in taxation. At the same time there will be decreases in benefits across the board. Surely no Minister should place such proposals before the House. I hope that the Minister will review the position and acknowledge in all honesty that mistakes have been made. Of course, he may say that benefits have been reduced by design and the taxpayer must pay more and receive less. The Minister cannot justify tax increases for reduced benefits.
  6.59 pm
  Mr. David Penhaligon: There have been several speeches about uprating benefits due to inflation.

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  I believe that for one reason or another—not always malicious—we have ended up with the worst of all options available for the uprating of benefits. Benefits are now uprated according to what the Government guess inflation will be in the next 12 months. I can think of nothing that one can predict with greater confidence than that the Government will always underestimate the likely rate of inflation.
  The position is not entirely the present Government's fault. Until 1975, benefits were paid according to the rate of inflation over the previous 12 months. That was not always perfect for the pensioners of Britain in times of rising inflation, but fortunately what goes up tends to come down, so there was eventually a jackpot year. After several years of adjustments based on past inflation rates, when the current year's rate was even higher, inflation would suddenly drop. An increase in pensions based on the previous year's inflation rate therefore meant that pensioners could look forward to an increase in real terms.
  Those who attended the debates in 1975 will recollect that the Labour Government suddenly decided that that was not a fair way to do things and that in future they would guess at the rate of increase of inflation and of prices for the following 12 months. At that time, I called it the greatest money-saving fiddle of all time. I do not know how much the saving is in today's finances, but it must have been £500 million or so. That was just one in a series of steps. The Government have a less than honourable record since then, as the prices element has now been pushed out and we must rely entirely on their guess at the rate of inflation for the next 12 months.
  A better system of uprating pensions must be found, as the guess does not even cover just the next 12 months. When it is announced to the House, it relates to payments some 18 months away. Moreover, one suspects that the guess was made behind the scenes several weeks earlier. People's benefits therefore depend upon guesses which may be up to two years old. I doubt whether many hon. Members on either side of the House would like to guess at the rate of inflation next month, let alone in two years' time. It is a ridiculous system.
  The Government clearly could have done something about the 2 per cent. shortfall this year. There is no reason why they should not have done so. Compared with the size of the British Budget or even the various predictions for the PSBR, the sum involved is not large. This is penny-pinching at the expense of those who can least afford it. If a last minute adjustment presents administrative difficulties, the Christmas bonus offers a way out—although I do not recommend it as a perfect solution—if we are to keep the insane system of trying to guess the inflation rate for the next 12 months.
  I wish to make two further points—one specific to my own area, and the other of more general relevance. The hon. Member for Stockport, North (Mr. Bennett) made an interesting speech about how in the real world these matters actually affect people. I wish to bring to the attention of the House a matter specific to my area which is nevertheless an appalling scandal. Complaints about the loss of 2 per cent. in benefit bring a wry smile to the faces of some of my constituents, as they know that they will receive no benefit. I refer to those who make their living from what is now the largest industry in my part of the country—the tourist industry. It has been said that tourism provides 16 per cent. of the jobs in my county. Tourism, of course, is seasonal. Although the weather in my
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  constituency has been considerably better than that in other parts of the country recently, I could not recommend it as a place to acquire a sun tan or to spend a weekend on the beach. We have not had much snow, but there have been 100 mph gales. When the weather is bad, the tourist industry scarcely exists.
  People in my area who have worked for an employer in tourism for more than three years have no entitlement to any unemployment benefit whatever. By statute, they are compelled to pay their stamp. There is no rule which says that they need not pay it because they are doing seasonal work and there is no alternative work for them. They are simply told that they must pay the money but they will receive no benefit.
  I cannot believe that there is no way to modify the various statutes so that areas such as mine are not penalised so much. I am sure that the Government accept that there is no other work, yet those people are severely penalised. When I put down questions seeking to ascertain the numbers involved, I have always achieved the marvellous response that it is "too expensive" to obtain the information—in other words, "Get lost". I do not know how many people are involved, but six people came to my surgery last week asking about the regulations. They could not believe that that was indeed the position. Unfortunately, with one exception in which I think that a mistake may have been made, I had to tell them that that was indeed how the rules operated. It is unfair, and I see no logical reason for it.
  Moreover, people who have made their living from the tourist industry for more than three years must never in any circumstances save more than £2,000. If they succeed in doing so the only income to which they might be entitled during the winter months—supplementary benefit—will immediately be Lost. How can anybody ever afford to buy his own house or his own anything in a county such as mine if that is the situation? If I obtain no more from the Government today than a promise that they will at least write and tell me how many people are affected by the regulations, I shall greatly appreciate that, as will my constituents, because it will enable me to raise the matter on a rather better basis.
  More generally, I wish to deal with the effects of the increase in national insurance contributions in tends of marginal rates of taxation. The Chief Secretary to the Treasury is present, so no doubt he will correct me if I am wrong. It is my recollection that when the Government came to power in May 1979 the national insurance contribution was 6·5 per cent. and the standard rate of income tax 33 per cent. Moreover, the first £750 of taxable income was taxed at a lower rate of 25 per cent. Since then the standard rate of tax has been reduced from 33 per cent. to 30 per cent., but under the Bill the national insurance contribution will rise from 6·5 per cent. to 8·75 per cent. On the face of it, the rate of taxation seems to have been reduced, in fulfilment of the Government's great election promises about tax reductions, from 39·5 per cent. to 38·75 per cent., although that is scarcely a reduction to celebrate from the rooftops.
  The situation is worse than that, however. The first time that the Government reduced income tax, they abolished the £750 lower band. On the second occasion, they did not increase taxation thresholds at all. We have now reached the incredible position in which someone earning as little as £29 per week will face a marginal taxation rate of 38·75 per cent. on the next pound. I do not know whether any

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  other country taxes at a marginal rate of almost 40 per cent. a person earning one-fifth of the national average wage. Not long ago people on the national average wage paid no income tax at all, although they paid national insurance contributions.
  The Government are now planning deductions from single people who earn not significantly more than a fifth of the average national wage—in other words, about £30 a week. We are telling such people that Britain is in such a financial state that if they earn an extra £1 a week they must give 38¾ of those miserable 100 pennies to the Government to help them balance the books. I challenge the Minister to name any other Government who would dare tax anyone at those incredible rates. The fact is that 38¾ per cent. of any marginal increase in income must go to the State by one means or another. I shall vote against the Bill for that reason if for no other.
  It would be ducking the issue to pretend other than that large sums of money can be raised, but I cannot believe that we need to tax people at anything like that rate. After all, many hon. Members would consider such a wage to be a "pocket money" income, but many people in my constituency work for £40 or £45 a week.
  The way in which we uprate benefits is crazy. We would do better to revert to the inflation rates for the previous year. That at least would be understood and would avoid the 2 per cent. nonsense. I specifically ask the Minister to turn his attention to how the three-year rule for unemployment benefit operates in areas such as mine. I draw to the Government's attention the marginal rates of tax that are now applied to people earning as little as £30 a week. I cannot believe that the Government are unaware of that, and I cannot understand how they are prepared to justify it.
  7.12 pm
  Mr. Bob Cryer: I begin by commenting on the general nature of this regressive legislation, which, as the amendment says, puts an enormous burden on the employed. In so doing, it takes money out of the economy, thereby reducing the level of demand which will in turn increase the number of unemployed. In due time, the Government will have to bring forward further legislation to increase national insurance contributions to pay for the additional number of people on the dole that they will have created.
  Since the Government came into office, the number of registered unemployed has risen to almost 3 million, but almost certainly a further 1 million people are not registered. Therefore, the Government ought to do something to avoid applying further taxation measures through national insurance contributions, because that is what is happening.
  It is no good the Secretary of State arguing that this device has been used before. That is true, but the Government's tax concessions in 1979 were so generous to the well-off that that group is now in the best position in society. According to the Government Actuary's report, which accompanies the Bill, the upper earnings limit is fixed at between six-and-a-half and seven-and-a-half times the rate laid down in section 1 of the Social Security Pensions Act. Instead of bringing forward legislation to increase contributions, it is time that the Government recognised the gross inequalities that they have largely
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  created and tried to remedy them by altering the 1975 Act at least to the extent that people in the top income brackets made a significantly greater contribution towards unemployment pay than they are doing at present. It is a demonstration of the Government's regressive attitude that so far they have failed to do so. Indeed, they have created a society in which the amount paid to the top 10 per cent. of income earners is equal to that paid to the bottom 50 per cent. The Government ought to try to eradicate that inequality, and this is the sort of legislation in which such action could be taken.
  The motion points out that many benefits are already being cut. It says that the burdens upon the employed take place against a background of cuts in benefits. I refer the Minister to early-day motion 127, which sets out graphically and in a straightforward manner what the Government have already done.
  I shall shortly comment in the Chancellor's recent announcement on which this legislation is based, but before doing so I should like to outline the background to the further cuts in benefits.
  The Social Security (No. 2) Act reduced by 5 per cent. in real terms unemployment benefit, invalidity pension and other short-term national insurance benefits to save £140 million in a full year. Section 2 froze the earnings rule for retirement pensioners, which saved £16·5 million in a full year. Section 3 reduced the linking period for spells of unemployment and incapacity from 13 weeks to eight weeks, saving £10 million a year. Section 4 abolished the earnings-related supplement from January 1982, saving £360 million a year.
  That is the sort of enormous burden that the Government are placing on people who are least able to bear it. If I recall correctly, according to the Government's own figures about 1,000 additional civil servants will have to be employed to cope with the supplementary benefit applications from people who no longer qualify for earning-related benefit because of the difficulties in which the Government have placed them.
  Section 5 of the Act reduced unemployment benefit for certain occupational pensioners, saving £25 million in a full year. Section 6, the most controversial section dealing with supplementary benefit entitlement to strikers' families, saved approximately £13 million.
  Mr. J. W. Rooker: I hope that my hon. Friend will realise that, while the early-day motion detailed the cuts that he has just itemised, its general thrust was to attack the quality of the BBC programme "Yesterday in Parliament" and the quality of reporting in The Times and The Guardian, all of which referred only to the section dealing with supplementary benefit for strikers' families and did not mention any of the other cuts to which he has just referred.
  Mr. Cryer: I wanted to give the background to the Bill and elaborate on the amendment to demonstrate that the Social Security (No. 2) Act was a vicious attack on the unemployed and other benefit recipients. As my hon. Friend said, it was treated by the media as though it was solely concerned with an attack on strikers' families. The Government were keen to do that, but they were also keen to attack the weakest in society who were least able to help themselves. The essence of the early-day motion is that the reporting was inacccurate, prejudiced and unbalanced.
  The Government Actuary's report also referred to the increase in unemployment. As I said earlier, there will be

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  further unemployment as a direct result of this legislation taking out expenditure from the economy and thereby reducing demand. Earlier today, the Prime Minister clutched at an increase in production of just over 1 per cent.—after this Government have decreased production over two years by more than 15 per cent. They have a long way to go to achieve the level of production that was operating in this country when they came to power in May 1979.
  What will happen to the economy when the Government increase national insurance contributions? The increase is bound to deflate demand. On page 6 of the Government Actuary's report there is an estimate—which I believe is a woeful underestimate—of an increase in unemployment of 300,000. The Government Actuary is under the general instructions of the Government and as a result he says that there will be an increase in unemployment of 300,000 on average. That figure will probably be nearer 500,000 because of the Government's action.
  Since the Government came into office, they have increased unemployment in my constituency by no less than 182·5 per cent. About 4,000 people in Keighley are chasing about 80 jobs. That is the Government's achievement and they are now introducing legislation that will compound the felony and make the prospect for job-hunting in Keighley worse, not better.
  Mr. Reg Race: May I divert my hon. Friend from job creation and job destruction in Keighley to appendix 3 of the actuary's report? My hon. Friend referred to the woeful underestimate of the increase in unemployment that the Government instructed the actuary to calculate for the coming financial year. Appendix 3 shows that unemployment benefit is to rise by only £13 million between one financial year and another. That strikes me as peculiar if there is to be a substantial increase in unemployment.
  Mr. Cryer: That is an interesting comparison and I hope that the Minister will explain how the appendix ties in with the claim by the Government Actuary that there will be an increase in unemployment of 300,000. Perhaps the Government have plans for slashing unemployment benefit even further, which they have not released to us, but which they have discussed with the Government Actuary.
  In Keighley, 4,000 people are chasing 80 vacancies, and Keighley is not the worst affected constituency in the country. Some constituencies are much worse off and the Government, with a smile on their face in the form of the Chief Secretary, are compounding the problem. We know that the Chief Secretary is not too concerned because he is a wealthy lawyer when he is not earning his money by cutting back on expenditure on the unemployed, pensioners, and so on. He has no cause for concern, but the vast majority of people in this country, and certainly hundreds of thousands of young people, do not know whether they will ever get a job. People in their fifties are particularly fearful because they know that if they are made redundant the chances of them getting a job are virtually nil. That is the tragedy that the Government have created, which they are now compounding by this legislation.
  As I said earlier, this is a vicious spiral. The public sector borrowing requirement is so high because the
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  Government are having to finance unemployment. Under this legislation they are seeking to finance unemployment by imposing a further tax that will reduce demand, create more unemployment and drive them back to the House with more legislation to finance the ever-growing dole queues. That is the vortex into which their mad economics has drawn them. The cost of unemployment in dole payments, supplementary benefits, the loss of direct taxation revenue and the loss of value added tax revenue is now running at about £12 billion a year. In those circumstances it is madness to bring forward this legislation. The Government should find other means of financing the dole queue in the short term, and they should alter their economic strategy so that the dole queues are decreased, the payments of unemployment benefit are decreased and tax revenue is increased. That is the only way to break through the spiral.
  We must resist the Bill and tell the Government to look to alternative policies. For example, they should be injecting more money into the economy—between £6 billion and £10 billion at least. Instead, the Chancellor announced a further reduction of between 3 per cent. and 4 per cent. in the rate support grant, which will inevitably mean an increase in the rate levy if local authorities are to maintain services. If local authorities do not raise the rate levy they will be putting people on the dole queue and, if they do that, the Government will be back here all the sooner asking for a greater national insurance contribution to pay for the extra people on the dole. They should be giving local authorities more money.
  The Government should know by now that of the money that goes to local authorities at least 80 per cent. is spent in the private sector. When they cut back on funds to local authorities they are cutting back on the sector that they claim to represent. That is why there are grumbles from all sorts of associations—for example, associations representing the building trade—because the Government are cutting back on local authority expenditure which, in turn, affects private enterprise suppliers.
  Mr. Race: Does my hon. Friend recall the answer to the parliamentary question asked by my hon. Friend the Member for Vauxhall (Mr. Holland)? He asked the Secretary of State for the Environment what proportion of new build in local authorities in Scotland, England and Wales was accounted for by the private sector. The answer was that 97 per cent. of new build in Scotland was accounted for by the private sector and that the figure was 93 per cent. in England and Wales.
  Mr. Cryer: My hon. Friend has illustrated my point graphically. In Scotland, 97 per cent. of housebuilding in the public sector is undertaken by private enterprise for local authorities—which no doubt scrutinise the private companies in great detail, as they need to do. The figure for England and Wales is 93 per cent.
  Local authorities will be under greater strain at a time when inflation is running at an annual rate of at least 11 per cent. or 12 per cent. They will have to cope with a cutback in expenditure from Government of at least 3 per cent. If Labour-controlled local authorities try to increase rates to keep people in useful employment and to maintain services, such as education, facilities for the mentally handicapped, meals on wheels, services for the elderly and so on, the Government criticise them for trying to keep

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  people off the dole. However, the Government's policies will increase the very dole queues that the Bill seeks to finance.
  The Government should switch from some of their lunatic public expenditure projects, such as Trident, to projects with peaceful purposes. The funny thing is that the Government never link public expenditure with jobs unless that public expenditure is on defence. When defence is mentioned, the Government always bring in the number of jobs generated by public expenditure. Instead of embarking on the £10 billion expenditure required for the Trident D5 missile, the Government should consider more mundane matters, such as the textbooks needed by our schools, the meals on wheels needed by the elderly and the facilities needed by the mentally handicapped. Such essential facilities should take priority over mad and lunatic expenditure on the means of mass destruction.
  The Government should be considering financing research and development into industrial projects. They should follow the path of the Japanese, who are not prepared to cut centrally directed expenditure on industrial research and development and on designing and developing products that people will need and use. If the Government embark on such a path—which is extremely unlikely—we shall need quota controls on imports to prevent increased demand from sucking in imports willy-nilly. In turn, we shall have to stand up to the Common Market and ensure that we are prepared to impose quota controls—whatever the EEC may think—as a prelude to withdrawing from the EEC, whilst maintaining trading contracts with it. We shall also need to restore exchange controls, so that the capitalists who parade as patriots in Conservative guise, when they drape the union jack over the table, are not allowed to shovel money as fast as possible out of the country to any country that will permit the maximum exploitation with the maximum profit. They do not care about those in Britain who need jobs and investment. They are prepared to shovel their money where they can make the maximum profit.
  If we carry out such measures, we shall create real jobs instead of the 12-month foundation jobs that consist of a sort of super youth opportunities programme and which, according to the Secretary of State's statement, will cost over £1 billion per annum. Under that scheme, people are taken from the dole queue and given a 12-month compulsory training course, although it is not clear what the purpose is. They are then shoved back on the dole queue and only a tiny minority of those involved have the possibility of a job. That is the reality. The Government are just disguising the situation.
  As the general election draws closer and closer, the Government will hope to disguise such things. It is no coincidence that the scheme is designed to come into full operation in 1983. The Government wish to doctor the unemployment statistics. According to the Government Actuary's report, unemployment will inevitably increase. The Government's policies will ensure that.
  Paragraph 14 of the Government Actuary's report says that the Treasury supplement will be reduced from 14·5 per cent. to 13 per cent. The supplement to the National Health Service is important. By and large national insurance contributions represent a regressive tax. The Labour Party favours income tax, as opposed to indirect taxation, because it is more progressive and levies a
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  greater tax on those most able to afford it. It relieves those least able to bear it. Of course, under this Government the situation has changed. The Government abolished the Rooker-Wise amendment, proposed by my hon. Friend the Member for Birmingham, Perry Barr (Mr. Rooker)—who is sitting on the Opposition Front Bench, listening attentively—and by Audrey Wise in Committee on the Finance Bill. They sought to provide a link between inflation and taxation allowances so that those at the bottom of the tax bracket moved upwards as inflation increased.
  By removing the Rooker-Wise amendment, the Government have automatically brought people into the income tax net in a regressive way. Those who, under the Labour Government, were not subject to income tax, pay income tax under the Tories—the party of unemployment. Given that income tax is potentially more progressive than indirect taxes, it is far better to finance the National Health Service through income tax than through national insurance contributions. To reduce the Treasury supplement to finance the National Health Service is a regressive step, that entirely conforms with the Government's attitude. They wish to shift the cost of the National Health Service away from the public purse towards any source of revenue that they can get hold of. In the fullness of time, the Government will no doubt be anxious to abolish completely the Treasury supplement and to replace it with charitable resources. The friends of hospitals will have to help to finance the National Health Service by holding jumble sales or bingo evenings. That is the way that the Government are going.
  The legislation is regressive, because it places a greater and unfair burden on the employed. It reflects the Government's disastrous and failed economic policies and their continuing attack on those who are in receipt of benefits—those who are least able to withstand such attacks. Therefore, together with my right hon. and hon. Friends, I shall vote against the Bill.
  7.37 pm
  Mr. Reg Race: My hon. Friend the Member for Keighley (Mr. Cryer) referred to early-day motion 127, which is of key importance to the debate. We have often drawn attention to the outrageous way in which the then Social Security (No. 2) Bill was reported by the press, and that affects our deliberations tonight. The cuts in benefits that have now been implemented as a result of that Act are referred to in the motion.
  I well recall going to the BBC radio studios in Bridge Street to argue the toss about the "Yesterday in Parliament" programme, which had said that the Social Security (No. 2) Bill cut strikers' benefits. I had a substantial public row with one of the BBC's senior reporters, who refused to acknowledge, at that stage, that reporting had been anything other than fair. As a result of the Government's actions the contents of the Social Security (No. 2) Act are being implemented in their entirety. The consequences for beneficiaries and their families are set out in the early-day motion. We only hope that the media and the BBC—who are not represented in substantial numbers tonight, as is usual when we discuss social security matters—will report the proceedings fairly, impartially and properly.
  The Bill contains many important features, one of which—the 2 per cent. shortfall—is important for beneficiaries. I understand that the Minister made no firm

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  commitment to making good the 2 per cent. shortfall, which will save the measly £65 million about which the Minister's own Back Benchers are fed up. I hope that before the end of the debate there will be a clear assurance from the Government that the 2 per cent. cut in benefits next November will be reinstated. There will be enormous difficulties for the Government and the Civil Service in implementing the proposal for three rates of supplementary benefits. There will be great hardship for those on supplementary benefit who will have to ask for additional payments for such things as clothes, shoes and furniture and so on because their benefits have been cut in real terms.
  There is no justification for certain people suffering a permanent cut of 2 per cent. in benefit while others will have that shortfall in benefits from this November reinstated to their benefit rates from next November.
  Mr. Cryer: My hon. Friend may recall the Under-Secretary of State for Health and Social Security saying:
  "For the sake of the record, I shall go further and list the other benefits that are not pledged by my right hon. and learned Friend the Chancellor of the Exchequer—unemployment benefit, sickness benefit, injury benefit, maternity allowance, child benefit—including one-parent benefit—family income supplement, mobility allowance and supplementary allowance."—[Official Report, 3 December 1981; Vol. 14, c. 485.]
  All those people will be attacked by the Government and not receive the 2 per cent. shortfall.
  Mr. Race: That is right, and I well remember the Minister reading out the list of benefits that were not to be uprated. The question that was being posed by the Opposition—no one else was asking it—was which of the benefits will be uprated in line with inflation and protected and have the shortfall put back, and which will not. It was only by Opposition pressure that we obtained an answer to that question.
  This winter the problems for beneficiaries will be far greater than they have been for a long time. Benefit rates are now far too low. That needs to be said because there are hon. Members who say that benefit rates ought to be kept low, either because the claimants are scroungers, or because the Government want to pursue a particular economic policy. People must be priced into jobs by lowering the real rate of wages, and hence the real rate of social security benefits, otherwise it would be more profitable for people to be out of work than in work.
  Ministers constantly tell the House that it is no good increasing wages and the demand in the economy because we have to improve the competitiveness of our industry in relation to that of our major foreign competitors. The problem with that thinking which is a central plank of the Government's policy, is that they are arguing that people will price themselves into jobs if they have reductions in their real living standards. The answer to the Government is that jobs will only be created, as my hon. Friend the Member for Keighley (Mr. Cryer) pointed out, by increasing demand in the economy.
  The quarterly report of the National Institute for Economic and Social Research, published in November, argued that only a major reflation of the economy could put back into the economy the jobs that had been lost. It criticised the Government's argument that only reductions in real wages could price people back into jobs. That is of relevance to what we are discussing tonight, because the Government feel that they have to keep social security
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  benefits low in order to justify the relationship between benefits and wages. If the Government say that wages ought to be reduced in real terms in order to price people back into jobs, it follows from their own logic that social security benefits must also be restricted in their real value in order not to have the problem of disincentive arising in relation to those who are in work and those who are out of work and potentially seeking jobs.
  When we criticise the Government's level of real social security benefits, we are implicitly attacking the Government's major economic policy. We are saying that the only way out of the hole that the Government have dug for themselves is to reflate the economy and go forward to create a more planned economy, along the lines that my hon. Friend the Member for Keighley described a Few moments ago.
  It is not only to the general economic problems that we are referring in criticising the Bill; we are concerned specifically with the low paid. The hon. Member for Truro (Mr. Penhaligon) rightly referred to the problems of the low paid in his constituency. The Government have abolished the 25 per cent. rate of income tax—the £750 band that was put in by the Labour Government to reduce the sharpness of the move into income taxation at the bottom level of the wages ladder. I draw attention to another major scandal in the treatment of the low paid.
  The Government Actuary's report is on the table with the Bill that we are discussing tonight. We are talking about increasing the lower earnings limit for class 1 contributions. It can be seen from page 3 of the report that the lower earnings limit is going up from £27 to £29·50 a week. The low paid are clobbered when they exceed that limit. Not only do they start paying national insurance contribution upon that part of their income above £29·50 a week; they have to pay it on the whole of their income, including everything up to £29·50 a week. That is horribly regressive to people earning tiny incomes. The sooner we get away from that policy and the sooner we say to the low paid that they do not have to pay national insurance contributions up to the level of the lower earnings limit, the better.
  The term "poverty trap" is used to describe the situation in which people get an increase in their wages and lose a certain amount of social security and means-tested benefits as a consequence. There is also a national insurance trap, whereby people have to pay their national insurance contributions on the whole of their income below the lower earnings limit and not just on that part which falls above it.
  Mr. Andrew F. Bennett: Will my hon. Friend accept that there is a double trap? People are caught for the full rate as soon as they go over the lower earnings limit, but if the rate is then put up and they drop out, it may well mean that they will pay anything up to six or nine months of contributions, but because they have not paid for the full 12 months they will get no benefit. Does my hon. Friend agree that it is a double trap, because people pay Put may still get no benefits?
  Mr. Race: As usual in these matters, my hon. Friend is correct. If a low-paid worker goes over the top of the lower earning limit, begins to pay national insurance contributions and pays them on the whole of his weekly income, it is possible for him not to build up a proper contribution record because he may not earn that sum for

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  a long time—he may earn it for only one or two weeks. Therefore, the whole basis on which the national insurance system is built—the establishment of a contribution record that entitles people to claim benefit when sick or unemployed—is substantially undermined.
  Another matter in the Government Actuary's report that we ought to discuss—I hope the Chief Secretary deals with it when he replies, because it is an important point—is the point I made to my hon. Friend the Member for Keighley a few minutes ago about appendix 3, which shows that in the financial year 1981–82, £1,983 million was to be expended from the national insurance fund for unemployment benefit. The next column shows that in the financial year 1982–83 that sum has risen to £1,996 million—an increase, of only £13 million. I ask whether that figure was a printer's error or, as I suspect, that there is a logical reason for it. I hope that the Chief Secretary can tell us the reason for that and whether most of the report's predicted 300,000 increase in the wholly unemployed—a figure inserted on the Government's instructions—will have to rely on supplementary benefit rather than the national insurance unemployment benefit. It cannot be that the predicted increase in unemployment will cost only £13 million.
  Mr. Cryer: Is one possible explanation the fact that the long-term unemployed will be shifting after 12 months of unemployment benefit to supplementary benefit? Is it not a terrible indictment of the Government's policies that they are planning to maintain a large proportion of long-term unemployed and are recognising that, without any palliatives such as foundation courses which they are producing for the young unemployed? The Government recognise that their economic policies create a pool of long-term unemployed labour which will be forced to exist on supplementary benefit.
  Mr. Race: That is true, and the numbers unemployed for more than six months and a year are increasing as a proportion of the whole. The position of the young unemployed who have been on the unemployment register for a considerable time is also very grave.
  The point that my hon. Friend the Member for Keighley did not raise concerns long-term rates of supplementary benefit paid to those who are unemployed for more than a year. The Government have not kept their promises because all that they have done is to say to workers over 60 that they can move on to the long-term rate of supplementary benefit if they are unemployed. However, the rest of the unemployed cannot do that. If they are not eligible for national insurance unemployment benefit, they do not get the long-term rate of supplementary benefit, which is the higher rate. I hope that the Chief Secretary will answer that point because we want to know why only a tiny increase is allowed for in appendix 3.
  Mr. Andrew F. Bennett: My hon. Friend is giving some of the unemployed false hopes because, as I understand it, those over 60 do not get on to the long-term rates automatically—they have to have done a year on the short-term rates. There are those who are not eligible for the short-term rate, possibly because of a wife's earnings, but who would be eligible for the long-term rate, but they can never get to that.
  Mr. Race: That is true. A point not stated in the table on appendix 3 is how the figures are calculated—whether on 1980 prices or on another basis. That is a major deficiency, because we cannot tell whether the figures are in real or cash terms and I am sure that it would be helpful to the House if that point were clarified.
  My hon. Friends have already referred to the Government Actuary's estimate of the increase in the level of unemployment. I have been considering the quarterly reviews, not only of the national institute but of the Cambridge Economic Policy Group and others, which have predicted increases in the level of unemployment substantially greater than the predictions included in the Government Actuary's report on instructions from the Ministers.
  I hope that when the Government discover that the level of unemployment is increasing more rapidly than they had predicted they will not return to the House and ask for further increases in national insurance contributions to pay for the shortfall in the national insurance fund which would be their fault because they had instructed the Government Actuary to take into account a lower increase in unemployment.
  If the Government Actuary had been instructed to make an assumption of a higher growth of unemployment the Chief Secretary would have had to come to the House and say "We need a higher national insurance contribution increase from employees and employers". The 300,000 increase assumption is in the report because the Government did not want to ask for a higher increase in national insurance contributions.
  The Bill is linked with the cuts in benefit implemented by the Government over the past two and a half years and it increases the level of taxation. It is astonishing that Ministers still have the gall to say at the Dispatch Box that their party is in favour of cutting taxation when their record in Government is that taxation—including national insurance contributions and income tax—has increased by 5 per cent. in real terms during their period of office.
  Mr. Cryer: Before my hon. Friend leaves the question of benefits, will he comment on the refreshing honesty shown by the hon. Member for Kensington (Sir B. Rhys Williams) when he said "We are definitely taking money away from the children", referring to the effects of cutting back benefits in the Bill? Does my hon. Friend agree that it is a pity that there are not more Conservatives who take an interest in this legislation, because the hon. Member for Kensington has been the only Back-Bench Conservative speaker and it is a pity that there are not more Conservatives who are honest enough to recognise the serious attacks that the Government have made on children in our society.
  Mr. Race: The absence of Conservative Members traditionally interested in these issues has been noted and we have had only one contribution from a Back-Bench Conservative. Where are the other Tory Members who were in the House when the recent Adjournment debate was promoted by my hon. Friend the Member for Stockport, North (Mr. Bennett)? They may have some covert deals with the Government over the 2 per cent. shortfall. If they have, the Government should come clean with the Opposition and tell us what that deal is. They must have done something of that sort or Conservative

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  Members would not have been so cowardly as to refrain from being in the Chamber tonight. I hope that the Government will tell us what deal has been reached.
  Not only have the Government not increased child benefit in line with inflation, and Tory Back Benchers are angry about that, but they have reduced the real value of the child dependency additions to many benefits that are still available. It is common knowledge among those who are interested in social security matters that the Government intend to phase out the additions. Their record of support for families with children is not good and that is a further excellent reason for opposing the Bill and the consequences of the Government's action.
  The cuts in the Exchequer subsidy to the national insurance fund are important because the Government are saying that general taxation is not a suitable vehicle for financing social security benefits—in other words, those in work must pay for the unemployed and the sick. The Opposition do not entirely support that principle. We favour contributions systems under which people build up an entitlement to benefits through their contributions, but we also favour subsidising the national insurance fund from general taxation.
  Those who draw social security benefits, whether national insurance or supplementary benefits, are the poorest in society. They are subsidised by the poorest and the middle-ranking groups in society. Those who are not subsidising the national insurance fund through general taxation are companies, because company taxation is virtually voluntary. I read in the Financial Times recently that capital transfer tax has become a voluntary tax, just as the old death duty was voluntary.
  When the Government say that they intend to remove part of the Exchequer grant to the national insurance fund, they are introducing a much more regressive method of financing the social security budget. We do not support that. We favour paying for benefits through general taxation and sharing the burden equitably.
  A scandalous view of social security benefits emanates from Ministers. They say that they have protected the NHS and social security benefits from the worst ravages of public expenditure cuts and point to the increases in absolute sums that Parliament has voted for social security and that have been spent on paying benefits, but they ignore the reasons for that. The increased social security budget, which the Government are having to defend to the Treasury, is a direct consequence of the depth of the recession. If we moved back to full employment and a reflationary economic strategy that budget would be cut in real terms. In their hearts, the Government know that that is so.
  I hope that we shall get no more of the silly remarks that have disfigured our social security debates when Ministers have said that they cannot allow real increases in social security benefits because we pay too high a proportion of public expenditure and GDP on benefits.
  I hope that the Bill will be defeated. We oppose taxation increases in the form proposed by the Government. Let us have a social security system that is paid for by everybody out of general taxation. Let us stop attacking the low paid and stop abusing the national insurance lower earnings limit. Let us get back to increasing the level of social security benefits in real terms and away from the cuts that the Government have been imposing in the past two and a half years.
  8.5 pm
  Mr. Ioan Evans: The Bill is not the legislation that was envisaged in the Queen's Speech. It may be included in the reference to other measures being laid before us, but nothing in the Queen's Speech suggested that there would be an increase in national insurance contributions.
  The Bill was the result of the Chancellor of the Exchequer's public expenditure statement on 2 December. I was interested to hear on the radio this morning that the Chancellor's speech in our debate on public expenditure was written by the Prime Minister. That report has not been denied. If the speech of the Chancellor, who deals with the nations's finances, was written by the Prime Minister, it is a significant development. If that is not so, I hope that the Chief Secretary will deny the report. [Interruption.] I understand that it was not the Prime Minister who wrote the speech, but her economic adviser, Professor Walters.
  The Government have got into a hopeless financial mess. We all know that. Monetarism is failing and the Tory Party, which has tended to accept the consensus of the Welfare State, is seeking week by week measures to undermine it. On the establishment of the Welfare State there was a general recognition by all parties that we should care for people and that Governments should be compassionate in meeting people's needs. The Bill and other measures show that the Government are seeking to undermine the basis of the Welfare State.
  Professor Walters is suggesting where cuts can be made and the chap from Marks and Spencer is going round Departments to find out where cuts can be imposed. It is deplorable that the Government's policies result in the least well off being hit hardest.
  We should look at the Bill not in isolation, but in the context of everything that the Government have done since taking office. The mini-Budget, of which the Bill is a part, should be considered in the light of the first Budget of the Chancellor in which the wealthy were given tremendous benefits. Tax on the highest income groups was greatly reduced.
  If Professor Walters is behind all this, we should remember that he is on the top Civil Service salary and finds that insufficient. It is supplemented by income from the Centre for Policy Studies.
  Mr. Michael Brotherton: Hear, hear.
  Mr. Evans: I am glad to carry the hon. Member for Louth (Mr. Brotherton) with me and I am pleased to see him in the Chamber. The only Conservative Back Bencher who has spoken so far is the hon. Member for Kensington (Sir B. Rhys Williams), who was critical of many aspects of the Bill. That shows the support of Conservative Back Benchers for the measure. Where are the wets? Where are those Conservative Members who are highly critical of the onslaught that the Government are making on the Welfare State and the financial policies that undermine the whole economy? They are in deep freeze this evening. They are not here to participate. Since they are critical of other aspects of Government policy, they should have been expressing their views here tonight.
  Mr. Brotherton: They are not here. The hon. Gentleman argues that they are not here.
  Mr. Evans: I think that the hon. Gentleman is not quite all here.

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  This is part of the Government's monetarist strategy. We have been told that the aim was to reduce inflation, interest rates, taxation and unemployment. We were not told that the Government would reduce social benefits. That is what the Bill does.
  The Government have increased inflation. It has increased by over 40 per cent. since the Government came to power. That fact is relevant to the Bill. Wage earners and workers are told by the Government that they must not expect a wage increase that is equivalent to inflation. They are told that they must expect a cut in their living standards. On top of that, there is to be a further deduction in order to meet the insurance burden.
  The Government have failed to reduce inflation. Yet this was apparently their main strategy. All the sacrifices and the cuts were designed to bring down inflation, but inflation has persistently increased. The Chancellor himself talks about 12 per cent. inflation in relation to the retail price index. That is higher than when the Government took office. The Government choose to use the tax and price index, devised in the Treasury by one of the Treasury Ministers who has now moved to the Department of Energy. This index not only measures retail price increases but also takes into account the tax burden and insurance burden. I should like to know from the Chief Secretary the effect of the Bill on the tax and price index. That index already shows an inflation rate approaching 15 per cent.
  The Government's strategy was also to reduce interest rates, but they have been persistently higher under this Government than under the Labour Government. The Government's approach was that sacrifices would have to be made to bring down interest rates. One should try telling that to people with mortgages who have been warned by building societies that the rate may go up. That has happened as a result of the Government's financial policy.
  The Government pushed up interest rates more than need have been the case through the withdrawal of exchange controls. Other countries have followed that example. The process has now developed into a vicious circle.
  According to the Government, the public expenditure statement was the bad news and the good news will come with the Budget. I hope that the next Budget will not produce further concessions for the wealthy. That was the main purpose of the Government's first Budget. National insurance is as much a part of taxation as income tax. When he receives his pay slip, the worker looks at what he has earned and what he is taking home. People are paying more income tax under this Government than they were under the Labour Government.
  The Government promised that they would reduce unemployment. In fact, unemployment has more than doubled. The Secretary of State for Employment states that unemployment is 12 per cent. In my area it is over 20 per cent. among male workers. Unemployment has increased substantially over the length and breadth of the British Isles. Its size affects the amount paid in unemployment benefit. I have seen no denial of an estimated cost to the Exchequer of £6,000 for every unemployed worker, assessed on loss of productivity and payment of benefits. If 1 million people were unemployed,
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  the cost would be £6 billion. With the present figure of 3 million unemployed, the cost amounts to £18 billion, more than the total paid in social benefits.
  Mr. Bill Walker: The hon. Gentleman describes the 20 per cent. male unemployment in his constituency as resulting from Government policy. How does he explain the 20 per cent. male unemployment in part of my constituency that occurred as a result of closures before the Government came to office?
  Mr. Evans: Is the hon. Gentleman saying that male unemployment was 20 per cent. before?
  Mr. Walker: Yes.
  Mr. Evans: In that case I should like to look at the figures, because I doubt that very much. I should be very surprised if that were so. There are areas in the United Kingdom with unemployment of 40 per cent. The figures are there to prove it. Unemployment has gone from 1,300,000 to 3 million. Over 1,700,000 people have become unemployed since the Government took office.
  I do not want to weary the House by giving a catalogue of manufacturing industries that have closed in my constituency. I have met industrialists who have told me categorically that unemployment is not due to wages or bad industrial relations but is a direct result of the financial and economic policies pursued by the Government—
  Mr. Deputy Speaker (Mr. Ernest Armstrong): Order. I remind the hon. Gentleman that we are discussing the Social Security (Contributions) Bill. I hope that he will speak to it.
  Mr. Evans: I was responding to the question put to me, Mr. Deputy Speaker, but I shall not develop it. However, perhaps I may say, in passing, that one of those firms was a part of Tube Investments. That company was a large contributor to the Tory Party.
  Many firms have suffered as a direct consequence of the Government's policies. The point I am making is that, with 3 million unemployed instead of 1,300,000, the total of public expenditure is consequently increased. The Government are saying "We have got it wrong. We have made a mess of the economy. There is a recession and that is partly to blame". But Britain is in a far worse position because Government strategy has been bad. So the Government are now saying that, because there are more people drawing insurance benefit, they must ask the workers to make increased contributions.
  The Government have got the wrong strategy and need to change it. In a recession it is wrong to take more money from the people's pockets when there is no demand in the economy. That is why I believe that on economic grounds alone we should object to the Bill.
  At a time of recession the Government are reducing capital projects when they should be expanding them. They should be getting the unemployed back to work and promoting various projects in the public sector. That area has been neglected.
  Those are the things that should be done. The amount that we would then be spending on unemployment benefit would be far less than is spent at present. It is wrong to increase the burden upon unemployed persons when that burden has already been increased by the Government's policy and to tell workers that they must have a cut in their living standards, particularly when wage increases are restricted to 4 per cent. and inflation is at 12 per cent.

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  This is the wrong time for the Government to decrease the Treasury contribution to the national insurance fund. If they have their sums wrong, this is the time to increase the Treasury's contribution. I say that not only about employees but also about the employers. The employers have been making representations to the Government to reduce their part of the national insurance contribution. At a time when the Government should be seeking to encourage employers to maintain people in employment, it is wrong to think of increasing the employers' as well as the employees' contribution. That should not be done when the real value of benefits is being cut. That is why the Opposition are right to decline to give a Second Reading to the Bill.
  We have talked about the cuts in benefits. It is highly deplorable to expect working people to pay an additional contribution to the National Health Service. Incidentally, I do not know whether prescription charges are included in the taxes and prices index, but we had a categorical statement from the Government before the election that they had no intention of increasing the prescription charge, which at the time was 20p.
  Mr. Race: Six "Labour lies."
  Mr. Evans: I believe that there were 12 "Labour lies". A Daily Mail article said that there were 12 Labour lies and one of them was that a Tory Government would increase prescription charges. I put that to the Prime Minister recently and she said that she had not said it. Was the Daily Mail lying? The Daily Mail said that she said it, and that the Tory Party said that the prescription charge of 20p would not be increased. What have the Government done? The prescription charge has risen from 20p to 60p, from 60p to £1, and from £1 to £l·30. I know that there are exemptions.
  Mr. Eastham: It is a 650 per cent. increase.
  Mr. Evans: That is right. My hon. Friend takes the words out of my mouth.
  What a deplorable record. The Government have picked on the sick and those in need of help to treat most adversely. Let us see that the prescription charge is included in the taxes and prices index.
  At present we have very severe weather conditions. We do not know how long the winter will last. Some old-age pensioners are living in very difficult conditions. Those dependent on benefits are beginning to wonder how they will be able to pay for their electricity, gas and coal. This is not the time for the Government to be taking from those who have so little.
  I ask the Government to think again about this measure. We shall be returning to it on Thursday. We have heard talk about the old Tories of the 1930s having changed and that at present the Tory Party is the party of not two nations but one nation. Let not that be told to the people, because only a very small proportion of the British people have benefited substantially under the present Government, but the vast majority have seen their living standards whittled away. Many have had their jobs taken from them. Those in greatest need have experienced the greatest suffering in this country for many years.
  8.27 pm
  Mr. J. W. Rooker: I do not think that I shall be accused of overstating the point if I say that this has been a wide-ranging debate. Basically, I
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  intend to confine my remarks to one part of the Official Opposition amendment—the real cuts in the value of many benefits. I suspect that on Thursday we shall look at the clauses in greater detail. I make no apology for saying that I do not intend to refer very much to the Bill.
  The Secretary of State read out a brief. He sounded a bit like a civil servant when reading it.
  The Chief Secretary to the Treasury (Mr. Leon Brittan): Oh no.
  Mr. Rooker: The Secretary of State seemed to say that the Government were doing a good job on benefits. It was a speech which, in manner, could have been delivered by anyone sitting in the Officials' Box, rather than a practising politician. My hon. Friend the Member for Pontypridd (Mr. John) made a coherent case against the Bill.
  There is a problem regarding the cuts in benefits. Concern has been expressed by Conservative Members—although not in the Chamber this evening. From reading some of their comments in the last four or five weeks and, more particularly since the Chancellor's statement a couple of weeks ago, it seems that it has suddenly dawned on some Tory Members that there have been some cuts in social security benefits. Unfortunately, the view that there have not been any cuts until now is shared beyond the Conservative Benches. In The Economist of 10 October there was a fairly lengthy article entitled "Thatcher at mid-term". Buried in that was a sentence which takes some believing:
  "The Thatcher government has not cut benefits".
  At least they had the good grace to publish a letter from me two weeks later detailing some of the real cuts, in both cash and percentage terms, that the Government have put through the House during the past two and a half years.
  The Chief Secretary will be expecting my first point because he has been pressed on it during the debate. We wish to know what exactly is the position about the shortfall in the short-term benefits. Unfortunately, the Secretary of State, in opening the debate, clearly did not have either Cabinet approval or Treasury knowledge about what will happen. However, someone has knowledge, in The Observer on Sunday the headline was "Howe in benefits retreat". The headline in The Times yesterday morning was "Howe 'will not cut benefits'". Both articles alleged that the Government Chief Whip had promised privately to Conservative Back Bench Members that in the Budget the Chancellor would make a different statement from the one that he made recently.
  It is no good for Conservative Members to be told something in private, which has directly caused their absence from the debate. If those Conservative Members were sincere in their beliefs and in what they have said during the past two weeks, they would have been here today to press the Government about the 2 per cent. cut. If they have been reassured privately—it has been published in the press—why cannot the Chief Secretary have the good grace to say that the press reports are accurate? He clearly wishes to have the opportunity to make the Government's position clear. However, we wish to have the answer tonight, because it is not good. enough that Conservative Members should be given information privately. It could be argued that they have failed in their parliamentary duties. They believe sincerely that the Government's policy on unemployment benefit is wrong,

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  but they have not come to the Chamber to make the case for their constituents. They may have done so by private agreement. If they have, we must know why.
  I wish to deal with two or three benefits in some detail. The first is unemployment benefit. It is well known to anyone who was in the Chamber last week at Prime Minister's Question Time that on two occasions, on Tuesday and Thursday, the Prime Minister tried to deny the challenges from my right hon. Friend the Leader of the Opposition that, for the man on average earnings with two children who became unemployed in May 1979 or who becomes unemployed in January 1982, there will be a real I cut in unemployment benefit of £13 a week. That cannot be denied. However, the Prime Minister denied it twice last week.
  I wish to give the brief background to that. The information was given in an answer to the hon. Member for Anglesey (Mr. Best)—a Conservative Member—on 20 November. Of course, the answer did not put it in those terms. It was not admitted bluntly that £13 a week had been lopped off. The question is on the record in columns 225 and 226 of Hansard. The key figures are that, in May 1979, a man on average earnings with two children would receive total social security benefits of £48·49. In January 1982 his social security benefits will be £55·20. There is no denying the fact that between May 1979 and January 1982 there has been about a 40 per cent. increase in the retail price index. The figure of £55·20 for January 1982 should be increased to £68 if it is to equal the real value of the benefits received in May 1979.
  The Prime Minister was invited to subtract £55—which is what that man will receive next January—from £68—which is what he would have received had the value of unemployment benefit been maintained between May 1975 and January 1982. That subtraction leaves £13 per week. How that came about is irrelevant. Those were his benefits. It is not good enough for the Prime Minister or other Ministers to say that earnings-related benefit must be subtracted. Who abolished the earnings-related supplement? Twice last week the Prime Minister, at the Dispatch Box, ran away from the facts because she did not want to confirm that a man in that position would lose £13 a week from next January. The same figure will apply to anyone on average earnings with two children who had an industrial accident between May 1979 and January 1972.
  Another aspect of the cuts in unemployment benefit is the 5 per cent. abatement. The Government call it a 5 per cent. saving. The Opposition know that it is 5p in the pound off unemployment benefit. During the past couple of weeks Tory Members have made a fuss about the 2 per cent. shortfall, yet every one of them voted for a 5 per cent. cut. That 2 per cent. represents one week's benefit over a year. We are talking not about statistics but about men and women who have to live on £37 a week. The 2 per cent. shortfall means that they will lose a week's benefit. It affects millions of people and their families. All Tory Members voted for that 5 per cent. abatement as a substitute for taxation.
  When the Social Security (No. 2) Act 1980 passed through the House, I asked the Secretary of State to detail the full effect of the cuts on the benefits affected by the 5 per cent. abatement. I was told that £45 million in unemployment benefit would be saved by that change. Yesterday, I asked for that figure to be updated because
  220
  of the massive increase in unemployment. The figures show that unemployment benefit has been cut by £80 million because of the 5 per cent. abatement for which every Tory Member voted. Tory Members moaning about 2 per cent. do not have the good grace to admit that they voted for a 5p in the pound cut off the uprating in 1980.
  I wish to give a further example of the real cut in benefits by cutting widow's allowance. I was interested in the form of the answer given to the hon. Member for Anglesey. A week later I tabled a question about widows' benefit. I did not receive my answer in the same form so I could not discover the total cut. Yesterday, I asked for my original answer on 13 November to be given to me in a similar form to that given to the hon. Member for Anglesey on unemployment benefits. I was told in a written answer that in May 1979 a widow aged between 50 and 59 years at widowhood with no dependants, whose late husband's earnings were at average levels, would have received a widow's allowance of £40·59. I was told that in January 1982 she will receive £41·40. In other words, in two and a half years there will be an increase of less than £1 a week.
  As I have said, in May 1979, a widow received £40·59. Since then there has been a 40 per cent. increase in the retail price index. In January 1982 she should be receiving £56 to £57 a week. Instead she will be paid £41·40. We have not heard too many complaints about that. There has been a real cut in the widow's allowance of about £15 to £16 a week.
  When the Secretary of State introduced the Bill he made great play about the Government's commitment on pensions. No one denies that the Government have a pensions commitment. They are committed to keep pensions in line with prices. Such a pledge is merely a commitment not to increase the real value of pensions. In a recent answer the Minister of State tried to take credit on behalf of the Government for keeping pensions 2 per cent. ahead of the increase in prices since the Government have been in office. If I remember rightly, the hon. Gentleman claimed that from November 1978 to November 1981 pensions increased by 52 per cent., and that the RPI had increased by 50 per cent. I was surprised to learn that the Government had been doing more for pensioners than even the Prime Minister's pledge. Where did the 2 per cent. come from?
  The Minister's figures went back to November 1978, and we all know that the November 1979 uprating was based on the Labour Government's formula of "Prices or earnings, whichever is the higher". We know also that earnings were higher than prices that year. I asked the Minister to explain the 2 per cent. increase and I imagine that his civil servant said "Minister, you have been caught. Do not bother to waffle." The answer to my question was one word. It was "Yes." The reason for the extra 2 per cent. lies in the spillover from the Labour Government's formula, which the Tories changed when they took office. There is a real cut when earnings increase in excess of prices.
  The Minister knows that the earnings limit was to be abolished according to the Tory Party's manifesto. The freezing of the limit in 1981–82 has cost pensioners £25 million. The limit has been frozen for two years. Men over 60 years with occupational pensions have lost £25 million in unemployment benefit in 1981–82 as a direct result of the Social Security (No. 2) Act 1980. There has been a real

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  cut in their benefits since the Government came into power. The Government have not given pensioners the good deal that appears on the surface.
  Tory social security policy seems to be the abolition of the earnings related supplement and increased contributions for contributory benefit. In January someone who becomes sick and who is in receipt of average earnings will lose £13 a week in sickness benefit because of the abolition of the earnings-related supplement. From January 1982, the loss in real terms on injury benefit will be £14·10 a week. I agree that that is only for 26 weeks, but everyone understands that. However, that amounts to a great deal of money when the weekly figure is multiplied by 26. From January 1982, maternity allowance will amount to £8·80 a week because of the loss of earnings-related supplement. I have already referred to the cut in the widow's allowance. I received the information in a recent answer. The average widow's allowance cut is £14·90 a week. That is a real loss because there is nothing to replace it unless the widow in question is so poor that she can claim supplementary benefit from the Department of Health and Social Security. I understand from recent answers that, as a direct result of the Social Security (No. 2) Act, at least 135,000 more of our fellow citizens will have to claim means-tested supplementary benefit because the Government have abolished benefits for which people have paid contributions in the past. What is so galling and hypocritical is that Tory Members have never complained about that.
  The hon. Member for Truro (Mr. Penhaligon)—who has returned to the Chamber—made the point quite effectively about the increase in the marginal rate of tax. That same point was made on Second Reading of the Social Security (No. 2) Bill last year. The figure that he did not quote, which would have made his point more effectively, is that the increase under this Tory tax-cutting Government in the marginal rate of tax on the low paid will be 23 per cent., following the passage of this Bill. That is the difference between 31½p and 38¾p at the margin. The figures are well known. We talk of national insurance as a tax. Ministers and former Ministers clearly understand that national insurance is regarded as a tax by the working population. I do not intend to delay the House by repeating the speech that I made last year in which there were many quotes from hon. Members on the Government Benches who said in the past that national insurance was treated as a tax. One has simply to add the 25p in the pound, which was the lowest rate of tax for the low paid when Labour left office, to the national insurance rate at the time, to get the 31½p. Now, we are up to 38¾p. That comes from a Government who had the brass neck to say in their manifesto, on page 27:
  "Income tax starts at such a low level that many poor people are being taxed to pay for their own benefits."
  Now, I shall quote the Tory Chancellor of the Exchequer who said recently:
  "It is, moreover, right that those in work should shoulder the additional costs."—[Official Report, 2 December 1981; Vol. 14, c. 239]
  Those in work, of course, can be those on family income supplement who are paying income tax and receiving a social security benefit. Therefore, in some ways, the Government have made a complete turnabout. They have come full circle. I do not know of any more benefits that they can abolish. I suspect that there are more benefits that they can cut in real terms because there are not enough
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  Tory Members with the guts to vote for their constituents' interests or vote for what they were elected on—their manifesto. It is futile for me or any other Opposition Member to expect any Conservative Member to enter our Lobby tonight.
  I repeat what was said by my hon. Friend the Member for Pontypridd at the beginning of the debate, that unless there is a clear commitment from the Government about the 2 per cent. cut in unemployment and other short-term benefits, the Opposition guarantee to give the Conservative dissidents the opportunity to register their dissent. There will be no chance to vote against the order, because the order will increase benefit. It must be accepted or rejected and, nobody in his right mind will vote against an increase of 10 per cent. in unemployment benefit simply because it should be 12 per cent. An order cannot be amended. There will be a further opportunity on the Social Security Housing Benefits Bill, which is presently in Standing Committee. Its long title is drafted in wide enough terms for the Opposition to ensure that on Report on the Floor of the House, in peak time, there is no excuse for any Tory Member to run away. They will have the chance to put that 2 per cent. back.
  I conclude with this consideration, which should be placed on record. With one exception, not one Conservative Member has come to the House to talk about cuts and unemployment, not as statistics but as they affect real people and their families. We shall make sure that the electorate fully understands that when the opportunity comes.
  8.50 pm
  The Chief Secretary to the Treasury (Mr. Leon Brittan): The hon. Member for Birmingham, Perry Barr (Mr. Rooker) was most candid in making it clear at the outset that he had not the slightest intention of talking about the Bill. None the less, with the assiduity and skill that we have come to admire, he contrived to remain within the rules of order while making a general political speech about the Government's social security record. Indeed, he covered a wide range of matters which were covered in the debates on the legislation of which he now complains with regard to the earnings-related supplement.
  It will, I suppose, be equally within the rules of order for me to rake over the coals and talk about the social security record of the Labour Government and to refer to the scandal of 1976 when, in order to save £500 million, a switch was made in the method of uprating from the historical method previously used to the forecasting method. The hon. Member for Truro (Mr. Penhaligon) thought that that was a mistake. It was more than a mistake. It was a deliberate act designed to save the Exchequer at the expense of pensioners.
  I mention those facts only to demonstrate that there are other ways of looking at history.
  Mr. Andrew F. Bennett rose—
  Mr. Brittan: I have only just begun my speech. I should like to elaborate a little on this.
  It is also worth mentioning that prior to the 1981 uprating there had been only three occasions since 1948 when the pension uprating did not fully compensate for price increases—in 1951, 1969 and April 1975, An elementary knowledge of political history in this country will show which party was in power then.
  Mr. Bennett: If the Minister is arguing that things went wrong in 1975–76, as many of us would accept, what did the Tory Party do to put them right as soon as it came to office?
  Mr. Brittan: That observation comes better from the hon. Gentleman than from Front Bench spokesmen seeking to make a case about the comparative records of Governments.
  I hope that I shall be forgiven if I commit the unpardonable offence of actually talking about the Bill. In speaking of the history of social security matters generally, it was perfectly natural that hon. Members on both sides should raise more general questions about the system. I refer particularly in this regard to my hon. Friend the Member for Kensington (Sir B. Rhys Williams). I am not a Minister at the Department of Health and Social Security. I have not even been a Treasury Minister for very long. I assure the House that I personally do not regard the present system as sacrosanct or as a faultless method which has stood the test of time and must endure as a monument for ever. I understand my hon. Friend's argument about the flaws in the system and the argument that there could be better alternatives to secure the kind of social security benefits that we want and can afford.
  I must tell the House, however, and I am sorry that I must advise my hon. Friend yet again, that this debate is not designed to review the entire system. Even if we took the view that it was right to change the system, this would clearly not be the occasion on which to do so. The Bill is designed to operate the existing system, which is primarily the system which has been in existence for a generation but which in its most modern form was created in the 1975 legislation by the Labour Administration. Therefore, whatever long-term changes may be desirable, this is not the occasion to implement them, and I am not pretending that this legislation is a wide ranging social reform of that kind.
  In listening to the various suggestions about long-term reform, one could not help being deeply interested in the contribution from the Social Democratic Party in the form of the hon. Member for Newcastle upon Tyne, East (Mr. Thomas). He seemed somewhat hesitant in his recommendations on the financing of the social security system. At one point it sounded as if he was suggesting a new form of tax to finance the system, but when he was pressed and probed further we learnt that he was referring to income tax, an old form of taxation. The hon. Gentleman was suggesting that that great engine rather than national insurance contributions should deliver the goods for the social security system.
  Mr. Mike Thomas rose—
  Mr. Brittan: If the hon. Gentleman bears with me, I shall certainly give way, but there is more.
  We then had the pleasure of listening to the hon. Member for Truro, one of whose most engaging characteristics is his candour. He told us a thing or two about the impact of income tax—the very tax that the hon. Member for Newcastle upon Tyne, East wished to see as the foundation of the SDP's new social security system.
  One arm of the alliance does not seem to have consulted the other. The speech of the hon. Member for Newcastle upon Tyne, East started with the promise of a new tax, but stumbled into a promise of a vastly increased old tax that his Liberal colleague finds extremely inimical. That
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  perhaps illustrates that there should be some more thinking before we can seriously accept what the SDP says on this issue.
  Mr. Thomas: I have no doubt that when the right hon. and learned Gentleman reads my speech in Hansard he will find it a less dramatic affair than he is trying to portray. Does he not accept that the regressive effect of the Bill in terms of the marginal effective tax rate on the low paid has now reached the point where the system should be reviewed and an alternative form of financing found? One alternative is certainly income tax, but there may well be others. I assure the right hon. and learned Gentleman that my hon. Friend the Member for Truro (Mr. Penhaligon) and myself are united in the view that any alternative would be better than the system we are now stuck with.
  Mr. Brittan: I welcome the fact that the hon. Gentleman's views on this matter have become progressively more tentative during the evening. It is wise to downgrade them in that sense.
  Mr. Thomas rose—
  Mr. Brittan: I am sorry, but I cannot give way a second time because I am trying to confine my remarks to the subject matter of the debate.
  I was about to say that the Bill deals with the financing of the expenditure to be incurred in 1982–83 as a result of extra expenditure on social security benefits. That is what the Bill is about, and that is what it does.
  Plainly the system will not be reformed tonight, and, even if one were to follow the suggested route of the hon. Member for Newcastle upon Tyne, East, it would be a major reconstruction, but within the present system, it is not unreasonable to say that, broadly speaking, if we increase benefits we must increase contributions. I do not think that it is oversimplifying the matter to put it in that way. We can talk about the details and the Treasury supplement, but that is the essence of what we are doing. The financing of it is a matter that the House is right to put in order before the benefits become payable.
  Opposition Members seem to be saying, in effect—they never quite spell it out—that they would like the benefits to be higher. If we increase them, the need for financing the benefits within our present system becomes all the greater. Therefore, I cannot accept that there is anything improper or surprising about a perfectly normal piece of legislation within the present system for providing the money to finance the extra benefits.
  Some hon. Members, such as the hon. Member for Keighley (Mr. Cryer) and my hon. Friend the Member for Kensington, were tempted, understandably, to range wider in their consideration of the economic issues. My hon. Friend the Member for Kensington asked whether this expenditure and this revenue raising by means of the contributions is reflationary. He put his case in an interrogatory form, but the hon. Member for Keighley castigated the measure as being deflationary. If one analyses the position, whatever one's views about whether the Government should seek to reflate the economy, this legislation and the decisions to which it relates on benefits are not inflationary, deflationary or reflationary. On the one hand, it assumes a certain increase in benefits and, on the other hand, it provides from the contributors the money to finance those benefits. In that sense it is neutral. If one

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  goes for fine economic analysis, to the extent that it is refiationary, deflationary or whatever, I suppose it could be said to be mildly reflationary, in the sense that those who contribute are likely to save a higher proportion of their income than those who receive benefits. It is broadly neutral, and I am trying to present a fair view.
  Mr. John: The right hon. and learned Gentleman has talked many times about a higher contribution to pay for higher benefits. He has been asked specifically about the shortfall of 2 per cent. May we now hear whether the Chief Secretary has promised dissident Tory Back Benchers that that will not be proceeded with? If he has told them that, will he now tell the House?
  Mr. Brittan: I welcome the opportunity to deal with that matter. The answer to the hon. Gentleman's question is "No". No such assurance has been given and the hon. Gentleman should not believe what he reads in the press, however many newspapers report such a story and however reputable they may be.
  The position on this matter is the same as it was stated to be by my right hon. and learned Friend the Chancellor of the Exchequer and me only a week ago. My right hon. and learned Friend said that the final figure will not be determined until the spring of next year, and that the Government will listen carefully to hon. Members' views on the matter. I have said that, too, and my right hon. Friend the Secretary of State for Social Services used almost the same words in his speech.
  Let us not forget that the point of controversy just raised by the hon. Member for Pontypridd (Mr. John) represents but a small part of the total. We must decide an important, but limited question. I refer to the way in which the extra benefits should be financed. I must make clear the nature of those benefits. Much has been said about unemployment and the recession. If hon. Members consider the extra expenditure that we seek to finance, they will see that the overwhelming balance of that money will be spent on increased expenditure on retirement pensions. That is what we are talking about.
  The figures show that of a total increase in benefit expenditure between 1981–82 and 1982–83 of £1,632 million, about £1,450 million extra will be spent on retirement pensions.
  Mr. Cryer: Is the right hon. and learned Gentleman confirming the Minister's statement that the shortfall would not be made good in
  "unemployment benefit, sickness benefit, injury benefit, maternity allowance, child benefit—including one-parent benefit—family income supplement, mobility allowance and supplementary allowance."—[Official Report, 3 December 1981; Vol. 14, c. 485.]
  If so, does not the right hon. and learned Gentleman feel ashamed?
  Mr. Brittan: The hon. Gentleman well knows that he has read out a list of the benefits in respect of which pledges were not given by my right hon. and learned Friend. If it is put in context, it can be seen what it means. The overwhelming balance of the money that we seek to raise will be spent on retirement pensions. Therefore, the legislation should commend itself to the House. I do not accept for one moment that we are financing the consequences of the recession, or anything of the kind. We are providing the money to pay for increased benefits.
  The Treasury supplement has been the subject of considerable controversy today. Perhaps I am speaking
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  now because it is called the Treasury supplement. Hon. Members will know the extent of the extra benefits and contributions provided by the Bill. We should put the Treasury supplement's contribution into perspective. The change in the Treasury supplement consists simply of £261 million—a comparatively small proportion of the total. My right hon. Friend the Secretary of State pointed out clearly that we must consider the percentage of benefits met from general taxation. That is the key point. It is not only contributory benefits that should be considered. Social security expenditure must be considered as a whole. There is nothing magical about a national insurance benefit or a benefit financed from the Consolidated Fund.
  All the benefits introduced since 1948—mainly for the disabled—have been financed from the Consolidated Fund, although they could have been introduced as national insurance benefits. Those new benefits now cost about £6 billion. Therefore, it is not unreasonable—looking at the whole picture—to ask what the total level of benefits met from general taxation should be.
  Mr. Ennals rose—
  Mr. Brittan: I was about to deal with the right hon. Gentleman's point. It is in that context that my right hon. Friend said that in 1975–76 37 per cent. of total benefits were met from general taxation. In 1980–81 it was 45 per cent. and in 1981–82 it was also 45 per cent. In 1982–83 it will again be 45 per cent.
  The right hon. Member for Norwich, North (Mr. Ennals) asked whether it was caused simply because of the change in the comparative amount being spent on supplementary benefit, and whether, if supplementary benefit continued to increase as a proportion of the total, the Treasury supplement would be correspondingly reduced. That is pushing the logic too far. It does not follow that because one is entitled, in fixing the Treasury contribution, to look at the percentage of benefits met from general taxation, one must regard that as a formula to be stuck to and assume that there is a percentage that is for all time the right one.
  Mr. Ennals: In that case, there is no logic at all. If the right hon. and learned Gentleman is saying that I was pressing the logic too far, I was only presuming that that was the logic of what the Secretary of State had said. Is there any logic in setting the figure of 13 per cent. rather than a higher one?
  Mr. Britton: If the right hon. Gentleman will forgive me, whereas before he was pressing the logic too far, he is now not pressing it far enough. It is not a formula but it seems to me that the percentage of benefits met from general taxation is a relevant and proper consideration to take into account in a substantial way as being one of the factors determining what the Treasury contribution should be.
  Although this debate provides a happy opportunity to canvass the record of the Government and their predecessor in social security generally, and at least to touch on the possibility of fundamental changes in the system, its purpose is to enable the House to give authority—
  Mr. Ennals rose—
  Mr. Brittan: —to the legislation required to raise the contribution. It is in that sense that I commend it to the House.
  Question proposed, That the amendment be made:—
  The House divided: Ayes 207, Noes 286.

  Division No. 26]

  [9.12 pm

  AYES

  Abse, Leo

  Fraser, J. (Lamb'th, N'w'd)

  Adams,Allen

  Freeson, Rt Hon Reginald

  Allaun,Frank

  Garrett, John (NorwichS)

  Alton,David

  George, Bruce

  Anderson,Donald

  Ginsburg, David

  Archer, Rt Hon Peter

  Golding.John

  Ashley, Rt Hon Jack

  Graham, Ted

  Barnett, Guy (Greenwich)

  Grant,George(Morpeth)

  Barnett, Rt Hon Joel (H'wd)

  Grant, John (IslingtonC)

  Bennett,Andrew(St'kp'tN)

  Hamilton,James(Bothwell)

  Bidwell, Sydney

  Hamilton, W. W. (C'tralFife)

  Booth, Rt Hon Albert

  Harrison, Rt Hon Walter

  Boothroyd, MissBetty

  Hart, Rt Hon Dame Judith

  Bottomley, RtHonA. (M'b'ro)

  Heffer, Eric S.

  Bray, Dr Jeremy

  Hogg, N. (EDunb't'nshire)

  Brocklebank-Fowler,C.

  Holland,S. (L'b'th,Vauxh'll)

  Brown, HughD. (Provan)

  HomeRobertson,John

  Brown, R. C. (N'castle W)

  Homewood, William

  Brown, Ronald W. (H'ckn'yS)

  Hooley, Frank

  Brown, Ron (E'burgh, Leith)

  Howell, Rt Hon D.

  Buchan,Norman

  Howells,Geraint

  Campbell,Ian

  Hoyle,Douglas

  Campbell-Savours,Dale

  Hudson Davies, Gwilym E.

  Carmichael,Neil

  Hughes, Robert (Aberdeen N)

  Cartwright,John

  Hughes, Roy (Newport)

  Clark, Dr David (S Shields)

  Jay, Rt Hon Douglas

  Cocks, Rt Hon M. (B'stol S)

  John,Brynmor

  Cohen,Stanley

  Johnson, James (Hull West)

  Coleman,Donald

  Johnson, Walter (Derby S)

  Concannon, Rt Hon J. D.

  Jones, Rt Hon Alec (Rh'dda)

  Cook, Robin F.

  Jones, Barry (East Flint)

  Cowans, Harry

  Jones, Dan (Burnley)

  Craigen,J.M. (G'gow,M'hill)

  Kaufman, Rt Hon Gerald

  Crawshaw, Richard

  Kilfedder,JamesA.

  Cryer,Bob

  Lambie, David

  Cunliffe,Lawrence

  Lamborn,Harry

  Cunningham, G.(IslingtonS)

  Lamond,James

  Cunningham, Dr J. (W'h'n)

  Leadbitter,Ted

  Dalyell,Tam

  Leighton,Ronald

  Davidson,Arthur

  Lewis, Ron (Carlisle)

  Davies, Rt Hon Denzil (L'lli)

  Litherland, Robert

  Davis, Clinton (Hackney C)

  Lofthouse, Geoffrey

  Davis, T. (B'ham, Stechf'd)

  Lyons, Edward (Bradf'dW)

  Deakins,Eric

  Mabon, Rt Hon Dr J. Dickson

  Dempsey, James

  McCartney,Hugh

  Dewar,Donald

  McCusker,H.

  Dixon,Donald

  McDonald,DrOonagh

  Dobson,Frank

  McElhone,Frank

  Dormand,Jack

  McKay, Allen (Penistone)

  Douglas,Dick

  McKelvey,William

  Douglas-Mann,Bruce

  McNally,Thomas

  Dubs,Alfred

  McNamara, Kevin

  Duffy, A. E. P.

  McTaggart,Robert

  Dunn, James A.

  McWilliam,John

  Dunnett,Jack

  Magee, Bryan

  Dunwoody, Hon Mrs G.

  Marshal I, D(G 'gowS 'ton)

  Eadie,Alex

  Marshall, DrEdmund(Goole)

  Eastham, Ken

  Marshall, Jim (LeicesterS)

  Edwards, R. (W'hampt'n S E)

  Martin,M(G'gowS'burn)

  Ellis, R.(NED'bysh're)

  Mason, Rt Hon Roy

  Ellis, Tom (Wrexham)

  Maxton,John

  English,Michael

  Maynard, MissJoan

  Ennals, Rt Hon David

  Meacher,Michael

  Evans, Ioan (Aberdare)

  Mellish,RtHonRobert

  Evans, John (Newton)

  Mikardo,Ian

  Ewing,Harry

  Millan,RtHonBruce

  Faulds, Andrew

  Miller, Dr M. S. (E Kilbride)

  Fletcher, L. R. (Ilkeston)

  Mitchell,Austin(Grimsby)

  Fletcher,Ted (Darlington)

  Molyneaux,James

  Ford, Ben

  Morris, Rt Hon A. (W'shawe)

  Foster, Derek

  Morris, Rt Hon C. (O'shaw)

  228

  Morris, RtHon J. (Aberavon)

  Snape, Peter

  Mulley,Rt HonFrederick

  Soley,Clive

  Newens,Stanley

  Spearing,Nigel

  Ogden,Eric

  Steel, Rt Hon David

  O'Halloran,Michael

  Stewart, Rt Hon D. (W Isles)

  O'Neill,Martin

  Stoddart, David

  Orme, Rt Hon Stanley

  Stott,Roger

  Palmer,Arthur

  Strang,Gavin

  Park, George

  Taylor, Mrs Ann (Bolton W)

  Parker,John

  Thomas,Dafydd(Merioneth)

  Parry, Robert

  Thomas, Mike (NewcastleE)

  Pavitt, Laurie

  Thomas, DrR. (Carmarthen)

  Penhaligon,David

  Thorne, Stan (PrestonSouth)

  Powell, Rt Hon J.E. (S Down)

  Tilley.John

  Powell, Raymond (Ogmore)

  Tinn,James

  Prescott,John

  Torney,Tom

  Price, C. (Lewisham W)

  Urwin, RtHon Tom

  Race, Reg

  Varley, RtHon EricG.

  Radice, Giles

  Wainwright,E.(DearneV)

  Rees, Rt Hon M (Leeds S)

  Walker, Rt Hon H.(D'caster)

  Richardson,Jo

  Watkins, David

  Roberts, Albert(Normanton)

  Weetch,Ken

  Roberts, Ernest (Hackney N)

  Welsh,Michael

  Roberts,Gwilym (Cannock)

  White, Frank R.

  Robertson,George

  White, J. (G'gowPollok)

  Robinson, G. (Coventry NW)

  Whitehead,Phillip

  Rodgers, RtHonWilliam

  Whitlock,William

  Rooker, J.W.

  Wigley,Dafydd

  Roper,John

  Williams, Rt Hon A.(S'sea W)

  Ross, Ernest (Dundee West)

  Wilson, Gordon (DundeeE)

  Ross, Stephen (Isle of Wight)

  Wilson, RtHon SirH.(H'ton)

  Ross,Wm.(Londonderry)

  Wilson, William (C'trySE)

  Rowlands,Ted

  Winnick, David

  Sandelson,Neville

  Woodall,Alec

  Sever, John

  Woolmer,Kenneth

  Shearman,Barry

  Wrigglesworth, Ian

  Silkin, RtHon J. (Deptford)

  Silkin, Rt Hon S. C. (Dulwich)

  Tellers for the Ayes:

  Silverman,Julius

  Mr. Joseph Dean and

  Skinner,Dennis

  Mr. Frank Haynes.

  NOES

  Adley,Robert

  Bryan, Sir Paul

  Aitken,Jonathan

  Buck,Antony

  Alexander,Richard

  Budgen,Nick

  Alison, RtHon Michael

  Bulmer,Esmond

  Amery, RtHon Julian

  Burden,SirFrederick

  Ancram,Michael

  Butcher,John

  Arnold,Tom

  Cadbury,Jocelyn

  Atkins, Robert(PrestonN)

  Carlisle, John (LutonWest)

  Atkinson, David (B'm'th,E)

  Carlisle, Kenneth (Lincoln)

  Baker,Kenneth(St.M'bone)

  Carlisle, Rt Hon M. (R'c'n)

  Baker, Nicholas (N Dorset)

  Chalker, Mrs. Lynda

  Banks,Robert

  Channon, Rt. Hon. Paul

  Beaumont-Dark,Anthony

  Chapman,Sydney

  Bell,SirRonald

  Churchill,W.S.

  Bendall, Vivian

  Clark, Hon A. (Plym'th, S'n)

  Bennett, Sir Frederic (T'bay)

  Clark, Sir W. (Croydon S)

  Benyon,Thomas(A'don)

  Clegg, Sir Walter

  Benyon,W. (Buckingham)

  Cockeram,Eric

  Berry, HonAnthony

  Cope,John

  Best, Keith

  Cormack, Patrick

  Bevan,DavidGilroy

  Corrie,John

  Biffen, RtHon John

  Costain,SirAlbert

  Biggs-Davison,SirJohn

  Cranborne,Viscount

  Blackburn,John

  Critchley,Julian

  Blaker, Peter

  Crouch,David

  Body, Richard

  Dean, Paul (NorthSomerset)

  Bonsor,SirNicholas

  Douglas-Hamilton,LordJ.

  Bottomley, Peter (W'wichW)

  Dover, Denshore

  Bowden, Andrew

  du Cann, Rt Hon Edward

  Braine,SirBernard

  Dunn, Robert(Dartford)

  Bright,Graham

  Durant,Tony

  Brinton,Tim

  Dykes, Hugh

  Brittan, Rt. Hon. Leon

  Eden, RtHon Sir John

  Brooke, Hon Peter

  Edwards, Rt Hon N. (P'broke)

  Brotherton,Michael

  Eggar,Tim

  Brown, Michael(Brigg&Sc'n)

  Elliott, SirWilliam

  Browne, John (Winchester)

  Emery, Peter

  Bruce-Gardyne,John

  Fairbairn,Nicholas

  229

  Fairgrieve,SirRussell

  MacKay, John (Argyll)

  Faith, MrsSheila

  McNair-Wilson,M.(N'bury)

  Farr,John

  McNair-Wilson, P. (NewF'st)

  Fell,Anthony

  McQuarrie, Albert

  Fenner, Mrs Peggy

  Madel, David

  Finsberg,Geoffrey

  Major,John

  Fisher, SirNigel

  Marland,Paul

  Fletcher, A. (Ed'nb'gh N)

  Marlow,Antony

  Fletcher-Cooke,SirCharles

  Marshall, Michael(Arundel)

  Fookes, Miss Janet

  Marten, RtHon Neil

  Forman,Nigel

  Mates,Michael

  Fowler, RtHon Norman

  Maude, RtHon Sir Angus

  Fox, Marcus

  Mawby, Ray

  Fraser, Peter (South Angus)

  Mawhinney,DrBrian

  Gardiner,George(Reigate)

  Maxwell-Hyslop,Robin

  Gardner, Edward (SFylde)

  Mayhew, Patrick

  Garel-Jones,Tristan

  Mellor,David

  Glyn, DrAlan

  Meyer, SirAnthony

  Goodhew,Victor

  Miller,Hal(B'grove)

  Goodlad,Alastair

  Mills, Iain (Meriden)

  Gow, Ian

  Mills, Peter (West Devon)

  Gower, Sir Raymond

  Miscampbell, Norman

  Grant, Anthony (HarrowC)

  Moate,Roger

  Gray, Hamish

  Monro,SirHector

  Greenway, Harry

  Montgomery, Fergus

  Griffiths, E. (B'ySt. Edm'ds)

  Moore,John

  Griffiths, Peter Portsm'thN)

  Morgan,Geraint

  Grist, Ian

  Morris, M. (N'hamptonS)

  Grylls,Michael

  Morrison, HonC. (Devizes)

  Gummer,JohnSelwyn

  Morrison, Hon P. (Chester)

  Hamilton, Hon A.

  Mudd, David

  Hamilton,Michael (Salisbury)

  Murphy,Christopher

  Hampson,DrKeith

  Neale,Gerrard

  Hannam,John

  Needham,Richard

  Haselhurst,Alan

  Nelson,Anthony

  Hastings,Stephen

  Neubert,Michael

  Havers, Rt Hon Sir Michael

  Newton,Tony

  Hawksley,Warren

  Onslow,Cranley

  Hayhoe, Barney

  Oppenheim, Rt Hon Mrs S.

  Heddle,John

  Osborn,John

  Henderson,Barry

  Page, John (Harrow, West)

  Heseltine, RtHon Michael

  Page, Richard (SWHerts)

  Hicks,Robert

  Parkinson, RtHonCecil

  Higgins, RtHon Terence L.

  Parris, Matthew

  Hogg,HonDouglas(Gr'th'm)

  Patten,Christopher(Bath)

  Holland, Philip (Carlton)

  Patten,John(Oxford)

  Hooson.Tom

  Pattie,Geoffrey

  Hordern,Peter

  Pawsey, James

  Howe, Rt Hon Sir Geoffrey

  Percival,Sir Ian

  Howell, Ralph (NNorfolk)

  Peyton, RtHon John

  Hunt, David (Wirral)

  Pink, R.Bonner

  Hunt, John (Ravensbourne)

  Pollock,Alexander

  Irving,Charles(Cheltenham)

  Porter,Barry

  Jenkin, RtHon Patrick

  Prentice, Rt Hon Reg

  Jessel, Toby

  Price, Sir David (Eastleigh)

  JohnsonSmith, Geoffrey

  Prior, RtHon James

  Jopling, RtHonMichael

  Proctor, K. Harvey

  Joseph, RtHon Sir Keith

  Pym, Rt Hon Francis

  Kaberry,SirDonald

  Raison,Timothy

  Kershaw,SirAnthony

  Rathbone,Tim

  Kimball,SirMarcus

  Rees-Davies, W. R.

  King, RtHon Tom

  Ronton,Tim

  Kitson,SirTimothy

  Rhodes James, Robert

  Knight, MrsJill

  Rhys Williams,SirBrandon

  Knox, David

  Ridsdale,SirJulian

  Lamont,Norman

  Rifkind, Malcolm

  Lang, Ian

  Rippon, RtHonGeoffrey

  Langford-Holt,SirJohn

  Roberts, M. (Cardiff NW)

  Latham,Michael

  Roberts, Wyn (Conway)

  Lawson, RtHon Nigel

  Rossi, Hugh

  LeMarchant,Spencer

  Rost, Peter

  Lennox-Boyd,HonMark

  Royle, SirAnthony

  Lester, Jim (Beeston)

  Sainsbury,HonTimothy

  Lewis,Kenneth(Rutland)

  St. John-Stevas, Rt Hon N.

  Lloyd, Ian (Havant& W'loo)

  Shaw, Giles (Pudsey)

  Lloyd, Peter (Fareham)

  Shaw, Michael (Scarborough)

  Luce,Richard

  Shelton,William(Streatham)

  Lyell,Nicholas

  Shepherd, Colin(Hereford)

  Macfarlane,Neil

  Shepherd,Richard

  MacGregor,John

  Shersby, Michael

  230

  Silvester, Fred

  Viggers,Peter

  Sims, Roger

  Waddington,David

  Skeet, T. H. H.

  Waldegrave,HonWilliam

  Smith,Dudley

  Walker, B. (Perth)

  Speed, Keith

  Walker-Smith, Rt Hon Sir D.

  Speller,Tony

  Wall,SirPatrick

  Spence,John

  Waller, Gary

  Spicer, Michael (SWorcs)

  Ward,John

  Squire,Robin

  Warren,Kenneth

  Stanbrook,Ivor

  Watson,John

  Stanley,John

  Wells,Bowen

  Stevens, Martin

  Wells,John(Maidstone)

  Siewart,A.(ERenfrewshire)

  Wheeler,John

  Stewart, Ian (Hitchin)

  Whitelaw, RtHon William

  Stokes, John

  Whitney,Raymond

  StradlingThomas,J.

  Wickenden,Keith

  Tapsell, Peter

  Wiggin,Jerry

  Taylor, Teddy (S'end E)

  Wilkinson,John

  Temple-Morris, Peter

  Williams, D.(Montgomery)

  Thomas, Rt Hon Peter

  Winterton,Nicholas

  Thompson,Donald

  Wolfson,Mark

  Thorne, Neil(IlfordSouth)

  Young, SirGeorge(Acton)

  Townend,John(Bridlington)

  Younger, RtHonGeorge

  Townsend, Cyril D,(B'heath)

  Trippier,David

  Tellers for the Noes:

  Trotter,Neville

  Mr. Carol Mather and

  van Straubenzee, SirW.

  Mr. Robert Boscawen.

  Vaughan.DrGerard

  Question accordingly negatived.
  Main Question put forthwith pursuant to Standing Order No. 39 (Amendment on Second or Third Reading):—
  The House divided: Ayes 288, Noes 228.

  Division No. 28]

  [11.17 pm

  AYES

  Alexander, Richard

  Goodhew,Victor

  Ancram,Michael

  Goodlad,Alastair

  Atkinson, David(B'm'th,E)

  Grant, Anthony (HarrowC)

  Beaumont-Dark,Anthony

  Gray, Hamish

  Benyon,W. (Buckingham)

  Griffiths, Peter Portsm'thN)

  Berry, HonAnthony

  Grist, Ian

  Bevan, David Gilroy

  Gummer,JohnSelwyn

  Biggs-Davison,SirJohn

  Hamilton, HonA.

  Blackburn, John

  Hampson,DrKeith

  Bonsor,SirNicholas

  Hannam,John

  Boscawen,HonRobert

  Hawksley,Warren

  Bottomley, Peter (W'wich W)

  Heddle,John

  Bright,Graham

  Henderson,Barry

  Brinton,Tim

  Hogg,HonDouglas(Gr'th'm)

  Brooke, Hon Peter

  Howell, Ralph (NNorfolk)

  Brotherton,Michael

  Hunt,John(Ravensbourne)

  Brown, Michael(Brigg&Sc'n)

  Jopling,RtHon Michael

  Browne,John(Winchester)

  Kershaw, SirAnthony

  Bruce-Gardyne,John

  Kitson,SirTimothy

  Buck,Antony

  Knight, MrsJill

  Budgen,Nick

  Lester, Jim (Beeston)

  Bulmer,Esmond

  Lloyd, Peter (Fareham)

  Butcher,John

  Luce,Richard

  Cadbury,Jocelyn

  Lyell, Nicholas

  Carlisle, John (Luton West)

  Macfarlane,Neil

  Carlisle,Kenneth(Lincoln)

  MacGregor,John

  Carlisle, Rt Hon M.(R'c'n)

  MacKay, John (Argyll)

  Chalker, Mrs. Lynda

  McNair-Wilson,M.(N'bury)

  Clark, Hon A. (Plym'th, S'n)

  McQuarrie, Albert

  Cockeram,Eric

  Major,John

  Cope,John

  Marlow,Antony

  Costain,SirAlbert

  Mates, Michael

  Cranborne,Viscount

  Mather,Carol

  Douglas-Hamilton,LordJ.

  Maude, Rt Hon Sir Angus

  Dover, Denshore

  Maxwell-Hyslop,Robin

  Dunn, Robert(Dartford)

  Mayhew, Patrick

  Dykes, Hugh

  Meyer, SirAnthony

  Fairgrieve,SirRussell

  Mills, Iain(Meriden)

  Faith, MrsSheila

  Mills, Peter (West Devon)

  Fenner, Mrs Peggy

  Moate, Roger

  Fletcher, A. (Ed'nb 'gh N)

  Monro,SirHector

  Fletcher-Cooke,SirCharles

  Mudd, David

  Forman,Nigel

  Murphy,Christopher

  Fraser, Peter (South Angus)

  Myles, David

  Garel-Jones,Tristan

  Neale,Gerrard

  257

  Need ham, Richard

  Speller,Tony

  Nelson,Anthony

  Spicer, Michael (S Worcs)

  Neubert,Michael

  Squire,Robin

  Newton,Tony

  Stanbrook,Ivor

  Onslow,Cranley

  Stevens,Martin

  Osborn,John

  Stewart, A. (ERenfrewshire)

  Page, John (Harrow, West)

  StradlingThomas,J.

  Page, Richard (SWHerts)

  Taylor, Teddy (S'end E)

  Patten, John (Oxford)

  Thompson,Donald

  Pattie,Geoffrey

  Thorne, Neil (IlfordSouth)

  Pollock,Alexander

  Waddington, David

  Prior, Rt Hon James

  Waldegrave,Hon William

  Proctor, K. Harvey

  Walker, B. (Perth)

  Rathbone,Tim

  Waller, Gary

  Rees-Davies, W. R.

  Ward,John

  Rhodes James, Robert

  Watson,John

  RhysWilliams,SirBrandon

  Wells, Bowen

  Rifkind,Malcolm

  Wheeler,John

  Roberts, M. (CardiffNW)

  Wiggin,Jerry

  Roberts, Wyn (Conway)

  Wilson, Gordon (DundeeE)

  Rossi, Hugh

  Wolfson,Mark

  Rost, Peter

  Young, SirGeorge (Acton)

  Sainsbury,HonTimothy

  Younger, RtHonGeorge

  Shepherd,Colin (Hereford)

  Silvester, Fred

  Tellers for the Ayes:

  Sims, Roger

  Mr. David Hunt

  Speed, Keith

  and Mr. Ian Lang.

  NOES

  Allaun, Frank

  Cook, Robin F.

  Bennett, Andrew (St 'kp 'tN)

  Cowans, Harry

  Booth, Rt Hon Albert

  Craigen, J. M. (G'gow, M'hill)

  Brown, Hugh D. (Proven)

  Cryer,Bob

  Brovm,Ron(E'burgh,Leith)

  Cunliffe,Lawrence

  Buchan,Norman

  Dalyell,Tam

  Campbell,Ian

  Davis, T. (B'ham, Stechf'd)

  Campbell-Savours,Dale

  Deakins,Eric

  Canavan, Dennis

  Dean, Joseph (Leeds West)

  Cocks, Rt Hon M. (B'stol S)

  Dempsey, James

  Concannon, Rt Hon J. D.

  Dewar,Donald

  258

  Dixon,Donald

  Marshall, DrEdmund(Goole)

  Dobson, Frank

  Marshall, Jim (LeicesterS)

  Dormand,Jack

  Martin,M(G'gowS'burn)

  Douglas,Dick

  Maxton,John

  Dubs,Alfred

  Maynard,MissJoan

  Duffy, A. E. P.

  Mikardo, Ian

  Dunwoody, Hon Mrs G.

  Millan,RtHonBruce

  Eadie,Alex

  Miller, Dr M.S. (EKilbride)

  Eastham, Ken

  Palmer,Arthur

  Evans, John (Newton)

  Parry, Robert

  Ewing,Harry

  Pavitt, Laurie

  Freeson,Rt Hon Reginald

  Penhaligon, David

  George,Bruce

  Powell, Raymond (Ogmore)

  Hamilton, W. W. (C'tral Fife)

  Prescott,John

  Haynes, Frank

  Richardson,Jo

  Hogg, N. (EDunb't'nshire)

  Robertson,George

  Holland,S.(L,b,th,Vauxh,ll)

  Ross, Ernest (Dundee West)

  HomeRobertson,John

  Sandelson, Neville

  Hooley, Frank

  Silkin, Rt Hon S. C. (Dulwich)

  Hoyle, Douglas

  Skinner,Dennis

  Hughes, Robert (Aberdeen N)

  Smith, Rt Hon J. (N Lanark)

  Kilfedder,JamesA.

  Snape, Peter

  Lambie, David

  Soley,Clive

  Lamond, James

  Strang,Gavin

  Lofthouse,Geoffrey

  Tinn,James

  McCartney,Hugh

  Welsh,Michael

  McElhone,Frank

  White, Frank R.

  McKay, Allen (Penistone)

  White, J. (G'gowPollok)

  McKelvey,William

  Winnick,David

  McNamara, Kevin

  McTaggart,Robert

  Tellers for the Noes:

  Magee, Bryan

  Mr. Walter Harrison and

  Marshall, D(G'gowS'ton)

  Mr. James Hamilton.

  Question accordingly agreed to.
  Bill read a Second time.
  Bill committed to a Committee of the whole House.— [Mr. Brooke.]
  Committee tomorrow.

WAYS AND MEANS

  SOCIAL SECURITY (CONTRIBUTIONS)
  Resolved,
  That, for the purposes of any Act of the present Session to make provision in connection with certain contributions payable under the Social Security Act 1975, it is expedient to authorise any increase attributable to the said Act of the present Session in the sums which—

  (a) under the Act of 1975, are to be taken as paid towards the cost of the National Health Service in Great Britain; or

  (b) are payable under the National Insurance Surcharge Act 1976 by way of surcharge on secondary Class 1 contributions.—[Mr. Brooke.]

  Scottish Special Housing Association
  9.41 pm
  The Under-Secretary of State for Scotland (Mr. Malcolm Rifkind): I beg to move,
  That the Scottish Special Housing Association (Vesting of City of Glasgow District Council Land) (Scotland) Order 1981, a copy of which was laid before this House on 25th November, be approved.
  It must be unusual if not unprecedented for the affairs of the Scottish Special Housing Association to be debated on the Floor of the House on two consecutive evenings. I suspect that on this occasion the order will not receive the same uncritical and unqualified support as the measure debated yesterday. That fact is not due to any lack of merit in the order—quite the opposite. The order is simply to allow 9,000 tenants of the SSHA to exercise the right to buy their homes that was given to them in the Tenants' Rights, Etc. (Scotland) Act 1980.
  As the House may be aware, the 9,000 tenants live in homes owned by the SSHA, but the land on which they are situated is owned by the Glasgow district council. Because the council owns the land, its consent is required to enable the tenants to exercise their right to buy. The council has declined to give its consent. It is an extraordinary position where both the owner of the house and the owner of the land are public sector landlords who are obliged to offer their houses to their tenants under the right-to-buy provisions. Because the owners are separate persons and separate legal personalities, the district council can, for the time being, frustrate the wishes of the tenant. Because Parliament recognised that that was an undesirable position to perpetuate, the Local Government (Miscellaneous Provisions) (Scotland) Act 1981 provided powers for the Secretary of State, through such an order, to ask for approval for the land in question to be vested in the SSHA so that the tenants could purchase their homes if they so wished.
  The circumstances in which such an order is appropriate are properly limited and specific. First, both the owner of the house and the owner of the land must be public sector landlords on whom the right-to-buy provision is an obligation that they must observe. Clearly, in this case, both the district council and the SSHA are bodies which, under the Tenants' Rights Etc. (Scotland) Act 1980, are obliged to sell houses to tenants who wish to purchase. Secondly, an order can be introduced only when the only fact preventing a tenant from exercising the right to buy is that the heritable proprietor of the land is unwilling to sell and where there is no other bar to the tenant exercising his right. That is undoubtedly the circumstance in the case under discussion. There is no suggestion that there is any reason other than the unwillingness of the council that prevents the tenants from exercising their rights under the Act. The third condition that must exist before such an order is appropriate is that it is clearly necessary and that there is no other way in which the statutory rights of the tenant can be properly enjoyed and fulfilled.
  The Secretary of State has sought to persuade the two authorities that have land in this position—Glasgow district council and Dundee district council—voluntarily to agree to the disposal of the land to enable the tenants of the SSHA to purchase their homes. Dundee district council eventually agreed to make the land available and that is an issue that is no longer a problem. Glasgow
  236
  district council made it clear that it was not prepared, short of an order of the sort that is before the House, to allow the authority to offer for sale its tenants homes in Glasgow.
  Glasgow district council has made it clear that the only consideration that it has in mind in refusing to enter a voluntary arrangement was its political hostility to tenants' rights legislation and to the rights of tenants to purchase their homes. That was the limited approach that the district council brought to the attention of the Secretary of State. It is in those circumstances that the order is before the house.
  No one should be in doubt about the substantial interest among authority tenants in Glasgow in the right to buy. The 9,000 tenants have no right that they can exercise because they are aware that their right is being frustrated by the district council. However, almost 500 of the 9,000 have already contacted the authority to express interest in purchasing their homes. I have not the slightest doubt that when the order comes into effect and tenants throughout Glasgow who occupy authority houses are aware for the first time that they can enjoy the right given to them by Parliament, the number will be significantly greater. It is without qualification that I commend the order to the House and invite the House to approve it.
  9.47 pm
  Mr. Donald Dewar: The Minister, in all innocence has presented what on the face of it is a simple proposition. He says beguilingly that the order is designed to correct an anomaly and to put SSHA tenants in Glasgow on the same footing as district council tenants. I suppose that in a way it is a simple proposition, but the Opposition contend that it is simply wrong. That should be stated at the outset.
  It is not surprising that the Minister and myself should end up in different positions. That is because we start from different positions. The Opposition consider that the sale of council houses is a mistake, and certainly as it is engineered in tenants rights' legislation. If it is assumed that it is socially divisive—I think that no one who has experience of representing a constituency with a majority of council tenants in the electorate would deny that—it is clear that the order should not have the approval of the House.
  We object to the scheme because it involves selling off public assets in a way that is without plan or strategy. It makes it almost impossible for district councils in Scotland to control their housing stock in the interests of the majority of tenants. If it is assumed that the sale of council housing is doing damage generally in Scotland, there is no case for making that damage universal by extending it to authority tenants in Glasgow.
  The Minister claims that about 9,000 tenants are affected by the order. He said that there are about 7,000 in Glasgow and, I think, 120 in Dundee. There is clearly a gap.
  Mr. Rifkind: We are aware of about 9,000 tenants in Glasgow and there were 120 in Dundee. The problem is no longer before us in Dundee because the authority has agreed voluntarily to the disposal of land.
  Mr. Dewar: It is perhaps a matter of detail. I invite the hon. Gentleman to read the Scottish Office press notice of 4 August 1981, a copy of which I have before me. It states clearly that there are 7,000 authority tenants in Glasgow

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  and 120 in Dundee. That leaves us well short of 9,000. I am, however, prepared to accept the sotto voce correction that it is the press notice which was wrong and not I. It was perhaps innocent and naive of me to take at face value a figure given in a Scottish Office press information handout, but I still have that kind of childlike faith in human nature. Nevertheless, I am happy to accept the Minister's assurance that for "7,000" one should read "9,000". That disposes of that. I thought that he was a little less than gracious to Dundee, but no doubt it will be grateful for that.
  I come to the reasons for the present situation. I speak here in terms of technicalities, not in terms of principle.
  Mr. Rifkind: Why not?
  Mr. Dewar: The Minister merely encourages me to return later and ad longum to the matters of principle at stake. He may regret my weakness in the face of such temptation.
  It is evident from the list of properties and land in the schedule that most of these arrangements were concluded in the early 1970s. I understand that this was because under section 8 of the Land Tenure Reform (Scotland) Act 1974 any long lease for domestic housing purposes would have to be for less than 20 years. There was therefore some haste at that time to conclude a number of leasehold arrangements with the SSHA running for about 60 years, As a substantial number of tenants and a considerable amount of land are involved, perhaps the Minister will say something about the financial arrangements, of which I am sure he is aware.
  I understand that a considerable rental income is at stake, which will clearly be lost by Glasgow district council. I am told that it is £23,028 per annum, which is paid to the district council by the SSHA. Will the Minister confirm that compensation will be paid for that? I understand that there will be negotiations with the district valuer and that the district council feels that a fair capital value would be just over £1 million. That may be a negotiating position and there may be a good deal of coming and going on it. Nevertheless, it is a fairly substantial sum. I hope that the Minister will say something about the financial implications.
  It is not just a matter of loss of rental income to the district council. There will be a considerable short-term impact on SSHA finances, which, as the Minister has said, we have had the opportunity to discuss more than once recently in the Scottish Grand Committee and in the Chamber. I presume that the SSHA will be expected to find the money fairly promptly. If this arrangement is forced through, there will be great pressure from Glasgow district council for it to be concluded by the end of the financial year. If about £1 million has to be paid to the district council, that will have some impact on the SSHA's finances. I accept that it is not a massive sum in the context of the SSHA's total outgoings, but it is still a significant sum. Can the Minister say how it will be expected to find that money? Will it receive compensation from the Government for that amount?
  Mr. Jim Craigen: Or will tenants have to pay more rent to compensate for the loss?
  Mr. Dewar: That is an interesting point.
  The Under-Secretary of State has never hidden his personal view—in a way, that is to his credit—that rents
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  should rise not as a matter of financial necessity but as a matter of social judgment. He believes in high rents because he thinks that people in Scotland are paying too little for their housing. I sympathise with the fear that this may provide another excuse for placing an impost on tenants and forcing up the rents of those who remain SSHA tenants despite the blandishments of the Conservatives' sales policy. The impact on the arithmetic of selling may also be significant, as many SSHA tenants—perhaps in these very houses—as a result of previous SSHA or district council tenancies, will qualify for discounts of up to 50 per cent. Presumably that money will have to be set off in terms of the SSHA's profit and loss balance against the outstanding debt on those houses. I think that almost all of them, by definition, are comparatively modern and newly-built and therefore have substantial outstanding debt.
  On the debit side will be the site value figure—the SSHA's proportion of the £1 million compensation that it must pay as a result of all these Government manoeuvres. Perhaps the Minister will say a little more about that, because it appears to be more complicated than the simple proposition that he meekly advanced to the House a few minutes ago.
  The Minister suggested that we were rather short of principles on this matter. I do not want to delay the House with a broad statement of our opposition to the principle of the sale of council houses—[Hon. Members: "Why not?"]—because I know that many hon. Members who will speak after me will do so admirably. Yesterday, when discussing the SSHA, the Under-Secretary started with the simple proposition that sales would benefit an authority, but hurriedly went on, in a smashing non sequitur, to say that there would not be greater benefit to the authority that sold most. I believe that that is a mistaken view. I accept that the SSHA will have a particularly attractive set of wares in terms of housing stock, but, in local authority terms, the area that sells most will benefit most, although that may be the area of lowest priority housing need.
  More important, the sales policy will do incalculable damage to the prospect of those waiting for housing or seeking a transfer in Scotland. The Minister talked about the district council in Glasgow frustrating the wishes of the tenants who want to buy. I accept that in a strict sense that may be true, because if someone wants to buy and cannot his wishes are abviously frustrated. If we weigh the frustration, bitterness and division created by selling off the best housing stock, I think it will be seen that the balance falls on our side of the argument.
  Mr. Rifkind: Where is the evidence?
  Mr. Dewar: Let me answer that question before the Minister jumps to his feet in his usual angular fashion. The evidence is available to any hon. Member in Glasgow who represents a constituency with a substantial number of council houses. It is an incontrovertible fact that the best properties will be sold. The kind of properties that people have a lifetime ambition to rent are being removed from the public sector stock by the Government's activities.
  Mr. Rifkind: The hon. Gentleman seems to believe that incontrovertible facts are the statements that he proclaims from the Dispatch Box. Does he appreciate that every opinion poll taken on the subject shows that 80 per cent. of council tenants, including 80 per cent. of Labour voters, believe that council tenants should have the right

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  to buy? If he has one iota of hard evidence to show that the sales policy is causing bitterness, perhaps he will give it to the House.
  Mr. Dewar: The Minister was not listening with his usual careful attention. The incontrovertible fact to which I was referring was that the best properties are being sold. Secondly, the bitterness to which I referred can be found almost every week in any surgery of an hon. Member representing a West of Scotland constituency.
  I shall not invite the hon. Gentleman to come to my surgery, because that would be artificial, but I invite him to come and meet some of the residents' associations in Drumchapel, Easterhouse or any of the other large housing estates in Scotland. The Minister indicates dissent, but he should listen to the genuine voice of the people affected. There is no doubt that there is anger about the operation of the sales policy in Scotland, and its extension will be equally unpopular.
  The reason why the Minister should pause and think is that his party at present represents a small rump of opinion in Scotland. If he is happy about the standing of his party in the opinion polls, he has very modest ambitions. He has shown no sign of that in any other way. The Conservative Party has no broad-based support and in the areas that are affected by council house sales it has negligible support, and the Minister knows it. The best properties will be sold. I took the trouble today to check on my constituency with the Glasgow district council. In the Anniesland area, a popular area of the city, there are 168 valuations under way. For the two wards in Drumchapel the figures are two in one ward and four in the other. That picture is repeated throughout the area. It is in the good desirable areas, or areas that are perceived as being good and desirable, that the sales are taking place. Semi-detached houses, terraced houses and a few four-in-a-block houses are on the list, but there are precious few tenements and no multi-storey buildings. There is a geographical distinction and a distiction between types of property.
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  When the Minister boasts about the impact of sales in Glasgow, he should remember the figures. On 11 December—the latest figure that I have—there were 3,438 applications, which in a vacuum sounds a large number, but out of 185,000 public sector houses in Glasgow it is comparatively modest. Although those houses that are now under threat are small in number, we do not disguise from the House that they are important in terms of the mix of the housing stock. They are a necessary part of the housing stock because they represent a particularly popular type of housing in a particularly popular area.
  I believe—it may come as a surprise to Conservative Members—in choice within the public sector. We should be providing as wide a range of choice as possible. The great tragedy is that because of the financial cuts that have been inflicted on local government by this Administration the choice has been very much restricted. For the many thousands who are waiting for housing in Glasgow or waiting for a transfer within the housing stock, the removal of those houses is a serious and embittering matter. It is doubly annoying because they cannot buy because they are not sitting tenants and their chances of ever renting a house of that type are being sharply reduced as every house is removed from the public sector and sold to the private sector.
  This is a recipe for bitterness and frustration. The Government are doing enormous damage and the extension of the system into the Scottish Special Housing Association housing stock in Glasgow is misconceived and deeply mistaken. The Minister suggested that Glasgow district council was hostile to the wishes of its tenants. It is not a matter of hostility. It took its stand on principle. It has a duty to look at the overall balance for all tenants in Glasgow, not simply those few who have been lucky enough to be in attractive housing or lucky enough to be able to buy.
  If we take that more global view of the city and its housing problems, there can be no reason for voting for a measure that will only exacerbate an already serious position.
  10.4 pm
  Mr. Bill Walker: It is important that individuals living in rented property that is owned by the State should have equal rights. It was correct that we should make it possible for those individuals living in Scottish Special Housing Association properties to have the same rights as those living in properties that are owned, rented or leased by the council.
  This is probably the first opportunity that I have had to say something kind about Dundee district council—[Interruption.]
  Mr. Michael Martin: Is the hon. Gentleman aware that we are discussing land in Glasgow, not in Dundee?
  Mr. Walker: It is relevant to consider what one authority has done in similar circumstances, particularly when I have a unique opportunity to say something kind about Dundee district council. I should have thought that Opposition Members would want me to take this opportunity. If Glasgow district council had followed the example of Dundee district council, there would have been no need for this order.
  Mr. Dewar: Is the hon. Gentleman aware that we are interested not in Dundee but in Glasgow? Perhaps he will address his remarks to claims about the popularity of the Conservative Party in Glasgow and explain why, out of 13 Members of Parliament for the Glasgow area, there is only one Conservative Member.
  Mr. Walker: I am never sure which Labour Party is asking me what and why. I wonder what the situation in Glasgow will be after the next general election. There will probably be changes. I shall not suggest what those changes will be, because, fortunately, I am not concerned. The situation does not affect me personally. The housing situation does not affect me personally. The housing association wishes to make houses available for sale and it has done so in Dundee. It is only right that it should be given the same opportunity in Glasgow. It is wrong for Labour Members, particularly the hon. Member for Glasgow, Garscadden (Mr. Dewar) to suggest that there is frustration, bitterness and division. That is how he described the feelings of those living in properties rented from Glasgow district council and, I understand, from authorities throughout Scotland.
  Dundee and Perth and Kinross district councils fall within my constituency, but I have not found any bitterness, frustration or division as a result of the policy to sell council properties to sitting tenants. The reason is clear. The majority of those living in council properties know that a family allocated a council property will probably live in it for many years. Indeed, many families live in their properties for 30 or 40 years. They are fully aware of the situation and that properties do not become available as readily as has often been suggested by Opposition Members. The council property that I grew up in some years ago is still rented by a member of my family. That means that there is no prospect that it will be made available to anyone on the waiting list.
  The hon. Member for Berwick and East Lothian (Mr. Home Robertson) often chides us about our lack of experience, sympathy and understanding. This is where
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  the position becomes false, because in this area it is fair for me to suggest that I know a good deal more about the subject than the hon. Member does.
  Mr. Craigen: I know that there are few human experiences of which the hon. Member has no knowledge, but has he been the tenant of an SSHA house?
  Mr. Walker: I regret to say that there are many human experiences that I have not enjoyed. I have certainly never been guilty of being found drunk or of any of the other delightful things which appear to be qualifications for understanding the problems faced by people living in council properties.
  Mr. Deputy Speaker (Mr. Ernest Armstrong): Order. I remind the House that we are debating the desirability or otherwise of vesting land in the housing association.
  Mr. Walker: I apologise, Mr. Deputy Speaker, if I have strayed out of order, but I hope that you will agree that, if I have strayed, it has been due to the interventions.
  I believe that it is wrong to suggest that there will be—
  Mr. Barry Henderson: Before my hon. Friend leaves that point, will he agree that a real problem, which causes great frustration to many council tenants., is that thousands of council properties in Scotland are left vacant because no one will go into them, but that when they are put on the market they are often bought?
  Mr. Walker: I agree that one of the great tragedies in Scotland is that so many properties which are the result of investment by the State have stood empty for a long time. I am sorry that the hon. Member for Dundee, East (Mr. Wilson) is not here. It is sad that there are many such empty properties in his constituency.
  It is interesting that in the case of other State-owned properties, such as those owned by the prison authorities, prison officers are very keen to buy. That is the kind of choice that everyone should have in a free society. People should have the right to buy the home they live in and to have a stake in it. I have never been able to understand the logic of the Opposition's arguments—
  Mr. John Maxton: If that is the case and the hon. Member sincerely believes that everyone should have the right to buy the house in which he lives, does he agree to his Government introducing legislation to give the tenants of private landlords the right to purchase their houses at a discounted price?
  Mr. Walker: If it is in order for me to answer that question, Mr. Deputy Speaker, I suggest that the hon. Gentleman, as always, has shown his ignorance of the true position. The Government can pass legislation to sell these properties because they are State properties. What the Government cannot do—
  Mr. Maxton: They belong to the local authority.
  Mr. Walker: They are State properties, and I use the word "State" in its widest context. An authority can sell only assets which it owns or controls. One cannot force a person to sell his own asset, any more than Labour Members would expect the houses they own to be sold deliberately as a result of a Government measure.
  Although the order is being debated for only an hour and a half, it is a very important one, because it gives the

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  people living in these houses in Glasgow the same rights as everyone else living in State-owned property in Scotland.
  10.14 pm
  Mr. Hugh D. Brown: Due to the noise in the House, I am afraid that I did not hear everything said by the hon. Member for Perth and East Perthshire (Mr. Walker). I am not complaining about that—I think that I have heard it all before—but I do not understand the reason for the jollity on the Government Front Bench. I regard the subject as a serious one. I am well aware that, as I have said on mamy occasions, the Government have not a housing policy.
  The only reason why the Government are superficially happy and able to laugh is that they think they are on to something that might get them a few more votes—my goodness, they will certainly need them. The Government are wrong. I do not think that the Minister did justice to the House in his explanation of the reason we need the order.
  As I understand it, Glasgow district council has repeatedly said that it opposes the Government within the law. If I am right about that—I see the Minister nodding in affirmation—we can consider the matter more objectively. The Minister has not told me why only Glasgow has the problem. Does it have something to do—I hope that my hon. Friend the Member for Glasgow, Garscadden (Mr. Dewar) is listening—with the land tenure Act? Why are only certain SSHA houses in Glasgow affected? Is it because of the time when they were completed?
  Mr. Rifkind: I thought that I had explained that point, but I am happy to repeat it. Only in Glasgow and Dundee are there houses owned by the Scottish Special Housing Association but on land owned by the local authority. In all other cases the SSHA owns the land and the houses. Dundee has voluntarily agreed to dispose of the land to the SSHA. Glasgow district council has declined to do that, and is the only local authority in that position.
  Mr. Brown: It is possible that I did not put my question in the right way. When the SSHA wanted to build on council-owned land, why was the land not transferred? Presumably that was done by other suthorities when they transferred land to the SSHA. It is not clear to me why the problem has emerged only in Glasgow, but perhaps the Minister has given the proper explanation.
  When the Minister seeks approval for an order he must take on board the fact that we need more information than merely the fact that 9,000 houses are involved and that interest has already been expressed in 500. How many of the 9,000 SSHA houses are in multi-storey or tenement blocks, and how many are terraced or semi-detached? Only by breaking the figures down in that way can we make sense out of whether interest in 500 houses is a lot. We are entitled to information.
  Is any compensation involved? The Minister must also take on board the fact that, if I were a Labour councillor in Glasgow, I would argue as strongly as I could to screw every penny out of a central Government institution as part of the deal. There is nothing unreasonable about that, and the Minister has not said whether the negotiations have foundered. There may not be large sums involved, but
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  does the Minister expect to get goodwill from any council, considering the Government's present attitude, their reduction of the rate support grant and other measures?
  It is wrong for the Minister to pretend that a wicked Labour-controlled council is trying to thwart the legitimate aims of tenants in its own or SSHA houses.
  Mr. Craigen: Assuming that the district council were to hand over the land or nothing to the SSHA, would the auditors not be on to the local authority like a shot to ask why it was doing that?
  Mr. Brown: I do not know the answer to that question. The House is entitled to more information from the Minister. It is a matter of public interest, because we will hear much in the next weeks and months about the powers of Government in relation to local authorities and ideas for rates. Hon. Members are asked to approve an order without hearing a word from the Government about the financial consequences to a local authority. That is outrageous.
  I make no apology for taking up a few minutes to express my view. Opposition Members have argued that if this right were to be given to every council tenant it should, as a matter of justice, be given to SSHA tenants, those living in new towns, prison officers and those employed by other public bodies. I give full marks to Glasgow for taking a while to get round to this issue. Opposition Members are united in opposing this indiscriminate sale. I welcome the fact that Glasgow has found a loophole.
  I did not realise that the 1980 Act gave powers to produce orders. It is doubtless the case that the legality has been checked, but I hope that the Minister will give more information about the financial consequences. If some money is to be paid to the district council, my guess is that the Government will take this into account in the allocation of resources to Glasgow in the future. Is that one of the factors that has been responsible for delaying the negotiations? I hope that the Minister will come clean about the financial terms.
  10.21 pm
  Mr. John Maxton: I am sure that you, Mr. Deputy Speaker, must have a certain sense of deja vu in relation to this debate. When a matter, debated last night, reappears again tonight, you must be wondering what the SSHA is. It is not something that is found in this part of the world. I should like to start by referring to the speech of the hon. Member for Perth and East Perthshire (Mr. Walker).
  Mr. John Home Robertson: Must you?
  Mr. Maxton: There is one point in the hon. Gentleman's speech to which a response must be made. In the main his speech was his usual terse combination of personal credo and reminiscence about where he has lived and what he has done. However, following my intervention about the right of private tenants in privately owned properties to purchase their property, his remarkable reply was that the difference was that one could not appropriate from private individuals but one could appropriate State property. At long last, even if from the Back Benches, hon. Members have heard the true voice of Conservatism in its relationship to local government.

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  The Government are engaged in the destruction of the difference between local authorities and the Government and the difference between the ownership of property by a local authority and the view of the hon. Gentleman—I noticed that many of his hon. Friends on the Front Bench nodded in agreement—that all property owned by a public body is State property. To my mind, that means property owned by central Government.
  Our discussion tonight centres on land that does not belong to the State. We are talking about land that belongs to the citizens of Glasgow, vested through the Glasgow district council. If the citizens of Glasgow were asked whether this land should be sold, vested, or whatever the term is, to the SSHA, those citizens, as they have shown in their voting record for the Labour Party, would probably not go along with it—certainly not unless there were sufficient compensation to make the exercise worth while to them.
  Mr. Bill Walker: From what the hon. Gentleman is saying, am Ito understand that he believes that in the event of a sale of this or any other kind, compensation should be and must be proper and adequate?
  Mr. Maxton: That would depend very much on the circumstances. In this circumstance, where it is appropriation—the hon. Member sneers, but normally it is Conservative Members who are attacking us when we talk about taking over and appropriating things. Now we suddenly find that that is what they are doing. They are taking over the land of the citizens of Glasgow and handing it over to the SSHA.
  My hon. Friends the Member for Glasgow, Provan (Mr. Brown) and for Glasgow, Garscadden (Mr. Dewar) have been concerned about the level of commpensation that will be payable to Glasgow district council. I, too, am concerned about that. What amount will be payable, and how will that be reckoned, as compensation to Glasgow? By whom will it be paid?
  This land is being vested not in the Government but in the SSHA. The Government may be considering that compensation to Glasgow for that land should come out of any allocation to the SSHA. That may well mean that the cost will be passed on to the SSHA tenants in Glasgow, who will have to pay higher rents in order that the land on which their house is situated can be purchased.
  The Minister has remarkable powers of being able to talk and listen at the same time. However, I am raising an important point. Who will pay this compensation? Will it be the SSHA? If not, will the Government deduct it from the allocation to the SSHA in terms of money outstanding? Will the Government ensure that if the SSHA has to pay, that will not be passed on to the tenants? That would be grossly unfair.
  The Minister made great play of saying that in Glasgow 500 people out of 9,000 had expressed a desire to purchase. On the figures, we all know that the expression of a desire is normally much higher than the number of those who end by purchasing. I think that we are talking of about 250 people. That is the sort of figure that is likely to result in terms of purchases out of the 9,000. On my reckoning, 500 is only 5½ per cent. of the total number of tenants of SSHA houses in Glasgow where there is even a suggestion that they might wish to purchase their houses. So I hope that the 94·5 per cent. will in no way bear the
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  burden of purchasing this land from Glasgow. I hope that the Minister will make it clear that they will not bear that burden.
  As I said last night, our concern is with that 94·5 per cent. who will not be purchasing their houses and who are already suffering large increases in their rents and cuts in their repair and rehabilitation programmes in SSHA housing. We want to make sure that they have no extra burden imposed on them.
  We are opposed to the sale of council houses in the blanket manner of every tenant having the right to buy My hon. Friend the Member for Garscadden is correct when he says that it is the better housing that is being sold in Glasgow and that the poorer housing is not being sold. In my constituency I have the large Castlemilk scheme. Very few houses are being sold in that area. Not only are the houses not being sold; as a result of the present Government's policies, the living standards of tenants in that area are suffering immensely because of the lack of repairs and the damage being done to the environment simply because repairs and improvements are not taking place. The tenants do not wish to purchase their houses.
  We are interested in that 94·5 per cent. of SSHA. tenants in Glasgow. Glasgow district council was right to oppose the measure and to force the Government to take the order throught the house and give hon. Members an opportunity to show our opposition to it.
  Mr. Dennis Canavan: On a point of order, Mr. Deputy Speaker. Is it in order for Mr. Forty Per Cent.—the hon. Member for Islington, South and Finsbury (Mr. Cunningham)—to conduct a blethering conversation with strangers while the debate is going on, or is this renegade from Scotland and from the Labour Party explaining to those people why the debate is taking place at this unearthly hour instead of in a more civilised forum in Scotland?
  Mr. Deputy Speaker (Mr. Bernard Weatherill): Anything that goes on beyond the Bar is not a matter for me and is not a matter for the House.
  10.32 pm
  Mr. David Lambie: I oppose the motion because it transfers land from Glasgow district council to the Scottish Special Housing Association. If the order had been to transfer SSHA housing to Glasgow district council I would have supported it, because I believe that instead of wasting time on transferring land from a district council to the SSHA we should be considering the policy of the Labour Party in Scotland, which is that the SSHA should be a building authority alone and that once it has built houses they should be transferred to the local authority to be factored in the same way as any other council house at rents equivalent to those paid by the tenants of normal district council houses. This is an irrelevant motion at a time when SSHA tenants are complaining about its bureaucracy.
  I wish to take up a point raised by my hon. Friends the Members for Glasgow, Cathcart (Mr. Maxton) and for Glasgow, Provan (Mr. Brown) about compensation. My hon. Friends were worried about the fact that the Minister has not told us what finance was involved in the transfer. They implied that that might mean that other tenants of the SSHA in Glasgow must pay for the land.
  I wish to widen that by suggesting that not only must the SSHA tenants in Glasgow finance the buying of land

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  from Glasgow district council; it will involve SSHA tenants in my area of Cunninghame. There are many SSHA houses in areas such as the Garnock valley, Dalry, Kilbirnie and Beith, as well as in Irvine new town and Kilwinning. Therefore, I speak on behalf of those tenants who must finance the purchase of the land by the SSHA from Glasgow district council.
  I have said before that those of my constituents who are SSHA tenants believe that they are financing house building by the SSHA in the oil-rich areas of Aberdeenshire, the North of Scotland, and in the Borders. They believe that because of Government cutbacks in finance, the SSHA must obtain extra money from its tenants in Scotland. Therefore, those tenants in Cunninghame are paying to build houses in the oil-rich areas of the north of Scotland. I worry whether there will be a further burden. Will the rents of those houses be increased in order to buy the land from Glasgow district council?
  The matter is serious. We know from leaks in the press, that the Treasury wished to have rent increases in public sector housing of about £4·50 a week. Luckily, there was a revolt in the Cabinet and luckily for SSHA tenants the wets in the Cabinet won. Rather than rent increases of £4·50 a week, we think that in England and Wales they will be £2·50 a week. You, Mr. Deputy Speaker, as an English Member, might be satisfied with that, but Members representing Scottish constituencies do not know at what level the Secretary of State for Scotland will set the rent increases for houses in Scotland.
  We have heard statements from the the Secretary of State for the Environment about Government policy for England and Wales, but we have not heard what the Secretary of State for Scotland proposes for rent increases for Scottish new town houses, district council houses and SSHA houses. Is the Secretary of State waiting for the result of the order tonight? Will the amount of money to be paid to Glasgow district council for the land have an important effect on the level of rent increases for Scotland? Will there be a report from the right hon. Gentleman next week, when Parliament is in recess, saying that he is not satisfied with rent increases of £2·50 a week but wants £3·50 a week to allow the SSHA to buy land from Glasgow district council?
  You, Mr. Deputy Speaker, knowing only English conditions, do not know that in my constituency the rents of SSHA properties are already much higher than the rents charged by Cunninghame district council, the local authority that owns most of the housing. Because the SSHA is a bureaucratic, dictatorial organisation, which voices the opinions of the Government, it fixes whatever rent it wants without any repercussions from the tenants or the local population. The local district council—a democratic organisation—must listen to the local people and tenants, and cannot be vicious towards them. It must fix a rent that local people are willing to pay.
  In my area the SSHA, because it is the voice of Government and a dictatorial organisation that does not have to face the consequences of its actions, fixes rent levels much higher than those charged by the local district council. If the order is passed, the SSHA tenants will be hard hit. I put the case to you, Mr. Deputy Speaker. As an English Member, you do not know Scottish conditions and—
  Mr. Deputy Speaker: Order. The hon. Gentleman knows that I have a great interest in Scottish conditions. He need not address his remarks to me in that manner.
  Mr. Lambie: I am giving details of the Scottish housing scene that you cannot be expected to know, Mr. Deputy Speaker. In Scotland, more than 60 per cent. of people live in public sector housing, whereas in England and Wales the figure is 30 per cent. Therefore, the Government's policy of drastically increasing rents for public housing in Scotland affects nearly two-thirds of the population, whereas in England and Wales the Government get away with attacking council tenants because it affects only one-third of the population.
  The Government are attacking Glasgow district council, which speaks for the overwhelming majority of people in Glasgow. The Glasgow Labour Members represent the people of Glasgow. There is only one Tory Member left in Glasgow. The hon. Member for Glasgow, Hillhead (Mr. Galbraith) is not present tonight. We are discussing Glasgow and the only Tory representative for part of Glasgow is absent. Where is he?
  Lord James Douglas-Hamilton: He is ill.
  Mr. Lambie: If that is so, I will give the hon. Gentleman that excuse tonight, but that does not excuse the other occasions when he has been absent.
  All the Labour Members who represent Glasgow constituencies will vote against the order. We represent the people of Scotland. That shambles on the Government Front Bench do not represent them. They do not even speak like Scotsmen. They are all educated at English public schools and they carry on the traditions of the English in the House. That is why we are speaking for the tenants of Scotland. We are speaking for the tenants of the housing association.
  We are saying to the Government "You will get away with this now because you are English Members." I see only one hon. Member representing an English consituency on the Government Benches, but once the Division Bell rings the other English Members will come in in their droves. They will come from all their hiding places and they will vote down the majority opinion of the Scottish Members. They will inflict English Tory policy on Scottish conditions about which they know nothing. The Government will win tonight because of the English Tory hordes, but after the next election we will change that. We shall transfer the housing owned by the housing association to the district council and the council will have sole control.
  10.42 pm
  Lord James Douglas-Hamilton: I enjoyed the spirited rendering of the hon. Member for Central Ayrshire (Mr. Lambie), but I fear that I have heard it before. I listened to it previously when the former right hon. Member for Kilmarnock, Mr. William Ross, as he then was, occupied the Labour Government's Front Bench and the Labour Opposition's Front Bench. The hon. Gentleman attacked him as strongly as he attacks us today. At least the hon. Member for Central Ayrshire is strictly consistent.
  It has emerged from the debate that Labour Members are not saying "We oppose the order because the people do not want it." They are saying "We oppose it

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  passionately, because the people want it and we feel that they should not want it." We are not ashamed to stand up for a property-owning democracy. What is more, we are determined to do everything within our power to bring it within the reach of everyone. The hon. Member for West Stirlingshire (Mr. Canavan) laughs. In a previous debate he read out a list of landowners in Scotland. His facts were unfortunately 100 years out of date. I hope that he will be a little more up to date if he contributes to this debate.
  The evidence of demand is overwhelming. When houses were put on sale in Glasgow, Easterhouse, as a form of homesteading, everyone was astonished at the number of houses that were sold. That answers conclusively the hon. Member for Glasgow, Garscadden (Mr. Dewar), who argued that only the nicer houses would be sold. That is not so. The houses in Easterhouse were snapped up at once. Martello Court, in my constituency, was referred to as a terror tower in which no one would choose to live. It was seriously suggested by the council that the entire tower should be demolished, but it was renovated and painted from top to bottom. It was made secure with a wall that was built round the perimeter. Virtually every flat has been sold and it has been a complete success. There is a market. Of course, every house must have its value.
  The order is competent in terms of the Tenants' Rights, Etc. (Scotland) Act 1980, which enables my right hon. Friend to transfer the ownership of houses from heritable proprietors to landlords. It is clear that Glasgow district council has refused to comply with legislation. It has opposed the compulsory sale of public housing to sitting tenants at discounted prices. I strongly hope that the Minister will stick to his case, because the demand is there. The tenants wish to buy and they should have the opportunity to do so.
  Mr. Canavan: Would the hon. Gentleman support a Bill to force his big brother, the Duke of Hamilton, to sell off houses to any of his tenants who wished to buy?
  Lord James Douglas-Hamilton: I think that many of the houses have been bought anyway, and others are occupied. I am very much against houses remaining unoccupied needlessly when people wish to buy them. I do not know of all the circumstances applying to those houses, but I shall certainly find out. I should have thought that such legislation would be quite unnecessary, but I certainly accept that houses should be filled and not left vacant. That is why we wish houses to be sold which at present cannot be filled by district councils.
  Mr. Dewar: The hon. Gentleman says that he is worried about houses lying vacant, but those are the very houses that cannot be sold under the tenants' rights legislation, because only sitting tenants have the right to buy. It is therefore the exact opposite of the situation to which he refers. Homesteading is an example of a district council responding flexibly to a local need and using its discretion wisely, but the tenants' rights legislation leaves no discretion to the local authority in housing management and destroys the rights of local democracy.
  Lord James Douglas-Hamilton: The hon. Gentleman is wrong. The essence of homesteading is that houses that cannot normally be filled may be sold to people willing to buy them at a knock-down price. Every house has its market value. Clearly, a house in what might be described
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  as a less desirable area has a considerably lower value than one in a more popular area. It is simply a matter of ensuring that houses are sold at the appropriate price in the appropriate circumstances.
  10.47 pm
  Mr. Michael Martin: I do not wish to give the impression that I am in any way critical of the SSHA, as it is a first-class landlord. The houses with which we are concerned include many in my constituency. They are very high demand houses. This worries me because, as many of my hon. Friends have said, it is to such high demand houses that many council tenants wish to transfer.
  Hon. Members have said that people may spend as long as 40 years in their council houses. That is not the case in many parts of my constituency. Many tenants who have spent 10 or 12 years in council houses want to get out of them because the property has deteriorated. When one asks where they wish to go, often they say that they want to stay in the area but that they wish to move into SSHA housing. One of the reasons for that is that SSHA property is very well managed. There is a first-class maintenance programme. The area housing managers tend to ensure that anyone behaving anti-socially is properly supervised in such a way as to work in harmony with the rest of the tenants. It is not a good idea to sell those houses when people who have served their apprenticeship in the hard-to-let areas want the opportunity to go into them.
  My hon. Friend the Member for Glasgow, Provan (Mr. Brown) asked what compensation Glasgow would receive for the land. Does the Minister realise that a great deal of land in the city was given by landowners as a gift to the citizens of Glasgow?
  The minutes of the old Glasgow corporation are fascinating, because they show that landowners, including the aristocracy, gave land to the citizens of Glasgow. They did so for the benefit of the people. Therefore, if we allow the SSHA to sell it to private individuals, we shall be going against the wishes of those who bequeathed the land in the first place. I am sure that in the area in which I live, landowners handed over land to the old Glasgow corporation for the benefit of all the people, not some.
  Not far from the land that we are now discussing, 600 acres in Robroyston were sold to fly-by-night salesmen who made a killing as a result. That caused a scandal. Last year the Secretary of State said that we had learnt from the mistakes of Robroyston and would ensure that it did not happen again. Only a few weeks ago, I discovered that one of those salesmen is now going through the bankruptcy court. That might be just a coincidence, but I wonder whether it was planned that way.
  Many of the houses affected by the order are nontraditional. If they are not repaired or modernised within a reasonably short time, some of them will have to be demolished. Let us not kid ouselves. Some of the SSHA houses in my area, and SSHA properties in others, are fire traps simply because they are not properly wired, yet we are handing them over to people who may not be able to keep up with the mortgage payments that the Government and the SSHA are inviting them to take on.
  If those houses are demolished, there will be large tracts of land in Glasgow upon which the public sector will not build because of the Government's financial cuts. I want an assurance from the Minister that in that event we shall

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  not have a repeat of the Robroyston saga. I want an assurance that at the very least the local authority will have an opportunity to take over that land.
  In the Scottish Grand Committee I said that the SSHA wrote to the Glasgow district council about the acquisition of property and land. It made the point that as a Government agency it would reflect the policy of the local authority. In other words, if the local authority was opposed to the sale of council houses, it would also be opposed to such sales. The Glasgow district council has adopted a certain line and is working within the law. I feel that the SSHA is morally bound to reflect the council's policy when operating within its boundaries.
  As a Government agency, the SSHA is obliged to carry out Government policy. If we had a Labour Government, I would insist that the SSHA carried out their policy. Having said that, I believe that the Government are forcing the SSHA into a conflict with Glasgow district council. That is a pity, because in all the years that I was a member of the district council we had nothing but good relations with the SSHA. The relationship could be destroyed because the Government are forcing the SSHA into that position.
  Mr. Lambie: Is not my hon. Friend being a little unfair to the Government? Does he not recognise that the chairman of the Scottish Special Housing Association is a Glasgow Tory councillor? Most of the councillors on the SSHA were appointed by the Government because they are Tories. They are not asking for protection against the Government. They are the spearhead of the Government against the local authorities.
  Mr. Martin: I believe that I was being a little fairer to the Government than my hon. Friend was a few moments ago. I take his point. When the next Labour Government are returned—[HON. MEMBERS: "If".]—I hope that they will take a leaf out of the Tory Party's book. I hope that we shall put Labour Party supporters into organisations such as the SSHA. The first criterion is that they should be elected people who are capable of doing the job—and the second is to get rid of the Tories. Conservative Members know their first priority. As soon as they get into power they put all their friends into key positions. There is no point in having power if we do not use it.
  There are many under-occupied SSHA houses. It is said that people—many of them widows—are living on their own in four-apartment and five-apartment houses. On the other side of the coin, my consulting surgeries are full of young couples who are desperate for housing. They would dearly like to move into the houses that are under-occupied. If the Government are to sell these houses through the SSHA, they will close the door on those young couples. A few years ago we could have told them to go to the home loan section and obtain a home loan. We cannot do that now because the Government have made sure that there is no finance available, even though home loans will be provided to council tenants buying their homes. With the present high rate of unemployment it is a tragedy that we should be telling the unemployed that they will not be considered for SSHA houses because the houses will be sold to sitting tenants. Many tenants will be denied the opportunity of buying a house because the Government believe in high unemployment.
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  I urge hon. Members to oppose the order tooth and nail.
  11 pm
  Mr. Rifkind: We were assured by Labour Members that tonight was an opportunity for Glasgow's Labour Members to show their complete opposition to the order. It is significant that half of Glasgow's Labour Members have not bothered to attend the debate. That is a measure of their disagreement with what is proposed.
  I was interested in the synopsis given by the hon. Member for Glasgow, Springburn (Mr. Martin) of the priorities of the next Labour Government. He suggested—as did the hon. Member for Central Ayrshire (Mr. Lambie)—that it was absolutely wicked for the Conservative Government to display all their prejudices by appointing a Conservative chairman of the SSHA. They may like to know that at the same time we appointed a Labour deputy chairman of the SSHA, no doubt also sharing our prejudices.
  The hon. Member for Springburn gave us his vintage definition of Socialism. It may have been news to some of his hon. Friends, but it was not news to the rest of us. It has been known in Scotland—certainly in the West of Scotland—for at least the last 30 years that that is what Socialism is about. I am sure that it will be true in the future as it has been in the past.
  Mr. John MacKay: Has the Minister noticed that the Social Democrat and Liberal Members have been absent from the debate? Does not that show the degree of their interest in housing matters in Scotland?
  Mr. Rifkind: On several occasions Scottish debates have taken place without one representative of the Liberal or Social Democratic Parties being present. It shows their almost complete lack of interest in Scottish matters in the House.
  Mr. Dewar: Will the Minister accept that there is a limit to the numbers game that can be usefully played in these affairs? For his information, of the 13 Glasgow Labour Members, 10 have been present at some stage during the debate. It is fair to say—as can be said of the one Glasgow Conservative Member—that the others are ill. Indeed, the hon. Member for Glasgow, Kelvingrove (Mr. Carmichael) has left for that reason.
  Mr. Rifkind: One accepts that there are legitimate reasons why some hon. Members are absent, but one is entitled to comment on the fact that some Labour Members have come into the Chamber for a very short time and then departed. I am interested in those who take the trouble to sit through the debate. It is surely reasonable to make that comment.
  The hon. Member for Central Ayrshire, as is usual on these occasions, managed to commit the next Labour Government to a series of new policies. When the hon. Gentleman embarks on his proposals for the next Labour Government his colleagues on the Opposition Front Bench—whom he is unable to see when he is speaking—always go from a dark to a lighter shade and are progressively more concerned as one commitment is piled on another. I assure the hon. Member that the commitment he has given on behalf of his party to disband the SSHA, and to transfer all its houses to the local authorities, is not a policy which has attracted any Labour Government in previous years. There was not the slightest indication, from the comments of the hon. Member for

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  Glasgow, Garscadden (Mr. Dewar) that if he had responsibility for these matters he would be any more attracted by the proposals of his hon. Friend the Member for Central Ayrshire than the previous Labour Government were.
  Mr. Lambie: The policy of the Scottish Council of the Labour Party—reaffirmed at various conferences—is not to disband the SSHA but to retain the SSHA as a building agency. Once the houses have been completed, they should be handed over to the local authority. That is a fair policy to adopt, and my right hon. and hon. Friends on the Opposition Front Bench are committed to it.
  Mr. Rifkind: The hon. Member for Garscadden was obviously enlightened to hear that he was committed to that policy. I should be delighted to give way so that he might confirm that fact. Apparently it is one of the commitments that he does not feel committed to, as is the case with many other aspects of Labour Party policy.
  My hon. Friend the Member for Perth and East Perthshire (Mr. Walker) was correct to say that the order is necessary only because Glasgow district council declined to adopt the constructive and sensible attitude of Dundee district council which realised that the interests of SSHA tenants would not be served by fruitless, politically inspired opposition and agreed to the proposal.
  Glasgow district council, faced with the same situation, took up a doctrinaire position. I should tell the hon. Member for Glasgow, Provan (Mr. Brown) that the council's refusal to agree to a voluntary transfer of land had nothing to do with questions of compensation. A letter from the council dated 4 November makes it clear that it opposes the transfer because it is opposed to the sale of council houses to sitting tenants. There are not technical, financial, compensation or other such reasons.
  The hon. Member for Garscadden and a number of his hon. Friends referred to compensation. Of course compensation is due to the council. There is no discretion for the Secretary of State. The legislation under which the order is proposed specifically provides for compensation and the Government accepted that from the beginning.
  The proper sum of compensation will be decided by the district valuer when the conveyancing between the council and the Secretary of State has been completed. Once the district valuer has determined the figure it will be accepted by my right hon. Friend. I give a categorical assurance that there is not the slightest danger of any of the compensation costs falling on SSHA tenants in Glasgow or elsewhere of compensation affecting the SSHA's ability to carry out its present programmes.
  Compensation paid by the SSHA to the Glasgow district council will not involve a net increase in public expenditure, because it will be a transfer from one public body to another. There will be no net increase in public expenditure and, therefore, no problem in providing for such a payment when the time comes.
  Mr. Dewar: We know that the capital ceiling for the SSHA in the current year is about £45 million. Presumably it expects to spend all that before the end of March next year. Will the £1 million come out of that, will the £45 million become an effective £46 million, or will the money be provided by a revenue payment from the Government? If the money is not to be found from increased rents—I accept the Under-Secretary's categorical assurance on
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  that—we want to be satisfied that it will not mean, say, a cut in the already hard-pressed modernisation programmes.
  Mr. Rifkind: I give the hon. Gentleman that categorical assurance. The sum involved will be for the district valuer to decide, and it is not clear whether the money will fall due in the current financial year or next year, but either my right hon. Friend will consider an adjustment in the borrowing powers of the SSHA for the current year or it will be taken into account in the determination of its allocation for next year.
  No net increase in public expenditure is involved and there is no serious problem. It is merely a technical adjustment which will not cause difficulty to SSHA tenants or the association's building and modernisation programmes.
  Mr. Hugh D. Brown: It is not good enough to say that it has nothing to do with adding to public expenditure. A cheque will be written by the SSHA. Will it be for £1 million? What sums are we talking about? There is no point in telling us that it is a matter for the district valuer. We all know that. Surely in the discussions there must have been a stab made at what sort of sums we are talking about.
  Mr. Canavan: The Under-Secretary's right hon. Friend should tell him the answer before he replies.
  Mr. Brown: Therefore—
  Mr. Canavan: The right hon. Member should tell him the answer.
  Mr. Brown: I had to put up with such interventions from my hon. Friend the Member for West Stirlingshire (Mr. Canavan) when I was a Minister, so there is no point in getting annoyed about them now. The Minister has not stated whether we are talking about £20,000 or £500,000. We want to know.
  Mr. Rifkind: The hon. Gentleman will have heard his hon. Friend mention Glasgow district council's own estimate of about £1 million. I cannot give the hon. Gentleman an exact figure. A factor to be taken into account is that the SSHA at the moment pays an annual rent to the district council of about £23,000 to £25,000. That will have to be capitalised because the rent will no longer be paid. The district valuer will also have to take into account the value of the land itself.
  Mr. Canavan: How much?
  Mr. Rifkind: The hon. Member for Provan will appreciate that once the district valuer has fixed the figure we shall be bound by his assessment. That w ill be the amount to be paid by the SSHA to the Glasgow district council. I have explained that there will be no significant problem in adjusting the overall finances of the SSHA to enable the payment to be made. There will he no net increase in public expenditure. It will transfer one public housing agency to another public housing body. It is a technical problem rather than one of real resources.
  The hon. Member for Garscadden suggested that Glasgow district council was entitled, even from the point of view of the principles that are involved, to adopt a stance of basic opposition to the proposals because it did not believe in the sale of houses. We are talking about houses owned by the SSHA which always follows the policy of the party in office at any given time. The SSHA

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  has been selling houses to its sitting tenants not only since the passing of the Tenants' Rights, Etc. (Scotland) Act but since the Government came into office. The policy of the owner of the houses happens to coincide with the wishes of the tenant. There is a willingness to sell and a willingness to buy. Glasgow district council's interest arises as a result of a historical anomaly whereby, back in the early 1960s, not the 1970s, the majority of these houses were constructed by the SSHA on behalf of Glasgow purely in the interests of speed and the avoidance of delay that the conveyancing of the land would have involved. An arrangement was made that has persisted to the present day.
  Mr. Dewar: This is perhaps an arid argument. The Minister will surely accept that it was not a coincidence that this ground was let leasehold and not sold. It may also have been a matter of convenience, but a point of principle is involved. Glasgow district council, rightly or wrongly, wishes to retain an interest in the land and an element of control, believing that this is right in the interests of the city of Glasgow and its citizens. That is the legal view, legally executed. The Minister must at least accept that Glasgow district council is given a right in the matter, even though he does not like the way in which it has exercised that right.
  Mr. Rifkind: I do not accept what the hon. Gentleman says. If that was the reason, one would have assumed that Glasgow district council, in its communications with the Secretary of State, would have stated it. The council has not done so. It has not claimed that its interest in the land was the basis of the original transaction with the SSHA and that it therefore does not wish to revoke the right. The chief executive of the city of Glasgow has stated:
  "My Council remains firmly opposed to the compulsory sale of public housing to sitting tenants".
  It has nothing to do with interest in the land or the original basis on which the land was provided. The view taken is that if the Secretary of State wants to enforce the sale he has no alternative but to use his powers under the Act. This is the issue with which the order is concerned. The city of Glasgow does not agree with the hon. Gentleman's interpretation of its motives. It is not what the chief executive states in his official correspondence with the Scottish Office.
  Mr. Dick Douglas: Hon. Members should hear about all the correspondence.
  Mr. Rifkind: This is all the correspondence. The letter from the city of Glasgow is not a confidential document.
  Mr. Douglas: I do not distrust the Under-Secretary, but is he willing to put the letter on the official record?
  Mr. Rifkind: I would not only be willing to show it to whomsoever wishes to see it; I would be willing to show it to the hon. Gentleman. That shows my entire trust and faith in the contents of the letter in question.
  The order has the effect that I indicated earlier. We simply wish to ensure that the 9,000 tenants of the SSHA in Glasgow are able to exercise the right that Parliament provided for them. That is not an unfair or unworthy desire. Therefore, I commend the order to the House.
  11.15 pm
  Mr. Dennis Canavan: I had no intention of taking part in the debate until I heard the Minister's useless reply. The hon. Member for Edinburgh, Pentlands (Mr. Rifkind) has the reputation of being one of the least unintelligent members of the Front Bench team from the Scottish Office, yet tonight his contribution has been an insult to the intelligence of the House of Commons. He has repeatedly refused to answer the 64 million dollar question—how much money will be involved in this financial transaction between the SSHA and Glasgow district council? I think that we are entitled to hear from him again—with the permission of the House.
  After the debate last night on the SSHA and after this debate, it is clear that the present over-centralised, dictatorial Government are now hell-bent on using the SSHA as an instrument to try to impose their will on public sector housing in Scotland in order to reduce and dismantle public sector housing and to make it less accountable to the elected representatives of the Scottish people.
  The Minister ought now to rise to give us a more satisfactory explanation. If he does not do so, some of the more enlightened Conservative Members might join Opposition Members in the Lobby.
  Question put:—
  The House divided: Aves 140. Noes 84.
  Question accordingly agreed to.
  Resolved,
  That the Scottish Special Housing Association (Vesting of City of Glasgow District Council Land) (Scotland) Order 1981, a copy of which was laid before this House on 25th November, be approved.

  Northern Ireland (Emergency Provisions)
  11.28 pm
  The Secretary of State for Northern Ireland (Mr. James Prior): I beg to move,
  That the draft Northern Ireland (Emergency Provisions) Act 1978 (Continuance) (No. 2) Order 1981, which was laid before this House on 2nd December, be approved.
  I ask the House to renew for a further six months all the provisions of the Northern Ireland (Emergency Provisions) Act that are in force. The last six months have not been uneventful. Last July the Republican hunger strike dominated people's thoughts and there were regular street disturbances. I am glad to say that that is now over, but the violence fostered by the terrorists has by no means ended. I know that the whole House will join me in expressing sympathy to all those who have suffered, and to their families.
  We have had good reason recently to feel something of the tragedy, because of the murder of Robert Bradford, whom we greatly miss tonight. During 1981, 98 people have died, 1,315 have been injured, and there have been 807 shooting attacks and 383 bomb attacks.
  Those figures are worse than those for 1980, but they are better than for most years in the preceding decade. They demonstrate that terrorism remains a powerful threat to the lives and prosperity of all the people of Northern Ireland. The strong feelings inevitably created by the hunger strike have left an unhappy residue of deep distrust between the communities, but the terrorists have failed in their objective of capitalising on that distrust to bring about inter-sectarian violence on a scale that might lead to anarchy.
  They have achieved a number of assassinations of those concerned with the protection of the community. The people of Northern Ireland are rightly deeply worried by these repeated attacks. Members of the RUC and its reserve, of the Regular Army and of the Ulster Defence Regiment form a higher proportion of the ranks of those killed than in previous years. I pay tribute to all those in the security forces who have again given unstinting service this year.
  There are many examples around the world demonstrating the advantages possessed by the ruthless terrorist conducting a campaign of murder for political reasons. Nevertheless, the security forces in the Province have had substantial successes. Some of them, as in recent weeks, have been spectacular. Many more have passed with less attention. So far this year 861 people have been charged with terrorist offences, 43 for murder and 65 for attempted murder. A very high proportion of the total prison population in Northern Ireland comprises people serving sentences for terrorist offences.
  The process of detection and arrest is a complex and finely stranded web. It requires a great deal of unobtrusive research and solid grind as well as courage. The police are deploying as many men as possible on anti-terrorist work. The strength of the RUC is now 7,280 men and women—an all-time high. Their professionalism is widely respected, not only in the whole of the community of Northern Ireland but among the police in Great Britain and abroad.
  The specialist skills and assistance of the Army are at their disposal whenever and wherever required. At present
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  there are over 11,000 Regular troops in the Province. Renewal of these provisions is one way in which Parliament can demonstrate its support for the security forces. The powers under the emergency provisions Act are a vital part of the security forces' armoury in circumstances where violence and intimidation are rife. They are provisions that one would not contemplate in normal times. We provide them with reluctance, and only after careful scrutiny even in exceptional times. They are, however, procedural modifications, which retain the fundamentals of our judicial system.
  We have not strayed from the essential assumption of innocence in default of clear proof to the contrary, or from trial in open court. The Diplock courts recognise the reality of intimidation, which all who are familiar with the circumstances in the Province appreciate. They are the powers that the security forces find invaluable in bringing terrorists to justice. They are not indiscriminate powers that damage the innocent as well as the guilty and undermine the principles of respect for law which all of us are concerned to uphold.
  The prime requirement to counter a terrorist campaign is information and evidence. The prime objective of the security forces and the Government is to improve the flow of information and evidence so as to secure the conviction of terrorists. That is the standard against which tactical changes in the operation of security policy are assessed. The security forces are continually refining their tactics and procedures. They welcome constructive proposals and positive support. Above all, they welcome information and evidence from the public.
  They should not be distracted by other events from their real task of protecting the lives of all members of the community. Nor should understandable anger over particular outrages lead us to play the IRA game by relieving our feelings in indiscriminate retaliatory action that accelerates the cycle of terrorism and violence. It is the Government's primary aim to bring an end to terrorism and to restore normal policing throughout Northern Ireland. Security policy is guided by that aim, and the Government take full responsibility for it. The professional means whereby it is carried out within the law are a matter for the Chief Constable and the GOC. The Government place no restraint upon their operation other than that of the law, which it is their function to sustain. If they need further resources we are committed to finding them.
  Other factors can make the security situation worse or better. Security in any society is a function of many factors. In Northern Ireland, relations with the Republic, the economy and the system of government all have a bearing. Now is not the time to consider these wider issues, but we do well to remember that they all have their impact on the situation that we are discussing.
  Successive Governments have rightly attached much importance to effective security co-operation with the Republic. Co-operation between the Royal Ulster Constabulary and the Garda is excellent and it achieves solid results. The apprehension of terrorists and the frustration of their plans mean that lives are saved in Northern Ireland. Both Governments want that cooperation to be even more effective in the common purpose of defeating violence and murderers.
  I mentioned the interconnection between security and the economy and the system of government. The House will obviously wish to have an opportunity to debate these

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  matters at some length before long. The people of the Province, whatever their political or religious views may be, have all suffered immensely from the violence of the last few years. Intimidation, fear, suffering and bereavement have become an ever-present accompaniment for much of the community. In these circumstances it is the poor and the defenceless who suffer most. It will not be easy to find a way through this, but we owe it to the overwhelming majority of decent people in Northern Ireland to seek a solution. One of the prerequisites is to improve security and defeat terrorism, from wherever it comes. The renewal of these provisions is an essential part of our campaign and I urge right hon. and hon. Members in all parts of the House to support the order.
  11.37 pm
  Mr. J. D. Concannon: When we last debated the renewal of these emergency provisions six months ago, we had a full day's debate in which to put our position to the then Secretary of State. Tonight's debate is a short one and I shall be brief. As they have done before on similar occasions, the Opposition will forgo their right of reply.
  I join the Secretary of State in his praise of the security forces and in his message of sympathy to those who have been bereaved since we last debated this matter. Since that time one of our number has been killed—one who used to take a keen interest in these debates.
  Since our last debate, two things have changed. We have a new Secretary of State, and the Labour Party now has a coherent policy on Northern Ireland, accepted by conference. Even so, it is with regret that I stand at the Opposition Dispatch Box for the third time to put forward our views on the renewal of this order. Opposition Members, like the Secretary of State, find it a continuing source of displeasure and disappointment that such extraordinary powers continue to be applied in Northern Ireland.
  The powers were originally necessitated by the violence that erupted from political incompatibilities. They can be safely and completely withdrawn only when violence diminishes markedly and an acceptable political settlement is reached. Therefore, I urge the Secretary of State to renew his efforts to establish some form of political compatibility between the communities in Northern Ireland, for only then will those who advocate political change by violent means be effectively isolated and lose support.
  Perhaps the most insidious feature of emergency legislation is the way in which it acquires an air of permanence. It is now eight years since the Diplock Commission's recommendations were put before the House in the Northern Ireland (Emergency Provisions) Act 1973. Those proposals were designed to meet a specific emergency and it was not intended that the main features of the Act should remain permanently on the statute book.
  Shortly after we assumed office in 1974, the Labour Government instituted an inquiry into the 1973 Act. We realised that the position in Northern Ireland changed frequently, and we were anxious to ensure that those far-reaching powers properly suited the position. Lord Gardiner undertook the review. His Commission stressed the fact that the existence of emergency powers should be limited both in scope and duration. We accepted almost all of Lord Gardiner's recommendations. We ended
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  internment immediately and put an amended Act through the House in 1978. That is the Act that we are renewing tonight.
  The Labour Party's view, as ratified at this year's conference, is that we should have an urgent and independent review of the Northern Ireland (Emergency Provisions) Act 1978 to ensure that the powers that it confers upon the security forces are consistent with the preservation of civil liberties and human rights, balanced by the maintenance of law and order. That idea was first advanced from the Opposition Benches 18 months ago by my predecessor, and only last July the Opposition devoted their debating time to a motion calling for an independent review of the Act.
  Why do we believe that such a review is important? On principle alone, it is essential that such comprehensive powers and unusual judicial processes should be monitored constantly to ensure that no abuse occurs. Further, the Government of the day must demonstrate publicly their belief that such wide-ranging powers are intended to be temporary. That can best be done by having regular, open and independent reviews of the legislation. In addition, there is some disquiet, both here and in Northern Ireland, about some provisions of the Act. A proper inquiry is needed to discuss those areas of disquiet and to encourage confidence in the process of law.
  The hon. Member for Belfast, West (Mr. Fitt), who usually attends these debates, is ill; and he has sent a message explaining why he cannot be here.
  The Government have argued on many occasions that a formal provision for review in Parliament is sufficient. We disagree. Our procedure does not allow for searching questions on matters of detail, nor do we have the opportunity to amend or delete sections of the Act in such a debate. In addition, and with respect to those hon. Members who may disagree, I do not believe that we have the expertise to review such an important piece of legislation.
  As the Act is the product of two judicial inquiries, it is essential that an inquiry should be held before we embark upon changing or amending such provisions. During the past 18 months the Government's excuses for not implementing such a review have been simplistic and pedantic. In our view, they have not adequately dealt with our request, which is why we continue to press it.
  Last December, the then Secretary of State glossed over our suggestions by saying that such a review would raise false expectations and would, in his view, increase tension. We maintain that without a review tensions are bound to increase. If certain provisions cause anxiety among many sections of the community in Northern Ireland, the Government have an overriding duty to ensure that such anxieties are properly allayed. Not to do so is simply to aid and abet increasing distrust in the judicial process and the rule of law.
  In July, the Minister, in a disappointing and disingenuous reply to a debate, suggested that a review of the Act would suggest that the Government had doubts about whether major parts of the Act were working properly. Doubts are nothing to be ashamed of—there should always be doubt where such powers exist. They effectively suspend the normal process of common law for those suspected or accused of terrorist offences. They are so far-reaching that there must always be doubt that they

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  are being properly applied or, indeed, are needed at all. The exclusion of doubt brings an element of permanence to the Act, which we sometimes find distressing.
  All sections of the Act would benefit from a review. It is vital to ensure that all powers permitted by the Act are still required, and if they are not they should be removed from the statute book. We wish a review to consider the Diplock courts. In the Labour Party conference statement, which is now policy, we said that a total return to jury trial would be impossible while paramilitary activity continued on the existing scale. We also noted the problems that Diplock and Gardiner outlined, that witnesses and jurors are subject to intimidation where there is a high level of inter-community violence. There is, however, plenty of scope for changes in the one judge, no jury courts—the Diplock courts—that deal with terrorist offences.
  A review might investigate recent claims that judicial case hardening has affected judgments. It might also investigate the possibility of extending participation in trials for scheduled offences. Further consideration of the idea of a panel of judges to preside in such courts would be valuable.
  We must remember that in the Irish Republic three judges sit together on cases relating to terrorist offences. If there are still insufficient judges in Northern Ireland—and that argument was used by Gardiner—there is scope to consider the idea of two justices of the peace being appointed to sit with each judge hearing a scheduled offence. There are more than 300 JPs in Northern Ireland. That would have the added benefit of introducing an element of lay participation into the trials. I put forward those ideas not because I want to pre-empt the work of any inquiry, but to show that there is plenty of scope for spreading the burden of scheduled offences trials from single judges.
  The Opposition regard a return to jury trial for all offences to be an essential objective but realise that persistent intimidation and violence make that impossible. However, there is one important area of review that might be considered—the possible descheduling of certain offences. One suggestion is that all offences with maximum sentences of less than five years should be returned to the process of normal jury trial. That change would include such offences as possession of minor firearms, unlawful collection of information and membership of illegal organisations. Such a descheduling exercise would show faith in the principle of jury trial and it deserves thorough consideration by an independent inquiry.
  Mr. Michael Mates: What does the right hon. Gentleman consider to be a minor firearm?
  Mr. Concannon: The hon. Gentleman knows the Northern Ireland context. I refer to maximum sentences of less than five years. I am putting forward a descheduling exercise not as the Opposition's view but as an area that in inquiry could consider. That would have to be followed by a debate in the House. These are ideas that various organisations and individuals have been expressing for some time while urging that a review should take place.
  An inquiry should consider also part II of the Act, which deals with powers of arrest, detention and interrogation. These powers are highly controversial and need continually to be assessed in the light of the changing
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  security situation. A review could deal with disquiet over section 11, which was specifically designed to go hand in glove with section 12 on internment. As the House knows, section 12 has been withdrawn. However, it is still on the statute book and it is high time that the relevance of the section was reviewed. Some of the sections in the second part of the Act may be inconsistent with a security policy, which is aimed at returning primary policing functions to the RUC.
  There are many other sections of the Act which could be improved by the sort of inquiry that we are suggesting, and I am sure that they will be referred to in the debate.
  It is not good enough for justice to be done; it must be seen to be done, especially in Northern Ireland where public confidence in the forces of law and Government is such a volatile commodity. We strongly urge the Government to adopt our moderate and sensible proposal and to allow the House, as well as the people of Northern Ireland, to have the benefit of an independent inquiry into the 1978 Act.
  The aim of the Opposition, as declared at our last conference, is to achieve a reasonable balance between the maintenance of law and order and the protection of civil rights. We have accepted the necessity for some emergency powers—this is now Labour Party policy—so long as the security situation remains serious, but we believe that there is a strong case for a fundamental review of the operation of the Act. If such a review is not implemented in the course of the present Administration, we shall give it the highest priority when we are next in power.
  The Opposition will not be voting against the renewal of the Act for the reasons that I have stated, but if the Secretary of State does not accept the clear case for a review, which is both fair and honest, we cannot declare our support for the Act as it now stands and we will not be voting for renewal.
  11.52 pm
  Mr. James Kilfedder: The emergency powers renewal has been introduced with reluctance by the Secretary of State. The people of Northern Ireland who have suffered so much, especially in recent months and weeks, will derive no comfort from what the right hon. Gentleman said, no matter how much he wrapped it up in fair words and words of sympathy.
  The reference by the right hon. Gentleman to civil rights and the speech of the right hon. Member for Mansfield (Mr. Concannon) show that this democracy has no stomach to fight those who have destroyed democracy in a part of the United Kingdom and who have destroyed the lives of innocent people in a part of the United Kingdom. It seems that the Shadow Secretary of State for Northern Ireland is telling the IRA that if there is a Labour Government after the next election the people of Northern Ireland will be surrendered to the gunmen because that Labour Government, if such a Government should ever come about, will feel that the terrorist must be handled with kid gloves.
  I regret to say that the speech of the right hon. Member for Mansfield will cause the IRA to laugh, as it must have laughed often enough at speeches made in the Chamber by Government spokesmen as well by other right hon. and hon. Members. In the face of such weakness, the IRA will take encouragement and redouble its efforts to murder and mutilate.

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  It is all right for hon. Members, but it is the people of Northern Ireland who face death and mutilation. I wish that those who speak in such fair terms had to live in Northern Ireland, and had to live along the border where people do not know whether they will be murdered during the night by evil men who are carrying out a heinous campaign of sectarian slaughter. So many speeches, promises and solemn undertakings have been made by the Secretary of State and his predecessors that there is now an ever-widening credibility gap between the Government and the long-suffering people of Ulster.
  To recreate confidence the Secretary of State must show some notable successes in the next few months. These can be achieved only by a more aggressive attitude towards the Provisional IRA terrorists, who murder with impunity. I emphasise that they can murder with impunity because if caught they surrender, if questioned they scream allegations of brutality against members of the security forces, if convicted they do not face the death penalty, and if sent to prison the term is frequently less than their atrocities warrant, and they are subsequently released on generous early release terms.
  A short time ago I tabled a parliamentary question asking the Secretary of State how many persons had died in Northern Ireland as a result of IRA terrorism since 14 September—the date when he took office—and how many IRA terrorists had been shot or killed by the security forces in the same period. The right hon. Gentleman's reply confirmed my worst suspicions. In a period of about 10 weeks, 27 people had died as a result of terrorist activity in Northern Ireland, and he stated that the majority of those deaths were attributable to Republican terrorism. Within the same period, only one person was shot dead by the security forces. That was on 19 October in Belfast, in an incident at a vehicle checkpoint.
  Those stark figures explain why the Provisional IRA campaign of murder, destruction and terror is in its thirteenth year and why the Army is not succeeding, because the Government have put a political restraint on the security forces preventing them from carrying out a campaign that would root out and destroy the IRA.
  The Government endeavour to sidestep the irrefutable allegation that they are not putting their heart and soul into rooting out and destroying the IRA by referring to the Anglo-Eire talks and improved co-operation between the two Governments and the security forces on either side of the border. But the one measure that justice demands and friendship should provide—the extradition of wanted terrorists to Northern Ireland from the Republic—is not forthcoming. The reason is simple. Although the means may be different, the aims of the Republic match those of the IRA—that is, a united Ireland.
  I hope that the Government fully realise that the Ulster people have taken more than enough terrorism. For 13 years they have shown courage, forbearance and patience, despite heinous atrocities. There was a time a few weeks ago when civil war could easily have broken out. Indeed, I think that many people expected it to happen. I warn the Government against interpreting the present calm as acquiescence by the Ulster people in the policies at present being pursued by the Government.
  This period of calm provides a vital opportunity for the Government to act decisively. The time has come for sterner measures against the terrorists.
  Mr. Mates: What measures?
  Mr. Kilfedder: First, if I were a member of the Government in a country in which terrorism of this kind was in its thirteenth year I would say that there should be martial law. Certainly, martial law should be established in certain regions of the Province.
  I advocated long ago that identity cards and fingerprinting, linked to a computer, should be introduced. That has not been done. Every available member of the SAS ought to be deployed in Northern Ireland until the terrorists are defeated.
  After listening to the figures that the Secretary of State gave the House today of the number of people who had died as a result of terrorist activity in Northern Ireland during the past year, I believe that the Government should be ashamed to come to the Dispatch Box without fresh measures to show their determination to defeat the IRA.
  Thirteen years ago the then Home Secretary argued against the adoption of stern measures in the Province, on the basis that a score of people might die as a result of such action to defeat the troublemakers. Today, after 13 years, more than 2,000 people have died and tens of thousands have been multilated, yet the Government are still harking on the need for a soft response.
  Some time ago I called on the Prime Minister to summon a meeting of Unionist Members of Parliament together with the GOC Northern Ireland and the Chief Constable. My demand went unanswered, but that refusal has not gone unnoticed by the Ulster people, who want action and results. I repeat that demand tonight. The Government should show their concern by consulting the Ulster Members of Parliament—certainly those who attend this House. Indeed, that is the basis of the meeting that the Secretary of State has arranged for next Monday to deal with unemployment.
  After shedding crocodile tears over the Protestant victims of the IRA's avowed campaign of sectarian slaughter, Cardinal O'Fiaich now refers to their evil deeds as a mortal sin. He must do more. If the Roman Catholic Church can excommunicate a woman for having an abortion, it is high time that Cardinal O'Fiaich excommunicated the Provisional IRA. In doing so he would show unqualified support for those priests who, with Christian integrity, have condemned the IRA. That is the way ahead.
  12.2 am
  Mr. Harold McCusker: I shall follow closely what the hon. Member for Down, North (Mr. Kilfedder) said, but on the basis of the two opening speeches and the reaction of some hon. Members to what the hon. Member said, I believe that there is an air of unreality about the debate that has no relevance to the situation in Armagh, Tyrone or Fermanagh. It almost makes me doubt whether it is worth while saying what I shall say.
  Thirteen years are 13 years too many. Those hon. Members who shake their heads and say "You cannot ask for stronger measures" should think of what it is like to have 13 years of turmoil, terror, slaughter and destruction, day after day, week after week, and month after month. I heard nothing from the two Front Bench spokesmen to indicate that I shall not be saying the same in 14, 15, 16 or 17 years. These are no longer temporary provisions. They are now permanent, and we are condemning people in Northern Ireland to a lifetime of tyranny.

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  Nothing was said to convince me that during the next 12 months there will be any improvement. In fact, terrorism has become self-sufficient. It is continually regenerating itself.
  We were supposed to be reassured by the fact that 861 terrorists have been convicted this year. It was 1,000 last year and 1,000 the year before. It will be 1,000 next year, but we heard nothing to suggest that the troubles would be brought to an end. To do that we must first convince all the people of Northern Ireland that the Government are determined to do so, and we must convince the terrorists as well. That will require something more than the comments that we have heard tonight.
  Children in Northern Ireland who are now 15 years old have known nothing but terrorism. They have lost their childhood. A person who is 30 years old has lost what many people would regard as the best and most exciting years of his life. If, like myself, one is between 40 and 45 years old, one looks back with gratitude to the fact that one once enjoyed a life-style where murder was such an occasional event that it horrified the whole community where we witnessed a bank robbery only on the television screen or in the cinema, and where freedom and happiness were available to everyone. I want to ask the House the same question that I asked my three colleagues last week. Shall I have to go home one of these days and say to my three children "Boys, get used to this life because this is the sort of life that you will have to live for ever"? That is the consequence of 13 years of tyranny.
  What can we do to improve the position? I know that we cannot stop a determined murderer. If the attempted murders of President Reagan and the Pope and the murders of the Kennedys could not be stopped, it proves that if a man is sufficiently determined he can kill. The difference in those cases was that there was always one deterrent—the likelihood that the person would be caught and amply punished. That is not the position in Northern Ireland.
  If we are lucky enough to catch those people and the police bring them to the police station to interrogate them, at the first stage we have all sorts of mechanical and electronic devices, not to help the police and the interrogators but to put the criminals under surveillance. The whole psychology of the interrogation system is that the person being interrogated is potentially a guilty man. So we watch him, monitor him and look after his interests, as a suspected terrorist.
  If the professional killers remain silent, if the organisers of the killings remain silent, and if those of us who know anything about Northern Ireland know that those people exist and remain silent, in a few days the terrorists will walk free and plan more killings. Is it not time for all the people of Northern Ireland to do something? Is it too much to expect a person to answer legitimate questions put to him by the police about alleged terrorist incidents? Is there any reason why an innocent person in Northern Ireland should not be prepared to accept that limitation if it helps us to put away terrorists? I hope that the Government will consider that point.
  I believe that silence must be considered an offence. A court must be able to take account of the fact that a man who has been asked a number of reasonable questions
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  about a terrorist incident in which it is suspected that he is involved must respond, and that if he does not respond, perhaps it is an indication of his guilt.
  The right hon. Member for Mansfield (Mr. Concannon) referred to minor firearms offences. What is a minor firearms offence in Northern Ireland? The gun that is being carried will be used to kill someone, or has been used to kill someone, and yet when a person found with guns, or explosives, or a person found recording the movements of the security forces appears in court, he is frequently allowed out on bail and absconds. Do the judges believe that being taken to court deters a terrorist? Serious offences have been relegated by the right hon. Gentleman as minor offences, yet every one of them has probably been a contributory factor in someone's death.
  Last week, one of the killers of my good friend Jim Hewitt was tried. Overnight, premeditated murder became manslaughter and the convicted man was given eight years' imprisonment for killing a decent citizen who was a part-timer in the security forces. In London, on the same day, a man found guilty of receiving stolen goods was given eight years' imprisonment. Where is the deterrent? What is the basis for the conviction that we are about to defeat the terrorists and that terrorism will not win?
  No matter where I look, and no matter where I go, I can find nothing to convince me or my supporters, or to convince the IRA, that the House has the determination to do what is necessary. A six-year sentence automatically becomes one of three years; an eight-year sentence becomes one of four years; a 10-year sentence becomes one of five years. Remission is automatic. We do not even have a parole board system under which people are expected to show some contrition or remorse, and to show that they have given up a life of crime. Anyone who behaves reasonably well will have half his sentence remitted.
  The hon. Member for Down, North spoke of the dangerous situation that now exists. If the House does not deal with terrorism the time will come when the people of Northern Ireland themselves will attempt to deal with it. It will be a terrible thing if that has to happen. No one has done more than I have to try to contain the dispute within the confines of the House. I have tried here to articulate the feelings of my people, in order to take some of the pressure off them and remove some of the frustration, but the House is not offering us anything. It is not saying anything other than that we shall be back again next year after another 100 people have died—and again the year after that.
  The Secretary of State must offer us some hope. He must offer us some conviction that terrorism must and will be defeated. For the first time, over the past few months, one has felt a resentment in Northern Ireland that will boil over one of these days. I hope that it will not, but it will be contained only if the House itself shows that it can deal with terrorism.
  12.12 am
  Sir John Biggs-Davison: I am proud to follow in the debate the hon. Member for Armagh (Mr. McCusker), who shares the dangers of his constituents and speaks fearlessly on their behalf.
  It is said that Provisional Sinn Fein—whom Airey Neave and others described as the Provisional IRA in

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  mufti—contemplates contesting elections. I hope it will. Let it do that. Let it submit itself and its cause to the judgment of the electorate.
  The partition of Ireland arose through the democratic decision of a distinct population, exercising its right of self-determination. While the Provisional IRA and the Irish National Liberation Army seek to deny by force that democratic will, it will be necessary to continue the powers contained in the Act, reluctant though we all are to continue them.
  Successive Secretaries of State have based their policy on the primacy of the police and the bringing of the terrorists to justice before the courts. That policy is sound. One argument in its favour is the way in which the Provos rage so furiously against what they call the "criminalisation" policy of the Government.
  The powers are still necessary. The time has not yet come—the speech of the hon. Member for Armagh brought that out forcefully—when the RUC can dispense with powerful military backing, and the defence of the border is clearly still a task for the Armed Forces of the Crown.
  Those of us who go to Northern Ireland from time to time notice and are told by Ulster people that there are few troops to be seen in uniform. There are fewer troops visible and we need more troops that are invisible and indistinguishable. I agree with my right hon. Friend the Secretary of State who said on 3 November:
  "It is not only the open, but the covert, side of security that is important."
  These debates provide us with an opportunity to pay tribute to the security forces, the Northern Ireland prison and fire services and the men and women who drive the ambulances. The hon. Member for Armagh said that the emergency has gone on terribly long. The tenth anniversary of the formation of the Ulster Defence Regiment has passed. I was present in the City hall when the regiment received the freedom of the City of Belfast.
  I was among those who expressed the hope that the occasion might have been marked by the provision of a long service medal for the UDR. The Territorials, for whom we all have the greatest admiration, have such a decoration and they are not at risk of terrorism. The Rhodesia Medal was struck promptly enough. Those who invigilated at the election in what is now Zimbabwe were sometimes in danger, but it was small compared with the risks run by the UDR in Northern Ireland. As for the Royal Ulster Constabulary, I hope that the RUC Reserve will not much longer be excluded from the Royal Warrant governing the award of the Special Constabulary long service medal.
  Of course we owe the security forces far more than medals or motions in the House, but there are those, even in the House, who play politics with the honour and morale of the security forces. I gave notice to the hon. Member for Antrim, North (Rev. Ian Paisley) that I intended to mention him if I was fortunate enough to catch the eye of the Chair in this debate. He replied to the effect that he had to be on the Continent rather than in attendance at the House this evening. Of course, it is open to him to pursue his vendetta with the Chief Constable—chief constables can look after themselves—but it was monstrous for the hon. Member to allege that the RUC ignored a warning and could have saved our colleague and friend Robert Bradford. The hon. Gentleman should substantiate that charge or withdraw it.
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  It is surely also time that the hon. Gentleman withdrew or proved his accusation that troops were wining and dining at a well-known Republican house when they might have saved Sir Norman Stronge or caught his murderers. These ever wilder and more vicious attacks on the security forces seem to indicate a paranoiac desperation.
  In a decade, the hon. Member has boxed the compass of options on Ulster—from full integration with Britain, which makes sense, to independence from Britain, which spells civil war and disaster. He seems incapable of constructive policy or consistent action and it is time that Loyalists saw the hon. Member for the non-Loyalist that he is.
  The hon. Gentleman and others in the House and outside have criticised the Anglo-Irish summit, which I prefer to call a summit between leaders of the United Kingdom and the Republic of Ireland, but I think that everybody could agree with a certain passage in the communiqué when the Prime Minister and the Taoiseach
  "reiterated their resolute opposition to violence and commended the level of co-operation between the security forces of the two countries".
  My right hon. Friend the Secretary of State has referred to the excellent co-operation between the Garda Siochana and the RUC. The Belfast Telegraph stated on 28 November that
  "co-operation between the RUC and the Garda is regarded as even better than that between the London Metropolitan Police and provincial forces in Belfast."
  I come now to the roots of the evil that has afflicted Northern Ireland for longer than the two world wars put together. About 600 suspects wanted for questioning in connection with terrorist crimes are believed to be at this moment in the Republic. Two hundred of them may still be active in terrorism and the other 400 are suspected of having been involved in various crimes before leaving the Province for the Republic.
  In 1975, the House passed the Criminal Jurisdiction Act and Oireachtas Eireann passed the Criminal Law Jurisdiction Act. There was parallel legislation in the two countries permitting suspects to be tried in one part of Ireland for offences committed in the other. What has been the effect? Only in one case, that of the murder of Captain Nairac of the Grenadier Guards in 1977, has there been a successful prosecution. Other prosecutions have failed on technical grounds or for lack of evidence. I understand that the police in both countries would like to remove differences in the rule of evidence. The Republic, strangely enough, guards old British customs which have disappeared and still observes the judges rules of 1912.
  The hon. Member for Down, North (Mr. Kilfedder) spoke of extradition. Hon. Members have not heard the result of a meeting between the Law Officers of the United Kingdom and of the Republic. We know, however, that the situation is unsatisfactory. We understand that the Irish Republic believes that it is unconstitutional to extradite those who claim a political cover for their crimes. relying on article 29(3) of its constitution which says that Ireland accepts—
  Mr. Deputy Speaker (Mr. Bernard Weatherill): Order. I am extremely sorry to interrupt the hon. Gentleman, but I think that his remarks are going slightly wide of the order. The order relates to the renewal of temporary provisions. I should be grateful if the hon. Gentleman would stick to that subject.
  Sir John Biggs-Davison: I was commenting on the remarks of the hon. Member for Down, North, who was not interrupted from the Chair and who referred to the absence of extradition from the Republic of Ireland.
  Mr. Kilfedder: No. I touched upon it.
  Sir John Biggs-Davison: I shall not proceed further on that line except to say that the granting of extradition or the introduction of an efficacious substitute will, for the Unionists in Northern Ireland and in this House, be the acid test for the "unique relationship" between the United Kingdom and the Republic.
  12.22 am
  Mr. Wm. Ross: Like other hon. Members representing Northern Ireland, I live with the problem day by day. We come to the House every month at Question Time, and on occasions such as tonight, and listen to what can only be described as a litany of terrorist incidents and police success. The fact that the litany is given every month, every six months and every year is not an indication of success. It is an indication of continuing failure by the Government to eliminate terrorism within the borders of the United Kingdom.
  If terrorism is to be beaten, it will demand not only sound judgment on the measures to be taken but foresight in the developing situation in Northern Ireland. That foresight was signally lacking in respect of the conditions for the remand of prisoners in Crumlin Road prison that culminated in the riot at the week-end. The conditions were not good. The Government had been warned a long time ago of those conditions, yet the riot occurred. On that occasion the Government waited for the explosion, as they seem to do time after time in relation to security in Northern Ireland.
  Why did the Government wait on that occasion? If the problem was overcrowding, why has a brand new H-block been lying empty in Magilligan prison for the past three months, furnished and ready for inhabitants? Why has that block not been used? Would it not have required the minimum of foresight to have made use of that facility and thereby relieve the pressure and possibly avoid the incident of the wrecking of the prison at the weekend?
  If this is a demonstration—I think that it is—of the failure of the Government to foresee what can happen and a failure to make use of facilities in this relatively small and unimportant field, how does the Secretary of State expect the people of Northern Ireland to have any confidence in him in dealing with the more serious issues?
  I accept that whenever we deal with terrorism we need covert operations, troops and police. A month ago the Spearhead battalion was flown in. Now we read in the newspapers that that battalion is to be pulled out. Can the Secretary of State confirm or deny that newspaper report of today?
  Mr. Prior: The Spearhead battalion is certainly not being pulled out for the time being.
  Mr. Ross: That is very welcome news, because it is clear that that battalion has had a good effect. If that good effect is to remain, given the situation in Ulster, those troops must long remain.
  The other newspaper report to which I should like to refer concerns the case mentioned by my hon. Friend the Member for Armagh (Mr. McCusker) relating to his constituent and friend. Like my hon. Friend, I found this
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  whole affair appalling. A man who was clearly guilty of complicity in the murder of a member of the Ulster Defence Regiment has had the murder charge withdrawn by the Crown. He was a man who joined the IRA knowing that it was an organisation dedicated to murder, and therefore he volunteered willingly to commit murder and took part in murder. He was caught, but he got off with four years' imprisonment.
  If that is the value that this House and the courts in this country put on any man's life, and especially on the life of a man who desires to serve the community, it is a sad day for democracy and for the standards of justice that British people should expect and should have given to them.
  If the confidence of the people of Northern Ireland and, above all, the confidence of the members of the security forces is to be maintained, a much stricter sentencing policy will have to be introduced. There is no way that anyone can think that a life is worth only four years' imprisonment for a murderer. When the courts give a man, in effect, four years' imprisonment they are destroying the whole basis of the idea of a local security force or of any security force of men volunteering and putting their lives on the line for that purpose. It is not good enough. It will not do. Something must be done to correct it.
  The most dangerous fallacy that underlies the whole of the Government's approach to security in Northern Ireland is the policy, which has been so evident for so many years, of co-operation with Dublin being necessary in order to defeat terrorism. The assumption is that Dublin can and will deliver enough to defeat the IRA. The hon. Member for Down, North (Mr. Kilfedder) drew attention to the fallacy. The Irish Republic can do only two things to defeat the IRA. The first is to grant extradition, and I doubt whether that will be granted by a Dublin Government. The second is to have strict control of the border. I discount all the other ploys that have been tried. They are nothing but froth. At best they are cumbersome and inefficient; at worst they are totally useless. History proves that.
  Extradition is an emotive subject in the Irish Republic. No Dublin Government can deliver extradition and hope to survive, least of all the present one, with the ultra-green Mr. Haughey sniping continually at their heels. It is nonsense to believe that we shall get extradition, although, if we did, it would be more than welcome. As extradition does not lie in our hands but, effectively—
  Mr. Deputy Speaker (Mr. Bryant Godman Irvine): Order. That subject has already been ruled out of order.
  Mr. Ross: I am grateful for your guidance, Mr. Deputy Speaker. The Irish Republic has effectively ruled the subject out of all possible debate.
  I move to the question of border security. The Irish Republic has a border with the United Kingdom which is uncontrolled. If the Secretary of State does not accept my word, he should consider the evidence of cross-border smuggling, which shows clearly a failure to control the border. The facts and figures are available in the Northern Ireland Office.
  It is shameful that the proud nation of which we are all members should run cap in hand to a foreign country that shelters the murderers of our fellow citizens to ask it to protect our property. It is not a job for the Irish Republic. The protection of the frontiers of this nation lies with us and with the House. It is up to the Armed Forces of the

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  Crown to defend the border. I am not interested in excuses. In my first speech in the House almost eight years ago I asked for the border to be tightly sealed and controlled. If that were done, the job of our security forces would be much easier. It is up to all of us to shoulder the responsibility for the defence of our frontier. It is not too late for the Government to do the job. All it takes is a little conviction and a little bit of guts.
  12.33 am
  Mr. Robert Rhodes James: I intervene briefly in following my hon. Friend the Member for Londonderry (Mr. Ross). I hope that he will always regard me as his hon. Friend because of the work that we do together for the Ulster university at Coleraine and our involvement in the affairs of Northern Ireland.
  This is my first attempt to intervene in such a debate, despite my long involvement in the affairs of Northern Ireland. Having listened to the debate after the Front Bench speeches, I am even more depressed by the negativism of the contributions, and I feel an increasing resentment that the English people and English Members should be involved in an internecine tribal war.
  Mr. Kilfedder: It is murderers killing innocent people. It is not tribal war.
  Mr. Rhodes James: The hon. Member for Down, North (Mr. Kilfedder) declined to allow me to intervene in his speech. I hope that he will allow me to say what I feel on behalf of my constituents and as someone who loves and respects and has faith in the people of Northern Ireland. I shall continue as I began because I believe deeply in these matters.
  I wish to make a point which the hon. Member for Londonderry will understand. It concerns a figure which the House should understand and appreciate. In Northern Ireland, 30 per cent. of young people who have the opportunity of higher education go to the mainland of Great Britain. About 80 per cent. of them never return to Northern Ireland. There is a brain drain of the best and brightest people in Northern Ireland. They are leaving the Province for the mainland. There is a collapse of faith in Northern Ireland. The order relates to the negative aspects of the situation. I intervene briefly to emphasise the most positive aspects.
  If we regard the order purely in terms of its negative aspect, we miss what is crucial to the future of the Province and the United Kingdom. The hon. Member for Armagh (Mr. McCusker) does not accept that some of us have faith in the future of the Province. Some of us have faith that, although orders such as the one that we are discussing are necessary in the short term, and although the evils of terrorism must be resisted, it is important that English Members of Parliament who know something about Northern Ireland should emphasise their faith in its future and in the decent people who live there. We should stress that in such a debate as this. It is important for the young people of Coleraine and Belfast, and for the young people of this country who are of one nation. That is the important aspect.
  I intervene to resist the negative and parochial approach of hon. Members. There will be no resolution of the problems until we come together and recognise that the future of the Province is the future of our nation.
  12.38 pm
  Mr. Neville Sandelson: I hope that the hon. Member for Cambridge (Mr. Rhodes James) will forgive me if I do not take up all the points that he raised, although I sympathise with much of what he said. The debate is short and I shall be brief. I hope to be to the point. I agree with almost everything that the right hon. Member for Mansfield (Mr. Concannon) said.
  The renewal of the emergency provisions is both necessary and, in the circumstances, inevitable. I wish that it were otherwise. There is not one of us who does not hope that the circumstances will change to permit the dismantling of emergency provisions which intrinsically offend democratic and juridical principles.
  The London-Dublin dialogue and the studies that have emerged from the bilateral talks at least point a way forward from the sectarian impasse and give a grain of hope for the future. Inevitably they have produced familiar tantrums amounting to near hysteria on the part of some who appear to prefer demagogy to responsibility, and who give the impression that they are averse to any progress towards a feasible solution that might bring the two communities together in restoring a measure of normality in the life of Ulster.
  It was equally predictable that terrorists who also refuse to countenance any form of compromise in their ultimate demands would seek to undermine the talks by a new campaign of murder and violence. But that is the situation with which we are faced, and it is a time for all of us in the House to give unequivocal support to the Government and the Secretary of State in the immensely difficult task that he has set himself. The right hon. Gentleman has the good will of my right hon. and hon. Friends in what he is trying to achieve. Nor should we do anything tonight to add in any way to the difficulties of the security forces and the other services in Northern Ireland. No one can envy their role or fail to admire and respect the way in which for years they have performed their duties of trying to maintain the peace, law and order and some semblance of normality in the Province.
  Let me emphasise the concern felt by all my lion, Friends at the continuance, however necessary I, for one, deem it to be, of emergency legislation that, by its nature, is repugnant to us. It is important in these debates to reiterate that concern. Following the important conference in Belfast in June of this year, which was chaired by Lord Gardiner and was attended by a representative body of individuals who met to discuss the administration of justice under emergency laws, it was stressed in its report that
  "the most insidious feature of emergency legislation is the way in which it acquires an air of permanence".
  The right hon. Member for Mansfield referred to that. So we must never allow ourselves to become inured to legislation of this kind, to allow an ambience of permanence to surround it, or to permit its continuance a day longer than the situation that gives rise to it.
  The legislation has been debated in considerable detail on previous occasions and will be again in the future. The question in our minds at all times should be how and when the legal system in Northern Ireland should return to normality. I feel a continuing concern about the procedures of arrest and interrogation, the operation of the Diplock courts, the list of scheduled offences and the

  275
  special category status. All these are given an artificial legality, although by normal yardsticks in a civilised society they are unlawful and offensive.
  In essence, this whole corpus of permitted procedure constitutes a denial of civil liberties and individual rights within the norms of the rule of law. This is not the moment to deny the Government these administrative instruments. It is, however, six years since the Gardiner report reviewed the operation of the emergency provisions, and I believe that a further review is now overdue. There are many features of the legislation that should be scrutinised afresh in the light of experience with a view to possible change and alleviation.
  In particular, I have in mind the judicial composition of the Diplock courts and the list of scheduled offences. Mere administrative difficulties should not be accepted as a conclusive reason for not changing the single judge system. Public confidence in the courts, in their judgment and impartiality would be greatly increased by broadening the membership of the panel of those who sit in judgment. Either professional judges or lay assessors could be added to the court and it may be that the arguments previously advanced against doing so now lack some of their earlier cogency. It is time that this aspect of the courts and their procedures was looked at anew.
  Further, the list of scheduled offences should be re-examined. It may well be possible to remove from the list various offences of a lesser character, carrying lesser sentences. Those of a lesser character are different from offences of a minor character. There is a clear distinction to be drawn. The right hon. Member for Mansfield has said, and I support him, that all offences with a maximum sentence of five years' imprisonment or less could now be de-scheduled and returned to jury trial. That should be looked at.
  My main reason for urging upon the Government a fresh review of the operation of the Act is that I believe that legislation of this kind should, by its very nature, be the subject of constant and continuous review by an independent body of a high judicial status. I hope that the Secretary of State will agree to do that. I have declared my support for the renewal of this order, but I must reserve my position when the matter returns for renewal if the Government, in the meantime, should have failed to provide for a suitable judicial inquiry to review the legislation and the way in which it operates.
  12.47 am
  Mr. Christopher Murphy: I support my right hon. Friend the Secretary of State in his belief that the Northern Ireland (Emergency Provisions) Act should remain in force. No one who has any knowledge of Ireland can be other than greatly concerned about the situation in the Province. It is therefore clear that this order is necessary. If terrorism is to be defeated, as it must be for the sake of the Irish people on both sides of the border, the current security arrangements have to be maintained and indeed strengthened, as this order, in part, seeks to do. It is also necessary that, to ensure the satisfactory outcome of such arrangements, close cross-border co-operation between the Governments of the Irish Republic and the United Kingdom should continue and strengthen.
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  This continuation order will be the more successful in achieving these objectives if the Anglo-Irish joint studies are allowed to proceed in the atmosphere of good will that has been created by my right hon. Friend the Prime Minister and the Taoiseach. Important though I believe the joint studies on all subjects to be, paramount must be that of security, which, together with the working of the Act, can make a lasting contribution to obtaining peace in the Six Counties.
  Having seen the security situation at first hand from both sides of the border, I know that it is almost self-evident that it is vital that the order should be passed. The citizens of Northern Ireland rightly look to their Government to provide the means of protection and expect provision to be made to ensure public order. The renewal of this order is essential for the police and the Army to carry out their onerous duties. I associate myself with the tributes paid to their courage and dedication. The order also shows, once again, the support of Westminster for the Union while the majority of people in the Province wish to remain within the United Kingdom. Closer co-operation between our country and the Irish Republic must be seen by all right-thinking people as realistic and appropriate, given our historic and geographic connections. The order enhances the conditions for such a relationship without prejudicing the inherent rights of Ulstermen.
  The need for the transfer of responsibilities for affairs in Northern Ireland to locally elected representatives becomes more and more acute. In assisting the speeding up of that long-awaited movement, this order is vital. It attempts to produce a more stable background against which that transfer can take place.
  The hopes and aspirations of the Irish—North and South—lie with the defeat of murderers who misuse people and their religious beliefs for their own selfish and narrow motives. The Northern Ireland (Emergency Provisions) Act 1978 must remain in force as part of the armoury to ensure that such defeat comes about speedily. The order should be passed unopposed to show our determination that democracy, not terrorism, should triumph.
  12.50 pm
  The Under-Secretary of State for Northern Ireland (Mr. John Patten): In the eight minutes remaining in the debate, I can hardly do justice to the many points raised by right hon. and hon. Members on both sides of the House. I propose to deal first with the straightforward request by the right hon. Member for Mansfield (Mr. Concannon) and from the SDP spokesman, the hon. Member for Hayes and Harlington (Mr. Sandelson)—who was spot-on in his discussion of the order—for a wide-ranging review of the workings of the Act. Secondly, I shall turn to the question of the way in which the Act and its continuance relates to security in the Province—a question that was discussed with such passion and vigour by the hon. Member for Down, North (Mr. Kilfedder), the hon. Member for Armagh (Mr. McCusker) and the hon. Member for Londonderry (Mr. Ross).
  I say straight away to the right hon. Member for Mansfield that we do not intend at the moment, or in the near future, to accede to his request for a wide-ranging review of the provisions of the Act. We do so because there may well be cause for such a review when circumstances have changed—when, for example, the public disquiet about the workings of the Act have reached

  277
  a great pitch or when—[HON. MEMBERS: "They have".]—terrorism has begun to decline to such a level that the Act may be thought unnecessary. Neither of those conditions obtains at the moment. Surely the right hon. Member for Mansfield and his hon. Friend the Member for Hammersmith, North (Mr. Soley) recognise that at such a time it would be improper for the Government either, by instituting a review, to hold out hope to terrorists that our resolve was weakening, or to upset the law-abiding people of the Province by knocking away one of the vital elements of the security forces.
  Mr. Clive Soley: Surely the Minister would agree that we wish to show to the House and to the world in general that we have a strong commitment to democracy. A review would do that. If we dealt with sections 11 and 14 of the Act and introduced the word "reasonable", as we have already dropped section 12, it would be a demonstration of the way in which we should go. That would be a strong case for a review, so let us have one.
  Mr. Patten: I appreciate the points that the hon. Gentleman makes and I appreciate his interest in human rights and the rights of those detained and arrested. That interest is shared by hon. Members on both sides of the House. However, the Act and the working of the provisions are subject to scrutiny in the House once every six months.
  We have had a wide-ranging debate and discussion. The right hon. Gentleman put forward many detailed points on the workings of the Diplock courts and on the question whether judges should be afforced by justices of the peace. The hon. Member for Hayes and Harlington also put forward many detailed points about the workings of the Diplock courts.
  We are aware of the concern about some issues that are affected by the Act and we have the opportunity, in this all-too-brief debate tonight, to discuss some of them. Now is not the time, when there are such problems in the Province, to begin to consider instituting such a review.
  Mr. Kevin McNamara rose—
  Mr. Patten: I know that the hon. Member for Kingston upon Hull, Central (Mr. McNamara) wished to speak in the debate.
  In the four minutes that remain I must turn to the second part of my remarks, which relate to the terrific concern that has been shown by hon. Members on both sides of the House about the relationship of the provisions of the Act to the security position in the Province. None who live on this side of the water could fail to be moved by the passion shown by hon. Members this evening. Few can appreciate the danger in which so many of them live and the public service that they render to their constituents. It would be foolish to deny that, or the problems that they face in carrying out their duties between London and their constituencies in the Province. Not only do they have to act as Members of Parliament; they have to act almost as county and district councillors. I hope that all of us on this side of the water agree on that.
  Despite the passionate way in which hon. Members have put their case, I ask them to step back for a moment from the intense problems that they face and realise that
  278
  not everyting is gloomy in the Province. It is not simply a litany of failure. I do not wish to indulge in statistical point-scoring with the hon. Member for Armagh—
  Mr. McNamara: On a point of order, Mr. Deputy Speaker. Is it in order to ask whether, in the time available, any hon. Member who is opposing the renewal of the order will be given an opportunity to speak? Only one member of the main Opposition party has been called to speak in the debate.
  Mr. Deputy Speaker: That question is not in order.
  Mr. Patten: I do not wish to indulge in statistical point-scoring with the hon. Member for Armagh, but he criticised my right hon. Friend for his record during the past year and said that only 861 charges had been laid for scheduled offences compared with 1,000 last year. Last year the number of charges laid was only 511, and the 861 laid this year shows considerable improvement.
  This week cars have been allowed into the centre of Belfast, which enriches that city in the evening— [Interruption.] Anyone who has seen the urban desert of Belfast during the past 10 years, with people unable to walk in the streets, would not laugh so easily at the idea that cars enrich the life and culture of the Province. The police are slowly taking over from the Army. My right hon. Friend has vigorously met the security challenge with the introduction of the Spearhead battalion, the additional mobile support units of the RUC—one has been sent to Newry—and the more flexible deployment of the UDR—
  It being one and a half hours after the commencement of proceedings on the motion, MR. DEPUTY SPEAKER put the Question, pursuant to Standing Order No. 3 (Exempted business).
  Question put:—
  The House divied: Ayes 103, Noes 14.

  Division No. 29]

  [12.58 am

  AYES

  Alexander, Richard

  Griffiths, Peler Portsm'thN)

  Ancram,Michael

  Hampson,DrKeith

  Atkinson, David (B'm'th,E)

  Hannam,John

  Beaumont-Dark,Anthony

  Harrison, Rt Hon Walter

  Berry, Hon Anthony

  Hawksley,Warren

  Bevan, David Gilroy

  Heddle,John

  Biggs-Davison,SirJohn

  Hogg,HonDouglas(Gr'th'm)

  Blackburn,John

  Hunt, David (Wirral)

  Boscawen.HonRobert

  Jopling,RtHonMichael

  Bottomley, Peter (W'wich W)

  Kershaw, SirAnthony

  Bright,Graham

  Kilfedder, James A.

  Brinton,Tim

  Lang, Ian

  Brooke, Hon Peter

  Lester, Jim (Beeston)

  Brotherton, Michael

  Lloyd, Peter (Fareham)

  Brown, Michael(Brigg&Sc'n)

  Lyell,Nicholas

  Browne,John(Winchester)

  McCusker,H.

  Bruce-Gardyne,John

  Macfarlane,Neil

  Budgen,Nick

  MacGregor,John

  Butcher,John

  McNair-Wilson,M.(N'bury)

  Cadbury,Jocelyn

  Major,John

  Carlisle, John (LutonWest)

  Marlow,Antony

  Clark, Hon A. (Plym'th, S'n)

  Mates,Michael

  Cope,John

  Mather,Carol

  Costain,SirAlbert

  Maxwell-Hyslop, Robin

  Cranborne,Viscount

  Mayhew, Patrick

  Dover,Denshore

  Mellor,David

  Dunn,Robert(Dartford)

  Meyer, SirAnthony

  Faith, Mrs Sheila

  Mills,Iain(Meriden)

  Fenner, Mrs Peggy

  Moate, Roger

  Forman,Nigel

  Molyneaux, James

  Garel-Jones,Tristan

  Murphy,Christopher

  Goodhew,Victor

  Neale,Gerrard

  G rant, Anthony (Harrow C)

  Needham,Richard

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  Nelson,Anthony

  Speller,Tony

  Neubert,Michael

  Spicer, Michael (SWorcs)

  Newton,Tony

  Stanbrook, Ivor

  Osborn,John

  StradlingThomas,J.

  Page, John (Harrow, West)

  Taylor, Teddy (S'end E)

  Page, Richard (SW Herts)

  Thompson,Donald

  Patten, John (Oxford)

  Thorne,Neil(IlfordSouth)

  Pattie,Geoffrey

  Waddington,David

  Powell, Rt Hon J.E. (S Down)

  Waldegrave,HonWilliam

  Prior, Rt Hon James

  Waller, Gary

  Proctor, K. Harvey

  Ward,John

  RhodesJames, Robert

  Watson,John

  Rhys Williams, Sir Brandon

  Wheeler,John

  Roberts, M. (CardiffNW)

  Williams,D. (Montgomery)

  Ross,Wm. (Londonderry)

  Wolfson,Mark

  Sainsbury,HonTimothy

  Young, SirGeorge (Acton,)

  Sandelson,Neville

  Shepherd,Colin(Hereford)

  Tellers for the Ayes:

  Silvester, Fred

  Mr. Selwyn Gummer and

  Sims, Roger

  Mr. Alastair Goodlad.

  Speed, Keith

  NOES

  Bennett,Andrew(St'kp'tN)

  Maynard, MissJoan

  Campbell-Savours, Dale

  Parry, Robert

  Canavan,Dennis

  Richardson,Jo

  Cryer,Bob

  Ross, Ernest (Dundee West)

  Dubs,Alfred

  Skinner,Dennis

  Duffy, A. E. P.

  Holland,S.(L'b'th,Vauxh'll)

  Tellers for the Noes:

  Lamond,James

  Mr. Ian Mikardo and

  Marshall, Jim (LeicesterS)

  Mr. Kevin McNamara

  Question accordingly agreed to.
  Resolved,
  That the draft Northern Ireland (Emergency Provisions) Act 1978 (Continuance) (No. 2) Order 1981, which was laid before this House on 2nd December, be approved.

  RAF Kemble
  Motion made, and Question proposed, That this House do now adjourn.—[Mr. Mather.]
  1.8 am
  Mr. Richard Needham: I always follow debates on Northern Ireland with some trepidation, and also some nostalgia as my ancestors represented South Down for four generations without ceasing. I am now of course, only too happy to represent Chippenham, about which I shall speak today.
  I am sorry to keep my hon. Friend the Minister so late into the night to discuss the proposed closure of RAF Kemble, particularly as only half of it is in my constituency. Nevertheless, it is an important half, as there are 400 people on the base who unfortunately seem more than likely to lose their jobs. Half of them live within my constituency, in villages where there is most unlikely to be any form of alternative employment. I am therefore sure that my hon. Friend will not mind my asking the questions that I wish to ask to ensure that the reasons behind the Government's decision can stand up to the full light of day and are valid.
  I accept at once that where the tail of the RAF can be cut back at the expense of the teeth it is vital that that should be done. Equally, there is an obligation on the Government to show that they have considered properly and openly the alternatives and have explained them to the people involved.
  The timing of these announcements has not been particularly helpful. I realise that the defence review took place in July and that the timing of this closure at the end of July was perhaps fortuitous, but it did not help when large numbers of people about to go on holiday were told about the proposed closure and it was impossible to contact any Minister about it until my hon. Friend was appointed in October. That meant that two and a half months had gone by. Obviously people spent a miserable summer wondering, fearing and doubting about their future without knowing exactly what would happen.
  My hon. Friend has been extremely helpful in speeding up the review, and he announced a feasibility study at the beginning of this month, but we are approaching Christmas; the next holiday period is now upon us. I believe that my hon. Friend has asked for answers to his consultation document by the beginning of January. Once again, time is short. I ask him as passionately as I am able at this late hour to extend that consultation period so that all involved have a chance of putting their views.
  The feasibility study is the key issue. While my constituents understand the need to consider cuts in the maintenance of the RAF, they have been given no reasons or figures to show why it should be Kemble as opposed to anywhere else. The proposal is that much of the work now carried out at Kemble, particularly the servicing element, should be moved to Abingdon. Why should the work be transferred to Abingdon? Why cannot the work be transferred from Abingdon to Kemble?
  The reason given by my hon. Friend in the feasibility study is a wonderful piece of convoluted English:
  "RAF Abingdon has a war role as a Collocated Operating Base".
  I can only say that the word "collocated" is not often used in the pubs around my part of the world. If my hon. Friend wants to use such words in a feasibility study, it would be

  281
  enormously helpful to my constituents if it could be explained to them as well as to their simple-minded Member of Parliament what they mean.
  Mr. Nicholas Baker: Hear, hear.
  Mr. Needham: I am grateful to my hon. Friend for that sedentary intervention. In his rustic way he obviously does not know what "collocated" means either.
  The study goes on to say:
  "RAF Kemble on the other hand has no war role and no permanent commitment to the servicing of any of the RAF's long-term front line aircraft".
  What is that war role? I do not want to be brushed off with the secrecies of war roles. Why cannot it be distributed equally advantageously to Kemble? It would be of enormous help if my hon. Friend would tell the House, and particularly those involved, why these services cannot be committed to Kemble rather than Abingdon. If it is for housing reasons, there are many empty RAF houses at Lyneham and Hullavington and there are Army bases at South Cerney which are not used. Why cannot the base be moved to Kemble rather than Abingdon and the housing that is required for the Service personnel be provided there? There is plenty of it and it is not being used. What are the costs involved in moving it?
  In the feasibility study there is a vague allowance of £3 million for the RAF base if at some stage it is sold. What about the houses in Abingdon? Could not they be sold? Abingdon is not as rural or as remote as the areas around Kemble. Is it not possible that the amount of money that the RAF would gain from selling Abingdon would be greater than it could get from selling Kemble? We do not know. Nothing is put forward in the feasibility study except those two convoluted sentences—which mean very little—on why Kemble should have been chosen rather than Abingdon.
  It is suggested by the Government that the reason for the move is that there are large numbers of RAF personnel who can undertake the work that is currently done by the civilian staff. If that is true, what on earth are those RAF personnel doing now? If they are under-employed, why are they under-employed? According to the figures put out by the Ministry, on which the civilian work force at Kemble have calculated their figures, it would require an additional 208 Service men to undertake the task currently done at Kemble. Are there 208 people now sitting around at Abingdon waiting to undertake this work? If they are overseas and they are to be brought back to Abingdon to do the work, what will happen in the event of war'? Will they then be sent back to the bases where the servicing arrangements for the aircraft will have to be carried out? Then who will do the work if the civilians are no longer capable of doing it? Those are perfectly reasonable questions, and I ask my hon. Friend to reply to them.
  The feasibility study suggests that the storage task put forward could be done either at St. Athan, where there are six hangars, or at Shawbury, providing the temperature there does not drop as it did during the last week. There are apparently six hangars that are currently unused at St. Athan, although my intelligence tells me that five of them are full of "green godesses", Canberras and bulk storage. It is not clear how the storage will be able to be maintained at St. Athan, It is also worth pointing out that about 5 per cent. of the space used at Kemble is used on behalf of
  282
  Abingdon. I ask my hon. Friend to say whether there is now space at Abingdon that can take up the 5 per cent. at Kimble.
  The storage use at Kemble is based upon the immediate readiness reserve, which is what the civilian staff at Kemble have to undertake to get the aeroplanes ready for use. The immediate readiness reserve is three days, and the short-term reserve storage is one month. The people employed at Kemble have the job of getting those planes ready. There is no mention of that in the feasibility study. When those planes are stored at St. Athan or Shawbury, what will happen to the immediate readiness reserve. Will the planes be left there? Who will do the job?
  The feasibility study states that £250,000 will be required at Shawbury to get the hangars there up to standard. Where does that figure come from? Is it plucked out of the air? How is it made up? It is a nice rounded figure. Does it include the three-phase electrical requirements and the other electrical installations that will be needed there? Can the Minister show how the figure is made up and how it has been arrived at?
  With regard to the surface finishing task which is done at Kemble and which it is proposed to move to St. Athan, the feasibility study says that the cost of doing this would be £30,000. How is that figure made up? New drains will need to be established at the hangar which is to undertake the task. There will need to be showers. All sorts of alterations will need to be made. Where did the figure of £30,000 come from?
  What about the work loading that is put forward in the feasibility study? Apparently the hangar which is to undertake this important job is so narrow that it is not possible to have the aeroplanes that are to be finished there other than in line, so that if there are five aeroplanes and one in the middle needs to be moved the others will have to be moved. Figures are put forward in the feasibility study for the number of hours that it will take and the improvements that will come about in productivity through having a two-shift system, but there seems to have been no consideration of the problem of the movement of aircraft in and out of the hangars.
  The feasibility study also shows that the additional establishment necessary at St. Athan would broadly be in a line with the reduction at RAF Kemble if it were to lose the surface finish task, and that the present RAF capacity for surface finishing could therefore be retained and even enhanced. Even if one accepts that contentionm, there are 50 technical, unskilled or semi-skilled people at Kemble involved in the task. Are they to be offered jobs at St. Athan? Are they to be moved? At least that would be 50 off the redundancies. I should be grateful if my hon. Friend would reply to that question.
  With regard to the Red Arrows and their movement, there are some suggestions that they would be sent to Lincolnshire. Are their costs included in the distances that they will now have to fly? The majority of their displays are conducted in the South of England. Therefore, they will require additional petrol, additional fuel, in order to get to their displays. Has that been taken into consideration? If not, how much would it cost?
  I hope that my hon. Friend will not feel that those involved in this little rural area—which relies almost entirely for its survival on the base—are critical of the way in which the feasibility study has been laid out.
  I ask my hon. Friend to consider the cost of the annexes, because this is an important point. In annex B,

  283
  the amount laid down for the saving of MT fuel is put at £31,000 per year. The amount that is being spent on that fuel at the moment is £27,000. In annex B, the amount laid down for the saving of heating fuel is £284,000, but that includes the heating costs of the Red Arrows. There will be the heating costs of the officers and the men concerned, wherever they go. If we take No. 5 maintenance unit, the figure is £248,000, so that the figure of £284,000 is wrong. Much more importantly, the saving figure in respect of works under annex B is given as £449,000. The actual saving in closing down the maintenance unit, I suggest to my hon. Friend, is £306,000, because the £449,000 includes the Red Arrows' married quarters, the RAF station cost, and RAF officers' married quarters. Those are not costs borne by No. 5 maintenance unit. They would obviously have to be added to the costs that the Red Arrows will incur wherever they go. It is a substantial sum and if those figures, the only ones that it has been possible to check, are wrong, the other figures may not be right.
  The annex also states that there will be a saving in civilian costs through employees being made redundant or moved elsewhere, but it adds to that figure the number of civilian posts that will be re-established elsewhere and assumes a total of 15 civilian posts.
  The feasibility study says that 50 additional people will be required to undertake the finishing costs at St. Athan. Why have they not been included? Why is there a reference to 15 in one column and 50 in another? Why is my hon. Friend certain that the additional costs will amount to only £2½ million against savings of£3½million?
  That worry and the figure of £1 million that is put forward for moving costs are causing great concern and doubt. It is up to Parliament to check whether the savings are made, and when the livelihood of people are being put at risk we must make sure that costs are worked out carefully and sensibly so that the proposed savings occur and we do not end up with additional costs being greater than expected.
  I am grateful to my hon. Friend for putting forward the final plan, and all local people would welcome the Americans taking over the base. Many American bases in the area have been enormously successful, but my constituents want an assurance that, if the Americans take over the base, jobs will be provided for local people and the local community will be helped with its desperate problem of 400 job losses, which could result in enormous hardship in certain villages near the base that can offer little chance of people who have given enormous service to the RAF ever being able to find work again.
  1.27 am
  The Under-Secretary of State for the Armed Forces (Mr. Jerry Wiggin): I fully appreciate the concern that my hon. Friend the Member for Chippenham (Mr. Needham) expressed about the possible impact on employment prospects in his constituency—a concern that is, of course, shared by my hon. Friend the Member for Cirencester and Tewkesbury (Mr. Ridley)—if RAF Kemble were to close. I emphasise "if', because, as my hon. Friend knows, we have not taken the decision to close Kemble and will not do so until the consultative process with the trade unions, which is now in train, has been
  284
  completed and we have had a chance to consider their views. That will be early in the new year. It is very important to stress that point right at the start.
  If I may pick up one point that my hon. Friend made, the word "collocate" is self-explanatory if pronounced properly. If my hon. Friend had pronounced it correctly he would have understood its meaning.
  My right hon. Friend the Secretary of State said in July that the unions and the work force would be fully consulted before decisions were taken. We are doing that now. While my hon. Friend's points are well taken, therefore, he is perhaps premature in making them.
  Soon after my arrival at the Ministry, I discussed fully with my hon. Friend the Member for Chippenham the reasons for setting up the studies into the future of RAF Kemble. I have since kept him and my hon. Friend the Member for Cirencester and Tewkesbury fully informed about every aspect of the possible way ahead. My hon. Friend the Member for Cirencester and Tewkesbury apologises for not being present. Many of his constituents work at RAF Kemble and he has taken a consistent and persistent interest in the matter.
  It would be helpful if the House was aware of the background to the proposals. RAF Kemble is the home of the RAF aerobatic display team, the Red Arrows, and No. 5 maintenance unit. The station and the maintenance unit have had a long and honourable history in the service of the RAF for over 40 years. I endorse entirely my hon. Friend's sentiments expressed in the closing moments of his speech. Whatever the final outcome about the future of RAF Kemble, I wish to place on record the Royal Air Force's indebtedness to the skill and dedication of the loyal work force of No. 5 maintenance unit over many years.
  The problems that we confront today, however, arise primarily from the need to ensure that the Royal Air Force, both in its front line forces and in the support area, is as efficient as possible and is giving value for money. Following the Government's statement last June, which was outlined in Cmnd. 8288, it became evident that the aircraft servicing work load for RAF Support Command could no longer justify or sustain three aircraft servicing and storage depots and their airfields at RAF St. Athan, RAF Abingdon and RAF Kemble. It was clear that spare capacity would exist and that it would be wasteful of resources not to find ways of instituting economies. Studies were therefore set in hand to determine how the exising facilities could best be rationalised.
  Of the three aircraft servicng and storage depots, RAF St. Athan is being developed as the major servicing base for Tornadoes, and it also has a large training commitment. RAF Abingdon has a well-found airfield that is the home of two university air squadrons and has a war role as a collocated operating base. RAF Kemble, on the other hand, has no war role and no permanent commitment to the servicing of any of the RAF's long-term front line aircraft. Our most substantial investments, therefore, are at St. Athan and Abingdon, which service primarily operational aircraft, rather than at Kemble, which deals with training and support aircraft.
  Furthermore, the minimum establishment of Service men in engineering trades is determined by the need for RAF Support Command to provide reinforcements in war to operational units. There is consequently a core of Service-manned engineering posts, whose number is dictated by the current war role, which it would not be

  285
  possible to reduce without serious operational penalties. We therefore have to bear in mind that for important operational reasons we have to retain a basic level of Service manning.
  Thus, our studies have concentrated mainly on the work undertaken by RAF Kemble by No. 5 maintenance unit, because this is the station where the civilians are employed, as my hon. Friend understands, although we have inevitably also looked at the work of all three aircraft servicing and storage depots.
  My hon. Friend knows the work carried out at RAF Kemble. I shall not go into too much detail, as time is limited. My hon. Friend asked the reason for the changes in capacity at RAF Abingdon. He will know that the Jaguar force is running down and that there will be a consequent reduction in the Jaguar major servicing task. RAF Abingdon is already carrying out a Hawk modification programme and is planning to start major servicing on Hawks assigned to NATO roles in 1982. Collocation—if I dare say that word again—of these servicing commitments at RAF Abingdon would therefore seem to be a sensible and realistic step towards rationalisation of this task and the most economic allocation of resources.
  As to the aircraft storage tasks, RAF Kemble currently provides 70 per cent. of the capacity required for RAF Support Command's fixed-wing aircraft storage for all three Services. Storage tasks require small numbers of personnel for the preparation and anti-deterioration servicing of the aircraft, but tend to make relatively heavy short-term demands on labour for recovery tasks. On past experience, these peak loads are infrequent and are therefore most cost effectively met by transferring manpower from other tasks on a temporary basis.
  The overriding criterion for deciding the relocation of the storage tasks is, therefore, dictated not by manpower requirements but by the hangar floor area required. Our studies indicate that it would be possible to make use of six aircraft storage hangars at RAF St. Athan and the additional four hangars required to make up the deficit could be provided at some additional works costs at RAF Shawbury. RAF Shawbury already has a resident civilian contractor undertaking other aircraft servicing work and it might be feasible for that firm to undertake all or part of the storage commitment.
  RAF Kemble currently contains a high-grade aircraft surface finish facility. RAF St. Athan provides most of the balance of the total Royal Air Force requirement for surface finishing. By a slight adjustment of resources at St. Athan and an increase in the establishment to cover two-shift working, throughput there could be increased to meet the present RAF capacity for surface finishing and even to enhance it.
  The House will note, therefore, that our studies have shown that it would be feasible to relocate the engineering
  286
  tasks currently carried out at Kemble. The majority of Kemble's engineering tasks could be transferred to RAF Abingdon, where the rundown in the Jaguar servicing task would release manpower and facilities to accept the new tasks. An expanded surface finish facility at RAF St. Athan could absorb the current total Support Command surface finish task, and the additional aircraft storage required could be found by bringing into use four hangars at RAF Shawbury.
  As to the future location of the Red Arrows—which are, of course, totally Service-manned—we have carried out a review of those airfields which might provide a suitable base for them. Their future location is, however, linked to the wider assessment of redeployment of frontline units in the wake of the defence programme review. Nevertheless, our studies have concluded that an alternative location could be found for them. It would seem feasible to deploy them to a new station at little additional cost.
  I said at the beginning that one of the prime reasons for these studies was the need for the Royal Air Force to be as cost-effective as possible. If the rationalisation of tasks at RAF Kemble were carried out on the lines that I have just set forth we would achieve considerable manpower and financial savings. I do not have to remind my hon. Friend of the Government's general policy in this area.
  To achieve these goals, we have to be—and we are—more cost-conscious than in the past. We must achieve value for money through greater efficiency. The feasibility studies that I have just described seem to indicate that the tasks now carried out by three RAF maintenance units could in future be carried out in the main by only two.
  On a very conservative estimate, the net running cost savings that could be achieved through the reallocation of tasks would be around £1·5 million, building up in the longer term to about £2 million per annum. These savings would seem to indicate that there would be considerable cost benefits in reducing overheads in the Royal Air Force support area.
  There are arguments that some staff will be lost through natural wastage and others may be found alternative employment in the Civil Service. I cannot accept some of the arguments that have been put about concerning the relative economies of closing RAF Kemble and paying unemployment benefit.
  I reiterate that the decision on this matter has finally to be made by my right hon. Friend. This has been a useful debate. I am grateful to my hon. Friend for bringing the matter forward.
  Question put and agreed to.
  Adjourned accordingly at twenty-two minutes to Two o' clock.

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Preamble
The House met at half-past two of the clock: The CHAIRMAN OF COMMITTEES On the Woolsack.
Prayers—Read by the Lord Bishop of Carlisle.

New Businesses
Baroness Elliot of Harwood: My Lords, I beg leave to ask the Question which stands in my name on the Order Paper.
The Question was as follows:
To ask Her Majesty's Government how many new businesses have been established in the United Kingdom so far this year and how many have had to give up trading in 1981.
The Minister of State for Defence Procurement (Lord Trenchard): My Lords, the latest information relates to 1980 when it is estimated from VAT sources that in the United Kingdom about 120,000 businesses started to trade at a significant level, that is to say their turnover was above the VAT threshold; a similar number ceased trading, for whatever reason, including mergers, takeovers, bankruptcies and liquidations.
Baroness Elliot of Harwood: My Lords, I thank the noble Viscount for that reply. However, is it not a fact that the number on the Registry of Business Names and the Register of Companies has gone up considerably this year and amounts to something like 60,000?
Viscount Trenchard: My Lords, according to the Register of Companies, the figure for the period January to October 1981 reached 60,794, which is an increase on the previous year. The Registry of Business Names also has some shortcomings as a measure of new businesses. Businesses trading under the name of the proprietor do not register and not all those who trade under another name register either.
Lord Mackie of Benshie: My Lords, is the Minister able to give us the equivalent figures for, perhaps, 1976 or the year prior to that?
Viscount Trenchard: My Lords, I am afraid I do not have figures going back that far. In the last two years the rise has been a relatively small percentage, but the movement is in the right direction. At the time—1980—business as a whole was in the throes of a recession.
Lord Orr-Ewing: My Lords, is my noble friend aware that in his first Answer he said that he had derived these figures from VAT sources? Is it not true to say that small companies would, in their early years, be trading below the VAT limit and would not, therefore, seek to register for VAT purposes? Or is that a mistake?
Viscount Trenchard: My Lords, my noble friend is quite right. The current threshold for VAT registration
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is £15,000 per annum turnover. So very small businesses are missed by that method of trying to answer the Question. There is no perfect way of answering the question about the number of small businesses, and to provide one would require a degree of administration from which we are trying to free small businesses.
Lord Cledwyn of Penrhos: My Lords, can the noble Viscount give some indication of the percentage of the new businesses which are in the engineering industry and in other productive industries which may be of use to the country in the coming years? Can he also give a spread of the industries in the country as a whole and say how many of them, for example, are in the North-East; how many are in the London area; how many are in Scotland; and how many are in Wales?
Viscount Trenchard: My Lords, I am afraid that I do not have that degree of detail with me. As regards the spread of the types of industries, I know that they contain an important percentage of modern industries such as, for example, electronics, but I shall write to the noble Lord in relation to further splits.
Lord Orr-Ewing: My Lords, in view of the number of new initiatives that the Government have taken to encourage the formation and growth of small businesses and the jobs that go with them, ought there not to be some yardstick with which to measure the results achieved, so that they are rather more up-to-date than the figures that my noble friend is currently able to give for 1980?
Viscount Trenchard: My Lords, there has been in this particular year a slight delay as regards the readiness of the figures, but the general answer is that which I gave just now—that it is extremely hard to get an exact register of small businesses without greatly increasing administration.
Lord Davies of Leek: My Lords, can the noble Viscount tell the House whether there is still encouragement of development not only in industry but in agriculture? What chance, in a small way, does a youngster have in these days to develop in agriculture, a smallholding or farming, either as a beginning or as a career?
Viscount Trenchard: My Lords, I think the agricultural aspect is a separate Question, so perhaps the noble Lord would table it. However, the number of the Government's measures to encourage, for instance, the regrettable number of people with redundancy payments to invest in new enterprises is very considerable and I believe that it stretches into the agricultural sphere.

Overseas Aid
2.42 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 the

83
ministerial committee which is considering cuts in public expenditure has reached a decision regarding further cuts in overseas aid.
Lord Skelmersdale: My Lords, the gross aid programme for 1982–83 will continue to be over one billion pounds, and the net programme will be £950 million. This is a reduction of just under £20 million below the previously planned figure, plus a further reduction of £6 million to compensate for an overspend of the same amount in 1980–81. In addition, the Commonwealth Development Corporation may borrow abroad up to £15 million in each of the next three years.
Lord Brockway: My Lords, while I congratulate the Foreign Office on resisting the demands for further cuts by the Treasury, I should like to ask the noble Lord whether it is not a cause for shame that our aid should be inadequate in view of the fact that the World Bank has recently stated that 26 African countries are on the verge of famine? Can he confirm that, since this Government came to office, aid has been cut four times more heavily than other public expenditure? Is this not ruining our reputation, which for generations before was a high one for assistance in world aid?
Lord Skelmersdale: My Lords, no, he could not confirm anything of the sort. The planned expenditure, as in Supply Estimates for 1979–80, was £844 million; for 1980–81, it was £882 million; for 1981–82, it was £972 million and, for 1982–83, it will be £950 million. I said in my original Answer that the Commonwealth Development Corporation may borrow up to £15 million in each of the next three years. In the noble Lord's Question we are dealing only with one year, but even with my shaky mathematics £950 million and £15 million make £975 million, which is an increase in the 1981 expenditure figure of £3 million.
Lord Kilmarnock: My Lords, will the noble Lord assure the House that the Government contemplate no further cuts in their aid for population activities?
Lord Skelmersdale: My Lords, I am afraid that I cannot promise any particular breakdown of the total aid figure. It will depend on circumstances at the time, not only within the overall aid budget but within our own economic climate.
Lord Oram: My Lords, were not the cuts last year, in fact, disproportionately large compared with cuts in other areas of public expenditure? Does not the statement that we have heard today indicate that nothing is being done to restore the position as it was prior to the cuts of last year? Moreover, were not these decisions taken during the very weeks when the Prime Minister and the Foreign Secretary were attending a series of aid conferences in Ottawa, in Paris, in Melbourne and then in Cancun, and putting their signatures to declarations about the need for much more generous aid to developing countries? Is it not shameful that these fine words have, in fact, been followed by mean actions?
Lord Skelmersdale: My Lords, we have always said that aid depends on our economic performance in other fields. The Government's first priority must remain to put our own economy to rights. That entails controlling public expenditure, of which the aid programme is a part. But this relatively small reduction and the additional allocation to the Commonwealth Development Corporation reflect the Government's commitment to maintaining a substantial programme of assistance to developing countries. So I do not believe that what I have said now is in any way inconsistent with what my right honourable and honourable friends have been saying around the world.
Baroness Trumpington: My Lords, will my noble friend confirm the excellence of the work done by the United Nations Voluntary Fund, to which, I think I am right in saying, this country is the second largest contributor?
Lord Skelmersdale: My Lords, I am afraid that I have been caught on the hop by that question: I shall have to write to my noble friend.
Baroness Llewelyn-Davies of Hastoe: My Lords, in spite of the noble Lord's reference to his own shaky arithmetic, is he not aware that, as The Times newspaper pointed out this morning, these figures in fact represent an 11 per cent. cut in real terms in the aid programme?
Lord Skelmersdale: My Lords, it depends on what you mean by "cut". I prefer to look at it as a reduction in the Budget estimate, which is no cut in my book.
Lord Brockway: My Lords, I wish to be constructive. Is the Minister aware that many of us appreciate that much of the aid is misused, going to urban populations and often subject to corruption? Would the Government consider that aid should be given, not Government to Government, but by a development agency which could contribute directly to rural construction, as is now the case in Mali?
Lord Skelmersdale: My Lords, yes, this has been under consideration for some time, but I am afraid that I am not able to give the noble Lord any concrete facts at the moment.

Greece and U.S. Nuclear Weapons
2.48 p.m.
Lord Jenkins of Putney: My Lords, I beg leave to ask the Question which stands in my name on the Order Paper.
The Question was as follows:
To ask Her Majesty's Government whether they are aware that the Greek Government is seeking the removal of American nuclear weapons from its soil and whether they will follow this example.
Viscount Trenchard: My Lords, the Greek Government has made it clear that it wishes to review its

85
position within NATO. This could affect all NATO bases within that country, but no decisions have yet been taken. As the United Kingdom remains fully committed to participation in the alliance military structure there is no need for the Government to review their policy towards the stationing of allied forces in this country.
Lord Jenkins of Putney: My Lords, while thanking the noble Viscount for that Answer, may I ask whether he is in a position to assure the House that, although the American weapons on British soil are under, as it were, American management, the British Government possess a dual key arrangement and that no such weapon can be fired without the active consent of the Government?
Viscount Trenchard: My Lords, I do not think that that question really arises from the Question tabled by the noble Lord. However, the noble Lord has received answers on previous occasions—certainly answers have been given in this House on previous occasions—to the effect that in a time of emergency the use of United States' bases in this country is the subject of joint decision. That has been the case in all the years that we have had American bombers as well as our own stationed here, and it will continue to be the case.
Lord Stewart of Fulham: My Lords, as we look across Europe today, is it not gratifying to know that we belong to, and take an active part in, a powerful alliance of free nations?
Viscount Trenchard: My Lords, I agree. The suggestion of the original Question is lack of unity in that alliance, and I can assure the House that there is near to total unity in the alliance on all questions. When the new Administration in Greece has taken stock, we very much hope that it will come into line with all other members.
Lord Gladwyn: My Lords, if the Greek Government insist on the withdrawal of nuclear weapons from Greek territory, will they have been deemed to have left NATO?
Viscount Trenchard: My Lords, I think that is a question for NATO, which I cannot at this stage answer.
Lord Brockway: My Lords, in view of the fact that the Question suggests that this country should end its nuclear weapons, may I ask the noble Viscount this question: do not military strategists now recognise that 50 missiles with warheads going North, South, East and West could destroy the greater part of the population of this country? Is the noble Viscount aware that, while many of us are demanding the ending of nuclear weapons in this country, it is not unilateralist, and that in Europe the movement is stronger against nuclear weapons than it is in this country?
Viscount Trenchard: My Lords, the whole question of the necessary balance of arms between NATO and the Warsaw Pact has been discussed in this House on many occasions and is a separate question. The noble Lord always gives me the feeling that in his opinion the
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policy of deterrence, including the possession of nuclear weapons, is less desirable than aggression. Yet, without aggression, no weapons will ever be used.
Lord Derwent: My Lords, when a supplementary question has nothing to do with the Question on the Order Paper, is it in order to answer it?
Viscount Trenchard: My Lords, possibly not, but a number of people read the record of these debates, and these subjects are important.
The Duke of Norfolk: My Lords, bearing on this matter, which does concern the Question on the Order Paper, could my noble friend please confirm whether the Russians are deploying one new SS 20 every three weeks, and whether the total they have now deployed is something like 250?
Viscount Trenchard: My Lords, my noble friend is quite right, and I wish that the noble Lord who asked this Question, and the noble Lord, Lord Brockway, would draw attention to that fact more often.
Lord Hill-Norton: My Lords, may I ask the noble Viscount whether in his knowledge any country belonging to the Warsaw Pact has asked the Soviet Union to withdraw nuclear weapons from their territory? Secondly, may I ask him whether there is a dual key arrangement, so far as he is aware, between the Governments of the members of the Warsaw Pact and the Soviet Union?
Viscount Trenchard: My Lords, I very much doubt whether either of those two propositions is the case within the Warsaw Pact.
Lord Jenkins of Putney: My Lords, is it not the case that it probably would not comfort the noble Lord much if there was a dual key arrangement on the Warsaw Pact side? Would the noble Viscount confirm that, in fact, there is no dual key arrangement on this side so far as American nuclear weapons are concerned?
Viscount Trenchard: My Lords, I have nothing to add to the Answer I gave to the noble Lord just now.

The Social Science Research Council
2.54 p.m.
Baroness Ewart-Biggs: My Lords, I beg leave to ask the Question which stands in my name on the Order Paper.
The Question was as follows:
To ask Her Majesty's Government what the safeguards will be to ensure that, under the proposed restructuring of the Social Science Research Council, fundamental research in the social sciences, as opposed to policy studies, will be continued.
The Parliamentary Under-Secretary of State, Department of Health and Social Security (Lord Elton): My Lords, I assume that the noble Baroness is referring to the new structure for the Social Science Research

87
Council's committees, which was made public through the council's recent document, A Change in Structure for Changing Circumstances. The council's continued concern to support fundamental research in the social sciences was made clear at many points in that document.
Baroness Ewart-Biggs: My Lords, I should like to thank the Minister for that Answer, which I was aware of. What I really want to ask him is whether he would agree that it is social anthropology which is in particular of very great value—not only because it has an extremely detailed focus but also because of its comparative approach? This has to draw, of course, on foreign, on worldwide, experience. With that in mind, will the Minister say whether overseas research in social anthropology will continue to be well supported?
Lord Elton: My Lords, the council is a chartered body, and the disposition of the council's funds as between its various activities is a matter for the council itself acting within the terms of its Royal Charter. I cannot answer for it.
Lord Robbins: My Lords, may I ask the Minister whether the fundamental research in social sciences which overlaps both the Committee for Social Sciences and the British Academy and other bodies will be sufficiently co-ordinated in the days to come?
Lord Elton: My Lords, I find that question difficult to answer because, as I say, the disposition of the resources of the council are for the council itself. I can say that the council's research grant scheme, which is open to grant applications in the fields of both fundamental and applied research, remains an important part of the council's method of supporting research, and that the grant applications are judged for the purposes of decision about funding by academic referees. I think the term is "peer review system of judgment". I think it is in the hands of those people that this surveillance that the noble Lord is asking about will rest.
Lord Beloff: My Lords, may I ask the noble Lord whether he is aware that there is in the academic community at large grave doubt about the efficiency and economy with which the Social Science Research Council has carried on its obligations?—that it is believed that the British Academy does the same job for the humanities at very much less cost? And would the Government consider whether some similar way of channelling funds through private learned societies and universities would not be a better way of doing it than the bureaucratic superstructure of the Social Science Research Council?
Lord Elton: My Lords, we seem this afternoon to be in the habit of getting rather away from the original Question asked. I take note of what the noble Lord says about the comparative esteem in which different bodies are held, and I shall draw it to the attention of my right honourable friend.
Lord Annan: My Lords, would the noble Lord agree that social scientists owe a considerable debt to the present chairman of the Social Science Research Council for the way in which he has taken note through his restructuring of the council of criticisms of the council's former operations such as the noble Lord, Lord Beloff, referred to a moment ago? Would he not agree that we ought to have confidence in his judgment and in the council's judgment about their priorities? Would he further agree
that in such matters as deciding whether to send on council funds four social scientists to Amsterdam for a conference or one social anthropologist to Borneo, this is a matter that is much better left to the judgment of the chairman and the council?
Lord Elton: My Lords, on the first part, the Government always welcome an institution examining its functions and reorganising them to meet current pressures. As to the second, I have already said that the disposal of funds is a matter for the council and not for the Government.
The Earl of Halsbury: My Lords, would the noble Lord accept that the amount of money spent on such branches of social science as that mentioned by the noble Baroness in her supplementary question, which might through basic understanding contribute to our resolution of social conflicts and tensions, is microscopic compared to all the research paid for on the material aspects of our culture which create those social tensions and conflicts?
Lord Elton: My Lords, I am not quite certain of the tenor of the noble Earl's question, but I would never belittle the value of academic research into practical affairs.
Lord Walston: My Lords, would the noble Lord agree that particularly the social anthropological work carried out under the auspices of the SSCR is of enormous value to the standing of this country, and particularly the academic aspects of this country, overseas? In view of the answers given and the questions raised by the noble Lord, Lord Brockway, and particularly in view of the cuts in overseas student grants, is it not essential that we do all that we can both on the Government side and on other sides to ensure that that work, which does so much to promote our good standing overseas, is not curtailed?
Lord Elton: My Lords, the noble Lord is probably aware that the Secretary of State is considering advice which he has received from the Advisory Board for Research Councils on the distribution of the science budget in 1982–83, and I am certain he will do so in the light of what the noble Lord has said.
Lady Young of Dartington: My Lords, can we take it from what the Minister has already said that he accepts that, while fundamental research in anthropology and other disciplines remains important, it is also highly desirable that research should be devoted to problems of social and economic policy which, as other noble Lords have said, increase in importance and difficulty rather than the other way round?
Lord Elton: My Lords, the council is actively engaged in supporting research in many policy-relevant fields of study. Two of the most topical and important are unemployment and law and order in the inner cities. It is open to departments to seek to commission research directed towards their policy concern with the council.

Employment: Training and Special Measures
Lord Denham: My Lords, at a convenient moment after 3.30 this afternoon my noble friend Lord Ferrers will, with the leave of the House, repeat a Statement which is to be made in another place on training and special employment measures.

Company and Business Names Regulations 1981
3.1 p.m.
The Lord Advocate (Lord Mackay of Clashfern)The Lord Advocate (Lord Mackay of Clashfern) rose to move, That the regulations laid before the House on 25th November be approved.
The noble and learned Lord said: My Lords, these regulations are to increase public certainty and parliamentary control over possibly undesirable company and business names. I propose first to explain the regulations and then to make some comments on the Fifth Report of the Joint Committee on Statutory Instruments relative to these regulations.
The control exercised over the use of certain "sensitive words" is of long standing. The Companies Act 1929 required the consent of the Board of Trade to a name which contained the words "Royal" or "Imperial", or which suggested Royal patronage. The 1948 Act however removed such specific control, and instead gave the department discretion in Section 17 to reject any name considered to be undesirable. The department took the view that certain words and expressions were particularly "sensitive" and required careful examination. Over the years a list of some 200 such words and expressions was built up in the light of experience.
I wish to emphasise that there is nothing ipso facto undesirable about the words in question. They may be quite properly used in particular circumstances. But equally they are capable of being misapplied so as to mislead the public in cases where companies do not measure up to the status they imply. Therefore, as a matter of long-standing policy, companies have not been registered by names containing these words and expressions until inquiries have been made of the applicants or comments received from other Government departments or professional bodies about the acceptability or otherwise of the use of the name in the particular circumstances.
That list of sensitive words was an administrative tool and was not subject to parliamentary control. Your Lordships had explained during the passage of the 1981 Act the changes that are proposed in this connection, and there has been a good deal of consultation in relation to this aspect of the matter in the course of the preparation and during the parliamentary
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stages of the 1981 Act. In the course of that, the department's old administrative list of doubtful words has been reviewed, and those other departments or organisations which had previously indicated an interest in particular words have been consulted as to whether statutory protection is still necessary. The list published as an annex to the consultative document in 1980 already represented a distillation of the experience gained since 1948. The circulation of the consultative document to a wide range of professional bodies and other organisations naturally generated further suggestions.
The list which now appears as a schedule to these regulations, therefore, has already been subject to considerable scrutiny in the commercial and professional world and was available throughout the parliamentary proceedings on the Bill which is now enacted. The list in the regulations needs to be viewed in the context of other provisions of the principal Act, particularly Section 22(1)(d), which prohibits the registration of a name the use of which by a company would, in the opinion of the Secretary of State, constitute a criminal offence. There are words or expressions the use of which is already controlled under other legislation, for example, the Banking Act. It is not necessary to bring such words within the scope of these regulations but, from the point of view of the company promoter, it is of course necessary to consider all the relevant legislation and it would be convenient to get all such words together on a single piece of paper.
The department has, therefore, prepared a list of the words in this category known to them, with details of the legislation under which they are controlled. This list will be published as an annex to the Registrar's Notes for Guidance on Incorporation of New Companies. If applications for companies to be registered by names including such words are submitted to the department, the applicant may be required to provide further evidence. I believe this will be a useful way of gathering all these various matters together. At present, some 33 words have been identified as falling within this category; that is, affected by other legislation and are subject to statutory control under legislation other than the Companies Acts. Together with those specified in the regulations to which I am speaking about 120 words will be subject to some form of control in future, compared with about 200 in the informal list which the department has used up to now for its internal guidance.
I have been speaking so far in terms of the incorporation of new companies. I should finally remind your Lordships in this connection that the regulations also cover the use of the specified words and expressions in trading or business names, whether by corporate or unincorporated firms. In these cases, too, the consent of the Secretary of State will be required before a name can be used which includes one of the words in the annex to the regulations. Without this provision there would be an easy means of evasion. Businesses which are already using such names with proper authority will not be required to re-apply.
I wish finally to refer to the Fifth Report of the Joint Committee on Statutory Instruments which has raised a doubt about the vires of these regulations. The doubt consists essentially of this, that if your Lordships look at the schedule, it will be seen that in respect of

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a number of the sensitive words there is no relevant Government department or other body specified. The joint committee properly raised the question whether the legislation under which these regulations has been made requires that every sensitive word should have a relevant body attached to it. All I can say is that I personally and the department have carefully considered whether that is a good point and have concluded that it is not.
The main provision, Section 31(1) has two branches, the first allowing for the specification of sensitive words and the second giving the Secretary of State discretion in respect of any such word to specify a relevant body. In the whole circumstances and context, it seems to me that the principal legislation envisages that in respect of certain sensitive words no relevant body will be specified. The most obvious example is the case in which it would be the Department of Trade itself that would be regarded as the department with the closest responsibility for the particular word.
Seeing the noble Lord, Lord Lloyd of Kilgerran, in his place, the word "patent" immediately suggests itself to me; it is obvious that the word "patent" is one for which the Department of Trade would certainly have responsibility. It would seem extraordinary for the Secretary of State of the Department of Trade to require an applicant to go to the Department of Trade itself in respect of that word. For that practical reason, in addition to what I have already said, I would suggest, with respect to the committee, that the doubt—and it is only a doubt—which they have raised is not well founded, and I hope that, with that explanation, your Lordships will feel that these are regulations which should be passed. I beg to move.
Moved, That the regulations laid before the House on 25th November be approved.—(Lord Mackay of Clashfern.)
3.10 p.m.
Lord Bruce of Donington: My Lords, the House will be obliged to the noble and learned Lord for having briefly taken us through the statutory instrument which is the subject of our discussion. First, I should like to congratulate the Chief Whip upon the time allowed us to read and to discuss this document. The noble Lord will recall that when we were discussing the principal Act in this House, after the first print of the amendments appeared, we were allowed three or four days to give them consideration. The House will recall that on that occasion I raised a protest that we had to consider 33 clauses, occupying 48 pages, de novo within a period of four days. We are happy to note—and we offer our felicitations to the Government Chief Whip—that in this instance this 3-page statutory instrument was published in good time for us to be able to consider it. Three times as much time has been allowed us to consider the statutory instrument as was allowed us to consider the 43 amendments to the Companies Bill as it emerged from the Commons, occupying some 48 pages. So we are making progress.
The business of the regulations is entirely detailed and is a proper subject for the making of regulations under the Act. However, I was a little worried as to whether or not the regulations themselves were ultra vires, particularly after seeing the report of the Joint
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Committee. The Joint Committee points out that from the wording of the Act itself it is not clear whether the qualification applied to subsection (1) of Section 31 of the Act connects readily with subsection (2) of the same section. If your Lordships will refer to the Fifth Report from the Joint Committee, you will find the following words:
"If the intention had been that a relevant body need be specified in relation to only some of the specified names or expressions the Committee would have expected subsection (2) to start with something like 'Where a company proposes to have as or as part of its corporate name any such word or expression in relation to which a relevant body has been specified, the appropriate person shall …'".
The report then goes on from there.
The Joint Committee was at pains to point out, in regard to the ultra vires observation, that the Department of Trade memorandum did not deal specifically with that point, and the noble and learned Lord's speech today did not deal specifically with the point. What the noble and learned Lord said, probably quite legitimately, is that where in the schedule to the regulations no name at all appears—such as the Department of Health, the Worshipful Company of Apothecaries, or some such body—we ought to read into that the Department of Trade, or the Secretary of State. That I think I accept. However, the objection of the Joint Committee remains; namely, that it is not clear that subsection (2) of Section 31 should follow the same rule as subsection (1) of the section. If the noble and learned Lord looks again at the report of the Joint Committee, he will find that that is the case, that neither he nor his department has dealt with that point.
I am well acquainted with the view that the intentions of both the department and the Minister are quite clear and that if one were to read the provision within the context of the debates and the parliamentary proceedings on the Act, there would be no difficulty. But, as the Joint Committee report points out, unhappily these matters might have to be interpreted by the courts, and of course where that happens the courts are inhibited from referring to the intentions of the Minister as expressed in debates or the intentions of Parliament as emerge from a perusal of the debates. It is far better if the section is cast properly.
I do not want again to rub home the point, but this kind of observation by the Joint Committee abundantly justifies the type of stricture that I felt bound to utter regarding the conduct of Her Majesty's Government in connection with the presentation of the Bill—that insufficient time was allowed in order fully to assimilate matters of this kind. I have no doubt that if the Bill had been in this House for a fortnight longer before it was debated and before the House considered the various amendments, we might have lighted upon this particular point.
On this one point raised by the Joint Committee as to whether or not the regulations are ultra vires, I am still in doubt, but happily on this occasion the Joint Committee's report and the regulations still have to go to another place for consideration, and it might well be that those in another place will see fit to examine the question further. I remain a little dubious as to whether or not the regulations are ultra vires, but I shall allow the matter to rest there.
Turning to the schedule itself, I would say that I

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have read it in conjunction with the memorandum on the regulations issued by the Department of Trade, in which the department describes the various criteria which were in its mind when it selected the specific words for inclusion in the schedule. The departmental memorandum states:
"The sensitive words have been chosen according to one or more of the following general criteria—as

(i) carrying prestigious connotations by implying association with some well recognised national institution or public body (e.g. the Royal Family, the Police, the Government),

(ii) implying skill or experience in an area of public health or public safety;

(iii) implying national, international or special business pre-eminence;

(iv) implying particular objects or functions which have a generally high standing in the minds of the public or a significant sector of it ".

It is with those criteria in mind that we have to consider the various names in the schedule.
Nevertheless, there are some difficulties. As the noble and learned Lord pointed out in his speech, there is another list of names that are associated with other Acts of Parliament which, if I understood him aright, are to be published as an annexe to some guidelines which are being sent out by the department. I should have thought that it would be preferable—the House might agree with me here—to include these details as a second schedule to the regulations, if only for the purposes of information. I say that because anybody reading this schedule will of course know from what the noble and learned Lord has said that there are other words which are virtually embargoed, but it is uncertain as to which words they are. it would therefore have been far better if those other particular words had been available to us today in order that we could have considered the various names on this schedule.
With those criteria in mind, I have a few questions to ask the noble and learned Lord. I should say that the words I am putting to him are purely speculative. I do not know as of now whether or not they may be on another list. All I know is that they are not on the list which is incorporated in this schedule. Why is not "continental" a specified word, or "intercontinental"? Both these words convey a degree of prestige, a degree of coverage, which is comparable to other words here. For example, it is comparable to "European", which I see is in fact in the specified list. I observe that the word "world" is not in the specified list. The incorporation of the word "world" in a title surely implies a degree of coverage and a degree of pre-eminence which might possibly have qualified it for inclusion. I observe that the term "EEC" is not banned, either, even though "European" is, apparently.
The word "incorporated" does not appear on the list. Of course, it may appear on the other list which the noble and learned Lord still has to disclose by the addition of his guide-notes. The word "corporation", I think, conveys a degree of pre-eminence which might conceivably be misused if incorporated within a business name. The word "public" is another name which might qualify for inclusion. Even the word "citizens" might be considered undesirable; and the word "practitioner", perhaps, ought to qualify. Practitioner in what? If one starts to specify various words as being likely to mislead people, it may well be that
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some of the words I have suggested to your Lordships might possibly qualify for inclusion.
I see that the word "psychiatry" is out. I do not know whether that is included in any other list in the noble and learned Lord's possession, but it will be interesting to see. Then there is the word "mental". I do not know whether or not it is going to be permissible for any proposed company or any proposed partnership to incorporate the word "mental" in its title. Again, in the absence of the other schedule that the noble and learned Lord has, we do not know. Again, I should have thought, in view of the fact that it is considered in the second column of the schedule that the Worshipful Company of Apothecaries are considered to be a relevant body to whom to apply, who knows but that the word "worshipful" itself might be considered fit to be specified in the schedule.
These suggestions have not been made at all frivolously. I am well aware that some of them may be incorporated in the other list. The purpose of my questions on these particular provisions is to inquire the Government's mind as to how those four rules that I have read out may be interpreted in relation to any of the suggested names that I have put forward. One of the arguments against regulations of this kind is that they are not susceptible of amendment in this House or in another place; one either accepts them or rejects them. Therefore, my suggestions can be only for the purpose of eliciting replies as to the application of the appropriate principles.
It would be churlish of me to refrain from congratulating the Government on their promptitude in having brought out the regulations. Aside from the criticisms that I have made and the inquiries I have sought to elicit, they will of course serve a very useful and very necessary purpose, and we on this side of the House would wish to support the regulations themselves. Indeed, we shall support their approval in this House; but I still leave the possibility of veto at some later stage on the whole of the ultra vires question. On that, I would prefer that we on this side of the House should reserve our opinion, but we shall not withhold our support.
3.26 p.m.
Lord Lloyd of Kilgerran: My Lords, may I join the noble Lord who has just sat down in congratulating the noble and learned Lord on the concise way in which he has introduced these regulations; and also may I say immediately that, for once, I concur almost entirely with what the noble Lord, Lord Bruce of Donington, has already put forward in his speech of just over a quarter of an hour. With that prologue, it will therefore appear quite clear to your Lordships that I shall not be detaining the House very long in a speech on these regulations. The noble and learned Lord was kind enough to refer to me in his speech when he was talking about vires. Indeed, at one stage I felt tempted to go more fully into this question of vires, because I have had very considerable experience in making submissions over hours, indeed days, about regulations and their vires; but I am resisting that temptation now.
However, there are two matters that I should like to ask the noble and learned Lord. They are practical matters, and they are these. What is the position of firms and organisations that are now using these

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words in the course of their business? I ask this question because of the way in which the noble and learned Lord dealt with that matter in his speech. It may be that there are subsections in this complicated Companies Act which will give an answer to my question, but the noble and learned Lord said that those who are using these words "with proper authority" could continue. I was not clear what "proper authority" meant. I assume that, in so far as concerns the corporate titles which are registered on the register of companies, that registration would constitute "proper authority". But now that we have no Business Names Registry—that has been abolished—if a firm is not a corporate company but is an ordinary business, what is the "proper authority" for allowing an ordinary business, which is not incorporated, to continue using that name?
The second matter is this. This regulation will impose, as it seems to me, a burden of expense and time upon small business. What kind of publicity is going to be given to this regulation? Obviously, the larger companies will be circulated by the CBI or the Institute of Directors, and so on, but I am thinking of, say, a very small business in a small Welsh village, where Ann Jones has set up a little confectioner's business and has put in her business title, "Ann Jones—Specialist in Welsh Cakes". Has she got to apply to a Secretary of State, unspecified, to know whether she is to allowed to use that name? This is not an absurd situation; there are a large number of small firms which will be using words like that in association with their business.
Take another word with which I am more familiar, perhaps, than I am with Welsh cakes, and that is the word "breeder". I am sure that the noble Lord, Lord Davies, who I see in his place, would agree with me that Dan Jones in Wales would put in brackets after his name "Cattle Breeder" or "Horse Breeder". Is that going to be prohibited? Must he make application to an unspecified Secretary of State? I am sure that he would. I am sure that all the people to whom I have referred would wish to be within the law, if they knew what the law was. May I remind the noble Lord of the somewhat draconian provisions of Section 28(7) which says:
"Any person who contravenes subsection (2)"—
that is, using a word when he ought not to, according to these regulations—
"shall be guilty of an offence and liable on summary conviction to a fine not exceeding …",
and then it goes on to specify the amount of the fine. In view of the fact that it could be a criminal offence to use these words in the course of business, then the public ought to be told so clearly. It is no good advertising it in The Times or Daily Telegraph for these small people. Will steps be taken to publish them more widely, perhaps in rural newspapers?
Lord Molloy: My Lords, I wish to make the briefest intervention and I hope that what I say will not be regarded as extraneous to the matter under discussion. The very words: "Company and Business Names Regulations" are very welcome and particularly the speech that the noble Lord has made and the excellent submission, I thought, from my noble friend Lord
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Bruce of Donington. I want to come down a little from the expert remarks that we have heard to put this point: that these regulations are fine, but what about the implementation of the law? How about the enforcement of these regulations? I believe that millions of ordinary people hardly know that such regulations exist.
What can I submit to your Lordships to back up what I have said? I should like to refer to that admirable programme of the BBC, "Watchdog", where week in, week out, they give cases of where our fellow citizens are cheated, thieved from in all sorts of ways, perhaps in being sold something, even a health cure where fraud is the hallmark of the companies and businesses concerned. When ordinary people read that there is a law against this sort of thing, they are incredulous because they never hear of anyone being apprehended. The BBC programme is never short of material. It might be that the people responsible for the enforcement do not see the "Watchdog" programme. It might be possible for them to get transcripts of what goes on.
I submit, in conclusion, that what I put to your Lordships this afternoon is concerned with what I am assuming this particular measure is all about: the protection of ordinary people. Up to now, all the regulations do not seem to be having any great success in that realm, in preventing bogus firms and bogus companies who do not seem even to bother to adhere set out from the very beginning to twist, cheat, upset and cause anguish to literally thousands of ordinary people in our country. The measure that we are discussing is, I would submit, designed to prevent that sort of thing, but there does not seem to be much of a case to show that what we are discussing this afternoon can be enforced. If there is no satisfactory reply coming as to how that can be done, then, frankly, we have been wasting our time.
4.34 p.m.
Viscount Hanworth: My Lords, I understand that this statutory instrument has been through another place already and therefore at this late stage all that I can ask for is an explanation of the points that I am going to raise, or possibly for the Minister to give earnest consideration to them. In 1980, the Department of Trade issued a document, Companies Legislation and Business Names; proposals for reducing the functions of the Department of Trade, in which there was an annexe listing the sensitive words which we are now considering. This document proposed inter alia that the Pharmaceutical Society of Great Britain should be the body to issue a letter of non-objection to the term "chemist" in a company or business name. The Royal Society of Chemistry, as the professional qualifying body for chemists, was not included in this at the time; but, after discussions with the Government, the Government accepted that both these bodies should have roles to play regarding the term "chemist" and also certain other words which I shall mention shortly. This statutory instrument does not mention either of these bodies nor does it mention drug, druggist, pharmacist, pharmaceutical or pharmacy.
One was led to believe originally that all these would be included. The bodies which I mentioned are

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extremely concerned about this. Unfortunately, perhaps, they failed to realise this until the last moment and I have been able to give the noble Lord the Minister only about one hour's notice of the points I was going to raise. It may well be that he will be able to say that all this is adequately covered by other legislation. If that is not the case, I hope that he will very earnestly consider these points because I think they are of great importance and they certainly come under the criteria under which the list of sensitive names has been made.
The Earl of Halsbury: My Lords, I rise with gratitude to thank the noble Viscount, Lord Hanworth, for raising this matter, because he raises it in independence from his own Benches. I have to confess an interest in what he has just said. The smart red tie that I am wearing is chosen not to match the political opinion of other Benches nor even the red plush of those on which I sit. It is blazoned with the arms of the Royal Society of Chemistry, of whose fellowship I have the honour to be a member—which has provided me with a professional basis for my career while others like me have provided the nation with two giant industries, the overall industry of chemistry and the autonomous part, the pharmaceutical industry, which so often comes before your Lordships' House for other reasons. In view of the fact that they were to have been included to their knowledge, as a result of consultation, in both consultative document, on the one hand, and the drafting stage of the Bill, on the other, it seems a great pity that they were not informed that they were going to be withdrawn from the list or given the opportunity to hear at first hand why they were withdrawn.
At this late stage those who think as I do are between the horns of a dilemma. One can either waste the time of the House by dividing on an issue that one will lose, or project a constitutional crisis by dividing on an issue where conceivably one might win. For the reasons to which the noble Viscount referred, it is too late to do anything about it; but because I feel helpless in this matter I would appeal to the generosity of the Minister to undertake to give the Royal Society of Chemistry an opportunity to hear at first hand why they have been omitted from the list. If the reason is (as has been suggested) that they are already provided for by other legislation may we hear from him, perhaps in more detail than time possibly provides in an answer to the House this evening, exactly what that legislation is and, if necessary, to argue as to whether they are fully provided for or not? That is not, I think, an unreasonable undertaking to ask him to give, with the hope that he will not at this stage close his mind to the possibility of a supplementary order at a later stage if arguments which may be adduced on this point finally carry the conviction in his mind that they have a measure of validity.
3.40 p.m.
Lord Davies of Leek: My Lords, may I speak briefly for perhaps two minutes? I should like to declare an interest on the pharmaceutical side. May I back up the expert opinion that we have heard from the Cross-Benches? It would have been better, having considered this matter, if there had been full consultation with the people in the pharmaceutical industry so that they knew
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exactly where they were. Obviously this has not been the case. More attention should be paid to this because tens of thousands of pounds are spent in legislation by the pharmaceutical industry in all countries to justify the foundation of research or the results of research. It is absolutely essential that clarity of declaration and the monotype on the ethical drugs that are produced is known and is in proper order. As it is now, it seems to be in vacuo. Consequently, I hope this noble House will pay particular attention to the speech of my noble friend who spoke from the Cross-Benches a moment ago.
3.41 p.m.
Lord Mackay of Clashfern: My Lords, may I thank those who have welcomed these regulations. I should like to say something about what the noble Lord, Lord Bruce of Donington, refers to as the "other list". The situation is—as I sought to explain in my opening remarks—that there is other legislation presently on the statute book which does affect the right to use names. The word "chemist" and the word "druggist" are examples of such other words that are controlled by Section 78 of the Medicines Act 1968 under which it is an offence to use those names in connection with a retail trade unless one is properly qualified.
I was indicating earlier that the department believe that there are some people who are not absolutely aware of every possible section in every Act of Parliament; and some of your Lordships may be among that number. It was thought that it might be helpful to gather these together into a document. That document will have no statutory authority. It will be a document compiled in order to be helpful, and that is the reason why it cannot go as a schedule to these regulations. These regulations are I believe, in spite of the doubt of the joint committee, made under statutory authority, whereas the other list would be a helpful compilation of relevant legislation.
That brings me to answer the question about publicity. The intention is to have national publicity about the matters with which we are concerned as well as the new system generally next month. It will of course continue. There will be new guidance given in response to inquiries and there will be prepared, as I hinted already, a document giving guidance on incorporation and setting out the various statutory provisions that may be relevant, including those to which I have just referred.
The noble Lord, Lord Lloyd of Kilgerran, referred to what I said at the end of my remarks about lawful authority. The position is regulated in the other provisions of the Act. On the business aspect, rather than the companies' aspect, the provisions are in Section 28(4) and 28(5). Basically, what they say is that where a business was lawfully carried on before the change under a name, it may continue to be carried on under that name, notwithstanding that the name is on the list of sensitive words in this regulation. I hope that is a sufficient answer to the noble Lord's general question.
With regard to the specialist in Welsh cakes, that lady will be all right in any event because I do not think that the word "specialist" is referred to. The word "breeder" is referred to in the list, and the relevant body in that case is, as one might expect,

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the Minister of Agriculture, Fisheries and Food. On enforcement, the situation is that the new matters that are a subject of these regulations will be dealt with in much the same way as under the old system. If the department is advised that a business is using a word without proper consent, it will follow that up. In an extreme case, a prosecution could result. As one responsible for prosecutions in part of the United Kingdom, I think that I can claim that we do our best to follow up any such matters reported to us and deal with them appropriately. I do not think that there is any likelihood, in answer to one aspect, that a company will be registered by a name of the kind listed here without proper consideration of it being made for the reasons which I have already explained.
The noble Lord, Lord Bruce of Donington, referred to the very lengthy list of words for consideration. All I can say is that the list that one could consider could be of almost indefinite length. A judgment has to be made of the words which in practice have been found to lead to difficulty. As I sought to explain in my opening remarks, the department has quite a long experience of administration in this field behind it, and it is in the light of that, as well as in the light of observations put in in answer to the consultation, that this list has been decided upon.
That brings me finally to say something regarding the Royal Society of Chemistry. My understanding of the position—and, has been said, I have not had very long to consider it personally—is that in the light of the consultation, it was felt that a word such as "chemist" was adequately dealt with by the statutory provisions of the Medicines Act to which I have referred, and that it was not necessary to retain its name in this particular list because, as I said, one has to look at the matter as a whole and look at all the legislation in considering whether it is necessary to put on the added burden which is required if a name is put in this list.
It is in the light of these considerations that we came to this decision. Naturally, I shall be glad to look at the situation in the light of what your Lordships have said and see whether any further steps should be taken—for example on the lines that the noble Earl, Lord Halsbury, indicated. The noble Lord, Lord Bruce of Donington, made a reference to ultra vires and the argument set out by the joint committee. In fairness to the Department of Trade, I should say that the joint committee invited them to give their observations on the possibility that this instrument was an unusual or an unexpected exercise of the statutory power rather than on the question of ultra vires. In any event, I have certainly carefully considered the full argument advanced by the joint committee in support of the view that there is a doubt about the vires of these regulations. I think that when one reads Section 31(2) in its context it refers to any such word or expression. When one reads that back in subsection (2) to its antecedent in subsection (1) its proper antecedent is paragraph (b)—that is to say, the paragraph under which a relevant body is to be specified.
Therefore while of course I have every respect for the view of the joint committee, on this occasion—having considered it carefully—I beg to disagree with it. The standing committee in another place agreed that these regulations should pass this morning. It
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will be subject to confirmation of course by another place later. I understand that so far as this point has been considered, that was the decision taken in Committee in another place.
On Question, Motion agreed to.

Employment: Training and Special Measures
3.50 p.m.
The Minister of State, Ministry of Agriculture, Fisheries and Food (Earl Ferrers): My Lords, with your Lordships' permission, I should like to repeat a Statement which is being made in another place by my right honourable friend the Secretary of State for Employment. The Statement is as follows:
" With permission, Mr. Speaker, I should like to make a Statement on training and special employment measures further to the measures announced on 27th July by my right honourable friend the Prime Minister.
" We have decided to extend the special Job Release Scheme, open to disabled men of 60 and over, until March 1984. Job Release allowances will be increased next April by 9 per cent. At the same time the conditions of the scheme in the public and private sectors will be brought into line. The Temporary Short Time Working Compensation Scheme will also be extended by two years and will then close, with the last application being taken in March 1984. From July 1982 the maximum period of support will be six months. Provision for the Community Enterprise Programme will be increased to 30,000 places in 1982–83. The total provision for these three special employment measures in 1982–83 has now been increased this year by £140 million to over £520 million, with an additional £61 million for the Young Workers' Scheme, which starts on 4th January next.
" Now I turn to training. We have today published a White Paper on the action needed to bring our system of industrial training up to date. We have drawn substantially upon the recommendations made by the Manpower Services Commission in their report, also published today, on the response to the consultative document, A New Training Initiative. The White Paper provides a framework for action by all concerned in industry and education, and sets out the lead the Government are giving in a 10-point agenda. I should draw to the attention of the House three of these points in particular.
" First, there will be a new £1 billion a year programme for unemployed young people which will guarantee a full year's foundation training for all those leaving school at the minimum age and finding themselves without jobs. Over the next 18 months, this entirely new' Youth Training Scheme will progressively replace the Youth Opportunities Programme and will give these young people training in basic skills which employers will need in the future. We are determined to lose no time in reaching the position where every 16 year-old school-leaver is in work, or in further education, or has a genuine opportunity of a year's training. By taking the decisions now, we are able to ask the Manpower

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Services Commission to ensure that this new Youth Training Scheme is in full operation by the autumn of 1983. Meanwhile, the Youth Opportunities Programme will be expanded and developed to provide about 100,000 of the new-style training places in 1982–83, and the allowance under it will be increased to £25 from next January.
" Young people in the new Youth Training Scheme in their first year after leaving school at 16 will have 'trainee' status. From 1983 they will cease to have eligibility of their own for supplementary benefit, except for the special groups, and so will be treated like those who remain in full-time education. While on the scheme they will, however, receive a training allowance from the Government. This will reflect the value of the training and relevant further education they receive and their learning role, and, although its precise level will be decided nearer the time, it is likely to be something over £760 a year. For older trainees who remain eligible for supplementary benefit, the allowance will be higher, probably around £1,250 a year. These allowances will not apply before 1983 when the scheme comes into full operation, and I am asking the Manpower Services Commission, in working out the detailed implementation of the scheme, to advise on the level of allowances which is appropriate within the resources available for the scheme as set out in the White Paper.
" Employers, trade unions and educationalists have all, rightly, expressed concern for the young unemployed. The Government therefore trust that we can now depend upon their wholehearted support in making this new scheme a success. This new scheme breaks entirely new ground in the training of young people in this country, and it is directed to young unemployed people as a first priority. But our ultimate objective is proper training for all young people, whether employed or unemployed, and to bring more young people into jobs with proper training. For those in jobs, we are increasing the financial encouragement to employers to provide foundation training and release for education so as to cover some 50,000 trainees in 1984–85. We are also continuing into 1982–83 our support for some 35,000 apprenticeships.
" The new scheme I have announced will now go ahead quickly to ensure that there will be universal provision for unemployed school-leavers. But the Government hope that the further study of youth training to be undertaken by the MSC will identify fresh ways in which to help get many more of the young unemployed into paid jobs with proper training. To the extent that their training needs can be met in such ways we would be willing to transfer resources proportionately from the new scheme.
" Secondly, we wholeheartedly support the MSC proposal that employers and unions should accept, and implement, the objective that by 1985 all training should be to standards without regard to age. We shall make Government assistance for skill training increasingly conditional upon steps towards that objective and the removal of unnecessary restrictions.
" Thirdly, we have asked the Manpower Services
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Commission to develop an Open Tech programme to make technical training more accessible to all with the necessary ability. Other important points of action are set out in the White Paper, including steps to improve preparation for working life in schools and colleges.
" In pursuit of all these commitments we have during this year increased the provision for training expenditure in 1982–83 by £399 million to a total of over £1·1 billion; in 1983–84 by an extra £517 million to a total of nearly £1·3 billion; and in 1984–85 by an extra £648 million to a total of nearly £1·5 billion, including over £1 billion on the new Youth Training Scheme. The provision for 1982–83 is included in the expenditure plans for that year announced by my right honourable friend the Chancellor of the Exchequer on 2nd December. The amounts for later years will be accommodated within the totals to be announced in due course.
" We are therefore providing resources totalling nearly £4 billion over the next three years to bring our training arrangements up to date. With the assistance of the Manpower Services Commission we have now set out a clear framework within which employers, unions, local authorities, education services and trainees themselves can play their part to modernise our training system. These steps are long overdue. Let us set out to provide training fit for a great industrial and trading nation. "
My Lords, that concludes the Statement.
Lord McCarthy: My Lords, we on this side of the House are very pleased to be able to congratulate the Government on some movement in some direction in one area. If this is not a U-turn, if it is not an L-turn, it is at least a departure from the straight, narrow path of monetary lunacy. At least we arc not being told in this critical area that "the best government is the least government." At last the Government have taken on some responsibilities.
I am also pleased to see that what the noble Earl has announced today has been so close to what we read in the papers and what in fact we discussed in this House on 4th February. It is reassuring for those of us who are not in the corridors of power to know that the departure of the "wets" from Tothill Street has had no effect upon the tendency of the department to leak. It is still the case that you can get all kinds of information out of the hollow tree on Clapham Common, ust s you used to be able to do. About that we are very pleased.
We are very pleased, too, that the Government have announced a number of provisions where they have reversed their previous policy; for example, in the area of what might be called short-term job maintenance, the extension of the job release scheme, the continuation of TSTWC—and the noble Earl said that after two years it would stop, but, of course, that is what they said last time; one keeps phasing out TSTWC until one finds that the depression is still there and one then has to keep it running again; but we are glad to see that we are not having TSTWC phased out for another two years—and the further expansion of the Community Enterprise Programme. The only question I would ask the noble Earl on this is: if we are now having an extension of the job release scheme, an

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extension of TSTWC and an extension of community enterprise, why have so many aspects of this policy been run down in the past and now have to be extended?
It is also right, and we congratulate the Government on it, that they have approved a very large part of the MSC's New Training Initiative in relation to skill training and adult training, although, of course, the noble Earl will know that what the MSC proposed was very expensive, and the Statement today does not tell us very much about where the money is to come from. I want to say one or two words about that before I sit down.
Finally, in the area of congratulation, it is right to congratulate the Government on accepting the MSC's target of 1,000 entrants into the YOP scheme for 1982–83. Once again, one must ask: why has the Youth Opportunities Programme been cut in the past? It is also about time that there was a small, inadequate increase in the YOP allowance of £25.
The real issue, however, and the controversial issue, and the issue which, if the Government continue with their present policies, could wreck the whole of these progressive measures, is what the Government arc proposing for the Youth Training Scheme. The Youth Training Scheme is to replace YOP from 1983 onwards. So we have to ask ourselves: why is it so unlike YOP in so many ways? It intends to be four times the size, it intends to be twice as long and yet it intends to be roughly half the price. In other words, why is it that the allowance for the new Youth Training Scheme is to be somewhere in the region of £15, whereas by that time, if the Government continue to keep the allowance for YOP up to the rate of increase in inflation, the allowance for YOP will be somewhere near £30. So why, when one scheme replaces another, and in a period when the two schemes will be running together, when some members of the same family, for example, could be on one scheme, while others could be on the other, do we have this situation in which something twice as long and four times the size costs half the price?
And why should it be introduced with a threat of withdrawal of supplementary benefit? The noble Earl did not actually read from the White Paper. Therefore, I should like to draw his attention to the first paragraph on page 10 of the White Paper, where the Government say:
" Those who unreasonably refused a special training place would, like adults who unreasonably refused training offers, have their benefit reduced for six weeks ".
My question is: by how much would they have their benefit reduced? My question is: how often would their benefit be reduced? And is it not the case that there is a difference here in the benefit that is reduced when you are training, because that is unemployment benefit, and the benefit in this case, which is supplementary benefit, and there is no alternative to supplementary benefit?
I must say to the Government, as indeed we said in this House when this subject was debated on the basis of leaks on 2nd December: if the Government continue with this policy, if they continue with this cut-price allowance, not only will they have their own Back-Benchers in another place against them; they will have the young people in this country against them, and indeed they will have lost the co-operation of the trade
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union movement, which the Manpower Services Commission said, in respect of all three of its objectives in the New Training Initiative, is absolutely essential.
4.15 p.m.
Lord Rochester: My Lords, from these Benches I should like to join in thanking the noble Earl, Lord Ferrers, for having repeated this Statement. We have noted the decision to increase to 30,000 in 1982–83 the number of places on the Community Enterprise Programme. But since this is the only programme catering for the long-term unemployed, whose number, I understand, is expected to rise next year to more than 1 million, we cannot be satisfied with the extent of the provision made for them under the programme.
As regards training, we welcome very much the new £1 billion programme for unemployed young people and the guarantee of a full year's foundation training for all those leaving school at 16 without a job to go to. We also strongly support the objective that by 1985 all training should be to standards without regard to age, and also the intention to develop an Open Tech. programme. But we fear that the setting of the allowance for first-year trainees at what—as the noble Lord, Lord McCarthy, has already said—may be the equivalent of only £15 per week, taken together with the element of compulsion inherent in withholding supplementary benefit from young people who are unwilling to participate, means that the consensus that is so badly needed in this field may, without trade union support, be lacking.
Is it not high time, in any case, for consultation between all those concerned, as to how the various related payments that are made to young people, including the education maintenance allowance and the rates for age of apprentices, can be rationalised? Is it not also true that, in their consultative document on this subject, the Manpower Services Commission expressed the view that some statutory underpinning was essential and, now that so many industrial training boards are to be dismantled, are the Government satisfied that the training that is contemplated is capable of being implemented on the basis proposed? Further, are they satisfied that the best of our large companies will prove able, without more financial assistance, to resume skill training that extends beyond their own requirements?
Because in this vital matter co-operation between the political parties is so desirable, I do not wish to strike attitudes today which might later make that co-operation more difficult. But will the noble Earl in turn assure us that, before the Government reach any final conclusions on these questions, they will consider carefully the responses that are made to this Statement and to the White Paper by those of us who, despite our reservations on certain points, are in sympathy with many of the principles on which these documents are based?
Earl Ferrers: My Lords, I am grateful for the welcome which both the noble Lord, Lord McCarthy, and the noble Lord, Lord Rochester, gave. I was heartened when the noble Lord, Lord McCarthy, in his true and generous spirit congratulated the Government on the points with which he feels in favour. As is said in the Statement, I think that this is a radical, new

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initiative. It has been chosen to try to meet the problems in which we find ourselves today, problems which are caused basically by a recession which affects not only this country but the world. Therefore, it does not represent either a U-turn, or an L-turn, or any other form of turn which the noble Lord would wish to ascribe to it. It is merely the practical application of new resources and new ideas to a very difficult situation, one in which we wish to see young people able to be trained so that they in turn can take part in the economy and the life of this country.
The noble Lord, Lord McCarthy, quite rightly described these as progressive measures. He asked why the Youth Opportunities Programme is so different from this new training scheme. If one may put something in a nutshell, which is always a dangerous thing to do, the purpose of the Youth Opportunities Programme was to give youth an opportunity to work. It did not necessarily provide long-term jobs. This scheme is different. The noble Lord, Lord McCarthy, also asked why the allowance has been reduced. The allowance has to be viewed in the context of this radical, new programme. It is guaranteeing to 16-year-old school-leavers, if they are not in work or in further education, the opportunity of a full year's training programme. So they will be continuing their learning role and will generally be regarded as still dependent upon their parents, like those who continue in further education. Therefore, it is not a strict comparison. The difference is as I have described it. The noble Lord, Lord McCarthy, said that the Youth Opportunities Programme has been cut in the past. In fact, it has never been cut. In 1982–83 it will be updated again to some 630,000 places.
The noble Lord, Lord Rochester, asked whether the Government are satisfied that the training will be available on the basis which the Government have indicated. We are satisfied that this will be so. However, I know that the noble Lord will understand that this is a very fundamental rethink. We published the original document and there have been consultations upon it. This is the Government's conclusion. It will be some 15 months before this programme gets into full operation. During that time it will be the duty of the Government to liaise with all the responsible bodies which will be involved in trying to ensure that this happens. The Manpower Services Commission have got to organise the schemes, interest sponsors, devise training courses, liaise with education authorities. We believe that it will be possible to organise these facilities and that this will come about. I would remind the noble Lord that three months of the training in these new training schemes will be off the job, while about nine months of it will be on the job. So there will be great flexibility.
The noble Lord asked me whether the Government will take into account observations which are put forward by organisations when they have had time to study the White Paper. Of course, we shall take those observations into account.
Lord Orr-Ewing: My Lords, we on this side of the House—
Several noble Lords: Order, order!
Lord Orr-Ewing: Three from the other side and none from this?
Earl Ferrers: My Lords, the noble Lord, Lord Kilmarnock, is a Social Democrat and therefore is not wholly in alliance with the Front Bench opposite.
Lord Kilmarnock: My Lords, we on this Bench also wish to express our gratitude to the noble Earl, Lord Ferrers, for repeating this extremely important Statement. Many of its lines we are able to welcome, in particular its emphasis that all future training should be to standards without regard to age. This is something which those on all sides of the House can welcome.
I have one slight reservation regarding the nub of the Statement concerning young people in their seventeenth year who are to have trainee status, for they are to cease to be eligible for supplementary benefit. We learn that they are to be treated like those who remain in full-time education. The noble Lord, Lord McCarthy, also touched on this point. In the White Paper, which we have not had time to read, we are told that supplementary benefit may be reduced to six weeks if there is an unreasonable refusal of a training offer. This might cause considerable hardship to a family which is dependent upon supplementary benefit. May I therefore ask the noble Earl how the Government are planning to apply this sanction? If a young, unemployed person is offered a place with a particular firm or on a particular course which he or she feels is unsuited to his or her inclinations and abilities and prefers to wait for another opening in a different firm, or on a different course, when exactly will the Government's axe fall, and to what extent? This is rather an important point.
Secondly, in view of the undertaking that those with trainee status will be treated like those who remain in full-time education, what is to happen to child benefit? Will their parents be entitled to this, too? As noble Lords are aware, those who remain in full-time education between 16 and 19 are entitled at the moment to child benefit.
May I also ask whether those who remain in full-time education will receive any more than the child benefit which goes to their parents at the moment? Will they also get the trainee allowance? If not, is this not very unfair discrimination against continuance in further education? Finally, may I ask the noble Earl whether the Government will receive sympathetically the suggestion that we should have a debate on this extremely important subject early in the New Year.
Lord Orr-Ewing: May I ask—
Earl Ferrers: My Lords, I can assure my noble friend that he will get a full opportunity to make his intervention, but it would be helpful if straight away I could answer the noble Lord, Lord Kilmarnock. First I am grateful to the noble Lord for saying that he appreciates that the training should be up to standards. He asked me how the supplementary benefit will work and how one will determine whether or not a person should have his supplementary benefit reduced. The point at issue is that if there is an opportunity for people who leave school to be given a year's full-time training it is not reasonable that if they refuse to take it up they should nevertheless receive supplementary benefit. The noble Lord asked me how this will operate. I am bound to tell him that the benefits reductions will be a matter of judgment and discretion

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and that it would be quite improper for me to say at this juncture how exactly that will fall. Obviously, however, there will be a system by which those who feel aggrieved or who are in special circumstances will be able to point that out.
The noble Lord also asked me whether parents will still have the child benefit while their children are undergoing this training. The answer is that they will. At the moment child benefit stands at £5.25. This will be available to those who carry on with their training in just the same way as it is available to those who are in full-time education. The noble Lord then asked (a little craftily) whether those who are in full-time education will also be able to get this allowance. This allowance is for those who are not in full-time training and who would have been unemployed but for this new training which will enable them to do something which otherwise they would not have done. It is to replace that supplementary benefit that the allowance is being made. The noble Lord asked whether there would be an opportunity to debate this matter. I am sure that it may be possible through the usual channels, if it is considered fitting, for a debate to be arranged.
4.20 p.m.
Lord Orr-Ewing: My Lords, may I thank my noble friend for that imaginative Statement which he repeated to our House. In the old days the political pendulum used to swing back and forth across this House. It now seems to swing around and around over the other side. I hope that this will not become too considerable a practice because we do want to comment from these Benches as well. I warmly welcome the imagination, the forcefulness and the generosity, so far as the expenditure is concerned, of this scheme. I think that the cost is going to be very large indeed, and obviously the taxpayers of this country will meet much of the bill; £1·1 million next year, amounting to £1·5 million in 1984–85, is no small sum of money.
Will my noble friend and his ministerial friends in the Department of Employment pay particular attention to the advantages of the German scheme, where great accent is put on vocational training? It is an ill wind that blows nobody any good, but I cannot help feeling that we are being forced into something which we ought to have adopted in this country many years ago—that is, craft training and vocational training for all people leaving school, irrespective of where they are going. I hope that we shall get the best points out of the German scheme and any lessons which they have learnt over the years.
May I suggest that it is important that the nation gets 100 per cent. co-operation from firms throughout the country. I would not in any way object to a levy on the total wages bill, because everyone must make a contribution and a sacrifice to this; but if that is to be levied on firms perhaps the Government will consider whether the national insurance contribution should be taken off, and then we can make this constructive suggestion for improving our manpower training for roughly the same contribution that British industry is now making via the less productive national insurance contribution.
Earl Ferrers: My Lords, I am surprised that my noble friend should say that in the old days the political pendulum swung backwards and forwards across the Chamber. Things do change and sometimes the pendulum does go around and around, because what happens on the Benches opposite sometimes changes. Nevertheless I am very glad that my noble friend had an opportunity to ask his question even though he was not able to do so quite as early as he would have wished.
I absolutely take the point about the German scheme to which my noble friend referred. We will of course study what is being done there in order to see whether there are ways in which we can use the benefits which they have accrued in our own country. My noble friend is entirely right when he says that the scheme needs 100 per cent. co-operation from firms. I would go one stage further, because clearly, when the Government make a statement of this nature, there are some facets of it which may appeal to some people and some facets which might not appeal to others; but I would ask those who are interested to realise that this is a positive step by the Government of the day, whatever views one may take. The Government have committed some £4,000 million over the next few years to help in training. Whatever one's opinions may be in respect of individual facets, it is terribly important that employers, employees, firms, educational establishments and everyone else should co-operate to make this scheme successful. There is no reason why it should not be successful but, like everything, it depends on all those involved co-operating to the fullest extent, and I hope that this will be done. My noble friend asked whether there was a possibility that the national insurance contribution could be removed, but I believe that is a little outside the scope of the—
Lord Orr-Ewing: My Lords, I believe I used the word "contribution", when I really meant to say "surcharge".
Earl Ferrers: My Lords, I supposed that my noble friend did mean that and, although he used the wrong word, I got the right sentiment—and I can assure my noble friend that I admire his prowess in getting in a plug. I will see that it is taken note of, but I will give no guarantee either way.
4.26 p.m.
Lord Stewart of Fulham: My Lords, I should like to ask the noble Earl the Minister two questions. First, will not some of the cost of the provision of this training fall upon local authorities, and how are the Government going to help them with that? Secondly, would the Minister not agree that there are a number of young people whose wisest choice, if they cannot get a job at 16, is to stay on at school—not necessarily with a view to university studies later, but to improve their general knowledge and standards of literacy and numeracy—and does it not follow from the answer given to the noble Lord, Lord Kilmarnock, that they or their families will be financially disadvantaged as compared with others?
Earl Ferrers: My Lords, I do not think that their families will be disadvantaged. I absolutely agree with

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the noble Lord that where people can stay on at school and so increase their knowledge and their learning, that is the best course to take. Where that is not possible, of course, they will be able to come under this present scheme. If the noble Lord says that that is a disadvantage, I think one has to weigh up the advantages of proper full-time further education against the more limited but nevertheless more substantial advantage of the training.
Lord Oram: My Lords, in his opening Statement the Minister gave estimates of the amount of money necessary to implement the training scheme in the next two or three years. In reaching those amounts I suppose that the Government had earlier made an estimate of the number of young unemployed likely to be unemployed in those years. Could the noble Earl give the House those estimates of young unemployed people in those years?
Earl Ferrers: My Lords, it is a hazardous thing for any Government to try to estimate what the levels of unemployment will or will not be six months ahead, let alone two or three years ahead.
Lord Oram: My Lords, but surely the figures which he gave must have some basis on estimates or calculations?
Earl Ferrers: My Lords, the figures which I gave were based on the figures on unemployment which arc available at the moment and which we wish to see reduced—and this scheme is one of the ways by which we wish to see them reduced.
Lord McCarthy: My Lords, before the noble Earl sits down, may I ask him for an answer to the question asked by my noble friend Lord Stewart of Fulham? His question was really about the cost to local authorities. This will undoubtedly mean an additional significant cost to local authorities. Maybe at this moment the noble Earl cannot tell us what the Government's policy on that will be, but if he cannot then surely he should tell us subsequently?
Earl Ferrers: My Lords, I am sorry that I omitted to answer that particular question. Of course there may be some cost to local authorities, but this will have to be determined, to find out what the cost will be. I will look into the matter and will write to the noble Lord. I do not wish to truncate this debate particularly, because I realise there are many people who are interested, but we have been at it for 38 minutes. I dare say that I have been at it for 28 of these minutes and therefore I may have truncated the contributions of other noble Lords; but if your Lordships think it is appropriate, I think we should pass on to the next business.

Civic Government (Scotland) Bill [H.L.]
4.28 p.m.
The Minister of State, Scottish Office (The Earl of Mansfield): My Lords, I beg to move that the House do now again resolve itself into Committee on this Bill.
Moved, that the House do now again resolve itself into Committee.—(The Earl of Mansfield.)
On Question, Motion agreed to.
House in Committee accordingly.
[The LORD MURTON OF LINDISFARNE in the Chair.]
Schedule 1 [Licensing—Further provisions as to the general system]:
Lord Ross of Marnock Lord Ross of Marnock moved Amendment No. 30:
Page 86, line 25, after (" when ") insert (" reasonably ").
The noble Lord said: It is not going to be easy to get a licence for some of these so far known occupations and pursuits, because we have not yet discussed even a single one of them. It is surprising that the licensing authority, having made out and delivered a licence to every person to whom a licence is granted or whose licence is renewed,
" shall, when requested by any person and on payment of such fee as they may charge under paragraph 16 below, make out a duplicate of any licence … ".
—" any person ".
When we begin to appreciate the kind of people getting licences—there is the itinerant metal dealer, the second-hand dealer—it opens up quite an interesting field. The phrase is "any person" and there is no limitation in the schedule—any person on request can get a duplicate of a licence. And there is no latitude given to the licensing authority; the word is "shall". So I think there should be a certain amount of limitation on it. Surely the person asking for the duplicate licence should give a reason for it. I am not terribly happy about my own amendment, but the point was so obvious, that some limitation should be put in, that I put down this amendment to get the Government's thinking about it. I beg to move.
The Earl of Mansfield: I am not by any means sure that the addition of the word "reasonably" is going to he very helpful to the local authority, as there can clearly be argument as to what is or is not reasonable in any particular set of circumstances. But I have sympathy with the noble Lord's intention, which is to restrict the obligation of the licensing authority so that they do not of necessity have to provide a duplicate licence to anyone who asks for it. I think it is arguable that only the licence holder himself, or his authorised agent, should have any need for a duplicate. Anybody else who has an interest should be satisfied with a certified copy of the register of applications provided for in paragraph 15 of this schedule. So I am inclined to accept the spirit of the amendment by considering an amendment to qualify the duty of the licensing authority to provide a duplicate licence to any person, to make it clear that such a duty applies to the provision of a duplicate only to the licence holder or his representative. So if the noble Lord, Lord Ross, would be good enough to withdraw his amendment for now, I will take stock of the matter.
Lord Ross of Marnock: I think that is very sensible and reasonable. If the noble Earl wants an easy way out of the difficulty, change the "shall" into "may", that in itself would give a certain amount of latitude to the local authority. In view of the

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noble Earl's undertaking, I am very happy to withdraw the amendment.
Amendment by leave withdrawn.
Lord Ross of Marnock Lord Ross of Marnock moved Amendment No. 31:
Page 86, line 40, after (" relates ") insert (" and its duration ").
The noble Lord said: This is a very reasonable amendment which I am perfectly sure is going to meet with the good wishes of the Government. When the licence is granted, the authority "shall specify the activity to which the licence relates and otherwise shall be in such form as the authority may decide". I think it should also specify the duration of the licence. The duration is mentioned later on, but I think on this document, the actual licence itself, the duration should be specified. I beg to move.
The Earl of Mansfield: As the noble Lord knows, licences will be in force for three years. I accept the noble Lord's contention that it will be of benefit if the terminal date of the licence is shown upon it. I am happy to accept the amendment.
On Question, amendment agreed to.
4.35 p.m.
Lord Ross of Marnock Lord Ross of Marnock moved Amendment No. 32:
Page 86, line 42, leave out sub-paragraph (8).
The noble Lord said: I am flushed with success, having had the first amendment accepted in principle and the second amendment actually accepted. I had better watch myself carefully and warn the Minister not to accept the next one. I am seeking to leave out sub-paragraph (8) for this reason. The Secretary of State, after all this, is, by regulations made by statutory instrument, going to prescribe model conditions for licences. Could not this have been left to the local authorities themselves? Does this require to be in legislation? And who asked for this? The other question that arises is, if the Secretary of State is going to produce model conditions—remember it is not mandatory; he may or he may not produce them—what is going to be the force of these regulations? Have local authorities got to look at them and then just tear them up, or is it just going to be a guide which they may or may not accept. Is there any point in this being in legislation? I think it clutters it up. There is nothing to prevent the Scottish Office doing it, if they want to do it, at the request of the local authorities, but where there is no provision in relation to compliance of the local authorities, and they do not have to accept the model conditions for licences which the Secretary of State may prescribe, frankly I do not see very much point in it. I would be happy if the Minister would say that he is prepared to think about it. I beg to move.
The Earl of Mansfield: The Committee will have observed that the noble Lord did not move his paving amendment to this particular amendment, which would have been Amendment No. 27. I say that because one without the other scarcely makes sense. In fact, this provision was introduced partly as a result of the working party and also as a result of comments received following the publication of the consultation
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document. Representations were made, and there were quite a number of them; that is, representations on the provisions of the White Paper, that the licensing system which this Bill seeks to set up could lead to widely varying licensing conditions being imposed throughout the country. And these variations might well be unnecessary because they might relate to circumstances and matters which were uniform throughout the country. So this might lead to a feeling of discrimination between different areas.
It is important that people conducting business in more than one licensing authority area are confident that the same business will not be subject to different conditions, conditions which vary unnecessarily from area to area. This, I am sure noble Lords would agree, would be an unjustifiable restriction on the conduct and indeed growth of businesses. So the provision in sub-paragraph (8) permits but does not compel the Secretary of State to make model conditions, so that licensing authorities will have regard to them when imposing conditions on the grant of licences. It is the intention that these model conditions set out a set of core conditions relating to basic matters which are of such a nature as do not vary according to which part of the country they are in.
Before making any regulations setting out model conditions on any licensing activities it is the intention of the Secretary of State to consult with the Convention of Scottish Local Authorities and appropriate trade interests as to what matters should be covered by the model conditions and in what manner.
In this way, we hope that model conditions can be drawn up which will meet with general acceptance. In this way, there will be a core set of conditions on basic matters on which there is no need for variation according to geography, but local authorities are still free to impose additional conditions that they consider necessary to meet the particular local needs and circumstances. The noble Lord, Lord Ross, is perfectly right. The model conditions will not be mandatory and the licensing authority need only have regard to them when attaching conditions. But we hope from our intended discussions with the convention that there will result model conditions which will be accepted by the licensing authorities to be benefit of not only the authorities themselves but also the licensed businesses. I cannot, of course, say at this stage whether we or the convention will want to specify model conditions for all authorities. We shall probably take things slowly and concentrate at first on a few priority areas, such as boat-hire, where we and the convention are agreed that there is an urgent need.
Therefore, I would remind the noble Lord, Lord Ross, that the working party itself in paragraph 12 recommended that there should be power to lay down a guide or code of practice. That is what we are doing. The aim is to help licensing authorities to impose reasonable uniformity and public awareness of what we are doing but, as I have said, the model will not be binding. In those circumstances, it is, I am afraid, third time unlucky for the noble Lord, Lord Ross, and I feel bound to resist this particular amendment.
Lord Ross of Marnock: How disappointing! The Minister of State rather defeats himself in his argument. He starts off by saying that it is desirable in respect of

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this that we should have the same kind of conditions throughout the country. First of all, he leaves it entirely to the local authorities as to whether they will pass a resolution to have licensing for many of the subjects which we have not yet discussed. Indeed, one was mentioned by the Minister of State, namely, boat licences. So we start on the basis that, if it is to be left to the local authorities as to which of the activities are to be licensed at all, there is no guarantee that there will be any uniformity throughout the country or any sense of fairness. There may be some very frustrated people who cannot get licences, or who do not have the authority of a licence to carry on some kind of activity but who can see other people coming into their activity, probably to their detriment, who are not subject to any conditions of any kind.
Then we come to—what did he call it?—the core set. Very few are mandatory in the Bill as it stands at present. I should have thought that it would be desirable, since it was felt necessary by the Government that these things should be licensed—irrespective of what the local authority felt—and that there should be a national system for them, that the Minister should have gone the whole hog and taken the power to say that local authorities would comply; that he would issue for the local authorities the conditions that are laid down.
This is a very long and complicated schedule. We are talking here of a generalised non-mandatory power that has been taken by the Secretary of State. Quite frankly, it does not mean much, if anything at all. It will only be a guide and the local authorities can, according to the statute, just set it aside and say, "We are going to please ourselves; our circumstances are different", and they will prescribe different conditions for different kinds of licences and, we might as well add, for different areas as well, because that will no doubt be in the guide when it comes.
I felt that the generosity of the Minister had gone far enough and that I would get a pretty bleak answer to this amendment. I am prepared to accept it and beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
4.44 p.m.
Lord Ross of Marnock Lord Ross of Marnock moved Amendment No. 33:
Page 87, line 4, leave out (" may be required to ") and insert (" shall ").
The noble Lord said: I beg to move Amendment No. 33. Paragraph 6(2) reads:
" Reasons for decisions referred to in sub-paragraph (1) above ",
and it then says:
" may be required to be given ",
which I suggest should read: "shall be given". There is a very simple reason for that. If your Lordships cast your eyes at the beginning of the previous sub-paragraph of paragraph 6, it says:
" A licensing authority shall, when required to do so under sub-paragraph (2) below, give reasons in writing ".
Then, at sub-paragraph (2), it says:
" Reasons for decisions referred to in sub-paragraph (1) above may be required ".
If we begin with "shall" we must carry on with "shall". If your Lordship's want further proof,
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let us look at page 90 where it says at paragraph 11(5):
" A licensing authority shall, when required to do so under sub-paragraph (6) below, give reasons in writing for arriving at any decision ".
There have been a great many comings and goings concerning "may" and "shall" and al I sorts of phrases that just do not add up. I do not know what has been happening at the Scottish Office over this Bill. I think that they could have taken another month over it and made it a far, far better Bill. It may not have been their responsibility. I think that it is unfair to blame the draftsman all the time, but somebody should have read the Bill before it came to this House. Anyway, I beg to move.
The Earl of Mansfield: Except for the last few sentences of his remarks I agree with the noble Lord, Lord Ross, and I am happy to accept the amendment.
On Question, amendment agreed to.
Lord Ross of Marnock Lord Ross of Marnock moved Amendment No. 34:
Page 87, line 8, at end insert—
(") Where under sub-paragraph (2) above a licensing authority give reasons they shall supply copies of those reasons to all other parties who would have been entitled under this paragraph to require reasons.").
The noble Lord said: I beg to move Amendment No. 34. I am suggesting in this amendment that where the:
" licensing authority give reasons they shall supply copies of those reasons to all other parties who would have been entitled under this paragraph to require reasons ".
So people who have objections or who are interested from the point of view of even taking their objections to appeal, should be given copies of the other reasons for the decision. I think that this was in the draft Bill. If we are to make the appeal procedure sensible then we must give the people who have an interest in it the fullest information in respect of what has happened to their objections, because there is another possibility later on. I beg to move.
The Earl of Mansfield: This amendment would create a great deal of extra and, I consider, unnecessary additional work for the licensing authority. The paragraph requires the authority, when requested within 48 hours of their decision by any competent party to the licence application, either as applicant or objector, to provide written reasons for their decision to the party so requesting it. I regard it as being unreasonable to require the authority to copy their written reasons to all other parties, even if they have not asked for them.
It has to be remembered that the public in general can object to a licence application within any prescribed classes, so the authority could find themselves having to copy their reasons to a large number of persons, a good proportion of whom may not really be concerned to receive them. I believe that the provisions available to all parties to request copies of reasons are sufficient to ensure that their interests are safe-guarded. So this proposal would, as I have said, create further unnecessary work for the licensing authorities. It would, therefore, create extra expense for the applicants and be of no very definable advantage to anybody.
Lord Ross of Marnock: The fact that people have a right of appeal against the decision of the licensing authority—even objectors—means that it is desirable that they should have an opportunity to see the decision and the reasons given by the authority. Bearing in mind that this 48 hours business—which I think is far, far too short—is in itself a restriction, if the licensing authority is to give reasons to one, it should give reasons to the others as well. The noble Earl said that it might well be the public at large; the public at large have to put forward their objections in writing and even be heard, or anyway be given a chance to be heard, by the licensing authority. I do not think that it is a question of 500 or 600 people turning up to do so; they would do it through a spokesman or agent. If that agent is not present at the time of the decision—in fact, the decision might be taken at an adjourned meeting, not necessarily on the same day, and then he has to learn that there are only 48 hours in which to object—he might be very happy at the fact that someone had requested reasons and that he would get the benefit as well. If you are going to give reasons to one, you should give reasons to the others.
Later on in the Bill, the sheriff (even without the 48 hours' limitation) in addition can ask for reasons when the matter goes to appeal. I think that the Minister has given a very disappointing answer. He spoke about being concerned about the licensing authority, which in most cases will be the district authority and in some cases the islands authority. All this complexity has been wished upon them by this legislation. It is a very, very complicated schedule. I think that far too much is being made of this particular complication. It follows from what the Government are doing and from what they say later on about the right of appeal that you can only appeal if you know the reasons for turning down your objections. I think that I shall return to this at another stage. Meantime, I am quite happy to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord Ross of Marnock Lord Ross of Marnock moved Amendment No. 35:
Page 87, line 30, leave out (" 6 weeks ") and insert (" 3 months ").
The noble Lord said: This amendment is to leave out "6 weeks" and insert "3 months". This is the question of a temporary licence which the licensing authority may grant. I think that six weeks is far, far too short for a temporary licence, bearing in mind the time taken to make your decision, to post it and send it off and then to make due allowances for Christmas or the New Year. But they are not mentioned in the Bill; they were mentioned in the previous Bill together with statutory holidays and the rest of it. I do not think that six weeks is long enough for a temporary licence.
From the point of view of the convenience of the authority itself, it would mean that it would need to convene another meeting to consider the lapsed temporary licence. So I suggest that we substitute "not exceeding 3 months". It does not mean to say that it will be three months, but "not exceeding 3 months" would be very much more sensible. I beg to move.
The Earl of Mansfield: I am not sure why the noble Lord thinks that six weeks is far, far too short. He
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spoke about Christmas and other festivities. In effect, paragraph 8 says that:
"(1) A licensing authority may grant a licence to have effect for such period not exceeding 6 weeks from its being granted ".
So the actual procedures of getting the licence have nothing to do with this. This is concerned with the duration for which a temporary licence will run. The purpose of it is to take care of occasions when an applicant will want a licence for only a short duration. An example might be a licence to run during such a period as the Edinburgh Festival, or some very temporary festival of that nature. To require the normal procedures, involving sending notification to neighbours and inviting and considering objections, was thought to be far too ponderous and, indeed, unnecessary for a short-term activity.
I suggest to the noble Lord, Lord Ross, that if one is to short-circuit the more normal procedures, one does not want—particularly bearing in mind possible nuisances—to have a period which will last too long. Therefore, it was felt that the decision whether or not to grant a licence in such cases was essentially a matter for the licensing authority, subject to the views of the police. It is worth pointing out that there are no provisions for public objection to an application or for appeal against a refusal to grant a licence. In those circumstances, it was thought appropriate to limit the duration of a temporary licence fairly drastically, and the six-week period seemed about right.
There is nothing magical about six weeks, but if a nuisance or disturbance is created, I would ask the noble Lord to consider that neighbours might tolerate a disturbance for six weeks, but three months might well be intolerable. So unless the noble Lord can adduce some reasons as to why three months is preferable to six weeks, I think that we have it about right.
Lord Ross of Marnock: I think that the Government are only guessing here. All they have suggested is something about the Edinburgh Festival. For that matter, six weeks might be too long for that. But there may be instances where something may happen or develop over the whole summer period, perhaps for two months. The whole point about "not exceeding 3 months"—which is how the amendment would have the line read—means that it is left to the licensing authority, which can say a month, a fortnight or a week-end. It is not tied to three months. It may well be that the six weeks will be too restrictive. From that particular point of view, I should prefer that it was a longer period. I think that six weeks is too restrictive; I accept the purposes that the Government suggest—that it might be desirable to have this licence for a shorter period and therefore lose all the rights of objections, appeal and everything else, but I am quite satisfied that six weeks is far too short. It may well be that three months is too long. I can return to that at the next stage.
Meantime, during now and the next stage, the Government can search the calendar for all the notable events that will take place in Perthshire. There may be a chip van convention around Scone that will last seven weeks! It may well be that we shall get to hear of something that is to be held in a place nearer the heart of the noble Lord, Lord Lyell, who sits on the Front Bench beside the Minister of State at the present time.

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It may well be that we shall have an international football festival—the Word Cup—played in Scotland. It is usually played in the country of the winner, and we are going to win it in June. With its preliminaries, that might last longer than six weeks. We want to be absolutely sure of these things at present.
On the understanding that I shall return to this with another figure and that I am perfectly sure the Government, and certainly the noble Lord, Lord Lyell, will think about this for the next few months. I shall be very happy to withdraw this particular amendment that does not commend itself to the Government.
Amendment, by leave, withdrawn.
5 p.m.
Lord Ross of Marnock Lord Ross of Marnock moved Amendment No. 36:
Page 87, line 39, after first (" and ") insert (" where appropriate ").
The noble Lord said: The Government here lay down that they are going to consult the Chief Constable and the fire authority. There may be no need to consult the fire authority, so why should we put it in and make it mandatory that they consult the fire authority? Here I have words that I think should meet with the Government's idea of what is fitting. They are just, "where appropriate", the fire authority. I beg to move.
The Earl of Mansfield: The noble Lord will recollect that when we discussed Amendment No. 14 last week I undertook to look at all these clauses and paragraphs where the fire authority is mentioned. What I undertook to do was to re-examine the possibility of limiting the duties of the licensing authority to circumstances which might in fact be more appropriate than in all circumstances. Since the noble Lord was kind enough to refer to my family home, I can think of an example where perhaps it would not be appropriate to refer to the fire authority, because we are to have a Bible-reading convention for a week.
Lord Ross of Mansfield: Surely hell fire comes into that.
The Earl of Mansfield: I am not sure whether the noble Lord has been asked to open it, but I wait with interest. In the circumstances, that would surely be inappropriate for the fire authority. Having regard to the terms of my undertaking, perhaps the noble Lord would withdraw his amendment for now.
Lord Ross of Marnock: The Minister said that he was going to think about this, and he has had a whole weekend to think about it and I had hoped that he could have made up his mind and come here in triumph. The triumph would have been mine, but the glory his, if he had said that he accepted the amendment, but he has not done so. I do not know what he has been doing over the weekend. It may be that he has been polishing up his Bible reading. On the basis of what the noble Earl has said, I am quite happy to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord Ross of Marnock Lord Ross of Marnock moved Amendment No. 37:
Page 88, line 6, after (" 17 ") insert (" below ").
The noble Lord said: This is a simple drafting amendment to put in, for the purposes of clarity, "below" after "17". I beg to move.
The Earl of Mansfield: This, as the noble Lord said, is a drafting amendment. As the noble Lord equally well knows, draftsmen go about their strange and esoteric task in a way which I think only they understand. When I first saw this, which was before the weekend, I thought that the noble Lord's amendment probably would do no harm and it might make the schedule easier for laymen and newcomers to read. However, I believe that the draftsmen think differently.
The advice I have had is that the governing provision of sub-paragraph (5) is paragraph (8)(2), which states clearly:
"This Schedule shall apply with the modifications specified in sub-paragraphs (3) to (5) below",
and I must emphasise the word "below". The proposed amendment would, if accepted, form part of sub-paragraph (5) which, in turn, refers to paragraphs 9, 10, 11 and 17, but the effect sought by the amendment has already been achieved by the use of the word "below" in paragraph 8(2).
I understand that there is a well-established drafting convention that the insertion now, for the second time, of the word "below" in the same paragraph would be otiose, as indeed it would if the amendment were to be applied—although the noble Lord does not seem to want to do this—to the reference in paragraph 6 to sub-paragraph (3) of paragraph 8.
Where the drafting convention does allow the use of the word "below", the draftsman has of course used it. For example, in paragraph 9(3)(a), in line 24 on page 88, or in sub-paragraph (6) of paragraph 9, in line 39 of page 88. The answer to the noble Lord, in short, is that the draftsmen do not consider that this would be a desirable amendment, and I must therefore resist it.
Lord Ross of Marnock: I hope that the Minister will ask the draftsman to tell him why the word "below" is not used twice but three times in paragraph 9. At least three times. Indeed, having mentioned "paragraph 17 below" and the arguments put by the draftsman to the Minister of State, which he accepted, that it would be otiose to use it again, I draw attention to the fact that paragraph 9(3)(a) mentions "paragraph 17 below", and he has to repeat in 9(5)(a), "17 below".
However, I am always interested in hearing what a draftsman has to say to justify an additional word in some places and leaving it out in others. I think that, from the point of view of consistency, it would have been far better to be there, especially in a schedule which runs to pages and pages, and paragraphs and paragraphs. Let us know that the paragraph we are looking for is below and not above. I am going to have an interesting time looking at the use of the words "above" and "below" during the next few weeks. However, I am not fussed about it, and I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord Ross of Marnock Lord Ross of Marnock had given notice of his intention to move Amendment No. 38:
Page 89, line 36, after (" and ") insert (" where appropriate ").
The noble Lord said: This amendment comes back again to "where appropriate". In view of what the Minister has earlier said, that he is looking at this to find a suitable form of words in suitable places, I do not propose to move this amendment.
[Amendment No. 38 not moved.]
Lord Ross of Marnock Lord Ross of Marnock moved Amendment No. 39:
Page 89, line 40, leave out (" on that day ") and insert (" when the variation of the licence is to be considered ").
The noble Lord said: I suggest that we leave out "on that day". The wording says:
" an opportunity to be heard by the authority on that day ".
We should instead put in
" when the variation of the licence is to be considered ".
In the interests of consistency, if the Minister of State would cast his eye down to the last line of this page he will see the words that I have suggested. If it is good enough on the second occasion,
" to attend and to be heard by the authority when the variation of the licence is to be considered ",
it would be far better than "on that day" in line 40. In all these things I am being very helpful to the Government, and I hope to the draftsman. I beg to move.
The Earl of Mansfield: I do not think that the noble Lord is being so helpful in this particular amendment as he would have the Committee believe. Sub-paragraph (2)(a) identifies " the day " as the day when the authority propose to consider the variation. Then we go on to sub-paragraph (2)(b). I really would have thought it obvious that " on that day " in line 40 means the day mentioned in line 34 in the same subparagraph. But when we get to sub-paragraph (3), of course that does not relate to the same thing as is set out in sub-paragraph (2)(a), so of course the draftsman has to put it in again. What the noble Lord by his amendment is putting in is real surplusage, and I do not think it makes the language any clearer.
Lord Ross of Marnock: The Minister is talking a lot of nonsense. If it is good enough the second time it is good enough the first, and he should go back and tell his draftsmen to make up their minds. After all, it might not be " on that day ", as in the phrase that is used. It might be considered over two days, so it might be the second day. Somebody might be summoned and not have the opportunity " on that day " to be heard. It would be far better from the point of view of the authority if we said,
when the variation of the licence is to be considered ".
That would be more sensible than " on that day Clearly, however, the Government prefer to leave the provision in the sort of muddle it is in, and who am I to persuade them otherwise? They have already shown themselves fairly well muddled over the Bill, and I leave them in that muddle, begging leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord Ross of Marnock Lord Ross of Marnock had given notice of his intention to move the Amendment No. 40:
Page 90, line 14, at end insert—
(" () Where under paragraph 6 above a licensing authority give reasons they shall supply copies of those reasons to any other party who would have been entitled under this paragraph to require reasons.")
The noble Lord said: This is the repeat of an amendment I moved earlier, to which I received an unsatisfactory answer from the Government. I do not propose to give the Minister of State an opportunity to repeat something unsatisfactory, and therefore I do not propose to move the amendment.
[Amendment No. 40 not moved.]
5.12 p.m.
Lord Ross of Marnock Lord Ross of Marnock moved Amendment No. 41:
Page 90, line 24, at end insert—
(" .—(1) A licensing authority may, on an application made to them in that behalf by a proposed transferee of a subsisting licence and in accordance with this paragraph transfer the licence—

(a) to a person proposing to take over the activity to which the licence relates;

(b) where the holder of the licence has died before its expiry, to his executor, representative or disponee;

(c) where, before the expiry of a licence, its holder—

(i) has become bankrupt or has had his estate sequestrated;

(ii) has granted a trust deed for behoof of his creditors;

(iii) has become insolvent;

(iv) has become incapable of managing his affairs;

to his trustee, judicial factor or curator bonis;

(d) where the licence was held by a company incorporated under the Companies Acts 1948 to 1980, to its liquidator, provisional liquidator, receiver or manager, if he has been appointed before the expiry of the licence.

(2) A licensing authority may, on an application made to them in that behalf by a person other than an individual natural person, substitute another employee or agent of the applicant for the employee or agent mentioned in paragraph 5(6) of this Schedule, and in this and the next following paragraph of this Schedule references to the transfer of a licence shall, unless the context otherwise requires, include references to a substitution under this sub-paragraph.
(3) A licensing authority shall refuse an application to transfer a licence if—

(a) the person to whom it is proposed that the licence be transferred is not in their opinion a fit and proper person to be the holder of the licence;

(b) where the licence relates to an activity consisting of or including the use of premises, the person to whom it is proposed that the licence be transferred in their opinion neither is in possession of the premises nor has a right to possession conditional only upon the transfer to him of the licence; or

(c) where the transfer applied for is under sub-paragraph (1)(a) above, in their opinion the holder of the licence is capable of giving his consent to the transfer but has not done so.

(4) A licence transferred—

(a) by virtue of sub-paragraph (1)(a) or (2) above shall have effect until it would have expired had it not been transferred;

(b) otherwise than by virtue of sub-paragraph (1)(a) or (2) above shall have effect until the next quarterly meeting of the licensing authority and—

(i) if no application has been made for its renewal, it shall then expire;

(ii) if an application has been made for its renewal it shall continue to have effect in accordance with paragraph 9 above.

(5) A licence transferred under this paragraph shall be held subject to the conditions under which it was held immediately prior to the transfer.
.—(1) Paragraph 1 of this Schedule shall apply for the purposes of an application for the transfer of a licence as it applies for the purposes of an application for the grant or renewal of a licence.
(2) A licensing authority shall, as soon as an application is

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made to them for the transfer of a licence, send a copy of the application to the chief constable.
(3) It shall be competent for the chief constable to object to or to make representations about an application to transfer a licence and where he desires to make objections to or representations about such an application he shall intimate them to the applicant before the meeting of the licensing authority at which a final decision is to be taken upon the application.
(4) In considering an application for the transfer of a licence a licensing authority—

(a) shall consider any objections or representations lodged by the chief constable at any time before the meeting of the authority at which a final decision is to be taken upon the application; and

(b) may make such reasonable enquiries as they think fit.

(5) A licensing authority shall, before reaching a final decision on an application to transfer a licence, give the applicant and, where he has lodged objections or representations, the chief constable an opportunity to be heard by the authority.
(6) A licensing authority shall have complied with subparagraph (5) above if they have invited the applicant and, where the chief constable has made objections or representations under sub-paragraph (3) above, the chief constable to attend and to be heard at the meeting of the authority at which the application is to be considered.
(7) A licensing authority shall, when required to do so under sub-paragraph (8) below, give reasons in writing for arriving at any decision of theirs to transfer or refuse to transfer a licence.
(8) Reasons for decisions referred to in sub-paragraph (7) above may be required to be given by the licensing authority on a request being made to the authority by the applicant or the chief constable not more than 48 hours after the decision was made.
(9) Where, under sub-paragraph (7) above, a licensing authority give reasons they shall supply copies of those reasons to any other party who would have been entitled under this paragraph to require reasons.
(10) The period of 48 hours referred to in sub-paragraph (8) above shall not include a day which is a Sunday, Christmas Day, New Year's Day, Good Friday, a bank holiday, a public holiday, or a day appointed for public thanksgiving or mourning.
(11) Nothing in this paragraph affects the power of the sheriff under paragraph 17 below to require a licensing authority to give reasons for a decision of the authority—

(a) which is being appealed to the sheriff under that paragraph; and

(b) for which reasons have not been given under this paragraph.").

The noble Lord said: We come to something much more important and fundamental; namely, the addition to Schedule 1 of a very lengthy series of paragraphs which deal with the question of the transfer of licences. We are here dealing with people holding licences for public entertainments, licences concerning second-hand activities—we will come to that eventually and see how comprehensive that is—with taxi and hire car licences, and it is clear that all sorts of things may happen. I list in this amendment occasions when
"a licensing authority may … have … an application made to them in … behalf … of a subsisting licence,"
from a number of people and in a number of circumstances; for example, from a person proposing to take over an existing licence where the holder has died, or in circumstances where, before the expiry of the licence, its holder has become bankrupt. There we could have somebody looking after the interests of someone who has died, and it refers to a pecuniary or shareholding interest, or it could be in respect of people to whom he owes money, or to whom he
" has granted a trust deed for behoof of his creditors … has become insolvent; "
so that, in that case, you might have a
" trustee, judicial factor or curator bonis ".
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It goes on to refer to,
"where the licence was held by a company … and … a receiver or manager, if he has been appointed before the expiry of the licence ".
The Bill at present does not say much about those matters. However, lest anyone thinks I have been working over-hard on this, let me disabuse them. These new paragraphs all appear in the proposals for a code of civic government in Scotland, which produced a draft Bill. They were all there; the Government put them out to people to consider in July 1980. All I had to do was copy them out and I am now asking the Government why they have not met what is an obvious need for a procedure for the transfer of licences. The matter was raised in the report of the working party, on page 12 of which they talk about the need for a procedure for transferring licences:
" Consideration has also been given to the situation where a licence holder dies, retires or is made bankrupt and one possibility is that provision should be made for the licence to continue in favour of any person that the authority think fit until the holding of the next licensing committee meeting. However, in the case of the licence holder's death, provision may be made for the licence automatically to transfer to his executor ".
There can be very difficult cases, and there is an even more complicated case when it comes to the question of the taxi-driver, because what he owns as part of his estate is his taxi; the taxi is licensed, and probably my noble friend Lord Underhill will expand on that aspect on later amendments which deal with that point.
Because the Government appear to have missed these matters, I suggest it is necessary to insert them in the Bill so as to deal in reasonable detail with the whole question of licences being transferred. The first part of the amendment deals completely with the power of the licensing authority, and then we come to the other items which supplement that. I commend the amendment to the Committee. The Government will be familiar with the provisions proposed, since they themselves put them into the White Paper just over a year ago. I beg to move.
The Earl of Selkirk: I am not certain of the effect of these provisions. We are of course referring to Clause 15 in the consultation document. That, so far as I can see, has been omitted from the Bill. What is the difference between getting a new licence and transferring one unless there is a pecuinary advantage in selling the licence? Is it the intention that licences should in some sense be marketable? I have not understood that from the tenor of the Bill, but that may be the case. It is clear that there is a question of giving consent by the original holder. If consent is given, and if consent is required, presumably that provides some advantage; and if there is an advantage then it is probable that somebody will pay for it. I did not know that these licences were intended to be on the market. Perhaps they are. I would be obliged if the Minister would tell me.
Lord Underhill: I support my noble friend Lord Ross, particularly as he said the amendment covered taxis.
The Earl of Mansfield: I hesitate to interrupt the noble Lord, and I do so simply to mention that there

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are later amendments, to which he has put his name, specifically dealing with taxi-cabs, and I suggest we wait until we reach those before discussing the subject.
Lord Underhill: That is precisely what I was about to say; I was about to assure the noble Earl that it was not my intention now to deal with taxis. However, I thought that as he might say I was being quiet on this amendment, I should rise to explain that it was not my intention to rehearse my arguments on taxis now. If this amendment were carried, it would of course include taxis and all the activities for which licences are given. I hope it will be carried. Not only, as my noble friend said, was it in the consultation document, but it is, after all, permissive. A licensing authority could decide whether or not to do it, and I should have thought it represented a principle with which the Committee could agree.
The Earl of Mansfield: The noble Lord, Lord Ross, was of course right to say that these provisions relating to the transfer of licences were included in the consultation document and were based on similar arrangements in the Licensing (Scotland) Act 1976. The reason why the clauses were dropped and do not appear in the Bill was because of the views of the local authorities. Those were that the transfer system as proposed was unnecessarily complex and they (the local authorities) doubted the need for such arrangements if the licensing system as a whole was made more flexible, so that it could be possible under the general system to apply speedily for a new licence without having to wait for the fixed, statutory meetings. That is one of the reasons why I resisted the amendments of the noble Lord, Lord Ross, which tried to make the machinery of application for licences cumbersome and attached to quarterly meetings.
The next point is that although the clauses were discretionary on the authorities in that they did not oblige them to transfer the licence, they did not provide any guarantees for the applicants that a transfer would be permissible. The clauses seemed not to give the licence-holder any guarantee of being able to transfer the licences, nor were they regarded as helpful by the licensing authorities, and so we decided to drop them. Under the procedures laid down in the present Bill the licensing authority would be free to consider a new application for a licence at any time, instead of waiting for the fixed meetings formerly proposed, and it seems to us that there is therefore sufficient adaptability in the new arrangements to cover ordinary cases of transfer.
The point on which my noble friend Lord Selkirk so unerringly put his finger relates to the marketability of licences, and we shall probably all have much more to say about that when we debate taxis. But at this stage I should like to add that the point of a licensing system and the power of a licensing authority to refuse licences solely on the grounds of supply and demand is not within the contemplation of the Government. A licensing authority might have many reasons and good reasons for refusing a licence, but that should not be one of them.
Of course there are cases of difficulty regarding the transfer of a licence. Such a case might occur upon the sudden death of a licence-holder. But under the
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provisions of the Bill there is an abbreviated procedure for the granting of a temporary licence—that is in paragraph 8 of the schedule, which we debated not long ago—and that procedure could be put in train immediately, so that the executor, the widow, or whoever was involved could have a breathing space in which to consider a revised licence application, as well as, where necessary, someone suitable and qualified to take over a business.
Since under Clause 3—and I commend the clause to the Committee—a licensing authority is empowered to delegate its powers to committees, and even to officials, it should be possible to make very flexible arrangements to cover cases of real hardship, and I understand that this already happens under the existing licensing system.
So with regard to the amendment, not only the Government, but also the local authorities, consider that the noble Lord's proposals are unsatisfactory and cumbersome, and we therefore greatly prefer the much quicker, more streamlined, and less cumbersome framework within which licensing will be carried out under the Bill, and for that reason I am not prepared to accept the amendment. If any Member of your Lordships' Committee were to conclude that, notwithstanding the arrangements for the granting of a temporary licence (to which I have already referred) as well as the arrangements that can be made by a licensing authority under Clause 3, we should provide a speedy procedure for cases involving sudden death, for instance, then I should of course undertake to look at that. But, so far as the generality of the amendment is concerned, I am quite sure that what the Government have set out is the proper path.
5.25 p.m.
Lord Ross of Marnock: I realise that the Government's decision has been reached after they had full consultation on the basis of the suggested provisions that I have copied in my amendment, but with all due respect, I do not think that either the suggestion in the draft Bill, or the suggestion that the Government now make, is necessarily adequate, and I think that the Minister himself appreciates that. Let us appreciate that we have not yet discussed a single licence; we have not discussed a single activity involving a licence. Mention has been made of taxis. The Minister himself mentioned a point about boats, though of course in that case the licence would refer to the actual boat, and I do not suppose that that situation would be affected by anybody's death. But there are other aspects of licensing which so obviously apply to a business.
At some point we need to provide for the automatic transfer of a licence in respect of a business to a named person or agent, because a business has to continue. A person connected with a business might die, but next day the business still has to open, or at least it should be able to open. I do not think that the Government, with this great, new, elaborate structure for licensing and all the rest of it, meet the case by saying, " Oh, yes, a temporary licence ". To obtain even a temporary licence requires a meeting of a sub-committee and getting hold of an individual. The Minister need not shake his head, because the situation is quite satisfactory at the moment, without all the elaborate

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system that is proposed. It is done now, but he is putting something new in its place.
If he is putting in its place something new, with all these elaborate instructions, conditions and everything else, we should put in the Bill a provision to cover this particular point. The working party felt that; and that was a working party of local authority people and the Minister's officials, set up, I think, by the noble Lord, Lord Campbell of Croy. That working party continued working all the time that I was Secretary of State. It worked for years—nearly 10 years—and it came to the conclusion that something should be done to cover circumstances where somebody died and where it was desirable to have an automatic transfer.
It is not good enough merely to wipe out the view of the working party and the proposals that were reached by the interdepartmental committee, which were enshrined in the draft Bill that was produced last year, and which I have copied into the amendment. I am prepared to accept that that procedure is too cumbersome. I am even prepared to accept that it does not meet the point that I am now making, but there is nothing in the Bill that meets that particular point, and I believe that there will be difficulties about transfer if we rely purely and simply on going back to the beginning and applying for a new licence. It will he very difficult indeed—
The Earl of Mansfield: Will the noble Lord answer a question?
Lord Ross of Marnock: No, I am not answering questions; I am asking them at the moment. If the Minister is to rely purely and simply on a sub-committee, or on the fact that there are powers to delegate even to an official, I think we should make it much clearer that there should be automatic transfer in particular circumstances. That is all I am asking for, and I am prepared to accept that the amendment does not meet the particular case. I believe that the Minister will cause confusion, whether it be for a liquidator, a curator bonis, a judicial factor, or anyone else, if they suddenly discover that in order to carry out their job they have to apply for a licence. I hope that the Minister appreciates the complexity of what we arc dealing with, as well as the difficulties that will arise for many people; and at the moment we do not know who those people will be, because, as I have said, we have not yet discussed a single activity that has to be licensed.
I also hope that he will have another look at the possibility of doing what the working party suggested, which was that there should be some provision for the automatic transfer of licence, it may well be to an agent, an executor, a next-of-kin or someone of that nature.
The Earl of Mansfield: I do not know whether the noble Lord is going to withdraw his amendment, but I assume he has read it through. Where is the automatic transfer? What the noble Lord accuses the Government of doing is of replacing something easy with a cumbersome framework. What I am trying to say to the noble Lord is that it is the noble Lord's cumbersome framework which he provides in his amendment which the local authorities did not want put into the Bill. At the very start of his amend-
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ment it says:
"A licensing authority may, on an application made to them …".
In other words, before the transfer takes place there must be an application to the licensing authority, which is precisely what the noble Lord is now complaining about.
What I have tried to tell the noble Lord is that if he would only accept the Bill as it stands then, first of all, the representative or the widow can go to the licensing authority and obtain a temporary licence (that is the first thing) or, secondly, under Clause 3 of this Bill, in such speedy applications the licensing authority can delegate to an official the job of issuing the temporary licence. In other words, the licensing authority, if it thinks fit, can provide a very speedy system of a temporary licence, even without the committee having to meet. That is far better than the cumbersome and extremely slow alternative which the noble Lord proposes in his amendment. It is not the Government who are imposing on the licensing authorities a cumbersome framework, a cumbersome procedure, which they do not want; it is the noble Lord who seeks to do it in this amendment.
Lord Ross of Marnock: Without this amendment we would not even have discussed the whole question of the difficulty that arises when a licence-holder dies, goes bankrupt or anything else; and your Lordships would not have been aware that there was such a problem. An amendment had to be proposed. What better amendment should be proposed than the words which were in the Government's own draft proposals? They dropped the proposals, and I have given them an opportunity to justify that and to state the reasons for dropping them. I accept their reasons for dropping them, but I draw their attention to the fact that that still leaves a gap, and that gap is something that was referred to in the report of the Government's own working party, set up in 1972, which worked over all these years and came to the conclusion, set out on page 12 of their report, that there should be provision for automatic transfers.
I understand the Government appreciate that now; and they take refuge in Clause 3, which says that a local authority " may ". " May " means they may not; and the person whose livelihood may be at stake is left in the situation that they do not know whether or not it is covered. Whether or not the noble Earl likes it, penalties have been laid down in respect of anyone who engages in these activities without a licence. Suppose they are without a licence for one, two or three days. They are liable to penalties. I will not read them out but I think the penalty is usually somewhere about £200 and whatever else may be applicable.
The purpose of my putting this amendment down was to fill the gap that the Government created by leaving these paragraphs out of the Bill, having put them into the draft Bill, and I trust that between now and the next stage the suggestion that the gap of automatic transfer should be satisfactorily filled will be accepted. On that understanding—and the Minister of State, in his first remarks in reply to an amendment, drew attention to this—I am quite happy to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord Ross of Marnock Lord Ross of Marnock had given notice of his intention to move Amendment No. 42:
Page 91, line 18, at beginning insert (" where appropriate ").
The noble Lord said: Once again, this is the kind of amendment that we have discussed before, where the Government have already committed themselves to examining it to see whether or not these words are appropriate and, if not, to finding other words in particular cases. I do not intend to move the amendment.
Lord Ross of Marnock Lord Ross of Marnock moved Amendment No. 43:
Page 93, line 35, after second (" licence ") insert (" or to transfer a licence ").
The noble Lord said: 1 do not know whether we dare mention the question of the transfer of licences after this, but I am dying to hear what the Minister of State says in this respect. I hope he is not going to tell us that no licence can be transferred, with the result that the amendment is quite unnecessary and in fact does not make sense. However, I beg to move.
The Earl of Mansfield: I think we had the argument on the transfer of licences in general on Amendment No. 41, and I do not think that I can say very much more except to repeat that there is nothing in the noble Lord's amendments—that is to say, Amendment No. 41 and this one which follows it—which is in any way speedier or cheaper than what is proposed in the Bill. I have in fact undertaken, in the case of death in office or death in harness, so to speak, to see whether in fact what we have proposed fully meets all contingencies. But apart from that, I do not think I can help the Committee any further on this amendment.
Lord Ross of Marnock: This amendment merely says " or to transfer a licence ". As I understand the logic of what the Minister said on the last amendment, no licences will be transferred and therefore this amendment does not make sense. That is what he really means. That being so, I propose to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord Ross of Marnock Lord Ross of Marnock moved Amendment No. 44:
Page 94, line 4, after (" places ") insert (" and on payment of such a fee ").
The noble Lord said: Here we come to paragraph 15(3), which provides:
" The register shall be open to the inspection of any member of the public at such reasonable times and places as may be determined … ".
I think there is a certain amount of work involved for the staff, and I suggest that there could possibly be a fee in respect of this, bearing in mind that
" any member of the public may make a copy thereof or an extract therefrom ".
My amendment does not say what the fee will be but merely provides
" on payment of such a fee as may be determined by the licensing authority … ".
I beg to move.
The Earl of Mansfield: This was a recommendation, or at any rate a provision, which was in the Consultative White Paper draft of the Bill. We considered the point carefully, and concluded that since licence applica-
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tions relate to activities which may affect the amenity, welfare and livelihood of other members of the community, access to inspect the register of applications—and I underline, as it were, the word " inspect "—should be free and unrestricted. But, of course, as the Committee will see from the next subsection, licensing authorities will still be able to charge for the provision of a certified copy of any item in the register. I therefore hope that, on reflection, the noble Lord might agree that this minor change is in fact a move in the right direction, and will withdraw his amendment.
Lord Ross of Marnock: I keep thinking of the people who Want to see these registers and to check on whether somebody has a licence—somebody who is a window cleaner, or whatever; it could be anything. We have not yet discussed who will have a licence. I should have thought that the Government would look on this with favour. It does not mean to say that the local authority will charge a fee but it leaves it open to them to do so. At one minute the Government is anxious that local authorities cover all their expenses in this field—and there will be some expense in someone getting a register, watching over what happens and seeing that the register is properly returned and not defaced. I should have thought that this was a sensible amendment without tying down the local authority to charge people.
I think the main thing is to make the register available and, having done that, then to deal with a fee. Under other legislation a fee can be charged for the same kind of privilege. It may be a nominal fee but the charge is there. I am not going to recite the other pieces of legislation that I have come across over the long time that I have been dealing with Scottish legislation, but I know that the Government have been over-generous in accepting amendments at the start and I do not want to press them too hard. I am quite prepared to accept the position that the Government think they are being generous here, to leave them with that reputation and withdraw the amendment.
Amendment, by leave, withdrawn.
Lord Ross of Marnock Lord Ross of Marnock moved Amendment No. 45:
Page 94, line 32, leave out (" reasonably ").
The noble Lord said: Here we come to expenses. Paragraph 16(2) of Schedule 1 says:
" in determining the … different fees [under the previous paragraph] the licensing authority shall ensure that from time to time the total amount of fees receivable by the local authority is reasonably sufficient to meet the expenses of the authority ".
What does " reasonably sufficient " mean? It is either sufficient or it is not sufficient. I suggest that we leave out the word " reasonably " so that the instruction is that fees must be sufficient. That is the aim: sufficiency to meet the expenses. I do not think that " reasonably " means anything at all here and that it would be better left out. I beg to move.
The Earl of Mansfield: I agree with the noble Lord and invite the Committee to do likewise.
On Question, amendment agreed to.
Schedule 1, as amended, agreed to.
Clause 5 [Rights of entry and inspection]:
5.44 p.m.
Lord Ross of Marnock Lord Ross of Marnock moved Amendment No. 45A:
Page 3, line 1, leave out (" for which case provision is made in section 45(2) of this Act ").
The noble Lord said: Now we go back to the beginning of the Bill by suggesting that we leave out,
" for which provision is made in section 45(2) of this Act ".
Here we are talking about window cleaners. From the drafting point of view, " for which provision is made in section 45(2) of this Act ", I think is a bit of nonsense. If you want to say that it does not apply to window cleaners, then say so; and leave it at that. If you are going to mention window cleaners later on then do so; but here is confusion. It adds nothing. It is not very enlightening for anyone reading a Bill to see in Clause 5 that it says you had better look to see what happens about window cleaners in Clause 45.
Incidentally, if anyone wants to know what happens about window cleaners there, I may say that I am proposing to leave out Clause 45 altogether. I do not think that window cleaners require a licence. From that point of view, it might have been better if I erase from this particular clause any reference to window cleaners. But from the point of view of reform of drafting, the phrase " for which case provision is made at Section 45(2) of the Act " is a bit of nonsense. if this is a new convention of drafting to put in something to say that it does not apply to window cleaners but if you are interested in window cleaners then look at Clause 45, I think that it is not good drafting. I beg to move.
The Earl of Mansfield: This amendment seeks to delete a clarifying reference to Clause 45(2) and, as such, I suggest it would do no more than to remove a helpful cross-reference guide which makes it clear that, although Clause 5(2) does not apply to window cleaners, this is not an absolute exemption and the reader is referred to Clause 45(2). As such, the reference is helpful and that is what it is intended to be. If we look at Clause 5(2) we see it provides that:
" An authorised officer … may require any person who the officer … has reasonable grounds to believe is carrying on an activity which requires to he licensed … to exhibit his licence within a reasonable time of being required to do so ".
It means that the licence-holder does not have to have his licence on his person and to produce it on the spot. He may produce it " within a reasonable time " at the police station or at the office of the licensing authority.
As the noble Lord did not go into the merits, or lack of merits, of licensing window cleaners, I shall not stray down that path; but since what Clause 45(2) does in the fact is to provide that a window cleaning licence must be exhibited forthwith on demand, in effect requiring that a window cleaner needs his licence on him when pursuing his trade—and, I may say it provides in Clause 45(3) an offence provision for failing to produce a licence when requested—then I think it is helpful that there should be the cross-reference which the noble Lord now proposes to delete. I do not think the cross-reference can be amended to become any neater. It is either a question of having it or not having it at all. I should have thought that in a long Bill like this it would be helpful to people reading the Bill—or the Act, if it should become an
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Act—to know that Clause 5(2) does not apply to window cleaners.
Lord Ross of Marnock: It could also tell them that nothing may apply to window cleaners unless the local authority passes a resolution under yet another clause. So far as I recall, the licensing of window cleaners is one of the optional things; so that we would need a dozen cross-references to deal with this. Once again, here we are talking about licensing and powers in relation to carrying licences when we do not know what is to be licensed. That is the weakness of the Bill from the point of view of anyone reading it to find out what it all means.
I will not say what I have said before about this. What do we want to know? We want to know that whatever else it applies to, it shall not apply to window cleaners. We do not need the cross-reference. It confuses; it skips over a few other clauses and you miss the one which says that there might not be any licensing of window cleaners unless there has been a resolution of the district council to make it apply.
There has been a lot of confusion on this Bill. Having waited from 1972 to 1981 it would have been far better if they had waited for yet another six months and tackled the job in a very different way, after looking at the English Local Government Bill which deals with licensing. A much clearer Local Government (Scotland) Bill—as I think it is—could have been produced.
I understand that the Government are adamant on this amendment. I do not know why. I do not think it is worth pressing to a Division; it would upset a great many people if we did. However, we can do something much more important than this. I beg leave to withdraw the amendment
Amendment, by leave, withdrawn.
Clause 5 agreed to.
Clause 6 [Powers of entry and search]:
5.51 p.m.
Lord Ross of Marnock Lord Ross of Marnock moved Amendment No. 45B:
Page 3, line 33, after (" person ") insert (" in authority ").
The noble Lord said: The Bill says:
" A constable who is not in uniform shall produce his identification if required to do so by any person in or upon any premises ".
Does that mean anybody? A policeman can be challenged by any person? I think that it should read:
" any person in authority ".
That would be a person with the right to challenge him. We have met the phrase " any person " in a previous argument and that phrase is wrong. If the Government can think of better words for limiting the challenge to a plain clothes policeman on a job then I am prepared to examine it. The Bill would be weak if we left the challenge there to any person at all. I beg to move.
Lord Mackie of Benshie: Surely any person who is challenged by someone in plain clothes is entitled to ask that person to produce his authority to challenge.
The Earl of Mansfield: I respectfully agree with the

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noble Lord, Lord Mackie of Benshie, although he somewhat shortened the argument. It is right to explain why we thought it correct to impose on plain clothes constables a duty to show their identification to any person on the premises or on a vehicle or vessel which they wished to enter and search in pursuance of a warrant granted under Clause 6.
I refer the Committee to Clause 7(6)(d) where—rightly in our opinion—it makes it an offence for any person to obstruct a constable, whether or not in uniform, who is executing a warrant under Clause 6. We believe that it is wrong that a person should be open to a charge of obstruction if he does not have the right to see a plain clothes officer's identification. Therefore Clause 6(3) imposes on an officer in plain clothes the duty to produce his identification to any person who requests to see it.
An example will make it clear to the Committee and also to the noble Lord, Lord Ross. Suppose one has a case where an officer in plain clothes goes to search a large scrap metal yard and he shows his identification to the owner or manager and then proceeds on his search unaccompanied. In such circumstances, he would appear on the face of it to be an intruder to anyone else in the yard who saw him. If an employee then challenged him and the officer refused to produce his identification, the employee could, if he decided that the officer was an intruder, act accordingly and then find himself facing a charge of obstruction even though he had acted in good faith. It is to avoid the possibility of a person who has acted in good faith facing a charge of obstruction that we imposed this duty on officers in plain clothes to produce their identification to anyone who requests to see it.
Another example is if somebody's house overlooks a scrap metal yard and somebody in the house, unconnected with the scrap metal yard, sees a person in plain clothes, whose identity is not known to them, lurking about. As a good neighbour, they go and challenge him. That is an example of where, in the circumstances, the onus should be on the officer in plain clothes to establish his identity and bona fides.
There is, lastly, the practical difficulty about the amendment: the phrase " in authority " is vague. If a plain clothes officer was challenged by somebody, there would then be some cross-talk between whether the person challenging him was a person in authority or whether the officer was going to produce his identification. It would probably take longer to sort that one out than merely to produce the warrant card or whatever. For all these reasons, I would prefer the clause to stay as it is.
Lord Ross of Marnock: I am not entirely happy about that. I said that I was not entirely happy about the phrase that I used:
" person in authority ".
It may well be:
" person who has himself a right to be there ".
This is usually what happens. But there may be occasions in which a plain clothes constable does not want to meet this business of being challenged by anybody; he wants to remain a plain clothes officer. The way it is phrased I do not think is entirely helpful
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to him. The noble Earl instanced the question of the scrap yard. The officer speaks to the owner of the yard and the owner allows him to go in. I am perfectly sure that the owner would go with him. If not, the owner would, in a loud voice, tell somebody else that the officer was coming.
The other suggestion is that somebody overlooking a scrap yard could see it and they would go down and challenge. If they had any sense, what they would do would be to ring up the police, as the police invite them to do. The police themselves would know exactly what was happening in that particular place. It may well be that the person could be rushing into something and finish up with something that he could not envisage. I do not think it is happy as it is. One might as well have left out " any person " altogether and just say:
" a constable who is not in uniform shall produce his identification if required to do so ".
It must be a person who is going to challenge him—or is it a dog? If the noble Earl does not like my phrase or any other, he might as well take out " any person " and so have the advantage of shortening the Bill. I shall consider the matter again and see whether I can come up with a happier phrase, one that might meet the mood of the Minister of State and those concerned with the Bill. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
The Deputy Chairman of Committees (The Earl of Listowel): Before I call the next amendment, may I point out to the Committee that there has been a mistake in the wording in line 36 which was put right in the first of the corrections to the text of the Bill. The noble Lord's amendment should therefore read:
" Page 3, line 36, leave out (' he shall not be entitled to enter or search ') and insert (' and warrant shall thereafter enter ') ".
I now call Amendment No. 45C.
Lord Ross of Marnock Lord Ross of Marnock had given notice of his intention to move Amendment No. 45C, printed as follows:
Page 3, line 36, at end insert (" identification and warrant shall thereafter enter the ").
The noble Lord said: I make a habit of reading Bills before I put down amendments. I read this particular clause for at least a quarter of an hour before I realised that somebody had made a mistake. It is not at the end of the line; those concerned just missed out a line altogether. But the confusion of Bills these days is great, and the drafting of Bills these days is so obscure. Sometimes I fancy that the purpose really was to obscure the meaning, just to make sure that everything was absolutely perfect from the point of view of the constable, in this case, or it may be somebody else. When I read this clause it said:
"… he has been so required to produce his premises, vehicle or vessel … ".
Then I went back and wondered whether I was seeing things—and eventually came to the conclusion that a line had been missed out. I tried to envisage what words would make sense. It may well be that the Bill, if not corrected, would have made better sense and certainly there would have been fewer words than is the case by putting in the line of the correction. I

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do not know who created this haste and hurry which did not enable the Scottish Office or anybody else to read the Bill at the proper stage and notice that a whole line had been missed out; but I hope the Minister will appreciate that it causes Members quite a bit of difficulty when we cannot rely on the words that are there and seek to amend the wording to make sense, and then later on they come along and say, " It is all right; we have missed out a line, but we have issued a correction note ". I can assure your Lordships that that correction note came to me long after I had put down my amendment. I was trying to make sense. It made sense in the uncorrected version. If we have the correct version, then I do not think my amendment does make sense.
[Amendment No. 45C not moved.]
Lord Ross of Marnock Lord Ross of Marnock moved Amendment No. 45D:
Page 3, line 38, leave out from (" vessel ") to end of line 39.
The noble Lord said: With regard to this amendment, I did not think that the words I suggested we leave out added anything at all to the subsection, and it was my suggestion that we should leave them out.
The Earl of Mansfield: May I say that, unless there is some sort of qualification at the end of the sub-section, it then becomes meaningless.
Lord Ross of Marnock: I apologise. This made sense with my amendment, but not with the correction. I beg leave to withdraw the amendment.
Amendment, by leave withdrawn.
Clause 6 agreed to.
Clause 3 [Offences, etc]:
Lord Ross of Marnock Lord Ross of Marnock moved Amendment No. 45E:
Page 4, line 29, leave out (" £50 ") and insert (" £25 ").
The noble Lord said: This refers to penalties, and it is suggested here under paragraph (c)—
"… fails without reasonable excuse to deliver his licence to the licensing authority in accordance with paragraph … "—
that the penalty should be not exceeding £50. In particular cases—because once again we are dealing with a great variety of licences—it might well be that the window cleaner's lapse in providing the licence is not quite so bad as that of somebody else, and I would have thought, from that point of view, £50 would have been enough there.
If we go to the next page, subsection (5) (2)— " within a reasonable time "—it refers to failure to exhibit a licence. The penalty there is only £25, so I think it would be as well in this particular one that we should allow a certain amount of latitude and though I admit it is not exceeding £50 I think that on the whole £50 is too much. I beg to move.
The Earl of Mansfield: I see the force of what the noble Lord, Lord Ross, has said regarding the penalty for this offence and I am content to accept his amendment.
On Question, Amendment agreed to.
6.6 p.m.
Lord Ross of Marnock Lord Ross of Marnock moved Amendment No. 45F:
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Page 5, line 35, leave out (" within 6 days after the date of the conviction,").
The noble Lord said: This paragraph suggests that where a holder of a licence is convicted an extract of the conviction shall be transmitted by the clerk of the court to the licensing authority, who will duly take note of it, I suppose, and hold it against him when it comes to a question of taking away his licence or, it may well he, of adding further conditions to it.
All this has to be done within six days after the date of conviction. The man has a right to appeal and that appeal might be upheld. Is it right, then, that before he even has the opportunity for appeal (because the time limit may be 14 days) that action should be taken which would be prejudical to the continued holding of a licence? I think there is something wrong here. It may be that the words of my amendment do not entirely cover what I have in mind in this amendment when referring to the period after the date of conviction—just to leave these words out. The point of it was to ensure that the Government would take note of the unfairness of this and put in other words; because after all the conviction may well be quashed and, if so, there is nothing to say in the Bill that in those circumstances another notice goes to the licensing authority. The only thing they would have is this notice of conviction I beg to move.
The Earl of Mansfield: There are difficult questions here as between equity and the protection of the public. The present sub-paragraph followed the model of section 129 of the Licensing (Scotland) Act 1976. So far as I am aware, the section has not given rise to any difficulty either for licenceholders or licensing authorities. Although the clerk sends an extract of the conviction to the licensing authority the licence-holder's right of appeal against conviction is of course unaffected, and if an appeal is lodged under Section 442 of the Criminal Procedures (Scotland) Act 1975 the clerk automatically arranges to notify the licensing authority of the outcome of the appeal. This is done administratively.
The noble Lord did not actually say so but I think he came close to arguing that no detail of the conviction should be passed to the licensing authority until an appeal, if there is one, has been disposed of. Again, I am not sure whether that is always in the public interest. For instance, if a licence-holder had been convicted of an offence against the person or against property which could have a serious bearing on whether he was a fit and proper person to hold a licence, the fact that a conviction has been secured is at least arguably in those circumstances prima facie justification for at least bringing the circumstances of the case to the attention of the authorities so that they should consider whether it is desirable in the public interest to suspend a licence—which they can do under the terms of the schedule—at least until the appeal is determined. I would remind the Committee, of course, that there is ground for appeal against the suspension.
As I have said, these existing procedures have operated administratively since 1976 quite smoothly. There is no evidence that a record of conviction is not followed up later with an outcome of the determination of any appeal and I do not at the moment see that we have evidence which would justify changing the

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existing procedures. But having said that—and this is the Committee stage—if any noble Lord is strongly of the opinion that reasons exist why there should not be notification in these circumstances, then of course the Government are prepared to listen to them.
Lord Ross of Marnock: The Minister said that, arguably, it was right to do this and he then gave us a hypothetical case about the detriment of the public. We are dealing here not with licensing, in the usually accepted Scottish sense, of public houses and the like, but with people's livelihoods in a wide variety of other areas. It is not fair, when a person has a right of appeal against a conviction, that it should be taken for granted that he will be convicted finally and that the licensing authority should be told about it.
I thought that there might be sense in waiting that extra week. The court would then be able to know whether or not there was an appeal and the word could be sent " Convicted, but appeal pending ". That would also alert the licensing authority to the fact that, possibly, it should be interested from the point of view of whether an appeal was to be upheld or dismissed.
I do not think it is fair or right to do this and to do it so quickly. We have the words,
" within 6 days after the date of the conviction ".
and the man has another seven days to decide whether or not he is going to appeal. Why not make it 14 days, so that we can also say whether or not there is to be an appeal? However, the Minister does not seem to be entirely happy that this is fair or right.
He said that nothing much has happened under the Licensing (Scotland) Act 1976. May I tell him that I introduced that Act, but I was not responsible for it because I ceased to be Secretary of State the day after. I do not think there was any cause and effect thereon. But I can remember arguing against certain sections of that Act, because the Government accepted amendments—and Tory amendments, at that—during the Committee stage relating to Sunday drinking and matters like that, on which I continue to frown. But, bearing in mind what the Government have said in respect to this amendment, and their feelings about it, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 7, as amended, agreed to.
Clause 8 agreed to.
Clause 9 [Application of Sections 10 to 29, 40 to 42, and 44 to 46.]:
6.14 p.m.
Lord Ross of Marnock Lord Ross of Marnock moved Amendment No. 45G:
Page 6, line 28, leave out from (" resolution ") to (" any ") in line 30.
The noble Lord said: This is a very simple amendment. We come now to the licensing of particular activities in respect of which the licensing authority has to pass a resolution stating that such-and-such will be subject to licences. Then we have the phrase
" as from a day specified in the resolution ".
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and that day
" must not be before the expiration of the period of nine months beginning with the day on which the resolution was made ".
All I want to know is: why nine months? We have been told that the procedure will be very simple and quick, and, if it is necessary for some of these activities to be licensed, why must we wait for nine months? Will it take nine months to create a new sub-committee? We have been told that these matters function very efficiently at the present time, so why the words,
must not be before the expiration of the period of nine months"?
I beg to move.
The Earl of Mansfield: I think the noble Lord may be slightly confused over his period of nine months. The nine months runs from the day upon which the resolution is passed and not from the day upon which the licensing authority sets about its task. There is no question of sub-committees or anything else. What one has to do is to strike a fair balance between the rights of the local authority to exercise effective control, and the rights of those engaged in a trade to be given every opportunity to safeguard their legitimate livelihood. Therefore, we feel that where an activity is to be licensed which has not previously been subject to that form of control, the trade in question should have very full warning of the fact so that people have ample opportunity to make any alterations to their vehicles, premises or equipment which may be necessary to meet the new requirements.
Nine months may not be necessary to enable window-cleaners to prepare for the advent of licensing. But, on the other hand, if I may turn to the noble Lord, Lord Underhill, and his taxis again, it might very well be necessary for the owners or operators of taxis to have a considerable period between the passing of the resolution, so far as the licensing authority is concerned, and the coming into force of these regulations which might specify a totally different form of vehicle to be employed as a taxi. That is the reason for the delay between the making of the resolution and the coming into force of the licensing provision, in respect of a particular activity. I hope the noble Lord will agree that it is a reasonable period of time.
Lord Ross of Marnock: The Minister said that he has made me think about it, and I am beginning to wonder whether nine months is long enough, because the Secretary of State has to produce models of conditions and to prescribe lists and all sorts of other codes. We have not dealt with them all and we shall come to them in due course. But if all this must be done before we can start the procedure, bearing in mind how long it took to produce this Bill, I doubt whether nine months is a generous enough time to allow the Government to do their bit of work.
I like the way the Minister said, " Ah, Yes, but what we are thinking of is not the Scottish Office and all the work that it has to do, and not the local authority and all the work that it has to do. What we are thinking of is the taxi owner. " But he has been subject to licensing for quite a time in certain parts of the country, and one thing I do not see changing to any great extent are the conditions about types of taxis. But the noble Earl has convinced me. I hope that he will have another look at it and see whether he

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is satisfied that the Scottish Office will be able in nine months to do all that it has to do. I see that the noble Earl is going to say, Yes and that the Scottish Office will look at this and speed things up very considerably and will deal with all the regulations and everything else. In fact, it may well be that we have to deal with them as well. But, in view of that, I beg leave to withdraw the amendment.
The Earl of Mansfield: Before the noble Lord withdraws the amendment, I wonder whether I may put him right again. It might be helpful, and not only to the noble Lord, if I explain as briefly as I can just how we envisage these licensing authorities affecting the transition between the existing licensing system, under the Burgh Police Acts or local Acts in respect of a given activity, and the new system in respect of the same activity provided for under the optional provisions in the Bill, which licensing authorities can adopt by resolution under Clause 9. After the Bill receives Royal Assent, it will be necessary first to complete consultation with interested parties on a number of points, particularly on the conditions in respect of hire car and taxi licences which under Clause 19 the Secretary of State has power to prescribe and proscribe by regulation.
Thereafter, we intend to bring into force Part I and Clause 9, probably around Whitsun 1983, enabling licensing authorities to resolve that certain activities should be licensed in their areas. To circumvent the obvious legal problems which would otherwise result from resolving to adopt optional provisions which are themselves not yet in force, we have specifically provided in Clause 131 that anything which must be done under any provision of Parts I and II of the Bill may be done before any such provision comes into force for the purpose of giving full effect to it when it is formally commenced. We have also provided in Clause 9(8) that licensing authorities which have resolved that certain activities under the optional provisions shall he licensed in their areas may, prior to the coming into effect of that resolution, exercise such powers conferred by Part I and the relevant optional provisions as may be required to bring the licensing system into effect in an orderly and equitable fashion.
The effect of Clause 131 and Clause 9(8) together is to enable local authorities to consider applications for licences not only before the day on which the resolution in respect of that activity comes into effect but also before the Secretary of State formally commences the optional provisions as a whole. It is clearly essential that licensing authorities should be able to exercise all their powers in respect of licence applications—for example, powers of inspection, duties of consultation with police and fire authorities—before the day on which the new licensing system comes into effect and it therefore becomes an offence to operate without a licence. In their resolution, licensing authorities will be able to set a date for the coming into force of the new system not less than nine months after the date of the making of the resolution but not of course earlier than the formal commencement of the optional provisions. This interim period will last for at least a year.
Since the Burgh Police (Scotland) Act and local Act provisions in respect of licensing will not fall until the end of 1984, unless the replacement provisions are
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commenced earlier, the existing regulatory systems will remain in force. Since most licences under the Burgh Police (Scotland) Act are granted from Whitsun to Whitsun it would be convenient if the transition could be effected at Whitsunday 1984, and this is our provisional aim. On that date the optional provisions will be brought into force, and under Clause 132(3) cognate licensing provisions of the existing legislation will automatically fall. Existing regulatory systems will therefore cease to have effect. However, since licensing authorities will have had plenty of time to resolve to adopt optional provisions and to consider applications under them, they should be able to fix the date of repeal of the old system as the date of commencement of the new. There should therefore be no problem in affecting a smooth transition between an existing and a new system of licensing in respect of any activity.
I am afraid that all this is complex and not a little tedious, but I hope that from this the noble Lord will see that in fact the new structure is designed to come into operation smoothly and in sufficient time for everybody who has to learn to live with it to know what they have to do.
Lord Ross of Marnock: What the noble Earl has said is very interesting. I congratulate him on a very fine Third Reading speech. I was too well brought up in another place; I know what is in order and what is out of order I realise that in this place anything is in order. However, I still congratulate the noble Earl. At the same time, I wonder what on earth would have happened to that speech if I had not put down this amendment. It is such an important amendment that I wonder whether we should let it go so quickly. But just in case there is another Third Reading speech up the sleeve of the Minister of State, I had better hurriedly withdraw this amendment.
Amendment, by leave, withdrawn.
6.25 p.m.
Lord Ross of Marnock Lord Ross of Marnock moved Amendment No. 45H:
Page 7, line 22, leave out from (" it ") to end of line 23.
The noble Lord said: I have a simple question to put to the Minister. Before proceeding to make a resolution (here I am inviting trouble again; we are back to the resolution by a district council) a licensing authority may make such modifications to the proposed resolution as they think fit in the light of representations, provided that such modifications do not extend its scope. Why not? That is why I suggest that we should leave out these words. I beg to move.
The Earl of Mansfield: This is part of a safeguard which we have built into the Bill to keep those involved in the trades concerned in touch with the thinking of the licensing authority at each stage. One of the safeguards is this one. It is a provision that licensing authorities may not make a resolution which goes wider than the scope of the proposed resolution previously advertised in draft. We felt that the trades to be licensed should without exception have an opportunity to make representations to the local authority about the terms of the draft resolution covering them and the right to have their representations considered. If licensing authorities could widen the scope of a draft

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resolution in finally making it, they could draw within its scope those who previously had been unaffected and who had therefore been given no opportunity to make representations against the licensing proposals. The limitation that is contained here was specifically designed to safeguard against this procedural danger and to ensure that all activities, and all cases of activity, had a chance to make representations against local authority proposals that they should be licensed. I hope the noble Lord thinks that that is a reasonable explanation.
Lord Ross of Marnock: It is not only reasonable but but very sensible. I am most grateful to the Government for having given that very lucid explanation of why this tailpiece phrase is included. In view of his explanation, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord Ross of Marnock Lord Ross of Marnock moved Amendment No. 45J:
Page 7, line 35, leave out from (" authority ") to end of line 36.
The noble Lord said: Here the licensing authority, having made up their mind, publish their resolution in a newspaper. It is also said that applications for licences in respect of the activity may be submitted to the authority one month after the date of the making of the resolution. We have just been told (it was part of that Third Reading speech) that local authorities are going to have the power to get ready for all these matters. But here it is said that nothing can be done by way of submitting applications for licences until one month after the date of the making of the resolution. Why one month? I thought that they were going to be all ready. I thought this was the implication of what the Minister of State has said and that there need be no delay at all. I beg to move.
The Earl of Mansfield: The delay has been put into the clause with two main considerations in mind. First, it was our intention to give local authorities time to make administrative preparations for the new scheme—for instance, to get forms and instructions printed. Perhaps more importantly, it was intended also to give those involved in the trades concerned time to consider their premises, vehicles and equipment and to obtain any legal advice required to draft their applications, so that when the licensing authorities first came to consider the applications they would have some idea of how many applications there were likely to be in total and how the provision of licensed activities might be distributed across the area. Therefore what this one month's delay is designed to achieve is what I might call orderly application on the part of those who will want licences. I would stress that it is really the licensing authority which will not consider an application before one month, as opposed to a ban on the submission: and it was as much from a desire to be fair to all would-be licence-holders as to its own procedures that this provision was drafted in this way.
Lord Ross of Marnock: With all due respect what the noble Earl the Minister said in his last sentence is not true. He said that there was no ban on sub-missions. It is stated specifically,
" applications for licences in respect of the activity may be
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submitted to the authority one month after the date of the making of the resolution".
If the Minister turns to subsection (8) he will find that there is a ban on the consideration of licences,
" until the expiry of one month after the making of the resolution ".
There is a very definite ban. One cannot submit an application for a month, and indeed the authority cannot consider an application for one month.
The Earl of Mansfield: In fact, the noble Lord is wrong. There is nothing to stop someone from submitting an application, but it will not be considered for a month.
Lord Ross of Marnock: In that case, at the next stage I am going to move an amendment to leave out Clause 9(6)(ii). If there is no objection to people sending in applications, and it is only that they will not be considered for a month afterwards, why not say so? We already have that in Clause 9(8). If what the noble Lord the Minister says is true, this does not make sense and it is not needed.
On Question, amendment negatived.
Clause 9 agreed to.
Clause 10 agreed to.
Lord Underhill Lord Underhill moved Amendment No. 46:
After Clause 10, insert the following new clause:
" Application of Schedule 1 to taxi licences.
.—In relation to an application for the grant of a taxi licence Schedule 1 to this Act shall take effect subject to the following amendments—
(a) the following paragraph shall be inserted after paragraph 2—
" 2A. In the case of an application for the grant of a taxi licence the licensing authority shall as soon as the application is made to them send a copy of the application to persons or organisations appearing to them to be, or to be representative of, the operators of taxis operating within their area."
(b) the following head shall be inserted after head 3(1)(c)—
" (d) in relation to an application for a taxi licence, any person or organisation to whom a copy of the application has been sent under paragraph 2A above.".
(c) in paragraph 5(3) there shall be inserted after the word " shall ", where it last appears, the words " subject to sub-paragraph (3A) below.".
(d) the following sub-paragraph shall be inserted after sub-paragraph 5(3)—
"(3A) In the case of an application for the grant of a taxi licence a licensing authority may refuse the application if in their opinion there is already in force in their area a sufficient number of such licences to provide a satisfactory service to the public consistent with the provision to licence holders of a reasonable livelihood.".
(e) in paragraph 17(4) there shall be inserted after the word ' person " the words " or organisation ".").
The noble Lord said: This proposed new clause covers two points: the limitation on the number of taxi licences that the licensing authority may issue or grant, and the opportunity for representatives of taxi operators to make objections or representations on an application for a new licence. At Second Reading the noble Earl said that the onus was on those who put forward the proposed limitation to justify such a change. Therefore, I want to justify this and do what the noble Earl said, and therefore to cover a number of points.
Paragraph (d) of the proposed new clause is the one which proposes that a licensing authority may refuse an application for a licence if they are of the opinion that there is already a sufficient number of such licences to provide " a satisfactory service ". Those last words are important. As has been said already, during the Second Reading debate it was stressed that the working party had recommended that there should be control of the number of licences. The actual quotation has not been given and so I wish to give it now, to put it on the record. Paragraph 11. 50(b) stated:
"District and islands councils should have the power to determine the number of taxis allowed to operate. This is necessary on the one hand to provide a service to the public and on the other to ensure that within the licensing area operators can make an adequate living ".
It would seem that four years after that recommendation the Government still approve that proposal, because it was included in the draft Bill in the consultation paper. Again, I quote the actual words of the proposed Clause 8, subsection (3)(c):
" having regard to the facilities of the same or of a similar kind already available in the locality, the grant of an application would result in the over-provision of such facilities ".
The preamble to that was that a licensing authority may refuse an application if that is the situation. At the Second Reading the Minister explained that this provision had been dropped because the Government were in general against any limitation of numbers and restriction of trade on quantitative grounds. But I was very encouraged that the noble Earl went on to say:
" Taxis are unique under the Bill as being the only trade whose charges are not fixed by market forces but are fixed by the licensing authority ".
There are some who suggest that a limitation such as that proposed in this clause makes for a monopoly. I would say that that is a complete myth. There can be no monopoly conditions where the charges and thereby the level of revenue and profits are in the hands of the licensing authority and not in the hands of the actual operators.
In fixing a fares tariff a licensing authority must in all fairness take into consideration that there is only a certain amount of custom. As the Minister went on to say in the Second Reading debate:
" One object is to give an operator a reasonable opportunity to make a living ".
A significant increase in the number of taxis despite the degree of custom there is in the area must lead to lower average receipts. At the same time it must lead to increased overheads per mile that are paid. The taxi operator cannot respond to market forces by increasing fares because, as has already been explained, these are the responsibility of the licensing authority. It surely must be recognised that any coherent policy of fare regulation must be accompanied by an intention on the part of the licensing authority to keep the number of taxis within limits which produce viability within the tariffs laid down.
The working party stressed that the case for limitation is not only in the interests of the taxi operators but also in the interests of the general public. That is one point I wish to emphasise. If the revenue is reduced because of the over-provision of licences, this must inevitably
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lead to a lowering of standards in both the provision and maintenance of vehicles. But if market forces and the policy of self-regulation is to be the rule, those members of the taxi trade who make the business their full-time livelihood must be at risk. This must be particularly so at times of economic stress when others will take up taxi driving on a short-term, temporary basis. The introduction of that kind of taxi-driver invariably leads to lower standards for the public and lower standards of vehicle maintenance and safety. It is the regular taxi operator who would have to bear the hardship.
The amendment is not asking that a local authority should fix a once-and-for-all figure of limitation, nor to be rigid in the way that it does this. That would work against the public interest because there could be a situation where there were too few taxis in an area, and therefore a licensing authority must have an opportunity to vary that situation if it so wishes. It is not the intention of the amendment that there should be a once-and-for-all limitation. Under the proposed new clause, a council would always be free to review the position, and should they consider that there are too few taxis in their area, they could grant additional licences.
Briefly, on the other parts of the new clause, as has been explained, Schedule 1 to the Bill deals with all activities for which licences are to be issued. The new clause proposes an amendment to the schedule which would apply only in the case of taxis, such as the limitation of licences to which I have already referred.
Paragraph 2 of the schedule provides that when an application for the grant or renewal of a licence is received the local authority shall send a copy to the chief constable, and at present to the fire authority; that is a point the noble Earl is going to look into. Head (a) of the amendment provides that in addition a copy of the application shall be sent to pesrsons or organisations representative of taxi operators. The purpose of that is because head (b) proposes that those persons shall be added to the list in the schedule as being entitled to make objections or representations, and I am certain that that will be regarded as reasonable. I think both these points included in the clause are reasonable, and I hope that in this very short time the onus placed upon me to justify these changes has been met. I beg to move.
The Earl of Mansfield: As the noble Lord, Lord Underhill, has said, this new clause would allow the licensing authority to refuse applications for taxi operators' licences if in their opinion there are already sufficient licences to provide a satisfactory service to the public consistent with providing a reasonable livelihood to taxi operators. It would also require the licensing authority to send a copy of all taxi licence applications to representatives of the existing licensing trade, who would have a right to object to any new applications.
The essence of this new clause is in the proposed head (d) which would allow the authority to refuse applications for taxi licences if in their opinion there are already sufficient licences, and so it goes on. That is, of course, that the licensing authority would be able, although not bound, to limit taxi licences on the basis

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of that criteria. As I am sure the noble Lord, Lord Underhill, would acknowledge, the rest of his amendment really revolves around the new limitation, so I propose to deal with head (d) first. The question of limitation of taxi licences is difficult, and I acknowledge that there can be strongly held and conflicting views. As I said on Second Reading, I know very well that the present licensed Scottish taxi trade feels strongly that the Bill does not contain this power for a licensing authority to refuse an application for a licence on the grounds that, in effect, the granting of the licence would result in an over-supply of the facilities in question.
The reason for our dropping this power of limitation, as I think I made plain in the earlier debate—and this applies to all activities licensed under the Bill, not just taxis—is quite straightforward. We are not in favour of local authorities controlling on quantitative grounds entry to private enterprise activities such as those covered in the Bill. This could well lead to artificial limitation and restriction on trade. And it is significant that in those areas where taxi numbers have been tightly controlled we have seen an expanding hire car market, which apparently meets a real public demand and provides a reasonable livelihood for those engaged in the hire car trade.
The noble Lord went on to argue that the taxi trade is unique because it is the only trade covered by the Bill whose charges are fixed not by market forces but by the local authority. But I would remind the noble Lord that at Clause 17 there is provided a mechanism whereby taxi operators can appeal to the traffic commissioners on fares. The commissioners are free to take into account on fares any matters they consider relevant, including those such as service to the public and return to the trade—matters which this paragraph of the amendment recognises as relevant. There is, therefore, that degree of protection for the taxi trade.
The amendment seeks to achieve limitation having regard to the criteria of service to the public and provision of reasonable livelihood to licence holders. One can immediately see why the trade would welcome the introduction of such criteria. At present a number of local authorities in Scotland who limit the number of taxi licences fix the limit at a number higher than existing licence-holders. But I do see difficulties. To start with, there could be a conflict between satisfactory service to the public and what the existing trade would regard as a reasonable livelihood. The public could be demanding more taxis and the trade saying that more operators would cut into their profits and so reduce their livelihood.
It can, I think, be argued that local authorities are not equipped to deal with quasi-economic issues such as what would or would not be the number of taxis which the public can support in a particular area to ensure both a satisfactory service to the public and a reasonable return to the operator. Both these concepts have very subjective interpretations. In our view, the main role of local authorities in relation to taxis is to confirm that the vehicles and the drivers are suitable and to fix the fare structure, on which the taxi operators have a right to appeal to the traffic commissioners. To empower local authorities to limit numbers would be seen as an unnecessarily protectionist measure which
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would not operate to the public's advantage because it would reduce competition. So it seems best to us to rely on market forces, bearing in mind that provision has already been made for appeals on fares. The trade in any area would reach its own balance both as to income to be derived from it as a result of the productivity and efficiency of the operators themselves and the fare structure agreed, where necessary with the traffic commissioners.
I am aware of the arguments which the National Federation of Taxicab Associations have advanced, that the absence of limitation of any kind does result in a free for all which leads to confusion and diminution of service to the public. But so far I do not consider that the case has been proved. I am bound to say that, despite the efforts of the noble Lord, Lord Underhill, I have yet to be convinced that any case has been made out for limitation, and I would have hoped in this debate for some guidance, perhaps from other noble Lords, as to whether in fact there is a case for limitation at all. But I will say at once that I am prepared to consult with the Convention of Scottish Local Authorities, if as a result of this debate there is really any demand for limitation, or any convincing arguments put forward for restriction, other than those which the noble Lord has already advanced, and, if I may say so, have already been well rehearsed.
I turn now to the other parts of the noble Lord's amendment. The other parts propose that local authorities be required specifically to inform representatives of the licensed taxi operators of applications for taxi licences who will also have the right to object to any new licence application. These paragraphs also, of course, have to do with limitation, but they are particularly and exceptionally protectionist. The effect would be to give existing taxi operators the privileged position of being notified of any new person applying to pursue that activity, and the right to object to that person's request. This is unacceptably protectionist. I can quite see the desire of anyone pursuing a trade wanting a statutory right to object to somebody else pursuing it. I am sure all enterprises would welcome that. But this idea would mean putting. the trade in a privileged position and, in effect, turning the existing operators into an élite enclosed guild. For those reasons I find it very difficult indeed to accept heads (a) and (b) of the new clause.
I fully accept that existing taxi operators should he able to know what is going on, and this of course applies to any other holders of licences under the Bill. So I would propose at a later stage of the Bill to amend paragraph 15 of Schedule 1, which requires a register of applications to be kept by the licensing authority and open to public inspection, and make clear what is already the intention, that all applications must be entered as soon as they are received. In this way taxi operators and other persons licensed under the Bill can keep abreast of developments by inspecting the public register.
So, by way of summary, I have so far not been convinced of the need or, indeed, the desirability of providing for limitation. As to that I am at the very best an agnostic. But I am willing to be convinced and, in that event, to consult the convention to see whether, in the light of any further arguments that

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may be put forward, they would wish to adopt the amendment tabled by the noble Lord.
Lord Mackie of Benshie: I tend to agree in this case with the Minister that limitation should not be by the licensing authority. There is at present in the rural districts of Scotland a tremendous expansion of the use of taxis. The need for licensing and the need for control of the vehicles and of the type of driver is, I think, very strong. On the other hand, it is quite extraordinary sometimes how long it takes to improve a vital service and how many mistakes and how much danger to the public there can be if it is a matter of complaint to public authority. I have seen bad vehicles—drivers who have terrified me and everyone else in the area. I am not sure whether they were licensed or not, but I think that there is little doubt that the quickest way that the public can cure this is by the business of selecting another operator, if there is one available. It takes too long for the licensing authority to correct the dangers and abuses which can certainly occur in taxi services in rural areas.
In my view the argument on fares does hold some water in that they are not fixing their own fares and therefore it is not a proper free market. On the other hand, if you have a licensing system and the authorities are seeing that the vehicles are right and that the people are right you will not have the number of cowboys coming into the business that you would have in an unlicensed system. So, in this case, I think the service to the public would be much better if competition were left to determine the number of taxis.
Lord Ross of Marnock: I am sure that my noble friend must be disappointed at the Government's reply. Yet there is some semblance of light that the noble Earl is prepared to talk to the local authorities about it. I hope that he would extend that discussion to the association of owners as well. The noble Earl says that he has not heard any arguments for it. It might well be that he has not heard any convincing arguments for it—that would have been fair enough.
Of course the noble Lord, Lord Mackie, points to the increased importance of taxis in areas where bus services have disappeared. He rightly stresses the importance there of the initial licensing system and that means, of course, the drivers and the vehicles. When he says that there is less danger of cowboys coming into this field, I do not think that he is right. In my view there is probably considerable danger of cowboys coming into this particular field.
I should like to know whether the Minister of State has made any reference to his own department as to the reasons for the working party's findings on this. The working party—set up, I think, in 1972—consisted of very eminent gentlemen who probably looked into this matter very well: Sir Ronald Johnson was chairman and secretary of Commissions for Scotland—a very distinguished Scottish Office civil servant; there was the chief constable of Renfrew and Bute, who is now assistant chief constable of Strathclyde; Mr. Chapman, the town clerk of Kirkcaldy, now the chief executive of Kirkcaldy District Council; Mr. Colquhoun, the town clerk depute of Glasgow; Mr. Evans, the county clerk of Midlothian; Mr. Grant, the town clerk of Dumfries; and Mr. Liddell, former town clerk of Greenock;
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there was Mr. MacLeod a former procurator fiscal from Edinbugh; there was the town clerk depute from Edinburgh; Mr. Russell, the county clerk of Aberdeen, now the chief executive of Grampion Regional Council, together with representatives of the Scottish Development Department (Local Government Division). All those people—
Lord Mackie of Benshie: I hope that the noble Lord will permit me to interrupt him. He has read out a list of very distinguished gentlemen serving on the committee, but every single one was a bureaucrat of some sort who thinks he knows best. There are not many members of the public represented on the committee.
Lord Ross of Marnock: There were representatives of the Scottish Development Department (Local Government Division), the Scottish Home and Health Department and the Solicitors Office. They met all sorts of people who were not bureaucrats. Even a bureaucrat can hire a taxi. Even a bureaucrat can stand and wait for a bus; even a Secretary of State can! I think that this categorisation of the people in the Scottish Office, eminent, with long service and the rest of it, as completely devoid of any knowledge of the rest of the world and how people live, is quite unworthy of the Liberal Party and even more unworthy of the noble Lord, Lord Mackie of Benshie. I can assure him that I probably have more contact with these people, every single one of them, than he has and I would not dismiss their experience in that particular way.
The point I want to make is that if we look at page 18, paragraph 11.50(b) which deals with taxis, the point is made as regards the distinction between taxis and hired cars that a far stricter code is necessary for taxis than for hired cars. The noble Lord, Lord Mackie, would probably agree with these distinguished bureaucrats in that regard. In fact he said so in his speech. When they came down to the question of control of numbers they had this to say:
" District and islands councils should have the power to determine the number of taxis allowed to operate "—
this is argument—
" This is necessary on the one hand to provide a service for the public ".
I think that the noble Lord, Lord Mackie, would agree with that. He wants a service for the public and so do these bureaucrats—terrible people; they are able to see into his mind and to put into words in one sentence what he took a sentence and a half to say. It goes on:
" and on the other to ensure that within the licensing area operators can make an adequate living ".
Does the noble Lord want these taxi drivers, who are so important in his area of the Highlands, to make an adequate living? Knowing the noble Lord, he will say, yes. Yet he would have wished upon them circumstances that might deprive them and drive them into bankruptcy, because there is an over-provision. We must get the balance right.
Lord Taylor of Gryfe: The noble Lord was asking about the provision to prevent them going into bankruptcy. The point was made that they still have the right of appeal to the traffic commissioners in

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relation to fares, and presumably the fares structure which would be agreed by the traffic commissioners would protect against the dire consequences which the noble Lord has outlined.
Lord Ross of Marnock: Not at all. There are far, far too many taxis all charging the same. Let us remember that the fares are laid down by the traffic commissoners. There is a point when you do not get sufficient customers for the number of taxis. It is as simple as that. There is no custom because there is an over-provision. That is the point. It has been made by the taxi owners and by the working party—these distinguished bureaucrats, as the noble Lord, Lord Mackie, calls them. It is a good thing that we are in Committee.
7 p.m.
Lord Mackie of Benshie: I want the noble Lord to realise that there are other methods of control. It may be far better for the taxi drivers to give up if there are too many of them, than simply to rely on the local authority providing them with a living. The local authority might, in fact, license far more taxis than are necessary. I am saying that even these distinguished gentlemen, whose minds work exactly like that of the noble Lord, Lord Ross, might not be as good as the general public in determining how many taxis there should be.
Lord Ross of Marnock: That is typical of the Liberal Party: let us have a superfluity; let everyone go bust and do something else, such as work in agriculture for the noble Lord, or something like that. But what about the actual taxis? They are very expensive vehicles. They have to go through all the hoops of being licensed as taxis. The Secretary of State—another bureaucrat will lay down exactly what kind of taxis they will be, how they will be equipped, and all the rest of it. He thinks that after spending all this time we should endanger the economic use of the taxi.
Of course, it is a matter of balance. But who is better able to deal with that than the district council of the new licensing authority, which will receive all the complaints about the provision and will be able to hear both sides and weigh them up, particularly if this provision is put into the Bill when it comes to actual applications for a taxi licence. It is a simple matter of provision and balancing it out. But if you do not include it, you get the position where the Minister suggests, " License everybody, provided that they meet the technical requirements ", and that kind of thing. We have seen this happen so often before. I can remember when buses first started in Ayr, there were about six different services. It was great for the customer, but five of them went bust and some people lost a great deal of money—they lost their livelihood. You do not want that kind of thing with something which, as is said, is an essential service.
I think that my noble friend Lord Underhill is quite right to press this point. It is a very limited sort of competition where everyone can get a licence but you cannot charge what you like, where the fares are laid down, in the first instance, by the licensing authority and then, on appeal, by the traffic commissioners.
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This is a recognition matter; there is a condition of semi-monopoly. In fact, this was virtually stated by the working party themselves. They went into this matter very fully, and the conclusion they reached was that there should be the power to determine the number of taxis allowed to operate. As far as I can understand, the licensing authorities with which I am more familiar are fairly generous in respect of this. They will never be able to be so restrictive as to please the taxi-owners; of that I am perfectly sure.
However, if you take away this power you imply—and it was implied in the speech (and I thought it was a very dangerous speech) of the Minister of State—that virtually everyone who applies and who meets the technical requirements must get the licence. What was the noble Earl's lovely phrase?—
" quantitative grounds restricting the activities for competitive business ".
I do not think that that applies here. It is a nice slogan; it is a nice principle for the party that the noble Earl represents.
Then he went on to say that there was very considerable resort to the hire market because of the absence of taxis. I think that he had better read the working party report, where he will discover the task or the job of taxis as compared with that of the hire car, for which even they suggested—and the Government found this acceptable—that there should be no restriction on numbers and no control of fares because it is a bargain struck between the person who hires the car and the driver or owner thereof. The whole position of taxis and hire cars is entirely different. It would be quite wrong to link the one with the other in his arguments about it.
Out of fairness to the public and out of fairness to the taxi driver, I think that we should allow the licensing authority, on which he is placing very considerable dependence in other ways, to be the judge in respect of the numbers, and give them the power to control numbers.
Lord Taylor of Gryfe: The noble Lord, Lord Ross of Marnock, is perfectly right; it is a matter of balance. In any legislation we have a duty to provide two things in this regard: first, an adequate service to the public; and, secondly, an adequate return to the man who is engaged in running a taxi business. In relation to the first, a substantial consumer interest is involved. I was wondering whether the Minister, when he has undertaken to consult with the Convention of Scottish Local Authorities on this matter, would also consult the Consumer Council in Scotland. When I get off the train from Edinburgh to Glasgow, I regularly witness a long line of people waiting for taxis in the rain and just now in very inclement weather—men, women and children—because there is not a very good public transport service to that part of town. I see them waiting for a very long time, unprotected from the elements.
There is a substantial consumer interest in providing enough taxis to ensure that the consumer gets a fair deal. So I would hope that the Minister might extend his inquiries in this regard and ensure that the balance is right by consulting the Consumer Council in Scotland as well as COSLA.
The Earl of Selkirk: My inclination is to support my noble friend in, I think, the very sympathetic approach which he made to what is undoubtedly a problem, because this is an integral service in a modern city today. The noble Lord has just given an example of where it might well fall down. I also know that the taxi drivers work very hard—at least many of them do—and they certainly deserve to get a full and reasonable living for so doing. But I should like to ask the noble Lord, Lord Underhill, who raised this, on what basis he would proceed. How would he reach the best result except by a balance? After all, there are part-time taxi drivers.
There is another matter. If the taxi service is bad, people will inevitably make other provision. There are a great many ways in which that can be done nowadays. I should like to see an excellent taxi service, in which case there must be an adequate number of taxis. Who is to decide what that is? I do not think that there is any way of deciding it theoretically, except by taking into account supply and demand.
The noble Lord, Lord Ross, spoke about people being deprived of their livelihood. In fairness, if anyone is deprived of a livelihood, they will give it up; people will not enter the service. There is an inevitable automatic balancing feature which takes place. I do not see how a basis could be reached, in theory, which would give a limitation which would be effective to the consumer and fair to the taxi driver. If the noble Lord, Lord Underhill, can explain in a convincing way how this could be done, I might change my mind, but at the moment I cannot see how it can be done.
The Earl of Mansfield: Before the noble Lord, Lord Underhill, decides what he is going to do—and, in view of my undertaking, I assume that he will withdraw his amendment, at least at this stage—I wonder whether I can put to him just what it is he has to do to convince the Government that his case is just. The Government have consulted the federation on a great number of occasions at official level. But the drawback to their arguments has been—as, in fact, my noble friend Lord Selkirk hinted—that they have produced a number of assertions of what they want to see, and not arguments based on fact. For instance, no hard evidence has been produced based on facts and figures that in areas, for instance, where the number of taxis is limited there has in any way been a more satisfactory scheme of things than in other areas where the number is not limited. Conversely, there have been no facts or figures produced that the kind of undesirable consequences which the noble Lord said would happen—for instance, part-timers and cowboys—have arisen, at any rate in an unsatisfactory manner.
Of course, the Bill provides for what I might call the quality of taxi driver in Clause 13, so that one must keep a distinction in this case between limitation of the number of taxis and the quality of those who drive them. That is something that the noble Lord has to get over. The other matter I wanted to mention is that I am extremely attracted by the request, if that is the word, of the noble Lord, Lord Taylor of Gryfe, that we should consult the Consumers Council, and I am delighted to give the undertaking that we shall do so.
Lord Underhill: May I just deal with a few points raised by the Minister. It was not I who said that the taxi trade was unique. It is unique under this Bill, but it was the Minister himself at the Second Reading who said that he recognised that because of,
" decisions by local authorities taxis could be said to be unique in being the only trade covered by the Bill whose charges are fixed not by market forces but by decisions of officials and, as it were, promulgated by local authorities ".—(Official Report, 24/11/81, col. 699.)
That is one of the big points for suggesting that there should be some limitation.
In case there is any dubiety about it, I must make it clear that I am not here as a consultant of the taxi trade. I have consulted the taxi trade, but have made it clear to them that I will only support amendments which I can justify for my own support for their case, and that is why I am putting forward this case now. The noble Lord, Lord Mackie of Benshie, said that if somebody cannot make a living, let them give up. That is rather a curious attitude for anybody to adopt. Surely we want to avoid that situation. We do not want to find a trade only of cowboys, so that legitimate people who want to make a regular, full-time living out of it all have to give up; but that is what would happen if one accepted Lord Mackie of Benshie's argument.
The Minister suggested that local authorities are not equipped to make this decision. I cannot believe that. I know very little about local authorities in Scotland, but I have had a fair amount of experience of local authorities in England and I cannot believe that an authority is not in a position to make this sort of decision. The noble Earl, Lord Selkirk, asked o what basis would it be done. Well, one would get the general consensus of demand by looking at the sort of point that the noble Lord, Lord Taylor of Gryfe, mentioned, to see whether there is a shortage of taxis at these points, or a superabundance. They would consult the police, or even the taxi trade. I am certain that the authority could make a decision upon this. I am as much interested in the interests of the public in this matter as I am in the interests of the taxi operators.
The Minister said that the question of market forces is somewhat limited in its effect because of the provision for appeal to traffic commissioners on the question of fares. I must ask, what is the Minister really suggesting? That if there are too many taxis and the operators cannot make a living, they then go to ask for higher fares? Surely that is not going to be an economic way out of the situation. It is a nonsensical way out of the situation. Therefore, I cannot see that that is the sole argument.
Under the terms of the amendment there would be flexibility on the part of the local authorities. They would not be compelled to fix any particular figure. They could vary it from time to time according to the situation. They could decide to grant additional licences if they consider that there is a necessity for so doing. Therefore, there is complete flexibility.
On the other two points, if we are not going to have limitation then surely there is a greater justification for the other points in the new clause that the representatives of the taxi operators should have the right to make objections or representations against new licences. This would be the only place where they

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would have the opportunity, if this is agreed, to say that there are far too many licences being given. I hope the Minister may look at that.
While I am grateful for his suggestion that he would be prepared to deal with greater publicity for registers, I hope he may say that he would also look at this question of representation, because if at the end of the day the Government are going to come down against limitation of the number of taxi licences, then surely that would justify up to the hilt the right of the taxi operators who have existing licences to make objections or representations if additional licences are going to be given.
I am grateful for his offer that he will arrange consultations with COSLA. I know there have been consultations with the taxi trade, but I hope it may be widened again, and in the light of the debate in this House that the Minister may have further discussions with the taxi trade. I am quite happy for some measure of the consumers being brought into this matter, because I believe this would be in the interests not only of the viability of those operating the taxis but also of the general public. In the light of what the Minister has said, I should like to study the debate carefully and see what may be done at a later stage. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
7.17 p.m.
Lord Underhill Lord Underhill moved Amendment No. 47:
After Clause 10, insert the following new clause:
(" Transfer of licences
.—(1) This section and section (Transfer of licences: supplementary provisions) below shall apply in relation to an application for the transfer of a taxi licence.
(2) A licensing authority may, on an application made to them in that behalf by a proposed transferee of a subsisting licence and in accordance with this section, transfer the licence—

(a) to a person proposing to take over the taxi to which the licence relates;

(b) where the holder of the licence has died before its expiry, to his executor, representative or disponee;

(c) where, before the expiry of a licence, its holder—

(i) has become bankrupt or has had his estate sequestrated;

(ii) has granted a trust deed for behoof of his creditors;

(iii) has become insolvent;

(iv) has become incapable of managing his affairs; to his trustee, judicial factor or curator bonis.

(d) where the licence was held by a company incorporated under the Companies Acts 1948 to 1980, to its liquidator, provisional liquidator, receiver or manager, if he has been appointed before the expiry of the licence.

(3) A licensing authority may, on an application made to them in that behalf by a person other than an individual natural person, substitute another employee or agent of the applicant for the employee or agent mentioned in sub-paragraph (6) of paragraph 5 of Schedule 1 to this Act, and in this Part of this Act references to the transfer of a licence shall, unless the context otherwise requires, include references to a substitution under this subsection.
(4) A licensing authority shall refuse an application to transfer a licence if—

(a) the person to whom it is proposed that the licence be transferred is not in their opinion a fit and proper person to be the holder of the licence;

(b) where the licence relates to an activity consisting of or including the use of premises, the person to whom it is proposed that the licence be transferred in their opinion neither is in possession of the premises nor has a right to possession conditional only upon the transfer to him of the licence; or

(c) where the transfer applied for is under subsection (1)(a)
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above, in their opinion the holder of the licence is capable of giving his consent to the transfer but has not done so.

(5) A licence transferred—

(a) by virtue of subsection (2)(a) or (3) above, shall have effect until it would have expired had it not been transferred;

(b) otherwise than by virtue of subsection (2)(a) or (3) above shall have effect until the next quarterly meeting of the licensing authority and—

(i) if no application has been made for its renewal, it shall then expire;

(ii) if an application has been made for its renewal it shall continue to have effect in accordance with sub-paragraphs (4) and (5) of paragraph 9 of Schedule 1 to this Act.

(6) A licence transferred under this section shall be held subject to the conditions under which it was held immediately prior to the transfer.").
The noble Lord said: Perhaps I may deal also with Amendments Nos. 47 and 48 because they deal with the same principle. We have already covered the general question of the transfer of licences in the amendment moved by my noble friend Lord Ross of Marnock dealing with the schedule, which would affect all activities for which licences are going to be granted. This deals solely with the question of transfer of taxi licences.
While I do not want to speak at length, there are a few points which should be made, and bearing in mind again that the working party, as my noble friend Lord Ross stressed, proposed that a licensing authority should have discretion to decide in what circumstances transfer should be allowed. I know there is the argument—this was stated by the noble Earl at Second Reading, and he has repeated it again this afternoon—that a private individual should not be in a position to make a financial benefit from what is fundamentally an administrative control.
There are sound reasons why, in the case of taxis, we should take another look at this. I was pleased that at the Second Reading the Minister said that he recognised that many local authority decisions indeed have a significant capital value. He stressed in particular planning decisions which affect the financial position in many cases of the person who is applying. In a number of cases the existing taxi licence-holder has himself paid a premium to acquire both the vehicle and his licence. Therefore, if he disposes of them at a premium there is in real terms no real profit, allowing for inflation.
If the right to transfer is to be abolished then clearly there is going to be a hardship on those who have already paid a premium in order to obtain their vehicle and licence—their business. This will be severe in those many cases where the operator has borrowed money for this purpose if he has to dispose of the business with the borrowed amount not repaid, and yet is going to be refused the opportunity to transfer the licence except on the basis, as outlined by the Minister, of a person submitting a normal application. The premium could never be unduly large because a local authority would always have the option to issue further licences, even if there existed the limitation which I proposed in the earlier amendment. Therefore it would always be in the power of the local authority to decide what should be done.
The Minister said the draft clauses applying to all licensed activities had been removed because they were too complex and cumbersome. I believe there is a

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sound case for taxi operators to be given this right, and if the proposed clause in the consultation document was too complex, applying to all licensed activities, it should not be beyond the wit of the Government to introduce some provision to provide an opportunity in the Bill for existing taxi licence-holders to have this right of transfer. If that is not in the Bill, local authorities could easily decide not to grant a licence to a person making an application and wishing to take over a business; whereas we believe there should be that right, otherwise there will be severe hardship in a number of cases of taxi operators.
The Earl of Selkirk: Is the noble Lord suggesting that the transfer would be for money?
Lord Underhill: Of course it would be for money. When a person transfers his taxi business, that is bound to be the case. Suppose a person has borrowed money to acquire a business. He has had to pay a premium for that business, including a taxi licence. Suppose he falls ill and must dispose of it. He still owes money. He wants the opportunity to transfer the licence and the business to someone else. If he does not have that right he will be in some difficulty.
I hope the Minister will appreciate that this is not just a case of somebody trying to profit from local authority decisions. It is a case where there has been an existing practice, not only in Scotland but in England and Wales, and unless this clause—or some other provision which the Government might care to introduce—is incorporated in the Bill, what is an existing practice will continue in many areas in England and Wales but not in Scotland, and that would be unfair as well.
The Earl of Mansfield: The noble Lord, Lord Underhill, has spoken to both his new clauses and I shall do the same. As he said, the specific arrangements which were contained in the White Paper for the transferability of any licence under the Bill, not just for taxis, were dropped as a result of views expressed by the local authorities that they were unnecessary and unduly complex. I must possibly correct what the noble Lord said in respect of the Working Party on Civic Government. The noble Lord was right to say that they said on page 18 of their report that The National Federation of Taxicab Associations was strongly of the view that a taxi licence should be regarded as property which could be sold or transferred with the vehicle. While there were arguments in principle against a licence granted by a local authority being sold for private gain, it is true that decisions by a local authority can have a significant capital value, and I quoted, as did the noble Lord, the example of planning permission.
Whether in fact taxi licences should have a capital value, which I understand in some cases can be worth several thousand pounds, is a matter which causes me a certain unease, and it obviously was something which the working party thought about. At any rate, they said—and this is significant—that the proposal for transferability " raises awkward questions of equity ", and they made no specific recommendation for transferability. They merely indicated that it would be up to individual licensing authorities to exercise
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discretion as in what circumstances transfer may be allowed. That is what the Government have provided for in the Bill. There is no reference to transfer, it is a matter which can be decided at the discretion of the individual authorities. This continues the situation under the Burgh Police Acts, where again there is no mention of tranferability.
This question of transferability is inextricably linked with questions of limitation, although at the moment there is limitation without statutory rights of transfer. It is plain that if there is no real limitation on taxi licences, the cash value of the licence and the protected right to operate is clearly very much reduced, if not completely so, if there is no limitation on numbers of licences. And of course in that instance the incentive for a right of transfer is more reduced and the capital value would go down, if not be completely eliminated.
Thus, I think one has to settle the question of limitation before one settles the question of transferability because, as I said, one goes with the other. As I said on the previous amendment, I propose to consult the convention and various other bodies, and I shall consult them on transferability at the same time. On the basis that all this will be gone into in considerable depth, I have no doubt before the next stage of the Bill, I hope the noble Lord will see fit to withdraw the amendment.
Lord Underhill: I am grateful to the Minister for repeating his intention to consult the Convention on this matter as well. I should like to feel, in the light of the points that have been made, that he will also consult the taxi trade. He has put forward some points on which their view as well as that of COSLA should he considered by the Government. On the basis of the Minister's agreement to have consultations I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 48 not moved.]
Clauses 11 to 13 agreed to.
Clause 14 [Signs on Vehicles other than taxis]:
7.29 p.m.
Lord Ross of Marnock Lord Ross of Marnock moved Amendment No. 48A:
Page 10, line 31, after (" on ") insert (" or above the roof of ").
The noble Lord said: This clause deals with signs on vehicles other than taxis and I suppose it could be construed as protection for taxis from " cowboys " or people who illuminate their vehicles or put signs on them so as to make people think they are taxis. This amendment, one in a series, is concerned with where the sign should be, and I suggest that it should be on or above the roof of the vehicle. That would be much clearer in terms of banning the use of words like " taxi " or " cab ", be it plural or singular, or " hire " or any other word having a similar meaning. This is probably the most important of the three amendments I have tabled on this subject, and I beg to move.
Lord Underhill: I should like to support my noble friend on this amendment. I know that when one is dealing with a Scottish Bill it is always dangerous to

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quote a Bill relating to England and Wales, but it was only in 1980 that the Transport Bill came before your Lordships. I was then involved in an amendment that dealt with roof signs on vehicles other than taxis and the words " or above the roof " appear in what is now the Transport Act 1980. They were inserted for the specific purpose of making certain that the provision would cover any sign above the roof. If we rely only upon the word "on", certain signs could fall outside the provision. I hope that the Government will accept the amendment and so bring the clause into line with a similar section in the English Act that the Government accepted as recently as 1980.
Lord Lyell: I am sure that the Committee is very grateful to the noble Lords, Lord Ross of Marnock and Lord Underhill, for speaking to this somewhat abtruse amendment, as it appears at first sight, but I hope that what I have to say will clarify the situation, even if only gently. As the Committee will see, Clause 14 attempts to deal with the problem of pirate taxis—though the noble Lords, Lord Ross and Lord Underhill, used esoteric language about " cowboys ". I do not know whether south of the Border taxi drivers are wont to wear quaint hats, heeled boots, or studded belts. However, I think that the Committee will be aware of the type of taxis that we are considering.
Certainly, this group of pirate or cowboy taxis includes vehicles that are not licensed as taxis and can thus be hailed, stopped or otherwise flagged down for hire, but which attempt to masquerade as licensed taxis. As no doubt the noble Lord, Lord Underhill, pointed out earlier, during consideration of the Transport Bill, later the Transport Act 1980, these pirate vehicles are a real problem for the public and indeed for the police, because frequently they display signs or marks of one kind or another in an attempt, no doubt often successful, to persuade members of the public that they are in fact lawfully available for flagging down or hailing in the street.
Clause 14 attempts to meet the problem by prohibiting the signs to which it relates from being displayed on any vehicle which is used for carrying passengers for hire or reward other than a licensed taxi. By referring to signs "on" the vehicle the clause prohibits such signs from being placed anywhere on the vehicle, whether it be on the roof, the sides, the boot, or any other place where they could be fixed. That would I think also cover a roof rack, which would prevent the sign from being in actual contact with the roof.
I would stress, in particular to the noble Lord, Lord Underhill, who takes a very close interest in the matter, that Clause 14 is based on, and draws on experience of, Section 64 of the Transport Act 1980, which, as the Committee is aware, applies in England and Wales. The wording of Section 64 is that which the amendment seeks to achieve, but it does not cover signs on other parts of the vehicle, and I am given to understand that this has opened a large loophole which has been duly exploited by the pirates, the cowboys, or other unlicensed taxi drivers in England and Wales. This has given much concern to the regulatory authorities and to the licensed taxi trade. For that reason the clause that we are now considering
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departs from the wording of the White Paper by referring to signs "on" all parts of the vehicle, not merely, as the amendment suggests, to signs on the roof, or to those that might be attached, even indirectly by means of a luggage rack or other contraption, to the roof.
I hope that I have been able to set at rest the fears of the noble Lord, Lord Underhill, over this matter. The noble Lord asked, why have we departed from the wording of the Transport Act 1980? I wish to stress to him and to the Committee that the legitimate taxi trade, which was represented by the National Federation, has welcomed the change that we are making in Clause 17, which is related to the clause that we are now considering. I hope that I have gone some way towards explaining the reasons why we do not believe that the amendment is suitable.
Lord Ross of Marnock: If I understood the Minister aright, he suggested that this was a very abstruse amendment. I suggest that in considering abstruseness he examines the Government's own proposals for a code of civic government in Scotland. On page 27 he will find, in relation to the proposed Clause 34, the words:
" There shall not be displayed on or above the roof of any hire car … ".
Those are the very words that I seek to include in the Bill— "on or above the roof of …". That covers a sign on a vehicle or above the roof of a vehicle. If that is left out, there could be affixed to the roof a sign that would not be actually on the vehicle. So I think that most of the Minister's arguments will disappear if he examines that point.
He suggested that there was a loophole. He seemed to imply that I was limiting the provision to the roof itself; I am not. The reference is to "on" a vehicle which is not a taxi but is used for carrying passengers for hire or reward. That probably means some type of hired car or minibus. I think that the position is fully covered by the words that I propose, and for the life of me, I do not see why he has turned them down—certainly not on the basis of what he has said. I hope that the Minister will have another look at this point.
I do not know whether there has been drawn to the attention of my noble friend the great weakness of the words that he inserted in the English Bill. I should be very grateful for any further information that is forthcoming. I hope that the noble Lord, Lord Lyell, will make another effort to convince me. It may appear that I am a wee bit dense this evening, but I am not unusually so.
Lord Lyell: I had hoped that my fairly full remarks on this problem would have persuaded the noble Lord, Lord Ross. I went to some lengths to point out to him and to the Committee that the word "on" that we have included in the clause covers the problem that he raises and that his amendment is unnecessary. I shall repeat once more the reasons why we departed from the wording in the White Paper, which the noble Lord said was the bible of abstruseness issued from the Scottish Office. We made the departure because we believed that the wording had opened a loophole, and as I stressed to the noble Lord, Lord Underhill,

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our proposal met the fears of the National Federation. We understand that the courts have interpreted the wording " on or above the roof " very widely as referring to the roof only.
I am afraid I would not be able to come up with any better argument. Indeed, the noble Lord took time out to tease me at an earlier stage about my home being the centre of football. I would suggest to him that he should consider the number " on " the shirt " on " the back of his beloved players. Perhaps he may care to ponder on that. I think the number " on " the players' shirts is quite convincing to me. If he would think of that, then I think he might see the simile as allied to his taxi-cabs.
Lord Ross of Marnock: I shall really need to read that speech to find the grave import of it, but I could not press an amendment after a speech like that. No, I must withdraw it and reconsider it. While I am on my feet, I can inform the noble Lord the Lord Chairman that I shall not be moving the next two amendments.
Amendment, by leave, withdrawn.
[Amendments Nos. 48B and 48C not moved.]
Clause 14 agreed to.
Clauses 15 and 16 agreed to.
Clause 17 [Appeals in respect of taxi fares]:
Lord Ross of Marnock Lord Ross of Marnock moved Amendment No. 48D:
Page 12, line 24, leave out sub-paragraph (ii).
The noble Lord said: Sub-paragraph (ii) deals with the powers of traffic commissioners in respect of an appeal that has been made to them; that is, an appeal on the subject of taxi fares. Sub-paragraph (ii) says:
" if less than two years have elapsed since they decided an appeal against a decision of the same authority in respect of the same scale or part thereof, and they consider it inappropriate that they should consider the matter again ",
then they may decline to proceed. I think that in these days of inflation this is a bit much. It is a bit much that, simply because they consider it inappropriate, whatever that word means—I do not know what it means in these particular circumstances—and simply because it is less than two years since there was an appeal against the same scale, they are allowed to decline to proceed.
Let us remember that the decision of the traffic commissioners on an appeal under this clause shall be final. That being so, I think we have to look at this a little closely, as to the fairness of it. It is simply because less than two years have passed since they looked at the question of an appeal in respect of the same scale. Two years! My goodness! I do not think they should be allowed to get away with this one for six months, far less two years. I think this is a bit unfair, and we certainly should not give them the protection of two years.
It is not that I want to see taxi fares rising and rising, but if it is less than two years they can say, " We are not going to look at it because we think it is inappropriate ". They do not need to give any reason; they just have to think that it is inappropriate. I do not think that is right; I do not think it is fair; I do not think it is just. I am sorry that my noble friend from the SDP, who thought that traffic commissioners were going to be a great protection, has gone. I wonder
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how he would have reacted to this. I wonder how he would have reacted to it in respect of railway fares, bus fares or anything else. Is the same power there in respect of turning down appeals against an increase in fares in respect of buses and the other matters that traffic commissioners cover? I do not know the reason for this provision at all, but I think that we should forget it. I think we should leave this subparagraph out. I beg to move.
Lord Lyell: The noble Lord has made some very important remarks about this particular clause that we have before us tonight. He, and I am sure your Lordships, will note that the whole of this clause is entirely new, that it was not contained in the (was it?) abstruse document quoted in the pale blue paper that the noble Lord was producing to your Lordships a while ago. Indeed, it was not in the consultation document. But certainly the amendment which has been moved by the noble Lord, Lord Ross, would remove from the traffic commissioners what we believe to be an important discretion not to proceed with an appeal on taxi fares in certain circumstances.
We regard the introduction of the appellate procedure in Clause 17 as a most important step forward. For the first time all the taxi trade—every single member of it—have the right of appeal on taxi fares fixed by a local authority. This also has to be reviewed in the light of the fact that local authorities, in terms of Clause 16 (which, if your Lordships will look back at page 11, line 28, your Lordships will see provides for such a review) must also review fares of taxis at least every 18 months; and, naturally, the trade may appeal on the outcome of such a review, including where the local authority decide to do nothing following such a review.
Given such an important innovation, we think it is crucial that the appellate procedure should work properly. One of the circumstances in which the appellate procedure could become overloaded and, indeed, cumbersome and all the other things that were suggested by the noble Lord, Lord Ross—unfair, unjust and all the rest—to the detriment of the taxi trade as a whole in an area, would be if the commissioners were to be swamped by frivolous and too frequent appeals. In order to guard against the possibility of such a danger sub-paragraph 18(2)(b) provides that the commissioners may decline to proceed if, on any appeal, less than two years have elapsed since the last appeal on the same scales and they consider it inappropriate to consider the matter again.
This is in no sense a bar against appeals within two years; it simply allows the commissioners to use their discretion as to whether it would really be appropriate in all the circumstances to proceed with the appeal. Not to allow such a discretion could well endanger the whole appellate procedure, and we believe this would be to the ultimate detriment of the taxi trade. For this fairly simple reason, I would suggest that we cannot accept this amendment.
Lord Ross of Marnock: I think the Minister should make up his mind. He should be very careful of his use of words. I do not see the word " frivolous " mentioned in this sub-paragraph. Nor did I mention it. He was the one who mentioned it. The word

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there is " inappropriate ". It is not defined. It is left entirely to the traffic commissioners, and this is one of the things to which I object. If we want the new appellate procedure to be respected and highly regarded, then I think we should start in the first instance on the basis of complete justice and fairness. Did the traffic commissioners suggest that they should have this power, or was it the Government's desire in some way or another to anticipate the wishes of the traffic commissioners? I think it is quite wrong to put this in, and to do that in this particular way. I hope the Government will think about it again.
I do not know whether the noble Lord wants to say anything before I make my decision about this amendment, but he is smiling. I do not know whether he is agreeing with every word I say, but I doubt it.
Lord Lyell: I think everybody is smiling since I indicated my dissent from wishing to add anything further to my possibly lengthy explanation.
Lord Ross of Marnock: I thought it one of the clearest explanations we have had for a long time from the noble Lord. I hope he will have another look at it because it does not entirely fit in with my ideas of justice, of fairness and the right way to proceed with this new form of appeal—bearing in mind the question of a final appeal. There is no appeal even from the point of view of law; you have got to get it right in this particular instance. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
The Deputy Chairman of Committees (Lord Drumalbyn): Amendment No. 48E is wrongly placed and should be Amendment No. 49. I do not propose to call it unless—
Lord Ross of Marnock: It is right; but it is in Clause 23.
Clause 17 agreed to.
Clause 18 to 21 agreed to.
Clause 22 [Interpretation of sections 10 to 22]:
On Question, Whether Clause 22 shall stand part of the Bill?
Lord Ross of Marnock: I want to ask a question on hire car or taxi. Does this cover minibus? Here we have a definition of taxis and hire car. Can the noble Earl tell the Committee whether these definitions cover minibus? More and more of these are used not as regular passenger traffic but from the point of view of taking people to particular functions, obviously on the basis of hire. Is this covered in this definition of hire car?
The Earl of Mansfield: Nothing in front of me would suggest other than that hire car means what it says, and it means any vehicle other than a taxi or public service vehicle which is quite differently provided for under the 1981 Act. If I am wrong about this, I will let the noble Lord know directly, but my instinct is that a minibus is merely a car with rather more seats in it.
Lord Ross of Marnock: So the answer is, Yes?
The Earl of Mansfield: The answer is, Yes.
Clause 22 agreed to.
Lord Ross of Marnock: I wanted to move my Amendment No. 48E.
The Deputy Chairman of Committees: I thought we agreed not to call it. Does the noble Lord think that the amendment is in Clause 17?
Lord Ross of Marnock: It is a paving amendment to the next amendment. We must leave out the word " or " which conjoins certain things and place it further down. I beg to move the amendment in my name on the Marshalled List.
The Deputy Chairman of Committees: I am afraid that I must rule that out of order. It is not to be found in Clause 17. It is to be found in Clause 23 and it is in the name of the noble Viscount, Lord Thurso. It is exactly the same thing. The noble Lord, Lord Mackie, is going to move it.
Lord Ross of Marnock: I thought that the attention of the Deputy Chairman had been drawn to it. It says, " page 16, line 31 ".
The Deputy Chairman of Committees: It is under the heading of Clause 17 on the Marshalled List. I think we could simplify matters. The noble Lord can speak on the amendment; but it is up to the noble Lord, Lord Mackie of Benshie, to move it.
Clause 23 [Second-hand Dealers' licences]:
7.54 p.m.
Lord Mackie of Benshie Lord Mackie of Benshie moved Amendment No. 49:
Page 16, line 31, leave out (" or ").
The noble Lord said: Amendment No. 49 is a paving amendment for Amendment No. 50. Amendment No. 50 contains the essence of the matter. Our attention has been drawn to this in that it appears that a person who is carrying on a hire purchase business, which is a method by which an enormous amount of business of the country is done, is subject to the rules for licensing and regulation of second-hand dealers which you could say, in pure terms, he was but in fact his business is quite different. It is possible that it could be covered by Clause 23(d) which reads:
" a person whose business as a dealer in second-hand goods or articles is incidental to another business of his, not being that of a dealer therein ".
I was assuming that this sort of thing was intended to cover a garage selling new cars and, as a part of that business, selling second-hand cars. In view of the immense importance of the financing of the general level of business in the country by hire purchase, it appeared to us that this was a sensible amendment, and I await to hear what the Government will say.
Lord Lyell: The noble Lord was seeking some clarification with his two amendments. I hope it will be convenient for me to deal with both Amendment No. 49 and Amendment No. 50. Certainly it is not

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our intention to bring commercial enterprises such as finance companies or anything in that nature within the scope of the clause dealing with second-hand dealers. I would therefore make it clear that we accept the principle behind these two amendments that finance houses should be exempt; but we are not entirely certain whether the amendment is required to achieve this. I would undertake to consider this amendment and, certainly, to introduce an amendment of our own if necessary.
I confirm that the Finance Houses Association wrote to my right honourable friend the Secretary of State at the end of November this year suggesting that the amendment was necessary and they drew our attention to certain amendments which had been made in relation to a number of English Private Acts which had been considered by your Lordships' House. We shall look closely at the examples quoted by them in considering whether amendment is necessary in the Bill before your Lordships now and, if so, what form it should take. I hope that that will go some way to settling the fears of my noble neighbour Lord Mackie of Benshie.
Lord Mackie of Benshie: In view of that assurance and of the attitude of the Government, I beg to withdraw Amendment No. 49. I will not move Amendment. No. 50.
Amendment, by leave, withdrawn.
[Amendment No. 50 not moved.]
Lord Denham: I understand that the noble Lord, Lord Ross, has matters of some substance to raise on the question of whether the clause stand part of the Bill. As there has been general agreement that we should rise at eight o'clock, I beg to move that this House do now resume.
Moved accordingly, and, on Question, Motion agreed to.
House resumed.

Civil Aviation (Amendment) Bill
Brought from the Commons, read a first time, and ordered to be printed.
Housing (Amendment) (Scotland) Bill
Brought from the Commons endorsed with the certificate of the Speaker that the Bill is a Money Bill, read a first time and ordered to be printed.
House of Lord's Offices
First Report from the Select Committee made, and ordered to be printed.
  MR FRANCIS MARRITT: SEGREGATION UNDER RULE 43
  MR FRANCIS MARRITT: SEGREGATION UNDER RULE 43
  GOVERNMENT TRAINING SCHEME BUDGETS
  GOVERNMENT TRAINING SCHEME BUDGETS
  HOUSING CONDITIONS IN RIOT AREAS
  HOUSING CONDITIONS IN RIOT AREAS
  THE A.34 WHITWAY DIVERSION
  THE A.34 WHITWAY DIVERSION
  NORTHERN IRELAND: CGT EXEMPTION ON HOUSE SALES
  NORTHERN IRELAND: CGT EXEMPTION ON HOUSE SALES
  NICC REFORM: CONSULTATIVE DOCUMENT
  NICC REFORM: CONSULTATIVE DOCUMENT