Sitting of 11 May 1981

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

  PRIVATE BUSINESS
  BRITISH RAILWAYS (PENSION SCHEMES) BILL
  Read the Third time and passed.
  BRITISH TRANSPORT DOCKS BILL
  As amended, considered; to be read the Third time.
  COUNTY OF KENT BILL [Lords] (By Order)
  Order for Second Reading read.
  To be read a Second time tomorrow.

Oral Answers to Questions
  WALES

    Common Agricultural Policy
    Sir Anthony Meyerasked the Secretary of State for Wales what representations he has received from farmers' organisations in Wales calling for an end to the common agricultural policy.
    The Secretary of State for Wales (Mr. Nicholas Edwards): None, Sir.
    Sir Anthony Meyer: Does my right hon. Friend agree that, without the protection afforded by the framework of the common agricultural policy, Welsh farmers would be at the mercy, alternatively, of demands from the Labour party for cheap food from wherever it could be bought, and of pressure from the Treasury to make short-term economies in current expenditure, whatever the damage to long-term interests might be?
    Mr. Edwards: I agree with my hon. Friend about the importance of European assistance to our agriculture industry, particularly when the settlement has put about £325 million in a full year into British agriculture. There may be Treasury intransigence under Labour Governments, but that cannot be said of Treasury Ministers of the present Administration in a year in which there has been a substantial financial injection into horticulture and in which the hill livestock compensatory grants have been increased.
    Mr. Geraint Howells: Does the Secretary of State not agree that it is better to reform the common agricultural policy than to abolish it?
    Mr. Edwards: I am sure that we all agree about the need for further reform and welcome the fact that the total share of the European budget taken by the CAP as well as the British contribution to it has been reduced this year.
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    I am sure that we all want the reform of the CAP to continue, while accepting its fundamental importance to the health of British agriculture.
    Mr. Roy Hughes: Is it not true that farmers over the years have not been particularly wise in their political judgment, as their blanket support for the Conservative Party seems to demonstrate? Is it not time that they realised that the agriculture support system introduced by the post-war Labour Government was far more satisfactory all round? Shall we not have to get back to that system, once a Labour Government take Britain out of the Common Market?
    Mr. Edwards: The Labour Party spokesman for agriculture appeared to threaten the whole system of grants for agriculture the other day, so the agriculture sector generally seems to have been wise in its political judgment.
    Mr. Best: The hon. Member for Newport (Mr. Hughes) clearly has few farmers in his constituency because he does not appear to speak with authority on their behalf. Does not my right hon. Friend agree that Welsh farmers also benefit greatly from the less-favoured area status in the EEC, a status which my farmers in Anglesey hope will come to them at some stage?
    Mr. Edwards: My hon. Friend has been assiduous in his representations on behalf of Anglesey farmers in that connection. I have already told him that Anglesey will be carefully considered in the review of the less-favoured area status in Wales.
    Mr. D. E. Thomas: Does not the Secretary of State accept that many farmers are critical of the intervention scheme and would prefer the same scheme to operate for beef as for lamb, since that system is far nearer to the old British system?
    Mr. Edwards: No doubt farmers have different opinions about different schemes, as on other issues, but I am sure that they all welcomed the continuation of the beef premium scheme, which is so important for that sector. That scheme, with the better assistance and the lamb premium scheme, provides £300 million of direct benefits for the British consumer. That should not be overlooked.
    Dr. Roger Thomas: Is not the main thrust of farmer representation the refusal by Britain to emulate the national stance on agriculture taken by other member States? For example, have not the French subsidised by 50 per cent. turkeys sold in Britain at 36p per pound?
    Mr. Edwards: The Minister of Agriculture, Fisheries and Food has made the strongest possible representations to the Commission about that scheme and the Commission is examining it.

    Public Works Programme
    Mr. Roy Hughesasked the Secretary of State for Wales if he will consult representatives of the building and construction industry with a view to organising a public works programme to help alleviate unemployment in Wales.
    Mr. Nicholas Edwards: There is regular contact between my Department and representatives of the industry. The Under-Secretary of State, my hon. Friend

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    the Member for Conway (Mr. Roberts), will be meeting the National Federation of Building Trades Employers in July. There is already a substantial capital works programme which benefits the construction industry in Wales and I have no plans for increasing it.
    Mr. Hughes: With mass unemployment now sweeping the country, is not such a public works programme with import controls what the country needs? Would not it be better for the Government to concentrate on building houses instead of pressurising local authorities such as Newport to sell prefabs, which is against the public interest?
    Mr. Edwards: We note that the hon. Gentleman supports a controlled economy. However, he should not underestimate the scale of the capital programme in Wales. About £100 million a year is being spent on the roads programme, £38·3 million on the Health Service and £47 million on the Welsh water authority. The factory building programme by the Welsh Development Agency, which is of direct benefit to the hon. Gentleman's constituency, is responsible for employing about 3,000 people in the construction industry.
    Mr. Wigley: Does the Secretary of State recall his visit to Llanberis a year ago to the major construction scheme by the CEGB at Dinorwic? Where will the 2,000 people who are employed on that scheme and who are to lose their jobs find other work?
    Mr. Edwards: As the scheme is phased out, a serious problem will be created. That is one reason why we are pressing on urgently with the A55 programme, which will be of direct benefit to the hon. Gentleman's constituency. I regret that a major part of that scheme—the Bangor bypass—is being held up by one individual's legal challenge.
    Sir Raymond Gower: I appreciate the public works to which my right hon. Friend refers, including the factory building by the Welsh Development Agency. However, in future consideration of such matters, will he take account of the fact that the construction and building industries are not largely dependent upon imported materials? Will he also take account of the particular and peculiar problems of smaller builders?
    Mr. Edwards: Of course we must take account of those matters. However, we must also recognise that construction programmes, however desirable and wherever they are, must be paid for by taxes and burdens on other parts of industry. One must achieve a balance. It is a myth to think that there is a miraculous cure for our economic difficulties involving capital projects in unspecified terms.
    Mr. Tom Ellis: Will the right hon. Gentleman confirm that only one road laying machine has been working in North Wales this winter?
    Mr. Edwards: A major road building programme is continuing in North Wales. It is hard to believe that only one machine has been working on that programme, which has been continued successfully.
    Mr. Alec Jones: Does the Secretary of State realise that it is extremely difficult to reconcile his figures with the industrial index for production in the construction industry in Wales, which fell by about 16 per cent. last year? There are large stocks of building materials and
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    thousands of workers in the dole queues. It is difficult to accept the figures. Does the Secretary of State recall that, in the 1930s, many major roads in South Wales were built as a result of public works programmes? Is it not time for an extended public works programme, not only to create employment but to improve the infrastructure, which Wales will need if there is ever an upturn under the present Government?
    Mr. Edwards: There has never been such a massive infrastructure programme as that which is being carried out today. It is having a direct benefit on the construction industry. The son of my hon. Friend the Member for Folkestone and Hythe (Sir A. Costain) was telling me only this week of the benefits to his company of participating in that massive programme in Wales.

    Primary Schools
    Mr. Knoxasked the Secretary of State for Wales how much was spent per pupil in primary schools in Wales in each of the past three years.
    The Under-Secretary of State for Wales (Mr. Michael Roberts): Net recurrent expenditure per head on all pupils in maintained primary schools in Wales was £338 in 1977–78, £384 in 1978–79 and £446 in 1979–80, at outturn prices. These figures exclude school meals, milk and transport.
    Mr. Knox: Does my hon. Friend agree that, if there is a connection between standards and the amount of money spent on education, the figures show that there is no reason why standards should have fallen in the last few years and strong reasons why they should have risen substantially?
    Mr. Roberts: Consistently since the Second World War Britain has spent a greater share of its gross national product on education than most of its industrial rivals. Between 1960 and 1980 we increased by 64 per cent. in real terms the amount spent per pupil in primary schools. That increase was not matched by a similar increase in standards.
    Mr. D. E. Thomas: Does the Minister accept that his inspectorate has just made a report which clearly shows that standards in primary and secondary schools in Wales are under threat because of the public expenditure cuts forced upon authorities by his Department?
    Mr. Roberts: I have read carefully the report by the inspectorate. It came to the conclusion that the fabric of education was intact.
    Sir Anthony Meyer: Is not the pupil-teacher ratio as good as, or better than, it has ever been?
    Mr. Roberts: The pupil-teacher ratio in Wales bears out the conclusion of the HMI report. It is at its best level.
    Dr. Roger Thomas: Did not that HMI report highlight a reduction in the quality and variety of education provision in the primary schools, in rural areas in particular?
    Mr. Roberts: No, Sir. The report made it clear that our education standards are being maintained.

    Unemployment (Mid-Glamorgan and Gwent)
    Mr. Hudson Daviesasked the Secretary of State for Wales what is the percentage increase in the level of

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    unemployment for the combined areas of Mid-Glamorgan and Gwent since May 1979; and what steps he proposes to take to reduce this figure.
    Mr. Nicholas Edwards: The figure is 79·4 per cent. to March 1981, the latest date for which unemployment figures are available on a county basis. Government policies have already achieved a sharp reduction in inflation and improvements in competitiveness. Interest rates are already lower than in most other countries. In addition, the major programme of factory building and regional assistance is already attracting substantial new investments to the area and more can be expected as the economy moves out of recession.
    Mr. Hudson Davies: Is the Secretary of State aware that it is an indictment of the Government's failure to tackle the problem that the Labour Party made such inroads in the county council elections in South Wales last week? Is he further aware that the problem will be exacerbated since 5,773 young people on temporary youth opportunities programme work will be back on the labour market and in Mid-Glamorgan alone 11,000 new people will join the labour force in the next five years as a result of the birth boom of the 1960s? Will he tackle that?
    Mr. Edwards: If the hon. Gentleman wishes to bandy statistics, I must tell him that the youth opportunities programme has been substantially increased from 7,100 to 10,200 places in Mid-Glamorgan, for example. I am encouraged that there was a sharp upturn in the early part of this year in the number of visits paid by prospective investors in Wales. The Welsh Development Agency has announced that, of the 289 visits made in the 1980–81 financial year, 197 were made since January. That shows a considerable interest in investment in the area.
    Mr. Hooson: Will my right hon. Friend tell the House about the increase in unemployment in the same areas during the last Labour Government?
    Mr. Edwards: I cannot remember all the statistics, but I well recall that, when the present Leader of the Opposition was responsible for employment in the Labour Government, unemployment in his constituency trebled.
    Mr. Alec Jones: Many of the 147,000 unemployed in Wales would welcome a return to the levels of unemployment which obtained under the Labour Government? The figures that the Secretary of State announced today—
    Mr. Speaker: Order. The right hon. Gentleman must ask a question.
    Mr. Jones: I apologise, Mr. Speaker. Does not the Secretary of State accept that his announcement of a 79·4 per cent. increase in unemployment is a condemnation of Government policies? Is he aware that that condemnation was shared by the people of Gwent and Glamorgan last Thursday when the Tory Party lost 47 seats?
    Will the right hon. Gentleman explain to county councils and other councils why the grant-aided capital expenditure on the youth opportunities programme element of the manpower services schemes will in future count against local authority capital expenditure? Why was that change introduced without any discussion with local authorities?
    Mr. Edwards: As usual, the right hon. Gentleman asked about three questions in the middle of his speech.
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    As he takes consolation from the improvement in his party's electoral position in this mid-term period, I hope that he will also take consolation from the more important fact that in Mid-Glamorgan this year eight factories have been allocated and seven more provisionally allocated. There is a widespread interest in new investment and in new job creation in the area.

    Job Prospects (Saltney)
    Mr. Barry Jonesasked the Secretary of State for Wales if, in view of the proposed closure of the No Nail Boxes Ltd. factory at Saltney with the loss of 150 jobs, he will meet the Alyn and Deeside district council and the Welsh Development Agency to draw up a programme to create new job prospects on the Saltney industrial estate: and if he will make a statement.
    Mr. Nicholas Edwards: I shall continue my practice of regular meetings with local authorities in the area. I have recently approved a further programme of factory building by the Welsh Development Agency in the Shotton area amounting to 212,000 sq ft.
    Mr. Jones: Does the right hon. Gentleman know that 2,500 redundancies have already been announced this year for the area between Chester and Mostyn in my constituency? In what way can he direct the WDA to bring new work to the Saltney industrial estate? Does he agree that the No Nail. Boxes board behaved in a sneaky and ungenerous manner by not telling its work force of its talks with the Welsh Office about its application for special financial assistance?
    Mr. Edwards: Eight factories in Alyn and Deeside have been either confirmed or provisionally allocated this year. The hon. Gentleman will be pleased to know that this morning WIDAB recommended that BICC should be given a grant of £735,000. Subsequently, the boards of BICC and Corning Glassware Inc. have announced that they will go ahead with the project in Deeside to provide 150 skilled jobs, which will bring new technology to the area.
    Sir Anthony Meyer: I am proud to say that Mostyn is in my constituency, not in the constituency of the hon. Member for Flint, East (Mr. Jones). Will my right hon. Friend note that that thriving and go-ahead port has gone from strength to strength since it was relieved from the threat contained in the Labour Government's Dock Work Regulation Act 1976?
    Mr. Edwards: I am delighted to hear that. Mostyn can be sure that under this Government it will be given every encouragement.

    Local Authorities (Manpower)
    Mr. Hoosonasked the Secretary of State for Wales what is the range of manpower reductions achieved by Welsh local authorities since May 1979; and whether he is satisfied with progress to date.
    The Under-Secretary of State for Wales (Mr. Wyn Roberts): From the end of May 1979 until the end of December 1980, the latest date for which figures are available, local authority manpower in terms of full-time employees and full-time equivalents in Wales has been reduced by about 2 per cent. Although the downward trend

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    has been encouraging, it must be maintained if Welsh authorities are to meet the public expenditure targets we have requested.
    Mr. Hooson: Will my hon. Friend identify the local authority with the best performance and that with the worst performance? Will he confirm that it is possible to achieve substantial economies without undermining local government services?
    Mr. Roberts: I do not wish to comment on the performance of individual authorities because their circumstances vary widely. However, while some authorities have been making efforts to reduce their staff, others have not. It is nonsense to suggest that local government services are being destroyed. We are simply asking local authorities to bring down their current expenditure to the level that it was five years ago in real terms, at the time of the last Labour Government.
    Mr. Wigley: How many of the full-time equivalents that have been reduced and jobs lost relate to home helps? What additional cost and burden has that placed on the National Health Service?
    Mr. Roberts: I do not have a precise analysis of the reduction in manpower. I do not think that the hon. Gentleman expects me to carry them in my head, or even on a piece of paper. Much greater efficiency could be obtained in local government services without their being disrupted.
    Sir Anthony Meyer: Does my hon. Friend agree that the need to reduce staff is not a valid reason for refusing to implement the Government's policy on the sale of council houses?
    Mr. Roberts: I certainly agree with my hon. Friend. Local authorities have a duty under the Housing Act 1980 to sell to those who have the right to buy. Many local authorities have previous experience of selling council houses. They can also make use of private sector services and change the duties of those already engaged within their housing departments.
    Dr. Roger Thomas: Does not the Minister agree that hardly a social services department in Wales has not had to cut back on staff who care for the elderly and those least able to defend themselves? Does he not agree that the loss of such people means a loss of care and a deterioration of services?
    Mr. Roberts: I do not agree that there has been a deterioration of services, especially in the social services sector. I have visited every social services department in Wales. I have met directors and chairmen of social services committees. There is scope for greater efficiency in that area, as there is elsewhere.

    Economic Policy
    Mr. Wigleyasked the Secretary of State for Wales if he will make a statement on the effect of the Government's economic policies on Wales.
    Mr. Nicholas Edwards: The massive programme of factory building, infrastructure improvement and financial support for industry has been designed to cushion the worst effects of the recession and assist change. As a consequence, even in the last year we have been able to attract a large number of new investments and with the
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    general improvement in competitiveness and good industrial relations in Wales we are now well placed to take advantage of the recovery.
    Mr. Wigley: Will the Secretary of State name one policy that has actually worked for Wales?
    Mr. Edwards: There is no doubt that the improved competitiveness of British industry provides the greatest chance of success in the world. People will buy our goods only if we are competitive and if they want to buy them. The improved competitiveness throughout British industry is the most hopeful factor for the industrial recovery of Britain.
    Sir Raymond Gower: Does not my right hon. Friend have evidence that many overseas visitors have been greatly impressed with the building of new factories and the clearance of sites in many parts of industrial Wales?
    Mr. Edwards: There has been not only a great appreciation of the industrial sites that we are able to offer, but recognition of the excellent industrial relations in many of the existing plants in Wales. I am glad to say that the senior management of Inmos told me only this week that they are having no difficulty in attracting the highly skilled personnel that they need for their plant in Wales. That augurs well for the future.
    Mr. Ioan Evans: Have not the Government's economic policies had disastrous effects on employment prospects, with a more than 80 per cent. increase in unemployment in Mid-Glamorgan since the Secretary of State took office? Will he seek to restore to those areas the special development area status of which they have been deprived by the Government's policies?
    Mr. Edwards: The future prospects of the area lie in the attraction of inward investment and the growth of companies. It is encouraging that companies such as Yuasa are setting up operations, that such companies as Smiths Industries are transferring new work to Ystradgynlais and that many other encouraging developments are taking place.
    Mr. Garel-Jones: Will my right hon. Friend confirm that one of the specific areas in which the beneficial effects of Government economic policy may be seen is the Llanwern steel works, where the level of productivity is equal to, or better than, most of our competitors in Europe?
    Mr. Edwards: It is that fact that gives that steel works a real chance of survival in a highly competitive world industry.
    Mr. Alec Jones: Does the right hon. Gentleman agree that if he gave a complete answer on the effect of the Government's economic policies in Wales it could be summed up in one word—"disastrous"? That was the judgment passed on him and his Government last Thursday. It is a judgment that will be echoed by most political parties in Wales and by most organisations. The only people in Wales who support the Government's policies are Tory Ministers and some Tory Members. Will he now answer the supplementary question that I asked him previously? Why has there been a change in policy for the capital expenditure of local authorities on MSC schemes? The right hon. Gentleman has boasted about the schemes but the change will place many of them in jeopardy.
    Mr. Edwards: While the right hon. Gentleman sells Wales short once again, overseas investors such as Mitel are expressing their confidence in the future.

    Steel Areas (Industrial Development)
    Mr. Bestasked the Secretary of State for Wales what part of the £48 million allocated for industrial development in the steel areas of South Wales was due to be spent in 1980–81; and how much was actually spent.
    Mr. Nicholas Edwards: A total of £24·8 million was to be spent during 1980–81—£21·7 million by the Welsh Development Agency and £3·1 million by the Cwmbran development corporation. Both bodies spent their full allocation.
    Mr. Best: Will my right hon. Friend try to extract at least some grudging praise from the Jeremiahs of the Opposition in an acknowledgement that this is the largest investment programme for Wales that has ever been seen in the Principality? Will he go further and convince the people of Wales that there will be the same level of investment for the Principality next year? May I ask him to give that commitment today?
    Mr. Edwards: My hon. Friend is aware that we had approximately half of the special programme in the first year and that there will be a substantial programme in the coming year. I was hoping that I would extract from the Opposition an apology for their early-day motion tabled earlier in the year in which they confidently forecast that there would be an underspend in the £24·8 million programme.
    Mr. Roy Hughes: Are not these figures a flea bite compared with the calamitous proportions that unemployment has reached? Does the right hon. Gentleman agree that the people are fed up with the Government's economic policies, as the county council elections clearly revealed last Thursday? Will he bear in mind that in a steel making area such as Newport only one Conservative candidate was returned?
    Mr. Edwards: The hon. Gentleman may consider that the figures amount to a flea bite. However, his constituency is getting a large chunk of the capital programme that is being spent. It has benefited considerably by the arrival of some major new industries. I wonder whether his judgment will be shared by the many people who will be gaining employment in his constituency as a result of the Government's spending programme.
    Mr. Alec Jones: We welcome the right hon. Gentleman's statement about Government spending. Will he inform the House how much of that money was spent on building and how much on the acquisition of land?
    Mr. Edwards: Of the detailed programme that was announced by the Government at the beginning of the year, in which we set out the allocation, 90 per cent. of the factory space that was announced is under construction and the remainder will shortly be started. As the right hon. Gentleman knows, there is a substantial building programme. I suppose that I must take his intervention as his apology for making such an absurd allegation earlier that we would not spend the money that needed to be spent.

    Jobs
    Mr. Geraint Howellsasked the Secretary of State for Wales how many jobs have come to Wales since May 1979; and how many jobs have been lost in the same period.
    Mr. Nicholas Edwards: Comprehensive information is not available on job gains and losses. An indication of net changes in employment levels can, however, be gained from the Department of Employment's quarterly estimates of employees in employment. Latest available figures indicate a net decrease between June 1979 and December 1980 of 80,000.
    Mr. Howells: In view of the seriousness of unemployment in Wales, may I ask the right hon. Gentleman to say what advice he will give to school leavers this summer, besides advising them to cross the border to England to find work?
    Mr. Edwards: Unemployment in Wales is serious. That is why we have the massive programme that I have been describing. I am glad to tell the hon. Gentleman that there has been no increase in the percentage of unemployment represented by school leavers. I advise school leavers to continue to provide themselves, especially while at school, with the skills that are best suited for modern industrial development and for the modern techniques that will increasingly be so important.
    Mr. Anderson: Does the right hon. Gentleman recall that when, about a year ago, the economic department at Bangor university predicted that there would be unemployment of 147,000 in. Wales by the end of the year and 172,000 at the end of 1983, the forecast was greeted with official scorn? The first figure has already been exceeded, showing that it was a serious underestimate. Does not this call for a major programme of regional activity and investment, which this Government will not initiate?
    Mr. Edwards: I did not comment on the forecasts that were made about a year ago. I do not propose to make a forecast now. As I have said repeatedly, we are undertaking the most substantial programme of site development and infrastructure preparation in Wales chat has ever been undertaken by any Government.
    Mr. Best: Is my right hon. Friend aware that we all welcome the 43,000 places that are being made available for the youth opportunities programme this year, which means that the Government have doubled the number of places in the scheme since they came to office? No doubt he will accept that that is not a panacea for the ills of youth unemployment. Will he continue to press my right hon. Friend the Secretary of State for Employment to investigate and move towards a scheme of vocational preparation for young people that will take them immediately they leave school—[Interruption.]—so that they may be better fitted for the needs of industry?
    Mr. Edwards: Amid the yowls and yaroos of Opposition Members, which they have been practising recently in the capital's streets instead of in the House, my hon. Friend was making an important point. We must concern ourselves with vocational training and continued retraining so that skills are adapted to new requirements. My right hon. Friend and I are currently considering

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    detailed proposals to improve the arrangements and I hope that it will not be long before further announcements are made.
    Mr. Rowlands: Does not the right hon. Gentleman's bluster this afternoon expose the fact that the Government's policies are no answer for the problems of Wales? Does he accept that 80,000 jobs have been lost in the Welsh economy as a result of the Government's policies? Instead of talking about inward investment, important though that is, and new factory building, what is he going to do about the 300,000 sq ft of empty factory space at Merthyr Tydfil, a direct victim of imported goods from within the EEC—namely, from Italy? What is his answer to that?
    Mr. Edwards: I am glad to observe that rates of absenteeism at Hoover's—
    Mr. Rowlands: Answer the question.
    Mr. Edwards: As usual, the junior Member for Bolsover never listens to an answer. I was about to say that I welcome the fact that in the recent past rates of absenteeism at Hoover's have fallen to their lowest level ever and are a great improvement on anything that has been achieved in the past. They are down to about 5 per cent., when they used to be about 15 per cent. That is the greatest single hope and prospect for the company's recovery.

    Public Expenditure
    Mr. Ioan Evansasked the Secretary of State for Wales what representations he has received from local authorities in Wales regarding Government cuts in public expenditure.
    Mr. Nicholas Edwards: I have received a large number of representations from local authorities in Wales regarding public expenditure cuts since I have been in office.
    Mr. Evans: Does the Minister realise that the increase in local authority rates and the cutback in a number of services are due to the policies which have been pursued by the Government and that on Thursday last week the massive Labour gains and the massive Tory losses were an indication that the people do not support the Government's policies on local government?
    Mr. Edwards: I am sure that the hon. Member will want to get what consolation he can at this time, with the dereliction of his own party. He is welcome to it.
    Sir Raymond Gower: As Opposition Members have been making use all afternoon of the barometer of last week's elections, is it not a fact that when the Labour Government were in office the local government losses suffered by the Labour Party were much larger?
    Mr. Edwards: It is true that not only the local government losses but the swings in opinion polls reached record proportions when the Labour Party was in office. It is much more significant that there has not been one constructive proposal of any sort from the Opposition Benches this afternoon.
    Mr. Coleman: On a point of order, Mr. Speaker. Are you aware that a number of Welsh Members have been prevented from asking supplementary questions this
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    afternoon because of the length of questioning and because of the number of times certain individuals have been called?
    Mr. Speaker: I understand the hon. Gentleman. However, as there is only one question to the Church Commissioner, with a bit of luck, we shall return to Welsh questions after that.

    HOLY ORDERS (REMUNERATION)
    Mr. Viggersasked the hon. Member for Wokingham. as representing the Church Commissioners, if he is satisfied with the current method of remuneration of those seeking Holy Orders.
    The Second Church Estates Commissioner (Mr. William van Straubenzee): The use of the commissioners' income is governed by statute and is primarily available towards the pay and housing of the clergy and the provision of their pensions. The commissioners themselves are not empowered, for example, to give financial assistance towards the maintenance of ordinands through the period of their training.
    Mr. Viggers: Does my hon. Friend agree that, whereas ordinands can normally obtain grants, there is no such general system for the funding of their families, which can result in real hardship because the families must rely on what is available from charities and individual dioceses? Does my hon. Friend agree that in the less-well-endowed dioceses that results in hardship? Does he agree that a fairer system would be to have a general national system for remuneration of ordinands' families?
    Mr. van Straubenzee: I should be happy to examine any case my hon. Friend had in mind. In essence, when a man is sent forward for ordination, he is the responsibility of the diocese in question. That responsibility is gladly accepted. He is often supported by a variety of sources, some of which have been mentioned by my hon. Friend. One is the Train a Priest appeal which appears in the Church Times, which I warmly appreciate. It is the established policy of the Church of England that no man, once he has been selected, shall be prevented from undertaking training for lack of money.

  WALES

    Housing Expenditure (Cuts)
    Mr. Andersonasked the Secretary of the State for Wales what information he has on the practice of Welsh local authorities in respect of improvement grants as a result of the Government's cuts in expenditure for housing.
    Mr. Wyn Roberts: Apart from certain mandatory grants governed by statute, local housing authorities have discretionary powers to award grants. I am aware that some authorities have said that they intend to suspend or restrict discretionary grants, though they are aware of the importance the Government attach to the improvement of our housing stock.
    Mr. Anderton: Is the Minister aware that many local authorities are not now giving discretionary grants and that that has put the clock back a decade in Wales? Is he aware that unfit homes which have the standard amenities are not

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    now able to receive grants and that the housing action areas which he has declared are of no use because no money is available in many authorities to give residents the cash to improve their homes?
    Mr. Roberts: I have visited housing authorities in Wales and I have stressed to them the simple point that they can increase their housing allocations by the sale of council houses and increase their net receipts. That is why we want them to sell council houses, so that they can increase their allocations. They are free to apply that increase to improvement grants.

    Water Policy
    Mr. Colemanasked the Secretary of State for Wales when next he expects to meet the chairman of the Welsh water authority to consider the future water policy for Wales.
    Mr. Wyn Roberts: I shall be brief. I meet the chairman of the Welsh water authority from time to time, but arrangements for the next meeting have not yet been made.
    Mr. Coleman: Is the hon. Gentleman aware of the anger in many parts of Wales, particularly in West Glamorgan, over the recent heavy water charges which have been introduced? When he meets the chairman, will he discuss with him the justification for the standing charge of £9 per household for water, particularly when those charges are levied on the basis of rateable value and not on the basis of consumption?
    Mr. Roberts: The hon. Gentleman will know that my right hon. Friend arranged, with the Welsh water authority's co-operation, for a team of independent accountants to examine the authority's books and to suggest whether a reduction in charges could be achieved. I am satisfied that the lower level of increase subsequently announced by the authority, amounting to an average rise of 14·8 per cent. in domestic bills, compared with the 20 per cent. originally proposed, is the minimum necessary to maintain an acceptable standard of service.

  HOUSE OF COMMONS

    Palace of Westminster (Staff)
    Mr. Canavanasked the right hon. Member for Middlesbrough, as representing the House of Commons Commission, how many people are employed in the Palace of Westminster.
    Mr. Victor Goodhew: I have been asked to reply.
    The number of staff employed in the six Departments of the House is 902. The Commission is not responsible for other persons employed in the Palace of Westminster.
    Mr. Canavan: Why has the Commission unilaterally broken off the grading review consultations that it was having with the trade unions representing its employees, especially when the consultations were in their final stages and when an appeal was being considered? Is not that deplorable, shabby treatment for the House of Commons Commission to dish out to its employees? Has the appeal system also been scrapped?
    Mr. Goodhew: The hon. Gentleman has misunderstood the situation. Those who are involved in the
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    discussions understand precisely what is going on. If there are any points which the hon. Gentleman wishes to draw to the attention of the Commission, he should write to me about them and I shall let him have an answer.

    Refreshment Department (Staff)
    Mr. Cryerasked the right hon. Member for Middlesbrough, as representing the House of Commons Commission, what is the total number of staff in the Refreshment Department.
    Mr. Goodhew: I have been asked to reply.
    The total number of staff employed in the Refreshment Department is 244.
    Mr. Cryer: Will the hon, Gentleman confirm that a fair proportion of that 244 is employed in the private dining rooms and that the private dining rooms have received a subsidy? Are there any plans to publish the bookings of the private dining rooms so that hon. Members are made aware, if they so wish, whether the private dining rooms are being used by outside lobbying and public relations organisations? Is the hon. Gentleman aware that at the moment those bookings are not available and there is a strong suggestion that that is because of a covering of such lobbying?
    Mr. Goodhew: I shall take note of what the hon. Gentleman has said. I remind him that fewer than one-third of those who use the Palace of Westminster catering facilities are the responsibility of the Commission.
    Mr. HeddleWill my hon. friend confirm that it is still the policy of the Refreshment Department, wherever possible, to buy British and that the recent appearance of the glass water jugs marked "Made in Poland" is simply a recognition of the sea change which is taking place in that country?
    Mr. Goodhew: That matter has not come into my purview. I believe that the country of origin would be acceptable to most hon. Members.
    Mr. Freud: Is the hon. Gentleman aware that the Refreshment Department employs two and a half times as many people as the Department of the Library and that, to date, not one of them has married a Member of Parliament? Will the hon. Gentleman tell the House where the Refreshment Department has gone wrong?
    Mr. Goodhew: I am not responsible for the fact that none of them has married a Member of Parliament.
    Mr. English: I presume that the last question related to the Financial Secretary to the Treasury, who is married to an ex-member of the Library staff.
    Does the hon. Gentleman accept that it would be desirable if the printers of House of Commons papers were placed in the same position as members of the Refreshment Department staff? The Refreshment Department was rightly taken into the purview of the Commission, which was an excellent idea. Our papers might be produced a little better if we took control of our printers as well.
    Mr. Goodhew: I note what the hon. Gentleman says. I shall see that those concerned deal with the matter expeditiously.
    Mr. Christopher Price: The hon. Gentleman is a Commissioner.
    Mr. Goodhew: Indeed, I am, and I am doing my best to make it clear that I accept the responsibility with dignity—I hope.

  EDUCATION AND SCIENCE

    Minister of State (Speech)
    Mr. Aspinwallasked the Secretary of State for Education and Science if he will place a copy of the speech of the Minister of State for the Arts to the Council of Regional Arts Associations on 15 April in the Library.
    The Minister for the Arts (Mr. Paul Channon): Yes, Sir.
    Mr. Aspinwall: Will my right hon. Friend ensure that more support is given to the arts in the regions, especially in the South-West, instead of so much support going to the London area?
    Mr. Channon: The regions should have a large slice of the money spent on the arts, and I am pleased that the proportion has been increasing in recent years. The level of artistic activity in the South-West is very high indeed. It is one of the best areas in the country.
    Mr. Faulds: Is not the answer to impose on local authorities a mandatory requirement to raise a specific rateage for arts and heritage purposes, to be used through the regional arts associations?
    Mr. Channon: I am against a mandatory rate for the arts. I am in favour of people supporting the arts as generously as possible, but a mandatory rating system would not be consistent with local democracy.
    Mr. D. E. Thomas: Would not resources be more effectively distributed if the Arts Council was relieved of the burden of dealing with individual clients and there was an overall allocation of resources to regions?
    Mr. Channon: A great deal of discussion is going on about whether more discretion should be given to regional arts associations. A working party has been set up by the Arts Council, local authorities and others concerned, and I have discussed the matter with local authorities. I hope that progress can be made.

    European Community (Ministers of Culture)
    Mr. Iain Millsasked the Secretary of State for Education and Science if he will make a statement on the recent discussions with the European Ministers of Culture.
    Mr. Channon: The European Ministers of Culture met last week. There was general agreement that within the available resources of member countries we would all work together to further steps for European cultural co-operation.
    Mr. Mills: What progress has been made towards designating 1985 as European Music Year, and what part will Britain play?
    Mr. Channon: There is general agreement throughout Europe that it would be a good idea to have 1985 as European Music Year, as it is the tercentenery of the birth of Handel, Bach and Scarlatti. It was agreed in principle at the meeting last week. We shall play our part with enthusiasm, and I await my hon. Friend's suggestions.

    Arts (Select Committee Report)
    Mr. Cormackasked the Secretary of State for Education and Science when he will be in a position to reply to the Select Committee report on the arts.
    Mr. Channon: The recommendations in the Committee's interim report on works of art require consultation among a number of Departments, but the Government will, of course, aim to reply as soon as practicable.
    Mr. Cormack: I thank my right hon. Friend for that reply. May I urge him to have discussions as quickly as possible? Will he ensure that we have a reply before the House rises for the Summer Recess? Is he aware that this important report is unanimous?
    Mr. Channon: The report is important, and it is a great tribute to the members of the Committee that it is unanimous. I shall do my best to accede to my hon. Friends request, although the remedy is not entirely in my hands.
    Mr. Faulds: Is the right hon. Gentleman aware that he will enjoy all-party support if he can deliver Government decisions along the lines of those sensible and constructive recommendations in the report; and that ready acceptance of the recommendations would meet with a especial welcome from the National Art Collections Fund, which has a long and splendid record in helping public acquisitions in galleries?
    Mr. Channon: I agree with the hon. Gentleman's latter remarks. I note his support for the report, which will strengthen the hand of those who advocate its total adoption. I shall attempt to meet the wishes of the House.

    Arts (Business Sponsorship)
    Mr. Blackburnasked the Secretary of State for Education and Science if he is taking any additional steps to encourage business sponsorship of the arts.
    Mr. Channon: I shall continue to take every available opportunity to encourage business sponsorship of the arts, and I have a number of regional engagements planned in which I intend to emphasise the relevance of sponsorship to the smaller arts and business organisations. A booklet to help arts organisations frame sponsorship proposals will be published later this year and I intend to hold a reception in London during the summer to bring together representatives of some sponsoring and non-sponsoring major companies.
    Mr. Blackburn: I particularly welcome my right hon. Friend's announcement about the booklet to be published later this year. Will he vigorously pursue the prospect of sponsorship by companies hiring pictures from local galleries, particularly in view of the Select Committee's report?
    Mr. Channon: I am most grateful to my hon. Friend for his interest, and I shall adopt his suggestion.
    Mr. Freud: Will the Minister bear in mind the existence of the Honours List and bring it to the attention of potential art sponsors, who are as keen as ever to receive titles?
    Mr. Channon: I note the hon. Gentleman's interest, and I shall give his suggestion the consideration that it is worth.
    Mr. Sainsbury: Will my right hon. Friend ensure that national and local media are not reluctant to give due reward to businesses that sponsor the arts? Will he ensure that the BBC, for example, is not reluctant to mention sponsorship in case it constitutes advertising?
    Mr. Channon: That is a good point. It is an important topic which has been raised frequently. I shall discuss the matter with the BBC and others. Great progress has been made, and I hope that we shall make further strides forward.

    British Film Industry
    Mr. Freudasked the Secretary of State for Education and Science what encouragement his Department currently is giving to independent British film-makers.
    Mr. Channon: Within my sphere of responsibility, support for independent British film producers is provided by the production board of the British Film Institute. I am pleased to say that the grant-in-aid to the institute for 1981–82 includes a substantial increase for this work.
    Mr. Freud: Is the Minister aware of the extreme difficulty for the private sector of the film industry in getting its films distributed? Will he see whether he can do something to help?
    Mr. Channon: That is more a matter for the Secretary of State for Trade. My responsibilities in the film industry are limited. The Department of Trade deals with the film industry as a commercial industry. My responsibilities are limited to the British Film Institute, but I shall draw my right hon. Friend's attention to what the hon. Gentleman has said.
    Mr. Cryer: Will the right hon. Gentleman encourage independent film production in this country by making more money available to the BFI? Will he accept that his responsibility is not entirely separate from that of the Department of Trade and encourage his colleagues in that Department to make more money available to the National Film Finance Corporation? Will he also bring pressure to bear on television companies to help independent feature film production here?
    Mr. Channon: The matters that the hon. Gentleman raises are partly the responsibility of my right hon. Friend, and I shall mention them to him. The British Film Institute has set a net budget for the production board of about £700,000 this year, which will permit about six low budget feature films and eight low budget experimental films to be made, which is a step forward.
    Mr. Faulds: Will the right hon. Gentleman discuss with his colleagues in the Department of Trade, first, the nonsense that films are placed in that Department? Secondly, will he discuss the need to fund British film-making by imposing a levy on the televising of feature films, which would be an easy way to bring funds to the film industry?
    Mr. Channon: I shall certainly discuss the first matter, but, unfortunately, so far the allocation of Government responsibilities is not among my duties. The second part of the hon. Gentleman's question is a matter for the Secretary of State for Trade, and I shall discuss it with him.

    Public Lending Right
    Mr. Moateasked the Secretary of State for Education and Science what is his estimate of the number of authors who would be eligible to register for public lending right.
    Mr. Channon: An estimate of 50,000 eligible authors has been used as the basis for planning but no precise figures are available. The number registering may well be substantially fewer.
    Mr. Moate: If my right hon. Friend is in the business of setting up quangos—which I hope he is not—and if he should ever institute a scheme of public lending right, what would be the likely average payment to each author for every £1 million of taxpayers' money expended?
    Mr. Channon: I am indeed enthusiastically looking forward to the introduction of public lending right. I know that this is one of the very few issues on which my hon. Friend and I are not in agreement, but the House has decided by a large majority that public lending right should be introduced. I ask my hon. Friend to await the consultative document which will, I hope before too long, be available to the House.
    Mr. Faulds: Will the right hon. Gentleman reiterate that this will be introduced before long, as the Government has been tardy in declaring its intentions on this matter? When will he make a public statement about the introduction of the scheme and exactly how it will be run?
    Mr. Channon: The consultative document will be published before very long and the hon. Gentleman will then be able to see. In fact, we are at the stage of appointing the registrar. I hope that he will be appointed very soon. The prime responsibility for actually getting on with the scheme, once Parliament has approved it, will be his. But there will be no undue delay.

Lead Pollution
The Minister for Local Government and Environmental Services (Mr. Tom King): With permission, I will make a statement on Government action on environmental pollution by lead.
The Government have now completed their review of policy, in the light of the report by the working party, under the chairmanship of Professor Lawther, set up by the then Secretary of State for Social Services. The Government accept the general conclusion of the report that current policy needs to be tightened in a number of respects, building on what has already been achieved.
The report makes clear the need to improve our knowledge of the effects of lead in our environment, and particularly of possible effects on children's intelligence. Some studies have been completed on this, and more are in hand. The Government have invited the Medical Reseach Council to commission a major study in this area.
The report emphasises the importance of a comprehensive approach towards tackling the problems of lead pollution. I have placed in the Vote Office a paper outlining the Government's response to the detailed recommendations in the report. In this statement I shall deal with the main points.
First, on the subject of paint, the real problem is not paint currently on sale to the public—most of which is virtually lead-free—but old paintwork in many houses and other buildings. This will be tackled by information and advice to local authorities, and by increased emphasis in health education programmes on ways to counter the hazards. There will be early discussion with the local authority associations on this and on other matters concerning local authorities.
Secondly, with regard to water, high levels of lead can occur in drinking water in some areas. The problem arises only in the minority of households that have both lead-solvent water and lead plumbing. Water authorities have been working to identify the problem areas and are taking steps to tackle the problem at source. This work is being pressed ahead as rapidly as possible. Meanwhile, water authorities, local authorities and area health authorities are being asked to co-operate to provide information and advice to people who may be affected.
In some cases, and particularly where drinking water comes from lead-lined tanks, the only answer is to alter the plumbing. The Government propose that such work should be eligible for home improvement grants. This will be considered in consultation with the local authority associations. My right hon. Friend will be taking corresponding action in Scotland, where there is a particularly severe problem in those areas where lead-lined tanks are common.
Thirdly, in relation to food, new regulations covering the maximum permitted levels of lead in food offered for sale came into force last year. The Food Additives and Contaminants Committee has already been asked to study the implications of the use of lead solder in cans in its study of metals in canned foods.
Finally, on emissions of lead to air, the Lawther report recommends an air quality standard for lead of 2 micrograms per cubic metre. The Government agree that this standard, which is also proposed in a draft European Communities directive, should be adopted.
On the control of industrial emissions, current powers are adequate to allow the proposed standard to be met.
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But, as the figures quoted by Lawther show, the standard cannot be met in some areas of heavy traffic. Petrol-lead emissions may also result in high levels of lead in dust, and may contribute to lead in food.
The Government have decided that the maximum permitted lead content of petrol should be reduced as far as is possible, without ruling out the continued use of car engines of present design—that is, from the present limit of 0·40 grams per litre to 0·15 grams per litre. This will reduce by about two-thirds lead emissions from cars some 10 years earlier than any other practicable method.
The aim will be to introduce the new limit not later than the end of 1985. The oil industry will need to install substantial new plant in order to produce the new low-lead petrol in sufficient quantities. We shall discuss the practical requirements with the industry. There will in time be some increase in the cost of producing petrol, but we believe that such extra costs are reasonable in relation to the environmental benefits of an early and substantial reduction in lead emissions.
Professor Lawther's report warned of the need to take further effective action to deal with lead pollution. The measures that I have announced today show the Government's acceptance of the importance of his report and our intention to take all necessary steps to reduce the hazards arising from lead in our environment.
Mr. Denis Howell: We welcome the concern of the Government and the steps that have been announced, but is the Minister aware that the Opposition are extremely disappointed on the main issue of principle, namely, lead in petrol? We believe that this is the wrong decision, given the two options before the Government of either reducing the maximum to 0·15 grams per litre or going for lead-free petrol immediately. We believe that the latter decision should have been taken now. Is it not inevitable that the environmental and health considerations and the developing public opinion on the subject will combine to make that part of the Government's decision obsolete well before it is implemented? The Opposition will certainly go for lead-free petrol. We believe that it would have been better to give industry and the motorist the necessary time to adjust to that fundamental decision.
We welcome the Minister's announcements on food, water and paint, but as the Government have cut back resources for the water authorities, can the Minister assure us that the authorities will have the resources to meet the costs, which are likely to be substantial, especially in the older cities? Is it adequate to offer a 50 per cent. grant to people living in the centres of old cities such as Glasgow and those in Lancashire? Should not this cost be undertaken by the whole community? What will be Government's response if large numbers of those citizens say that they cannot afford to replace their lead pipes or tanks?
Why, too, has there been the political delay of 18 months before the Minister's announcement today? The Labour Government reduced the amount of lead in petrol on four occasions. We set up the Watlip inquiry that reported in July 1979, and the Lawther working party which reported in March 1980. It is clear from all the leaks over the past year that there has been a departmental dog-fight within the Government, in which the Treasury has routed the Department of the Environment and the

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Department of Health and Social Security. The House itself has not been consulted. Certainly, we shall wish to have a debate at an early opportunity.
On the question of health, I am sure that the Minister will agree, as he said in his statement, that the absorption of lead into the body by any means is an evil that we should not discount. Even since the Lawther committee reported, two of its members—Doctors Lansdown and Yule—have produced further significant information, which suggests that the decision to go for lead-free petrol ought to be taken now and that the major study that the Minister has announced can only be described as a further development of the policy of procrastination that seems to have been pursued over the past year or so.
Finally, does the Minister agree that the whole of industry would prefer the major decision to be taken now? We shall get the worst of both worlds by reducing the maximum to 0·15 grams per litre in 1985 and then having the further expense of going to a zero level later. The decision is not in the interests of the motor industry or the oil industry, and it is certainly not in the interests of future generations of young children. We must therefore register our grave disappointment with it.
Mr. King: I am well aware of the right hon. Gentleman's long interest in this subject. Having replied on behalf of the previous Government and been unable to announce much progress, I appreciate that he feels a certain frustration at having to respond to my statement.
It is a little unfair to accuse the Government of taking 18 months to respond to a report that was published only a year or so ago. The right hon. Gentleman will be aware that it is the Lawther report to which I am responding.
At this stage it is not possible to indicate the costs that will fall on the water authorities. The first aim of the water authorities is either to change the sources of what is called plumbo-solvent or lead-solvent water or to treat the water. In every case, that need not necessarily be an expensive process. It is only if those two options fail that one is forced to consider the alternatives of changes in the plumbing to which I have referred and in respect of which costs could fall on the water authorities as well.
The right hon. Gentleman would not expect me to comment on press accounts about the Treasury's routing of the Department of the Environment. However, according to the accounts that I saw, the Treasury are pressing for no home improvement grant allowance and for a 0·35 grams level of lead in petrol. I do not comment on press stories, but what I have said today does not entirely bear out the statements contained in those stories, nor are they entirely in line with the collective decisions of the Government to pursue a sensible environmental policy to tackle lead pollution.
The right hon. Gentleman said that the Opposition would prefer to follow the lead-free route. I mentioned that I have placed in the Vote Office a copy of the documents, which show the detailed response to the Lawther report. There is a graph at the back of that document which, on the evidence available, shows the relative effect as to the time at which any improvement would be noticed. The Opposition's policy would result in a slower improvement in lead pollution. On the evidence available to me, it would be 25 years before we achieved the position that I have recommended should be implemented from 1985.
Several Hon. Members rose—
Mr. Speaker: Order. I propose to allow questions on the statement to run until 4 o'clock. If questions and answers are brief I should be able to accommodate nearly every hon. Member who wishes to intervene.
Mr. J. Enoch Powell: Will the Minister give an assurance that corresponding measures on paint and water will be carried out simultaneously by Northern Ireland Ministers?
Mr. King: I have made the statement on behalf of the United Kingdom.
Mr. Martin Stevens: Does my right hon. Friend accept that there will be general satisfaction at the prospect of a speedy drop of two-thirds in the level of lead in petrol over the next four years? Is it true, as has been suggested in the press, that there has been a deal or understanding with the oil industry, namely, that in exchange for a level of 0·15 grams there will be no declaration of intent to move to lead-free petrol?
Does my right hon. Friend agree that over the last 10 years, by a comprehensive programme that has attacked not only lead in petrol but other toxic gases emitted from motor cars, the United States has developed technologies that have enabled a barrel of crude oil to send a car for more miles? Will he therefore consider a comprehensive review, in the United Kingdom, of all the toxic elements generated by automobiles?
Mr. King: I m grateful to my hon. Friend for his opening remarks. I saw the Sunday newspaper account about a deal and I am glad to have the opportunity to make it quite clear that it is totally untrue and that there is no such deal. My hon. Friend raised an important point when he referred to other emissions. In that connection, we are considering the monitoring arrangements for all other emissions as well.
Mr. George Cunningham: What figure presently applies in Germany which corresponds to the 0·15 figure that the right hon. Gentleman has announced for Britain? What is the relationship between the study referred to at the beginning of his statement and the investigations, now being carried out in Islington and elsewhere, that have been sponsored by the EEC?
Mr. King: The level in Germany is 0·15. At present, the level in other EEC countries varies between 0·4 arid 0·15. I shall be tabling a paper on the other study tomorrow.
Mr. R. A. McCrindle: Would it not have been preferable to move rather more swiftly to the introduction of totally lead-free petrol and then turn all the pressure open to Government and private industry to persuade motorists to move to its use, as that has been a successful approach in many other countries?
Mr. King: If my hon. Friend studies the chart contained in the document that I have placed in the Vote Office he will see that the earliest and most significant reduction in lead emission will be achieved by the move to a level of 0·15. On all the evidence available to the Government, first, the move to lead-free petrol would take longer to introduce and, secondly, the cumulative effect would take place much more slowly.
Mr. Kenneth Marks: Does the Minister agree that a certain group of people and localities

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are most severely affected, namely, young children who get the exhaust smoke straight in their faces and are nearer the dust, and those localities that have the highest concentration of vehicles, lead water pipes and factories that use lead? Will he go further and pay grant for the changeover from lead water pipes, even if there is no general improvement in the home?
Mr. King: It is our intention that people should be eligible for this grant on its own rather than as part of a general improvement grant. The hon. Gentleman will find clarification of that point in the supporting literature that is available in the Vote Office.
Mr. T. H. H. Skeet: As motorists are particularly concerned about the high octane rating of the car, will my right hon. Friend ensure that lead-tolerant catalysts are developed and additional additives put in? Otherwise, the price of petrol could go up considerably prior to 1985.
Mr. King: With respect, that is a responsibility of the motor industry. I have set out the Government's views on a ceiling for the level of lead in petrol and I have set the date from which that will be effective. I have made it clear in my statement that there will be immediate discussions with the oil industry, and I hope that by agreement it will be possible to achieve that at an earlier date. It will then be necessary for the motor car industry to adjust itself to the new situation that I have announced.
Mr. David Alton: I welcome the report, but is the Minister aware that as long ago as 1971 both BP and Shell said that they could produce petrol without lead? Why have the Government decided to dismiss that alternative? How many young children are likely to be affected during the next five years by the continued use of lead in petrol at its present level?
Mr. King: It is not merely a question of what the oil companies can do; it is also a question of what cars can use. If there were an immediate move to lead-free petrol as from tomorrow, the vast bulk of cars in Britain could not use it. The problem is to achieve the changeover. The advantage of my announcement is that, subject to capital investment by the oil industry for further refining capacity, it will be possible for petrol with the lower level of lead to be used in existing motor cars. It will therefore be possible to make a much quicker shift. That is why we have chosen this route.
If one went down the lead-free route one would have to allow a reasonable period of transition. It would be necessary to design and produce new motor cars, which used lead-free petrol, and to bring them into general use. Although the United States introduced lead-free petrol in 1974, still only half the motor cars there are able to use lead-free petrol.
Mr. Robin Maxwell-Hyslop: Has my right hon. Friend looked into the possibility of accommodating lead-free petrol in existing engines by using petrol alcohol blends? Could we not exchange North Sea oil, which Brazil needs, for the alcohol fuel that is produced in Brazil, which we need? In that way, we could produce blended alcohol and oil-based fuels that could be used in existing engines without a tetra-ethyl lead element in it.
Mr. King: I hesitate to engage my hon. Friend in discussion on such technical matters. I think, Mr. Speaker, that you will agree that my hon. Friend has a rare ability to introduce a new angle to any subject under discussion in the House. I should like to consider the point that he has raised.
Mr. Neil Carmichael: I congratulate the Minister on his statement, and particularly on his comments on domestic lead supplies, but is he aware that in the central belt of Scotland the water is very soft and that particular dangers therefore arise? Is he further aware that as many of the houses are old and carcassed in lead piping, special arrangements will have to be made to help the local authorities to provide the money for conversions? Has the right hon. Gentleman had talks with Scottish Ministers on that subject?
Mr. King: I assure the hon. Gentleman that my right hon. Friend the Secretary of State for Scotland and his colleagues have been very much involved in the discussions. All those concerned recognise that there is a widespread problem in Scotland. The size of the problem is about the same as that found in England, but in terms of Scotland's population the problem is much greater.
Mr. John Bruce-Gardyne: As one who has cycled daily in central London for the past 20 years, may I ask my right hon. Friend to remind the House of what the Lawther committee said about lead emissions from petrol? Did it not say that it was unable to detect any significant health hazard as a result of such lead emissions? What is my right hon. Friend's best estimate of the total cost of his statement to public funds, and of the aggregate cost to consumers?
Mr. King: Although I understand that an impression may have been gained in some quarters that Professor Lawther felt that there was no need for action in that respect, that is not correct. He drew attention to the need to match the lead-in-air standard, and made it clear that the lead content of petrol was one of the factors that gave rise to excessive lead-in-air concentrations in Britain. That point should be made clear. My hon. Friend will be aware that further work has been done and several studies have emerged since the Lawther report, which reinforce the concern felt.
The total annual cost is estimated to be about £200 million. The cost to the consumer is likely to be incurred in 1985, or thereafter. For the motorist, it will amount to about £25 a year. I hesitate to give figures for additional costs on petrol prices so far ahead as 1985. At present, our best estimate is about 4p per gallon.
Mr. Clinton Davis: How long did Germany take to put the change into operation? Furthermore, how long did the change take in the United States of America? Is the right hon. Gentleman aware that Rushmore infants school, in my constituency, was found by the Inner London Education Authority to have 10 times the level of lead in dust recommended by the environmental authorities of the EEC and the United States of America? What comfort can be given to the parents of those children?
Mr. King: On the hon. Gentleman's first point, I should need to check the exact length of time involved. The test is how quickly the oil industry can adapt its refining capacity to produce adequate supplies of fuel with

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the equivalent octane level but with a lower lead content. That will involve additional refining capacity. That is the yardstick that we used for setting the length of time. As I have sought to make clear in my statement and in the answers that I have given, I hope that we shall be able, in discussion, to improve on that date.
It is precisely as a result of our concern about the difficulties faced in the hon. Gentleman's constituency and several other inner city constituencies that we have acted in order to achieve the earliest possible reduction in lead levels. I hope that the hon. Gentleman will co-operate and will help to put across information about the other areas of hazard. There is a tendency to concentrate exclusively on lead in petrol. Professor Lawther drew particular attention to other significant problems, not least that of canned food.
Mr. Nigel Forman: Although I warmly welcome the decision taken by my right hon. Friend and by the Government, will my right hon. Friend tell the House why it is so much more difficult to move from 0·15 to zero? That is not entirely clear to me.
Mr. King: It is a question of time lag, and of bringing into use cars that can use lead-free petrol. If one allows for the time lag that we believe will inevitably be involved, one must face the fact that time will be lost in reducing the amount of lead in the air and, therefore, in reducing lead pollution of the atmosphere. I hope that the graph in the Vote Office will make that point clear to my hon. Friend.
Mr. Donald Anderson: As the Minister now apparently accepts the scientific evidence of the effect of such pollution on young children, will he not go beyond the figure of 0·15 and give a timetable for lead-free petrol? Is he aware of the report of the Environmental Health Officers Association, to the effect that many local authorities in England and Wales no longer give discretionary grants because of the Government's cuts in housing? Will he bear in mind that the new housing improvement grant that he mentioned may have no effect, because of overall Government cuts?
Mr. King: The hon. Gentleman's latter point is a matter for individual local authorities. Some local authorities will mot need to make such grants available. I should not want the statement to be misunderstood. This is a serious statement, but it is not a cause for general alarm throughout the country. Hon. Members should be aware that there are areas and pockets of concern. In England, the water problem is confined to a limited part of the country. In Scotland, the problem is more prevalent. There is not a national traffic problem. As for the medical evidence, the pilot studies give cause for concern. The hon. Gentleman said that I apparently accepted the medical evidence. I mentioned the need for a wider study, and the Government have made a request to the Medical Research Council.
Mr. W. Benyon: Why have my right hon. and hon. Friends rejected the use of exhaust filters, which have the triple advantage of practically eliminating lead emissions, avoiding the reconstruction of refineries, and providing many extra jobs?
Mr. King: I understand that such filters would not work with the low-level lead content that we have
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proposed. Our proposals are for the quickest way to reduce lead pollution in the atmosphere. The lead content in petrol is the most serious car pollutant.
Mr. Leslie Spriggs: Given the crucial importance of lead-free petrol to the health of the nation, will the Minister come clean and tell us how long his Department has had the Lawther report?
Mr. King: The Government received the report in March 1980.
Mr. Robin Squire: I warmly congratulate my right hon. Friend on his statement, but will he bear in mind that there is a balance between other emissions and lead? As some of my hon. Friends have said, if we put the control of other emissions to one side by controlling lead we may make future problems more serious.
Mr. King: I entirely understand why my hon Friend raised that point. I have already told the House why we have taken this decision on the seriousness of the problem and why we believe that we should take the earliest possible action on lead pollution.
Mr. Alfred Dubs: Will the right hon. Gentleman comment on the increasing evidence that any lead in petrol is dangerous to the health of children, in that it causes mental retardation and behavioural difficulties?
Further, will the Minister comment on the scientific suggestion that by lowering the level of lead in petrol smaller particles will be emitted from motor cars and that these will be more easily absorbed into the human body?
Finally, in his statement has the right hon. Gentleman been influenced by the EEC directive of 1978, which suggested a lower allowable limit of 0·15 per cent.?
Mr. King: It is precisely because we accept the hazards of lead pollution that we have sought to achieve a solution that gives the earliest possible reduction in lead levels.
I am not aware of the second matter raised by the hon. Gentleman, and I should like to look into it.
On the third point, although the EEC directive fixes the minimum level in the Community, there is nothing to prevent the use of a lower level in this country.
Mr. Denis Howell: Will the Minister now explain his 25-year reference? I have had an opportunity to look at the graph. Is it not clear that it is a little misleading? Is it not possible to have a reduction programme simultaneously with the announcement of a lead-free policy to follow it? Why have other countries been able to announce lead-free programmes without any reference to 25 years? Indeed, lead-free petrol is now available in many countries.
Secondly, the Minister said that the annual cost would be £200 million a year—£25 a year for the motorist and 4p a gallon on petrol. What would be the additional cost if we took the decision to have lead-free petrol?
The question of water authorities and local authorities is an important one, as the Minister said. Will he assure the House that the funds for an extensive programme of re-equipping water supply, where necessary, will be made available?
In view of the importance of this subject and the ground to be investigated and covered, we would hope to have an early debate on the whole matter.
Mr. King: The right hon. Gentleman will appreciate that the last point is a matter not for me but for my right hon. Friend the Leader of House. However, I should welcome that opportunity if it were possible.
I cannot explain across the Floor of the House how the right hon. Gentleman should read the graph. This is a cumulative matter. The right hon. Gentleman will find that the cumulative reduction—this point has been made by all people writing on the subject—will not be achieved by an equivalent amount in the lead-free system until the date that I have given.
The right hon. Gentleman asked how the costs of lead-free petrol would compare. As against the £200 million for the 0·15 per cent., the total cost would be £350 million and the average cost to the motorist would be £50, not £25.

Orders of the Day

  Finance Bill
  (Clauses 1, 4, 19, 23, 27, 29, 88, 89 and 122; and schedules 1, 2 and 11.)
  Considered in Committee [Progress 6 May]
  [MR. BERNARD WEATHERILL in the Chair.]
  4.4 pm
  The Chairman of Ways and Means (Mr. Bernard Weatherill): Before I call the first amendment for discussion, I should like to apologise to the Committee. Hon. Members may have noticed that amendment No. 59, to clause 27 and amendment No. 58 to clause 29 have not been included in the marshalled list of amendments for today. Those amendments have now been reprinted on a separate sheet, which is available in the Vote Office, and they have been included in my provisional selection of amendments.
  I apologise to the Committee, and to the official Opposition who tabled these amendments, for the oversight in the printing process.

  Finance Bill
    Clause 27

      SOCIAL SECURITY BENEFITS
      Mr. Robert Sheldon: I beg to move amendment No. 19, in page 15, line 12, leave out subsection (1).
      Clause 27 taxes unemployment and supplementary benefits paid to the unemployed. For many years it has not been possible to tax these benefits because of difficulties in collection. The clause seeks to tax these benefits up to the standard rate of benefit. It does not seek to tax supplementary benefits for children, housing or certain exceptional circumstances. All the details concerned with this matter are to come into force by regulations.
      Later we shall question why the regulations are to take the place of what we consider ought to be the proper way to do it—by a schedule to the Bill. As I said, that is for later discussion. Meanwhile, we note that the proposal is to bring in the regulations under section 204 of the Taxes Act.
      The procedure is that the unemployed person will not have tax rebates paid to him until he is back in employment. He will get no refund of tax until he starts work or until the end of the tax year, whichever comes first.
      In the 1980 Budget Statement, the Chancellor announced that short-term social security benefits would be taxed to remove a disincentive to work. I am not sure how the Chancellor measures these incentive and disincentive effects. I believe that he has come adrift on some of these incentives. The relief for higher rates of income tax was supposed at one time to be the salvation of our industry. Lower taxation was put forward as a panacea at the election. However, we can see very little evidence of any results from such incentives. I am not sure that the Chancellor will see very much by way of incentives from the proposal in clause 27.
      I have always believed in the principle of taxation of short-term benefits as of nearly all other forms of income.

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      They form part of income. The original intention of those who introduced short-term benefits in the late 1940s was that they should be included. They were taken out of tax only because of the administrative problem and the numbers of civil servants required to produce what could be accepted as a fair and reasonable system.
      One of the questions that I shall be asking the Financial Secretary to the Treasury concerns the number of civil servants that he will require to make the system workable. The problem has increased as more people have come into tax. In 1949–50 a married man with two children on average income came into taxation when his income was 99 per cent. of average income. As a result of the Bill, the proportion will now be 38 per cent. It is clear that this will have enormous consequences for the taxation of short-term benefits because more people will come into tax. It will become more attrative to the Inland Revenue to tax people on unemployment benefit because the revenue is greater, but it will have a greater difficulty because there are more of them.
      It is difficult in these matters to divorce the principle of taxing these people from the administrative problems concerned. Have the Government discovered a practicable and equitable solution of taxing those on unemployment benefit who are not presently being taxed on it?
      We shall be debating the details of clause 28 in Committee upstairs, but that clause shows how this system will be implemented. Clause 28 should frighten the living daylights out of anyone who has any lingering doubts that the citizen is mightier than the State. But that is for discussion in due course.
      Clause 29 will deal with the regulations. As I have said, these should form a schedule to the Bill. Treasury Ministers have funked placing before the Committee the full details of what they intend to do, and they are leaving them to be introduced under regulations. We shall be opposing them on this matter. If we are unsuccessful, I must serve notice on the Government Front Bench that we shall seek to change this in subsequent years, if necessary, by amendments and by new clauses at various times. We take a very poor view of the way in which this escape route has been found to avoid dealing with delicate and not very good legislation.
      The big argument for not taxing unemployment benefit in particular has been the saving of civil servant numbers. Every Treasury Minister has always examined, whenever he has gone into Great George Street, schemes for taxing these short-term benefits, unemployment benefit in particular. A fair scheme, unquestionably, is expensive to operate.
      We note that the Government are keen on reducing the number of civil servants. They have been saving civil servants in a number of ways. They have been saving them on statistics, because they do not want to intervene—and even more, they do not even want to know. They have been saving them on those investigating income tax frauds from the special offices. They have been saving civil servants where they could be shown to produce large sums in revenue. But, at the same time, they have been employing more civil servants to examine social security frauds. They have been chasing up the pence and ignoring the tens of thousands of pounds that are available for collection. Employing more civil servants for taxing short-term benefits seems to be part of this variable change of opinion as to the levels needed in the Civil Service.
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      The questions that we must now ask ourselves when we are looking at the numbers of civil servants—we shall want some answers during this debate; I have informed the right hon. and learned Gentleman's private office about this matter—are as follows. What numbers of civil servants will be required to undertake this scheme? Where will they be placed? What will be their responsibility? How many claims for benefit do they reckon to deal with? How many movements of paper will be required?
      What we really want is a proper discussion of what the Government intend to do in the regulations that they propose to introduce in due course.
      As I have said, the number of civil servants required to operate a truly fair scheme is very large, because there are four parts of the administrative framework, and each depends on another. We have the benefit office, the tax office, the claimant, and the employer. All of these people are in some sort of contact with each other. So there is a vast amount of intercommunication which is very expensive in Civil Service manpower.
      What can be done—it seems that the Government are thinking in these ways—is to short-circuit this by administrative fiat. What the Government are saying is that the civil servant will make a statement as to the amount owing, and if there is no objection within 30 days, that will be it. It is not subject to any appeal or to the normal rules of law, or to Members of Parliament being able to take a case on behalf of a constituent and being able to say that there were overriding reasons why a person was not able to do this. All of these matters will be turned aside because the Government need a simple system to make the whole thing work. It is on this matter that we shall want to hear from the Minister.
      4.15 pm
      We know from the greatest authority in this respect, the chairman of the Board of Inland Revenue, the distinguished public servant, Sir Lawrence Airey, that 10 per cent. of the Inland Revenue's codings are wrong. This information was given to the Public Accounts Committee in questioning last week. This established service, with a great reputation and great integrity, is subject to that kind of error. What are we to make of a new service, questioning people frequently at the lower level of income, people who are not well versed in dealing with many matters concerning benefits received, and who do not keep proper records and accounts? Yet they have only 30 days in which to lodge their objections, and if they do not do so, this House, every MP, is powerless to act on behalf of a constituent.
      That is the kind of simplification, the kind of demotion of fairness and equity, that we are asked to contemplate. That is why we thought it important enough to bring to the attention of the whole House in Committee.
      The trouble is that the present Government are trying to get the taxation of short-term benefits on the cheap and nasty. They are indifferent to the grievances and injustices, and it is the task of the House of Commons and this Committee to make them aware of them. We must give the Government a responsible warning that we are not prepared to see civil servants put into the invidious position of harrowing those who receive benefits just because the scheme that the Government are providing can succeed only on such a basis.
      But our opposition is based not just on the administrative simplifications and the unfairness which the

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      scheme introduces. On 26 March 1980, the Chancellor of the Exchequer dealt with the taxation of these benefits. He started off in this way:
      "First, we have the scheme, which my right hon. Friend the Secretary of State for Social Services announced before Christmas, whereby employers would have the responsibility for the payment of a minimum level of sick pay during the early weeks of sickness. This will bring the bulk of sickness payments into tax through PAYE. This scheme should be operating from April 1982."
      We know what happened to that. Then the Chancellor went on—and this is the scheme that still survives, so far—
      "Secondly, we intend to bring benefits paid to the unemployed into tax at the same time. This will be done in such a way that in general the claimant will neither receive refunds nor suffer deductions of tax until he is back at work."
      That is the stick. The Chancellor continued:
      "We are also considering how best to bring into income tax at an early date the remaining short-term benefits, and invalidity benefit, which, primarily for administrative reasons, are at present untaxed."—[Official Report, 26 March 1980; Vol. 980, c. 1460.]
      The Chancellor went on to say that he did not want to wait until 1982 to tax short-term benefits, and, as a result, he would be increasing unemployment benefit and other benefits by 5 per cent. less than what would fully reflect the forecast price movements.
      This 5 per cent. on the unemployment benefit and other benefits continues each year. I understand that it was to be a temporary measure, until people were brought into tax, which was the purport of what the Chancellor was saying. But the Government are now bringing these people into tax, and the obvious corollary is that that 5 per cent. should be paid back. The 5 per cent. continues each year. Each year the claimant will be getting a 5 per cent. cut, which will continue year by year. It was lost in November 1980, and it will be carried through to the 1981 uprating and all the others to come, unless the Government take some action. The total benefits each year will be that 5 per cent. less than they should have been.
      If we compare unemployment benefit with invalidity benefit, we see that the Chancellor said on 10 March:
      "when invalidity benefit comes into tax the 5 per cent. deduction made from the November 1980 uprating will be restored."—[Official Report, 10 March 1981; Vol. 1000, c. 770.]
      So the principle has been conceded. The financial Secretary nods. If it has been conceded for the invalidity benefit, it should also be conceded for the unemployment benefit. As we know, the value of the invalidity allowances is to be restored from November next.
      We have seen some rough justice, with benefits increased less than the cost of living to take account of untaxed benefits. That is rough justice because some of those beneficiaries would have paid no or very little tax. We have seen biased and partial justice which those claimants do not deserve. But that was for last year. What matters now is that next year we shall again be taxing those benefits. That is truly double taxation. Beneficiaries have had their unemployment benefits reduced and they will now be taxed on what they did not receive. That is the double taxation that the Government are introducing. The unemployed lose part of their benefit and are then taxed on the reduced portion. I can imagine the outraged letters to the Conservative press if the Chancellor had tried that sharp practice on the higher paid.
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      What worries me is the use of the tax system as a punitive measure which calls into question the uncertain aspects of some of our tax system. We now have two kinds of income tax—schedule D, with allowances for expenses, where one pays months later in money reduced because of inflation. Schedule D allows one to engage in tax avoidance with complicated accounts subject to negotiation. On the other hand, with PAYE one pays on the nail and has no alternative. Not only will these people pay on the nail but they will be robbed too. That is unjustified. We shall oppose it strongly and continually.
      When the Government announced that they would introduce taxation of short-term benefits, including unemployment benefit, we were not hostile but we were questioning. Now we have seen the Bill. We have not yet seen all the details, but even at this stage we can see a number of the injustices that it entails. If the Government wish to introduce proposals to tax those benefits equitably, we are prepared to consider them afresh. Meanwhile, we intend to oppose the measures, no only on the Floor of the House but in greater detail in Committee upstairs.
      Mr. David Winnick: Like my right hon. Friend the Member for Ashton-under-Lyne (Mr. Sheldon), I have strong objections to the clause. Once again the Government intend to penalise the unemployed. The Government have previously introduced other measures which have hit the unemployed—for example, the phasing out of the earnings-related supplement. That supplement helped a large number but will be ended in 1982. Another measure which has hit them is the ruling whereby anyone who has been unemployed for longer than 12 months and tries to claim unemployment benefit will not receive a penny if he has over £2,000. A number of unemployed who have received redundancy money will find that they will be unable to receive supplementary benefit once the unemployment benefit is exhausted after 12 months.
      The Government have refused to grant long-term supplementary benefit to the registered unemployed, no matter how long a person has been registered, how hard he has tried to find a job or whatever his family circumstances. As my right hon. Friend said, unemployment benefit, like a number of other short-term benefits, will increase by less than 5 per cent. the rate of inflation.
      In an interesting letter to The Times today, the director of the Child Poverty Action Group points out that between June 1979 and June 1980 flat rate unemployment benefit for a couple with two children fell from 45·5 per cent. of average net income in work to 42 per cent.
      The reduction in the 5 per cent. increase has meant the loss of about £1·65 for a couple. That sum can mean much to someone who has lost his job, especially if he has family responsibilities. It may not mean a great deal to right hon. and hon. Conservative Members—
      Mr. D. N. Campbell-Savours: Who are not listening.
      Mr. Winnick: —who are not even listening. The sum of £1·65—which to the Financial Secretary to the Treasury is just a tip that he would give without a second thought—to many of my constituents is considerable when their wives have to check every penny because they are unemployed and do not know how long it will be before

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      they get a job. However, we would not expect the Government to understand the difficulties and hardships that the unemployed have to endure.
      Mr. Campbell-Savours: Has my hon. Friend seen the article in The Times recently which mentioned the considerable division between Treasury Ministers and civil servants in the Treasury on the Government's attitude to monetarist policies? When we consider that the Ministers present today are not listening to the speeches of hon. Gentlemen in this vital debate, we can clearly understand the difficulties that Treasury officials have. It appears that Treasury Ministers are unwilling to listen to the better judgments of their officials, especially in criticising the monetary strategy of the Government.
      Mr. Winnick: I endorse that. It is unfortunate that the Financial Secretary to the Treasury did not listen to my hon. Friend. Perhaps he will read it in Hansard. It was a useful intervention and worth studying by the right hon. Gentleman and his colleagues.
      The Government not only pursue policies that have brought the highest unemployment since 1933; they also seem determined to harm those who become victims of their policy. A person, especially a family man, who becomes redundant needs all the financial support he can muster. Although the Government may argue that under the clause an unemployed person will not pay income tax on his short-term benefit until he is back in employment, he will not be able to receive the proposed tax refund until he returns to work or until the end of the tax year. That is a setback to the unemployed.
      At present, someone who becomes redundant—there are enough in that category now—can, if he claims, receive his tax refund quickly. That helps to support him while he is out of work. Anything that helps the unemployed to survive the ordeal of the dole queue is worth supporting.
      Some of my constituents, if they are quick enough, can claim a tax refund. If they are due for a tax refund, they will receive the money. However, under the clause that will not happen. That is why the clause penalises the victims of the Government's economic policies. I wonder whether Treasury Ministers and other members of the Cabinet would be so complacent if they had to endure the shock, pain and humiliation of being made redundant, not knowing how long it will be before they get another job, and did not have private wealth or substantial savings. Would they be so willing to pursue their present policies?
      One must compare the manner in which the unemployed will be penalised, and have been penalised over the past 18 to 20 months, with the way in which tax evasion continues. We know of the activities of the Rossminister Group. My right hon. Friend made a valid point when he said that people who have received unemployment benefit, less the 5 per cent., will pay tax, but that the 5 per cent. will not be restored. That is a form of double taxation. My right hon. Friend said that those in the higher income tax bracket would squeal. Of course they would—but they would not expect such treatment from the present Government.
      As is to be expected, there seems to be a different attitude towards those with high incomes, who are well protected in many ways. Income tax reductions help not the average income earner, let alone those with less than average incomes, but those with high earnings. The most
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      unfortunate sections of the community are now being penalised, by the Government's taxing unemployment benefit, supplementary benefit and the rest. There may be a case for taxing short-term benefits, but the way in which the Government are going about it should make us all the more determined to oppose their proposals, which are unjust.
      The unemployed person needs all the support that he can be given. The phasing out of the earnings-related benefit was a blow. I referred to it when we discussed the Budget last year. Now the Government are telling unemployed people that they cannot claim the normal tax refund that one could usually claim quickly to help in surviving the ordeal of unemployment. That is wrong, and that is why we have every justification for opposing this part of the clause.
      4.30 pm
      Mr. David Ennals: Like my right hon. Friend the Member for Ashton-under-Lyne (Mr. Sheldon), when I was in Government, as Secretary of State for Social Services, I made it clear that I accepted the principle of taxing short-term benefits. But the extraordinarily unfeeling way in which the Government have treated the unemployed, and the timing of their decision, are almost beyond comprehension.
      When I was preparing my notes I intended to say that the Government had clobbered the unemployed twice over, but my conclusion now is that they have clobbered them five times over. First, as my hon. Friend the Member for Walsall, North (Mr. Winnick) has said, they show insensitivity to the effects on a man's mind, behaviour and consciousness of being forced into unemployment. Some Ministers on the Treasury Bench may not have spoken to people who have now spent long months unemployed as a result of the policies that the Government have forced on the country. They may not know of the humiliation felt by the unemployed, the increase in psychiatric disturbance, and the need for people to see their general practitioners simply because of the psychological effect of being unemployed, being forced out of work, which they believe to be their right.
      Secondly, there was the decision of the Secretary of State for Social Services to clobber the unemployed a second time by reducing the level of unemployment benefits. Many of us on the Opposition Benches spoke bitterly, because we felt bitter and still feel bitter, about his decision at the time of the previous Budget that those who should suffer most were not the people who earned most but those who earned least, or who earned nothing and received only benefit. That was an act of despicable meanness by the Government.
      The unemployed, already miserable because of their unemployment, with little opportunity of finding new jobs, with a level of benefit below that to which they believe themselves to be entitled, and to which they were entitled under the previous Government, are clobbered thirdly by the Government's now bringing their short-term benefit—long-term though it may be in fact—into taxation. We have heard nothing from the Government Front Bench so far today, but Conservative Back Benchers have often spoken nonsense about people being better off out of work. They will certainly prove now that that is not true. It never was, except of a very small number of people with large families.

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      There has been a massive increase in the number of people brought within the tax net as a result of the Government's decision to end the working of the Rooker-Wise-Lawson amendment. That was the Government's fourth method of clobbering the unemployed. The allowances to which they were entitled no longer exist.
      The Government's fifth method of clobbering the least fortunate in our society is their decision on tax refunds, which is meanness five times compounded. It is despicable to force the unemployed to receive their tax benefit either when they return to work—they are lucky then; when they are out of work they are unlucky, so they are denied what was everyone's entitlement until the introduction of the bill—or at the end of the tax year, which may be 11 months after their entitlement.
      We have 2½ million unemployed, and the figure is rising steadily month by month. It will probably go as high as 3 million. What can be the Government's motive in deciding to take measure after measure to damage the unemployed, already damaged as a result of the Government's decisions and their monetarist policies? Of all the clauses in the Bill, this is perhaps the most despicable, the meanest and the most worthy of condemnation.
      I am glad that the amendment has been moved. I shall vote proudly with the rest of the Opposition, and I hope that we shall be joined by some Conservative Members. There do not seem to be many present who give a damn about the issue—
      Mr. Winnick: Nor does the Minister.
      Mr. Ennals: Having had responsibility in a previous Cabinet for, admittedly, a much smaller number of unemployed, I feel deeply and passionately about the way in which the present Government are behaving towards a most unfortunate group in our society.
      Mr. Keith Best: I think that there is general acceptance in the House—there certainly is in the Committee—that short-term benefits should be subject to tax. Not one speaker on either side of the Committee has said that that should not be so.
      I welcome the Government's decision to bring short-term benefits within the tax net. The abuse may have been over-estimated by many, but the general public perceived that some people were doing very well out of the fact that benefit was not subject to tax. However, a number of us on the Conservative Benches are concerned that the Government have not given an undertaking that the true level of unemployment benefit will be restored when the benefit is finally brought within the tax bracket.
      The belief that short-term benefits should be brought within tax is also held by the Child Poverty Action Group. I am sure that most hon. Members taking part in the debate have received its copious briefs. It does a great service to the community through its research, which helps us to come to decisions.
      I shall not repeat the points that have already been made about the pronouncements of various Ministers about the nature of the 5 per cent. shortfall. I ask right hon. and hon. Members to consider only two. The first is the statement by my right hon. Friend the Secretary of State for Social Services during the Committee stage of the Social Security (No. 2) Bill last year. He said:
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      "as the unemployment benefit comes into tax so the rationale for the 5 per cent. abatement ends. It is an interim scheme in lieu of taxation. One will give way to the other."—[Official Report, Standing Committee B, 30 April 1980; c. 526.]
      The other was made by my hon. Friend the Under-Secretary of State for Health and Social Security. She said:
      "It is a temporary measure pending taxation."—[Official Report; 3 February 1981; Vol. 998, c. 140.]
      What confuses me to a certain extent is why it is said that security is being given to the invalidity benefit and that that will be safeguarded but that unemployment benefit will not be safeguarded. To my suspicious lawyer's mind, there seems to be an inequality of treatment there which needs further amplification.
      It may be said by the Government that the current level of unemployment benefit is too high and that it has to be reviewed. If that is really the Governement's view, it is only fair to this Committee that it should be spelt out. We could then argue about that rather than seeking to gain an assurance that unemployment benefit will be restored to its former level minus the 5 per cent. shortfall, if that assurance is not to be forthcoming in any event because in reality the Government are saying that unemployment benefit is too high.
      You would not allow me, Mr. Weatherill, to go into a broader debate on that subject, and in any event there is not time for it today, but it was clearly the impression of many of my hon. Friends and quite obviously it was the impression of Opposition hon. Members that when pronouncements were made about the 5 per cent. shortfall it was on the clear understanding that the shortfall would be made good when the short-term benefits finally came into tax.
      All I ask my hon. Friend the Financial Secretary to do is to tell the Committee what the Government really mean. I do not argue that the Government do not have to look at the matter in the light of prevailing economic circumstances—it would be supreme folly not to do so—but it is only fair that the Committee be told whether the Government will never give an assurance that those benefits will be made good or whether they are saying that they think that short-term benefits should be reviewed per se. If the latter is the Government's response, I hope that my hon. Friend will feel able to say so.
      There is no shame in saying that any benefits should be subject to review. I have no doubt that such a statement would be greeted with a cacophony of noise and abuse from the Opposition, but I am sure that the more rational and realistic of hon. Members would say that it was right to look at matters from time to time and to review benefits.
      I ask my hon. Friend to say on behalf of the Government whether that is the case. Then we can have a debate about it.
      Mr. John Horam: I support the decision to count unemployment benefit and other short-term benefits as taxable income, and I do so for two reasons.
      Those whose income comes from State benefits such as unemployment and other short-term benefits should be treated the same as those whose income comes from work. That is a simple matter of equity. In a notably inequitable tax system, we should sieze every opportunity to make a further step towards fairness.
      Here, we are discussing in practical terms the difference between people who work all the year and the amount of tax that they pay and people who work only part

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      of the year and may be unemployed for the remainder of the year, and the amount of tax that they pay. That, in the real world, is the position that is affected by the clause.
      4.45 pm
      I am also in favour of bringing unemployment and other short-term benefits into the tax net because it widens the tax base. Over the years the tax base has narrowed substantially. That is one of the reasons why we have had to increase the rate of income tax and why we have had to lower the tax threshold to the remarkable and damaging point to which the right hon. Member for Ashton-under-Lyne (Mr. Sheldon) referred just now. People are paying tax on an extremely low level of income—below the poverty level—and that is indefensible whichever way it is looked at. Therefore, it is important to begin trying to widen the tax base so that we may reverse this general creep of the tax threshold down to ever lower levels of income.
      As a number of hon. Members have pointed out, the principle of taxing short-term benefits is one that not only this Government are seeking to bring into effect but that was supported in principle by the Labour Government. The right hon. Member for Norwich, North (Mr. Ennals) agreed that he, as Secretary of State for Social Services, had supported the principle of taxing short-term benefits.
      That being said, however, it is legitimate to put two questions to the Government. First, there is the question that the hon. Member for Anglesey (Mr. Best) talked about so effectively. I refer to the 5 per cent. deduction made last year. It was made in lieu of taxation. We are now getting taxation, and it is legitimate to ask what are the Government's intentions about restoring the deduction that was made last year. I will not go into that at any length, because the point has been made from both sides of the Committee, but it is a question that the Government must answer.
      The second and wider question is a taxation one, and I put it to the Financial Secretary. It is typical of this Government that while many of us believe that it is right to widen the tax base for the reasons that I have outlined, once again they have started at the wrong end. They have started at the lowest levels of income and they have not gone into the possibility of widening the tax base for those with higher levels of income.
      In a leader on 9 April the Financial Times pointed out the Government's position very fairly. It said:
      "What is notably lacking is any comprehensive review of what the Inland Revenue rightly calls 'tax expenditures'—the concessions, worth some billions in revenue, to various forms of private income and expenditure. Would-be reformers have argued convincingly that the cost of concessions to house purchase, contractual saving and some classes of capital investment is not simply a matter of lost revenue, but imposes a further heavy burden on the economy, through distorting the allocation of financial and real resources … there is no way in which the Government's aim to create an incentive society can be achieved without facing these issues. Excessive borrowing and income taxes below the poverty line are not appropriate sources of finance."
      That goes to the heart of the matter, which the Government must explore.
      Is this the beginning of a serious attempt to widen the tax base that will follow through ultimately to other tax expenditures affecting people on higher levels of income, or are we to see once again simply an attempt to penalise the poor and stop there, with no one else being brought into the tax net? That is the fundamental principle of taxation
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      on which the Government should be answering questions and making their broad view clear to the Committee. In other spheres of economic policy they are anxious enough to point out that they have some sort of medium-term strategy, and I welcome that, but they should also be outlining their long-term view about the evolution of their tax policy, and so far we have heard nothing about it.
      There are legitimate questions that the Government have to answer about the way in which they have handled this issue. However, on the principle itself I support the decision to bring short-term benefits into the tax net.
      Mr. Campbell-Savours: I see the proposal in clause 27 as very much an inexcusable imposition on great numbers of people who are unemployed today not as a result of their own deficiency but directly as a result of deficiencies in the Government's central economic strategy. I treat this as an imposition, because l cannot separate the clause from clauses in other Bills that we have dealt with over the past 18 months, all of which, collectively, have the effect of penalising our constituents.
      We have seen considerable increases in nationalised industry prices, which in many ways are only substitutes for taxation. In many areas they were introduced simply to raise revenue where the Government had given hack tax in their first Budget. The allowance thresholds have been frozen in this Budget. That, too, is a severe penalty to my constituents and the constituents of my hon. Friends, particularly as we are now told that the taxation threshold has been reduced from nearly 90 per cent. to 38 per cent. That brings many more people into the tax net.
      The decision to phase out the earnings-related supplements is causing considerable anxiety to industrial workers throughout the country. There have been increases in VAT, and heavily increased charges for National Health Service provision. Overlapping supplementary benefit rules were introduced in a small measure that passed through the House earlier last year. My hon. Friends will have received much correspondence about the overlapping benefit rule changes, particularly because they affect our constituents in many areas where we had not imagined that they would surface. Many of the problems that arise in my surgery now relate to the changes resulting from that legislation. Those changes were not fully debated, because we could not anticipate them fully.
      The measure is inexcusable also because it implies a penalty for unemployed people. The unemployed are beginning to wonder whether the Government are trying to wage a war against them. Ministers rarely appear on television—that being the chief communication medium for most of our constituents—to defend their policies on unemployment. In the grey and indifferent answers that they give in parliamentary replies they do not seem to come to terms with the considerable problems that exist. There is a feeling in the country that the Government are indifferent to the plight of unemployed people. This measure will cut the take-home pay of unemployed people. That is how they see it.
      It is inexcusable, too, because the clause is based on a crude deception. That deception of the British people has been mentioned frequently. It stems from the Government's decision, in November 1980, to downrate the increase in unemployment benefit, whereby a single unemployed person will lose 70p and a married couple £1·20. That social security legislation of November 1980, together with the social security legislation currently

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      before the House, means that married couples will be £1·65 per week worse off. Those people can rightly say that they accepted the decreases because they were decreases on the natural increase in advance of what they thought would be compensatory increases when the Government introduced the taxation of benefits, on which there has been general agreement on both sides of the House.
      The hon. Member for Anglesey (Mr. Best) mentioned the comments of the Under-Secretary of State when she chided a Labour Back Bencher, during oral questions some months ago, for criticising the Government's policy on unemployment. I shall quote what she said:
      "The hon. Gentleman is quite wrong to paint the abatement in unemployment benefit as he did. It is a temporary measure pending taxation which all parties in the House have agreed".—[Official Report, 3 February 1981; Vol. 998, c. 140.]
      Labour Members were in no doubt about that. We accepted the Government's word that it was a temporary measure. It is clear that there is disquiet among some Conservative Members, too, about whether the House was misled on that occasion.
      I shall quote a small section of the brief that the Child Poverty Action Group sent to hon. Members. That group has been at the forefront of the national lobby and has expressed considerable anxiety about the changes. Its latest brief says:
      "Dismay and incredulity at the Government's position would have been better descriptions of the CPAG's reaction. We would argue that such a wait-and-see position is simply not good enough. How can Ministers on the one hand argue that the benefit cut was a temporary measure pending taxation and on the other refuse to make any commitment whatsoever to put an end to the temporary measure once taxation takes effect? Their position is untenable. It is surely unfair to ask Members to vote on the question of taxation of unemployment benefit without giving them a clear idea of the Government's intentions with regard to restoring the cut in unemployment benefit. The two issues are interlinked and cannot be debated separately".
      That is absolutely right.
      The Financial Secretary knows the importance of this issue in the country. He knows its importance to hon. Members who took what was said on that occasion as a promise from the Government that there would be some form of uprating of unemployment benefit before the introduction of taxation on unemployment and supplementary short-term benefits. However, that did not happen. Instead, the Government are picking on a minority—unemployed people—to pay the bills for the Government's failure in their economic strategy.
      The right hon. Gentleman bears a heavy responsibility. The article in The Times the other day said that he, as a Treasury Minister, was refusing to accept that Treasury officials, on this occasion, speaking the same language as Members of Parliament, not only on the Labour Benches but on Conservative Benches, were accusing him and his hon. Friends of an inflexibility that was not normal in the House of Commons. The right hon. Gentleman should not be on the defensive when he comes to the Dispatch Box. He should spell out clearly why he has refused to link these important issues. The House was convinced at the time of that statement, and the right hon. Gentleman, in pursuing the approach that he does, is gravely undermining the confidence of the House.
      The £200 million that we are told will be raised in revenue as a result of the taxation of short-term benefits and unemployment benefit should go back to the
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      unemployed and the underprivileged groups of people who are being required to pay it. If Treasury Ministers and Ministers in the Department of Health and Social Security evaluate the worth of that £200 million, they can find responsible ways of channelling it back. The £45 million that will arise directly from the refusal fully to uprate under the 5 per cent. and 1 per cent., under successive social security legislation, should be fed directly back to the groups who are losing out.
      There was an article in The Sunday Times yesterday about the difficulties that the hon. Member for Caernarvon (Mr. Wigley) is having with his Bill on disablement. We are told that the Government will not give him his Bill because they cannot afford to do so in the International Year of Disabled People. If the Government have any humanity and compassion—we on the Labour Benches have no monopoly of those qualities—they will have the courage to demand that that part of the £200 million is allocated to these special groups.
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      We are told that raising benefits reduces incentives and that reducing and taxing benefits—which is what will happen if the Bill is passed—increases incentives. The greatest and most positive disincentive is the decision not to index-link tax allowances and to raise the threshhold. That is a real disincentive. The failure of the Government to act in that area led them to introduce the change that we are discussing.
      The Budget contains a business start-up scheme. It is said in the media and in the corridors of the House that some Government Members object to restrictions in the scheme. Perhaps many people do not know that a great deal of money for people on large incomes is tied up in the clause. Many tens of thousands of people could make up to £7,500 a year by claiming tax relief on investment in small businesses if they are willing to take the risk. I am not against risk takers. Tax incentives should be available. However, we must understand that because of the way in which such schemes are funded, affluent people will receive tax reliefs and unemployed men and women will pay the price.
      Mr. K. J. Woolmer: Before I discuss the arguments for and against taxing benefits and the Government's motives, I wish to discuss the reduction in the real value of unemployment benefits. Last year the Government declared that there was to be an interim measure until they introduced other methods of taxing benefits.
      About £1·20 a week for a couple is involved in the cuts in unemployment benefit, at a time when we have the highest unemployment level since the 1930s. People will regard that cut as one of to meanest of many mean measures taken by the Government. This year the cuts are expected to rise to £1·65 for a couple. Will the Minister confirm that that is correct? Will he confirm that the measure is still regarded as interim, in lieu of taxation, or have the Government changed their minds? The House is entitled to know. Have the Government decided that the cuts are not interim, but permanent? If they have decided that the cuts are to be permanent, why did they make that decision? Why did they tell the House last year that the measure was interim, in lieu of taxation? We are entitled to clear answers.

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      I should deplore such a change of heart. I hope that we will have an assurance that the real cuts in unemployment benefit will be reversed. At the least I hope for a clear explanation of Government thinking. They should not let the issue slip away in a general reply. An important principle is at stake. If there is a misunderstanding we should clear it up. Do the Government intend to restore the real value of the benefits?
      I can understand the argument that all incomes should be liable to income taxation, given an appropriate method of offsetting allowances. In that spirit many people inside and outside the House accept that all forms of benefit should be subject to income taxation, depending on the level of income received in a year.
      That is not the reason given by the Government on a number of occasions. The explanation given last year by the Chancellor of the Exchequer was:
      "The net extra reward to a low earner from going out to work can be so close to the benefits he can get when on social security as to extinguish his incentive to find or stick to a job. Indeed, there are people whose incomes out of work exceed what they could reasonably expect to get when in work. There is undoubtedly widespread and justified public concern about this disincentive."—[Official Report, 26 March 1980; Vol. 980, col. 1459.]
      That is a clear expression of Tory appeal to prejudice, fear and concern. That was the reason given for introducing taxes on benefits. The notion was that in some sense the absence of taxation on benefits provided a disincentive to work. The reason had nothing to do with the view that all income should be taxed.
      Does the Financial Secretary still believe that there is widespread concern that there is no incentive to work? If he does, does he believe the concern to be justified? If he believes that it is justified, will he provide figures on which he bases that judgment? What proportion of people are better off out of work than in work? Is the proportion significant? I accept that scroungers exist. Some scroungers are wealthy. They do not do a day's work, but have a high standard of living. They often fiddle or exploit loopholes in the taxation rules. They often have a darned sight better living standard than people on the bottom of the pile. Now that the Financial Secretary is no longer involved in electioneering he should say what effect the Bill will have on the incentive to work. How many more people does he expect to see at work in 12 months' time as a result of this measure?
      The conclusions of a Policy Studies Institute study were that only slightly more than 3 per cent. of male unemployed were receiving more in benefits than they would earn by working. The study shows the reality that, on average, unemployed men receive only 46 per cent. of their previous earnings. I accept the frustrations and niggles caused by those who take advantage of social security, but we must recognise that the overwhelming bulk—97 per cent.—of the 2½ million unemployed do not do so. It is unreasonable not to put emphasis on the 97 per cent. who are a darn sight worse off because they are out of work. It is an insult to the problems that they face if emphasis is not placed on them.
      Does the Financial Secretary disagree with the conclusions of the Policy Studies Institute? Does he still wish to put the same emphasis on the reasons for introducing this measure? Like so many Government actions—for example, the leaked announcement about an 11 per cent. pay rise for the Armed Forces while they are trying to make civil servants and others accept 6 per
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      cent.—it is not necessarily the merit of their actions that causes trouble, but the incredible ineptitude of their timing. When unemployment is rising sharply, with more than 2½ million unemployed, and when virtually all the unemployed want to work, the real reason why these measures are being introduced can only be the ideological prejudice of the Government.
      More than 22 per cent. of men and youth in Batley in my constituencies are out of work. There are more than 70 unemployed for every job vacancy. Individual after individual comes to me and other hon. Members at our surgeries, or writes to us, to tell us of the real tragedy that they are applying not only for one or 10 jobs, but for 100, 200 or 300 jobs. To paint a picture suggesting that unemployment is a result of fecklessness and scrounging is far from the reality of the painful problems hitting families and individuals. That attitude hits the strikers and the unemployed not simply as irrelevant but as a sickening commentary on the Government's understanding of the problems facing the unemployed. I hope that the Government will respond with a renewed statement of what they think they are achieving and the reason why they are introducing these measures today.
      I hope that the Committee will approve the Opposition amendment. It is not the right time to hit still harder at the unemployed. It is not the right time to hit the families of those driven to take industrial action. In this day and age the people of Britain want jobs. The Government should not be concentrating on penalising those out of work but should be ensuring that they create work for my constituents and the constituents of other members of the Committee.
      People in Britain want the opportunity to work. They do not want to scrounge or to take advantage of the welfare State. They want the opportunity of a job. Offer them the work and they will take it.
      5.15 pm
      Mr. Austin Mitchell: The clamour of speakers on the Conservative benches casts a depressing light on the attitude of the Conservative Party towards the debates both this week and last week. Last week no one on the Conservative Benches was keen to participate. They disapproved of the Government's decision not to raise allowances in line with inflation, as was argued for by the Financial Secretary in 1977. They are not here this week because of their basic shame about the effects of this clause. The Opposition are trying to counteract the clause by tabling this amendment. Where is the reserve army of the Tory unemployed when this especially nasty piece of legislation is being discussed? How are they salving their consciences?
      This is a vicious piece of legislation which reveals the vicious face of the Tory Party. Government strategy during the past two years began with the much-heralded and trumpeted tax cuts for the better-off in 1979. They were primarily for the really well-off, not for the mass of the population. Those tax cuts were given on the pretext of stimulating incentive, initiative and enterprise and regenerating the British economy on the basis of new dynamic forces. At that time, the Chief Secretary warned that they would allow people more time to spend on the golf course, and that has happened. The incentives and the encouragement of enterprise did not work.
      We have seen an accelerating downward spiral of decline, the cost of which has been unemployment, a loss

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      of tax revenue and the need to increase expenditure on nationalised industries. All that has forced the Government now to ask the poor, the unemployed and the social security beneficiaries—the less well-off section of the community—to pay the price of the Government's folly during the past two years and of the failure of their economic policies. One consequence of today's clause has been described as making the Government a Robin Hood in reverse. It is far more vicious than that. It is sheer, simple, fiscal thuggery, which is appropriate to some who sit on the Government Benches. They are taking from those with least to give to finance the failure of the Government's policies during the past two years, and the failure of the tax concessions in 1979.
      The unemployed are being asked to stump up their mite to finance that failure. That is the real face of Toryism in the 1980s. They are taking away from those with least to give.
      It is not a Tory Party of one nation, but very definitely of two nations in which the downstairs nation pays for the lifestyle and the tax concessions of those upstairs. It is not the Whig tradition of Macmillanite Toryism which looked for an expansion of the cake so that the crumbs of affluence could be dropped on the tables of the workers. We are seeing all the viciousness of a zero sum society in which the poor and the unemployed are asked to pay for the tax concessions for the well-off being handed out by the Tory Party. They have also the consolation that they are paying for the Prime Minister's manifest economic delusions of two years ago—delusions which she and a dwindling band of those in the Treasury still share.
      Bearing in mind what has happened over the past two years, the logic is that unemployment benefits should be increased and not taxed in this paltry pettifogging fashion. The whole trend of increased unemployment benefit and redundancy payments in the 1960s and 1970s was to encourage employees to change jobs more rapidly and to encourage labour to be more mobile, to move to new jobs and to sacrifice existing jobs. That was what the improvement and regeneration of the economy demanded. That was the logic behind increasing unemployment benefits and redundancy payments.
      The Government have thrown that process into reverse at this time by accepting that unemployment on its present scale is a permanent feature of the economy. In effect, the Government are saying to the unemployed "You have been called on by the Prime Minister to make a sacrifice for the nation. You are asked to be a voluntary import control so that you will not purchase as much from overseas. You are asked to be a sanction or a weapon against trade unions and against those in work so that they will keep down their demands for wage increases and the pressure of wage inflation. You are the reserve army of unemployed to bring pressure on them. What do we give you for this sacrifice? We give you taxation of the paltry benefits that we allow you in the first place. You are asked not only to make sacrifices but to suffer at the same time." That is the logic behind the clause.
      That logic is compounded by the insult of last year's 5 per cent. abatement of the necessary increase in unemployment benefit. That was said to be a temporary measure, awaiting the introduction of taxation of unemployment benefit. It was said specifically last year that it was in lieu of taxation. However, there is now no
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      sign that that temporary abatement will end. Equally, there is no sign that its cumulative effect upon unemployment benefit will be rectified. The effect has been substantial because following the uprating of November 1981 it will amount to a cut in unemployment benefit for a single person of about £1 a week and, for a couple, about £1·65 a week.
      The commitment to restoration was specific. The Secretary of State for Social Services addressed the Committee examining the Social Security (No 2) Bill in April 1980. When speaking about the abatement he said:
      "That will make no difference, because as the unemployment benefit comes into tax so the rationale for the 5 per cent. abatement ends. It is an interim scheme in lieu of taxation. One will give way to the other."—[Official Report, Standing Committe B, 30 April 1980; c. 526]
      There is no indication that it will. No promise has been held out.
      If the Government meant their words of 1980, they will have the decency now to say that the abatement will be made good, the cut will be removed and its cumulative effect will be removed. How can we accept the clause without a promise from the Government to effect compensation, to ensure that the reduced standard of living of the unemployed will be compensated, if they are to be taxed, by increases in benefits that they should have had last year? If the Government are not prepared to make that promise, it is clear that their intention is to reduce the standard of living of the unemployed.
      It has been estimated that about £200 million to £250 million will arise from the taxation of unemployment benefit and the other benefits that will be imposed by the clause. Why are the Government not promising to use that money to extend long-term rates of supplementary benefit to the unemployed? That is a development that would cost about £75 million a year, a small sum when compared with the sum to be raised by the proposal contained in the clause. Why is not the flat rate of unemployment benefit being increased for the long-term unemployed? Why are those in that position not being put in the same position financially as the long-term sick?
      It appears that long-term unemployment will be a permanent feature of the economy. It will worsen under the Government's economic policy and the Government have a duty to compensate the unemployed. They are asking the unemployed to make sacrifices. The cost of putting the long-term unemployed in the same financial position as the long-term sick would probably cost less than the saving that the Government will make if these proposals are implemented. Unemployment and supplementary benefits for the unemployed are worth less now when set against the average net income of the diminishing number in work than at any time during the 1970s. It ill behoves a Government who have been arguing for years about scroungers and the "Why work?" syndrome to introduce such a proposal. Indeed, in its 1979 manifesto the Conservative Party stated:
      "Income tax starts at such a low level that many poor people are being taxed to pay for their own benefits."
      That is what the Government are now introducing. The manifesto continues:
      "All too often they are little or no better off at work than they are on social security."
      That is what the Government are now guaranteeing, not so much by the clause that the Committee is discussing but by the rest of the Budget, and specifically by the failure to increase allowances.

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      Why is this mean, vicious and nasty clause being introduced when there should be a review of the framework of all allowances for all sections of society? Why are the unemployed and social security beneficiaries being singled out for special treatment? There is a second Welfare State of tax allowances. It is extremely expensive and it benefits predominantly those in the middle class. Obviously those who pay more tax receive more benefit from tax allowances. The allowance system is in need of revision and overhaul. It should be subject to broad consideration so that all sections are treated fairly. Why is the review restricted to the unemployed and social security beneficiaries?
      Mr. Winnick: Is not the short answer to my hon. Friend's question simple—namely, that we have a Tory Government?
      Mr. Mitchell: The tenor of my speech suggests that I hesitate to make such an aspersion against the Government. I am glad that my hon. Friend has made it rather than myself. It is vital that all sections of society should be treated fairly. For example, why are national insurance contributions not to be allowable against tax if benefits are to be taxable?
      At this juncture most Governments would try to act with a certain amount of delicacy and tact. Perhaps delicacy and tact are too much to expect from the Financial Secretary but those qualities are not too much to expect from the Government. It is incumbent on a Government who believe that this is one nation and one country to treat all sections alike and not to hit out viciously against one section.
      There has been a welcome for the general principle of the taxation of benefits or at least for extending the tax framework. It is one of those bright ideas that are so difficult in practice. It is perhaps good in theory that all revenue should be treated alike for tax purposes, but that is difficult to implement in practice. The difficulties were constantly pointed out by Labour Ministers when the Labour Party was in power.
      5.30 pm
      The chief difficulty is the large number of civil servants that will have to be employed. A complicated system is necessary if that is to be done fairly or at all. The Government face an ideological problem about increasing the number of civil servants. The Minister has been asked about that several times. I hope that he will tell us what number of civil servants is necessary as a result of the measure.
      Because of their ideological quibbles and doubts about increasing the number of civil servants, the Government have tried to cut down that increase to the minimum, by having a stark, simple system. That system, because of its starkness and simplicity, becomes unfair. To stop increasing the number of civil servants, the Government have introduced a system in its most unfair form, through the present proposal. It is a crude system which gives too much discretion to the Civil Service, from which there is no recourse and on which there is no appeal. The Government are getting the worst of all worlds because they are increasing the number of civil servants and treating the unemployed with the maximum brutality.
      The provision is based on a myth which was deliberately fostered by the Tory Party for the five years when the Labour Government were in power. That myth
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      was that the unemployed were scroungers, that they were living off the fat of the land and that they had a higher standard of living than anyone else. That myth was fostered by the Tory Party and Tory press, such as the Daily Mail. Everywhere one went canvassing, people always knew of someone who was living off hundreds of pounds a week and who was spending all his time in the pub, on social security. They could never mention a name or produce an example, but they all knew of someone because they had been told of such people by the Tory Party and the Tory press.
      The Government are a little more quiet and tactful about that myth now. However they are still using it to justify the measure. It is being used as the whole basis of their approach. The idea is that the standard of living of the unemployed should be brought into line with that of others and that scrounging should be penalised by such a measure. That is the justification for the measure, even if the Government are now in a new, moderate and condescending, public relations, pitying mood—which the Prime Minister has favoured—and even though they are speaking tactfully about the unemployed these days.
      Mr. Woolmer: I do not believe that my hon. Friend noticed that the hon. Member for Sowerby (Mr. Thompson) was vigorously indicating by motions of his head that he felt that a significant proportion of the unemployed were scroungers. I am not sure whether that was the indication. My hon. Friend should give him the opportunity to back that up. Perhaps my hon. Friends should give opportunities to Conservative Members to express their views rather than nodding or shaking their heads.
      Mr. Mitchell: I do not believe that the hon. Member for Sowerby (Mr. Thompson) can believe that. Every time I visit my mother in Sowerby and read the Halifax Evening Courier, I see the roll-call of factory, textile and plant closures in that constituency, I see how pressing the problem of unemployment is becoming there. I am sure that the hon. Gentleman cannot have such a view of the unemployed. I hope that my hon. Friend's assumption is incorrect. However, that is a motivating force in large sections of the Conservative Party. I shall exempt the hon. Member for Sowerby from that taint because of the problems in his constituency which should bring the question of unemployment much to his mind. The Conservatives have that view of the unemployed and are using it to justify the measure.
      As my hon. Friend the Member for Batley and Morley (Mr. Woolmer) said, the Policy Studies Institute research, which was financed by the Department of Employment and the Manpower Services Commission, found that among only 3 per cent. of whites and 5 per cent of minority groups were there people who received more on benefit when they were unemployed than they had earned while working. The average drop in their income as a result of unemployment was 46 per cent. The pressing problem and picture of the unemployed was one of hardship, not a picture of scrounging, living the life of Riley, drinking 20 pints a day in every pub in the land. That picture has been painted by the Tory Party for many years. The report concluded that benefits could be substantially increased while still maintaining the incentive to find work.
      In 1980, the Institute of Fiscal Studies argued that unemployment benefit could be raised by 12 per cent.,

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      using the extra revenue accruing from taxation of such benefits, as is now being proposed. Why is that benefit not being raised in such a way?
      The Government have a clear duty to commit themselves to that policy now so that we can decide on it in the light of full knowledge and information. Tragically, there is now emerging the culture of unemployment which will be not only heartbreaking for the unemployed but destructive of our institutions and of many of the values that are so important to our society. There is a remorseless rise in unemployment. There is now no way in which the Government can stop unemployment rising to 3 million this year. I am almost certain that the rise will continue next year. It is possible, as the Cambridge economic policy group has done, to conjecture a rise to 4 million and more on present trends.
      What is to stop unemployment rising? It is not the silver lining which the Prime Minister discerns all over the place because she has not much else to discern in the economic situation. How can unemployment stop rising when the overvalued pound is not competitive, and when we are still not investing or growing? That points remorselessly to a continued decline. Additionally, there is the tremendous burden of unemployment. The calculations of the cost, in lost revenues and in benefits, of each person who is out of work vary, but taking the Treasury calculation it would be an average of £5,000.
      We should compare the gross cost of unemployment with the burdens mentioned by Professors Bacon and Eltis. They said that those burdens were shackling the economy under the Labour Government. The burden must now be more substantial and a greater shackle. Therefore, industry must have more difficulties to bear if it is to compete in the world outside. The Government are creating that situation. Unemployment is a burden on industry's back and it will cripple and probably break British insustry.
      In the face of those facts there can be nothing of the revival expected by the Prime Minister, the Chief Secretary and the Financial Secretary, who mentioned it in his interview on "Weekend World." There will be no stimulus, no expansion and no growth but a continued further decline and with it, a remorseless rise in unemployment.
      It is just when unemployment on such a scale is becoming a long-term feature of the British economy that the Government choose, with their tact, grace and charm, to introduce this vicious, nasty little measure and to start taxing the benefits of the unemployed in such a fashion. It is all very well for the Prime Minister to pity and sympathise with the unemployed when that is politically necessary, after five years of sneering at them as scroungers and layabouts. That is not enough. The unemployed must be helped. They should be helped at this juncture and not treated in such a way.
      In conclusion, this is perhaps the Government's most sordid action in a particularly depressing Budget. A Government who have staked much on their desire to cut the Civil Service are increasing it. The measure treats the unemployed crudely and painfully at a time when unemployment is remorselessly rising. It is unworthy of the Committee, although perhaps not of the Government.
      Mr. Clive Soley: Earlier, when my hon. Friend the Member for Grimsby (Mr. Mitchell)
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      pointed to the lack of Conservative Members I overheard one who was leaving the Chamber say that that made it more difficult to keep the debate going. They do not want to keep the debate going for the reasons that my hon. Member gave.
      I remember the Conservative campaign before the election to label people out of work as scroungers. I almost take my hat off to the Conservative Party for the way that it makes emotional claims about race, crime and people claiming benefits. The Government, say that they will do the community a service by clamping down on such problems. They rarely, do so, although they try to get away with measures such as this. They made great noises about crime, but have produced only a couple of detention centres, which are supposed, to solve the problem of thuggery. They back down over crime, but I wish that instead they had backed down over this measure. It is one of the most appalling displays of double standards that we have seen.
      The campaign waged by Conservative newspapers to support the Government, as my hon. Friend said, picked out individuals who it was said were receiving hundreds of pounds a week that they were not earning. Claimants and others with low incomes were made to feel that there was something wrong with them. Decent people became anxious about what others thought of them. Research is now linking depression and suicide with rising unemployment. The figures also increased during the slump in the 1930s. Work makes a person feel respectable. Depression can be linked to receiving benefits and being accused of being a scrounger. The feeling is perpetuated by the Government and the newspapers that support them. It does a great disservice to the country and causes individuals and families to suffer, as is increasingly being accepted.
      When I was canvassing at the last election, people would frequently, suggest that there was work available for so-called scroungers if they wanted it, even though I explained that one had to take account of the skills in demand in an area and income levels compared with State benefits. Newspapers had given what they said were classic examples of scroungers as evil people. Little of that is mentioned now, primarily because people realise that unemployment is a real problem. West London is comparatively well off for employment, but even in my area people recognise that unemployment is a problem.
      5.45 pm
      The vast majority of working people are not scroungers. For complicated social, economic and psychological reasons a tiny percentage may not want to work and are scroungers, but that is a far lesser problem than that of those on high incomes who make an art of tax avoidance and evasion. The Government show their immorality by not recognising that. A far greater proportion of lost revenue results from actions of people at the higher end of the income scale. I realise that we do not want to set precedents or to justify certain behaviour, but that should not make us blind to what happens at the higher end of the income scale. We pursue so-called scroungers far more determinedly and vociferously than we pursue people at the other end of the income scale.
      It is not often mentioned that many unemployed people do not claim benefit, and we do not discuss the lack of take-up of other social security benefits. If an office is raided to collect papers to confirm tax avoidance, it

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      becomes headline news, and it is said that such action threatens individual freedom and is reminiscent of the actions of the SS and the police striking at night. We do not hear much when people are sent round from the Department of Health and Social Security to find out whether a woman has a man living with her and should therefore be given a few pounds less. Our moral values are the wrong way round.
      People on low incomes are more in need of an accountant. Those on high incomes should be able to manage for themselves. There is a limit to the amount of work that people can do themselves, but the moral need is on the side of those with low incomes. That becomes more so as we bring people at the lower end of the scale into the tax net, which people seem to agree is acceptable.
      Although less so recently, the Conservatives have used so-called scroungers as scapegoats for the failure of their economic system, although they have given the rich major tax concessions. My hon. Friend the Member for Workington (Mr. Campbell-Savours) mentioned some of those tax concessions. It is a fallacious argument that they will generate investment. People invest for other reasons. Although money is available it is not being invested because of the uncertainty of the future of our economy. It does not pay to invest in Britain, not least because of the Government's policies. The theory behind such tax concessions is wrong.
      It is also false to believe that giving people benefits discourages them from working. The two assumptions have led to a division not only between rich and poor and North and South but between those who receive benefits and those who do not. People on benefits have wrongly been made to believe that they are to blame for an economic system that has failed them.
      The Financial Secretary to the Treasury (Mr. Nigel Lawson): I hope that you will forgive me, Mr. Lamond, if I am sufficiently eccentric to confine myself to the amendment. In some ways it has been a strange debate. The amendment seeks to prevent unemployment benefit being taxed, yet the overwhelming majority of Opposition speakers, who, led by the right hon. Member for Ashton-under-Lyne (Mr. Sheldon), presumably will shortly troop into the lobby to support it, having conceded that the benefits should be taxed. He said that at the Dispatch Box today and he said it many times when he was a Treasury Minister.
      I shall now deal with some of the points that have been raised. There was some concern, which I understand, about the uncertainty as to whether the 5 per cent. abatement of unemployment benefit will be made good when the taxation comes into play in April 1982. If I could answer that question here and now, I would gladly do so, but I cannot, for the simple reason that no decision has been taken. This is a public expenditure matter and the decision will be taken in the course of the public expenditure review alongside all the other public expenditure decisions. The review will take place this summer and autumn in the normal way and the decision, of course, will be made clear and announced publicly well before April 1982, when taxation of benefits under the clause comes into effect.
      Mr. Campbell-Savours: If that is so, does the Minister believe that the vast expenditure on matters such as Trident
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      are more important in the Government's evaluation of priorities than expenditure on the unemployed? Will he tell us that now?
      Mr. Lawson: No, of course I shall not, and I should be out of order were I to do so. But the hon. Gentleman is right to imply that public expenditure priorities as well as the totality of public expenditure and what can be afforded will be discussed during the review. The results of those discussions will be put before the House and the country well before April. 1982 when unemployment benefit will come into tax under the clause.
      Mr. Robin F. Cook: The Minister is resting his case for being unable to assure the House that the 5 per cent. abatement will be restored on public expenditure considerations. It would help us to know how much weight to attach to those considerations if he would tell the Committee how much revenue will be generated by the clause and how much it would cost to restore the 5 per cent. abatement. If more revenue will be gained from the clause than it would cost to restore the 5 per cent. abatement, surely in justice his first priority should be to use that revenue to repay the 5 per cent. that he stole from the unemployed.
      Mr. Lawson: It is absurd to talk about money having been stolen from the unemployed. The hon. Gentleman, who is very eloquent, is inclined to get carried away, as he has done on this occasion. I am sure that he will agree that what is legally enacted and approved by the House of Commons cannot be construed as theft. I shall come to cost later. The hon. Gentleman's comparison between the two costs is not relevant. The relevant figure in the public expenditure discussions is the cost of restoring the 5 per cent. abatement, which must be assessed in the light of all the factors in the public expenditure equation. That figure is some £50 million, which is a significant sum.
      The hon. Member for Batley and Morley (Mr. Woolmer) asked a question and made an assertion. He always makes thoughtful contributions, which I welcome. In this, he provides an example which might fruitfully be emulated by some of his hon. Friends. He asked whether I could confirm his figures as to the value of the 5 per cent. abatement. I confirm that the figures that he quoted are broadly accurate.
      The hon. Gentleman's assertion was perhaps in the form of a question. He was perhaps asking me whether thought that there was still today what has come to he known as a "why work?" problem. Indeed I do. If my hon. Friend the Member for Norfolk, North (Mr. Howell) were in the Chamber, he would certainly be greatly surprised if it were asserted that the problem no longer existed. There is indeed a problem. The hon. Gentleman perhaps inadvertently confused himself by assuming that the full dimension of the problem was the small, although not insignificant, minority who are actually better off out of work than in work.
      The dimensions of the problem are far wider than that. There is also the large number of people who, as a result of the interaction of the taxation and benefit systems, are only slightly better off in work than out of work. Finally, there are those—the overwhelming majority of the unemployed—mentioned by the hon. Member for Gateshead, West (Mr. Horam), speaking for the Social Democratic Party, who are in work for part of the year and on unemployment benefit for the other part. The total net

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      income that they receive as a result is considerably greater than the net income that they would receive if they were in work for the whole year, having the same gross income. That is another dimension.
      I commend to the hon. Gentleman, who I know reads a great deal—I refer to the hon. Member for Batley and Morley, in case the hon. Member for Blackburn (Mr. Straw) who has just entered the Chamber is not quite tuned in yet—an interesting article in the autumn 1978 issue of the "Midland Bank Review" by Mr. John Hemming and Professor Tony Atkinson on this whole matter. The hon. Gentleman will know that Professor Atkinson is scarcely likely to be party to anything which sought to grind the faces of the poor, as the Government are alleged to be doing by some Opposition Members; nor indeed is Mr. Flemming. The thrust of that article was that there was a real problem and that the main remedy, although not the only remedy, was the taxation of unemployment benefits.
      Mr. Woolmer: If the burden of the Minister's argument is that introducing taxation of unemployment benefits would reduce the balance between income received while unemployed and while working, by how much would the average weekly income be reduced in a typical example? It is not unfair to ask that. How much, for example, if a family man with two children receives two-thirds of average earnings and is in work for half of the year and out of work for the other half, by how much would his average income be reduced? Knowing that would give us some feeling of how much importance the Financial Secretary attaches to the effect of a reduction in income on incentive to work.
      Mr. Lawson: I do not have in my head figures for all the different families in different circumstances working for different fractions of the year, but if the hon. Gentleman wishes to write to me, I shall be glad to answer that point.
      Mr. Cook: The Minister prayed in aid the study by Mr. Flemming and Professor Atkinson. I trust that before leaving that point he will make it clear that they had set out to show how much better off the unemployed would be if the benefit were taxed and the proceeds used to increase the benefit.
      Mr. Lawson: That was not their purpose, although they certainly suggested that the proceeds might be applied in that way. That was not the thrust of the argument. Nor do we have the funds available to do that. Nor, in my judgment, would it be justifiable to use the money for that purpose at any time.
      The hon. Member for Gateshead, West was among the many who supported the principle of the clause. He had, however, one further concern. He asked whether the Government were in favour of widening the tax base in general rather than only in this sphere. The hon. Gentleman suggested that it was necessary to widen it in every respect. I do not think that one can take such a simplistic view. In general, there is a strong presumption in favour of widening the tax base.
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      6 pm
      However, I quote one example that was mentioned earlier by the hon. Member for Workington (Mr. Campbell-Savours). We are due to debate the business start-up scheme later in Committee. That can be construed as—and in a way it is—a narrowing of the tax base. Will the Social Democratic representative who serves on the Committee be voting against the business start-up scheme on those grounds? We shall see. The width of the tax base is not the only yardstick that one has to use. The hon. Gentleman suggested that the tax base could be increased by the abolition of mortgage interest relief. I am interested to learn that that is the official policy of the Social Democratic Party. I assure the hon. Gentleman that it is not the policy of the Government.
      The right hon. Member for Ashton-under-Lyne asked about the cost in terms of Inland Revenue staff. Governments in the past have accepted the principle of making unemployment benefit liable to tax. That is the only way to achieve equity between those in work and those out of work, particularly between those in work for part of the year and those in work for the whole of the year. That is quite apart from the disincentive effect contained in the present system. Nevertheless, previous Governments, including the Labour Government, have shrunk from that decision on the grounds of the number of staff involved.
      Towards the end of their period of office, the Labour Government estimated that they would need between 10,000 and 11,000 extra staff to handle the taxing of unemployment and sickness benefit. Of course, sickness benefit is not covered in the Bill, and when that becomes liable to tax it is our intention that it will be done through the employers' statutory sick pay scheme. As a result, there will be negligible staff implications. The number of staff required to deal with the taxation of unemployment benefit will be about one-third the figure which the right hon. Gentleman quoted.
      Mr. Robert Sheldon: I take it that that is the gross figure.
      Mr. Lawson: Our best estimate of the total number of increased staff required is in the order of 3,500. That must be set against the reduction of 9,000 Revenue staff that we have already secured.
      Mr. Robert Sheldon: The right hon. Gentleman will have received the questions that I put to him through his Private Office. They included questions about the number of claims for benefit and the Dependants other than the Inland Revenue in which that extra staff may be found.
      Mr. Lawson: I did not receive notice of the first of those two questions. As to his second, in addition to Inland Revenue staff, there will be staff from the Department of Employment, the DHSS and the Northern Ireland DHSS. The lot are included. However, I do not have a breakdown of the figures. If the right hon. Gentleman wishes, he can table some written questions and we shall do our best to answer them. Inevitably, these questions are somewhat speculative, because the figures depend on future levels of threshold, the number of unemployed and so on.
      The right hon. Gentleman also asked a number of detailed questions about the 30-day rule and other matters. Those matters come under clause 28 which we shall be debating in Committee upstairs. Indeed, there were no

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      representations from the Opposition to the effect that we should debate that clause on the Floor of the House. Therefore, we shall come to that clause in due course and we shall be happy to answer his questions at the appropriate time.
      The right hon. Gentleman complained that the mechanics of the scheme would be introduced by regulation, and argued that they should be included in a schedule to the Bill. I am surprised that, as a former Treasury Minister, he should make that point, because he must know that all the legislation relating to the mechanics of the PAYE system has been introduced by regulation. The mechanics of PAYE have never been included in the main legislation. We are, therefore, maintaining the practice that has existed since the PAYE system began, which was maintained by the Labour Government.
      Nevertheless, the right hon. Gentleman opposed the method that we have chosen to bring unemployment benefit into tax. It is a method that I unhesitatingly commend to the Committee. We are saying that throughout the period in which he is unemployed, a man will receive the gross unemployment benefit with no deduction for tax, nor will he receive any PAYE refunds. When he returns to work or at the end of the financial year, whichever is the sooner, the one will be netted off the other. In 90 per cent. of cases, the amount due in refunds will be greater than the amount which should have been paid in taxation during the period of unemployment. Therefore, when the man returns to work, a small payment will be made to him representing the netted out difference between the two figures. That is a practical and commonsense way of bringing unemployment benefit into tax, and the principle is approved just as much by the Opposition as by the Government.
      The right hon. Member for Ashton-under-Lyne said that as a result of the abatement the unemployed will be taxed on what they have not even received. That is not the case. In no way can the unemployed be taxed on a higher rate of benefit than they have received. I am sure that the right hon. Gentleman is aware of that.
      Mr. Robert Sheldon: The point that I was trying to make was that these unfortunate people will be denied that money and will find themselves taxed on it. That is what I was objecting to.
      Mr. Lawson: They will be taxed on the benefit that they receive, not on the unabated benefit. If that were the case, we would indeed be open to criticism, but that is not the case.
      The hon. Member for Edinburgh, Central (Mr. Cooke) asked about the cost of this amendment. It is about £240 million. I must emphasise the size of that figure, because it touches on an earlier point about which the hon. Member for Gateshead, West made some telling comments. The Opposition have already voted on amendments which altogether would cost more than £4 billion. This amendment brings the total to nearly £4¼ billion. If they press the next set of amendments to a vote, the figure will be well over £4½ billion, and this is only the third day of the Committee stage. They are in favour of public expenditure increases as well.
      Because of the Opposition's delight for public expenditure, one assumes that they would wish to see public expenditure increased by a similar amount. Therefore, altogether we are talking about an increase in
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      the PSBR of £9 billion or £10 billion. They support that. In other words, the existing public sector borrowing requirement would be doubled. Do the Opposition have any idea of the consequences for interest rates and, as a result, for industry? Do they have any idea of the inflationary threat that such a borrowing requirement would portend? The Opposition have shown the height of irresponsibility.
      However, I do not defend the provision on those grounds alone. Some of the other tax increases in this Budget, notably those on personal allowances, were put to the House with some regret. There was no great merit in them other than the money that they raised, which was vital to the proper conduct of the economy. However, this provision has the merit that there is no reason in principle, why unemployment benefit should not be liable to tax on the grounds of incentive and equity.
      I commend the clause to the House. With no apology whatever, I ask the Committee to reject the opportunistic amendment that has been tabled in the name of the official Opposition.
      Mr. Richard Wainwright: Although employees' contributions for national insurance are not allowed as a relief for income tax, Liberal Members have long made it clear that, along with most hon. Members, they support the principle of taxing benefits when they cross the tax thresholds. I expected the Financial Secretary to make the case in such a way that we should be able to join him in resisting the amendment. However, he found himself unwilling or unable to give us cause to think that the abatement of benefit—which was explicitly stated by his ministerial colleagues to be a temporary substitute for tax—will be put right when the tax comes into effect. That completely changes the picture.
      I am always reluctant to repeat quotations. However, the statement made by the Secretary of State for Social Services in Committee commits the Government. The right hon. Gentleman spoke on the Social Security (No. 2) Bill and said:
      "The hon. Gentleman asked specifically about abated unemployment benefit. That will make no difference because as the unemployment benefit comes into tax so the rationale for the 5 per cent. abatement ends. It is an interim scheme in lieu of taxation. One will give way to the other." — [Official Report, Standing Committee B, 30 April 1980; c. 526.]
      If the Financial Secretary had repeated that without making a detailed legislative commitment, Liberal Members would have been minded to resist the amendment. However, the right hon. Gentleman has been unable to give the Committee an assurance.
      I reject the reason that the right hon. Gentleman ostensibly gave for being unable to reassure hon. Members. He said that the matter would have to wait until public expenditure was reviewed. All hon. Members know that many of the public expenditure commitments for 1982–83 are firmly established. The Government know that they cannot avoid them. The idea that £50 million could not be committed at this stage does not hold water, particularly when the Government are to be commended on having largely implemented the admirable principle that the House should be able to discuss revenue and expenditure together.
      It is established that we should have the White Paper on public expenditure at the same time as the Budget. What the Financial Secretary has said to excuse his inability to give any commitment on removing the

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      abatement of benefit is in clear conflict with that. Until the Government state categorically that they intend to honour the commitment so clearly expressed by the Secretary of State for Social Services we cannot possibly help them to protect the clause.
      6.15 pm
      Mr. Cook: At the beginning of the debate the Financial Secretary stated that he would be eccentric and would stick to the terms of the amendment. He ended his speech by going over every amendment that the Committee has considered in the past three days. I should like to nail to the table the canard that the Treasury has produced three times from the Dispatch Box. Indeed, it is something of a tribute to the bankruptcy of the Treasury's arguments that it produces that canard each time that it is called on to defend a proposition. As the Financial Secretary well knows, it is an insult to the intelligence of Committee members to suggest that it is possible to take the sum of the Opposition's amendments and say that it represents their considered and balanced view of what a Budget should be.
      Last week I made it perfectly plain that we were moving the amendment on the reduced rate band in the light of the defeat of our amendment to increase tax thresholds. I made it clear that after the Treasury had voted itself £2 billion it was appropriate to consider giving £1 billion back to the low-paid through the reduced rate band. Had our reason, persuasion and eloquence—to which the right hon. Gentleman keeps paying tribute—carried the right hon. Gentleman with us on tax thresholds and had we convinced him of the view that he espoused in 1977, we might not have thought it necessary to move the amendment on the reduced rate band. That knocks £1,100 million from the sum that the right hon. Gentleman mentioned earlier.
      In his political interest, the right hon. Gentleman should drop his argument. The Conservative Party waged its election campaign on the basis that the country was groaning under the taxation imposed by a Labour Government. During that campaign there was no suggestion—in the Daily Mail or anywhere else—that the time would come when the right hon. Gentleman would resist Opposition amendments to remove £4 billion of taxation in the interests of fiscal prudence.
      Mr. Lawson: I am interested to hear what the hon. Gentleman says. He said that he had made certain remarks earlier. I was not in the Chamber when he did so, but I take his word for it. If he is saying that if the Opposition threshold amendment had been carried they would not have moved their amendment to restore the lower rate band, that is of interest. The figure would then have become not over £4 billion but about £3 billion, plus whatever was pressed to a vote. Will the hon. Gentleman confirm that figure of £3 billion? If not, what is the figure? The Opposition's view of an appropriate Budget judgment and of what they think appropriate in terms of taxation and public expenditure is of some interest to the Committee and to the country. By what total amount would the Opposition seek to reduce taxation and by what amount would they increase public expenditure?
      Mr. Cook: I am happy to repeat what has already been said from the Dispatch Box. We do not have a figure. It is well known—this was said several times during the
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      Budget debate and we do not resile from it—that the Government's Budget judgment reduces the public sector borrowing requirement, in real terms, at a time of unprecedented recession and fall in output. That can only make it more difficult for the economy to expand. Were we to increase public expenditure along the lines that we have consistently argued for—I do not think that the right hon. Gentleman denies our consistency—it would not necessarily result in an equivalent rise in the public sector borrowing requirement.
      The Financial Secretary said that he would eccentrically stick to the amendment. Having dealt with his eccentric departure from the amendment, I shall come back to his remarks on it. I entirely acquit him of having spoken—as my hon. Friend the Member for Workington (Mr. Campbell-Savours) feared he might—in a defensive mood. Whatever else he may have been he was not defensive. The passionate, eloquent, well-argued speeches from my hon. Friends on the Back Benches clearly failed to get across our concern, anger and indignation at what the Government are doing to the unemployed. This measure represents the last step in the cumulative process.
      The Financial Secretary said that it was common ground among all who took part in the debate that in principle short-term benefits should be taxed. That is so. It has been common ground among all Governments since 1948 that short-term benefits should be subject to tax. It has also been common ground among all Governments since 1949 that there was no way of doing it that was both fair to the claimant and practical to the Treasury. Having heard the Financial Secretary, the Committee must ask whether that way, which has eluded every Government, both Conservative and Labour, since 1949, has now been found by the right hon. Gentleman.
      I turn straight away to the figure that the right hon. Gentleman gave to the Committee, which I think surprised and shocked many hon. Members. The right hon. Gentleman—for perhaps the first time under this Government—announced an increase of 3,500 civil servants to implement this clause and the associated clauses. That is, as he generously admitted, 40 per cent. of the number that had been saved by the Treasury in cutting back on civil servants. The hon. Gentleman said that the Treasury had saved 9,000, and 3,500 is 40 per cent. of 9,000.
      Mr. Lawson: That was from the Inland Revenue alone. From the Chancellor's Department as a whole the saving has been 130,000— a substantial part of the total saving.
      Mr. Cook: How many—130,000?
      Mr. Lawson: I am sorry—13,000.
      Mr. Cook: If we keep knocking off digits at this rate, we shall soon be below 3,500. I accept the figure of 13,000, but that still leaves us with the fact that in this and the following two clauses we are restoring 25 per cent. of the cuts achieved with considerable difficulty by the right hon. Gentleman and his colleagues during the past two years.
      It is perhaps worth recalling what some of those dismissed civil servants did. About 2,000 worked on tax avoidance and tax evasion measures. There is more money to be made by the Treasury from putting the screws on tax avoidance and evasion than will ever be recouped from these three miserable clauses.

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      There is another provision in the Bill to relax the excise rules. That will result in 400 redundancies among warehouse men and excise men attached to bonded warehouses. As a result, excise duty will virtually become a matter of voluntary tax assessment by the distillers companies.
      Last week we had a debate on the reduced rate band. The hon. Member for Colne Valley (Mr. Wainwright) will recall that the question of the number involved in implementing the reduced rate band was raised not by the Opposition but by the Government Front Bench. At that time the Chief Secretary said:
      "On the administrative costs, which the hon. Member for Colne Valley rather pooh-poohed, the Committee should get the facts on the record and draw its own conclusions. I do not suggest—I very much doubt whether anyone else in my position would—that the administrative cost should be a conclusive consideration, but it is relevant. The Government aim to reduce the proportion of our resources that we spend on administration. The saving of 1,300 staff resulting from the abolition of the lower rate band last year will contribute towards this."—[Official Report, 5 May 1981; Vol. 4, c. 89–90.]
      There we have it. Last year the Treasury saved 1,300 staff because it was unwilling to maintain the reduced rate band, which produced a lower marginal rate of tax for the low-paid and softened the introduction of the tax threshold for the low-paid. This year the Treasury is contemplating taking on 3,500 additional staff to increase the tax on the low-paid—indeed, to increase the tax on the unemployed. There is a glaring contrast there between the resources that the Treasury is not prepared to spend to assist the low-paid and the resources that it is prepared to find to wring tax out of the low-paid.
      I know, and the Committee in its heart knows, why the Treasury has been able to conquer its prejudice against Civil Service numbers. On this occasion the Treasury has been able to do so because it has been overwhelmed by its even stronger prejudice against the unemployed. We are back to the vision that the Prime Minister held out to the nation in December 1979 about the nation's expanding army of the workshy. One would need a neck of brass to double unemployment as the Government have done—to break the unemployment record of the 1930s—and then to blame it on the unemployed.
      My right hon. Friend the Member for Norwich, North (Mr. Ennals) and my hon. Friends the Members for Workington and Batley and Morley (Mr. Woolmer) said that one would have thought that the Government would avoid the introduction of this tax on the unemployed at a time when they have achieved record unemployment.
      Mr. Lawson: First, I owe the hon. Gentleman and the Committee an apology. In my zeal to correct the figure of 9,000 I exaggerated somewhat at 13,000. On checking the figure I see that the saving for the Chancellor's Department as a whole is 11,000.
      Secondly, the cost will gradually reduce as the computerisation of PAYE, which starts on a pilot basis in 1983, comes into effect. This is the initial cost in terms of staff, and there will be a reducing staff cost.
      Thirdly, I should like to get the hon. Gentleman's position clear. Is he opposing the increase because he is wholly in support of our general policy of reducing the size of the Civil Service? Is he in support of that policy? If not, does he believe that the Civil Service should not be reduced? If so, his argument on staff cost seems somewhat paradoxical.
      Mr. Cooke: I am encouraged by the rate at which the figures produced by the Treasury for savings on staff have been so rapidly revised in a downward direction. We began with 130,000; we moved rapidly to 13,000, and now we are down to 11,000. It will be some time yet before I conclude. We look forward with interest to what the figure is when I sit down.
      Returning to the last point made by the Financial Secretary in his generous intervention, it has not been any part of our argument that we should hire civil servants for the sake of it. Equally, we believe that there is no argument for laying off civil servants to massage the figures downward for electoral purposes. We firmly take the view that we should increase the size of the Civil Service only where the result will be efficacious and effective. To take on 3,500 additional civil servants for this purpose is not effective or reasonable, especially when that suggestion comes from a Government who have laid off 2,000 tax inspectors working on tax avoidance who netted a far larger sum than will be netted by these 3,500.
      My hon. Friend the Member for Batley and Morley made a point that I think weighs heavily with every Opposition Member who has taken part in the debate. We have so many unemployed now not because they are workshy or better off on the dole but because jobs are not available. The Prime Minister visited Perth last week. She made a stirring speech, in which she referred to sunny uplands just over the horizon and to living in a land of hope, if not of glory. On the day that the right hon. Lady spoke in Perth the jobcentre there had an advertisement for only one dozen vacancies—every one of them in Saudi Arabia. That is the reality in respect of the jobs available for the young unemployed in Perth. It is not that they are workshy or scroungers; the jobs are not there.
      My hon. Friend the Member for Batley and Morley referred to the PSI study, which established that just over 3 per cent. of male unemployed are better off unemployed than in work. There was another figure in that study that particularly stood out. The study found that only 12 per cent. of the unemployed covered by the survey had turned down the offer of a job in the first six weeks of unemployment. Putting it the other way round, 88 per cent. of those offered any job in the first six weeks took it. In half of those cases of the 88 per cent. who took a job, the job was worse paid than the job that they had held before, but they took it to get out of unemployment.
      6.30 pm
      That is the reality of the situation. Yet the Government—we recognise it—remain obsessed with the mythical problem of the "Why work?" syndrome. I can understand why the Government are sensitive about the problem of the "Why work?" syndrome. They are sensitive about it because they themselves have done more to worsen the poverty trap than any Government since the last war. Last year they deepened the trap by abolishing the reduced rate band. This year they have widened the trap by not upping the tax thresholds.
      I can tell my hon. Friends and the hon. Member for Colne Valley why it is that the Government cannot make a commitment to restore the 5 per cent. abatement. The reason why they cannot up the unemployment benefit by 5 per cent. is that, having failed to increase the tax thresholds, if they were now to up unemployment benefit

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      by 5 per cent. they would thrust tens of thousands more people into the poverty trap, who then would find that it was better to be out of work than to be in work.
      The Government were pressed very strongly on the issue of the 5 per cent. abatement—not a cut, but an abatement, as we were assured. A number of hon. Members referred to the statement by the Secretary of State for Social Services, who said that
      "as the unemployment benefit comes into tax so the rationale for the 5 per cent. abatement ends."—[Official Report, Standing Committee B, 30th April 1980; c. 526.]
      The hon. Member for Anglesey (Mr. Best)—I am sorry that he has not been in the Chamber since he finished speaking—quoted the Under-Secretary for Health and Social Security, who said:
      "It is a temporary measure pending taxation which all parties in the House have greed."—[Official Report, 3 February 1981; Vol. 998, c. 140.]
      I am bound to say that the hon. Lady took something of a liberty with the other parties in the House, since all the other parties in the House voted against it, but I presume that we are taken to have agreed, since we lost because the right hon. Gentleman called out his troops.
      We have not had the advantage of an intervention from the Secretary of State for Social Services. Throughout most of the debate we have had the attendance of his Minister—who, for most of the debate, was kept two Treasury spokesman seats away from the Dispatch Box just in case he should be tempted to break his silence and make a rash commitment to spend money on upping unemployment benefit by 5 per cent.
      It is grossly unfair for the Committee to be asked to vote the money that will arise out of taxation and then be told that the Goxernment will think about what they will do about the 5 per cent. abatement that was imposed last year on the basis that taxation was round the corner. It will not do, for the reason to which the right hon. Gentleman referred in his reply. As he clearly admitted, the resources are there. They arise under this clause, apart from anywhere else. As the right hon. Gentleman said, he will benefit by £240 million from the clause, and it will cost £50 million to restore the 5 per cent. to the unemployed.
      In all candour and in all decency, the first call on the £240 million that the right hon. Gentleman is getting out of this clause has to be the restoration of the 5 per cent. abatement from the very people whom he is now taxing.
      The Chancellor of the Exchequer, during his reply to the Budget debate, responded to a characteristically trenchant intervention by my hon. Friend the Member for Keighley (Mr. Cryer). In his response the Chancellor said:
      "Conservative Members are as much concerned about the unemployed as anyone else."—[Official Report, 16 March 1981; Vol. 1, c. 96.]
      I am very glad that we have the Chancellor's word for it, because we could not have divined it from what he has done over the past two years. During that period his Government abolished earnings-related supplement for the unemployed. Last year he cut unemployment benefit by 4 per cent. This year, in a Bill that we shall be debating again later this week, the Government are to cut a further 1 per cent. off unemployment benefit in order that they can get their full 5 per cent. of flesh from the unemployed. That is the record of the past two years.
      If the Chancellor is really concerned about the unemployed as much as anyone else, he now has the
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      opportunity to remedy part of the problem and assure the Committee that if we pass this provision for taxation of unemployment benefit he will restore the 5 per cent. that was taken from the unemployed on the pretence that they were to be taxed and that this was in lieu of taxation.
      If we cannot have that assurance, I do not think that my hon. Friends and I have any alternative but to vote against the clause by voting for our amendment. In doing so it is relevant to draw to the Committee's attention to one last contrast that is presented to us in the Bill. The Financial Secretary suggested that the entire thrust of our concern about the Bill was simply with those places where additional tax was imposed. I must put it back to the Financial Secretary.
      If we look at the Finance Bill as a whole we find that there is one other fresh inequity that arises from it, even among the unemployed. There is another clause—clause 31—that provides additional relief for those who are made redundant and get a golden handshake. At present they can get £10,000 without paying tax. Ten thousand pounds is a very generous figure. Indeed, the same study as that to which my hon. Friend the Member for Batley and Morley referred discovered that only 5 per cent. of those made redundant received a payment from the employer exceeding £2,000. A very small percentage received £10,000.
      Clause 31 ups that figure of tax-free golden handshakes from £10,000 to £25,000. That is where the Chancellor's concern for the unemployed is. It is for that tiny proportion of the unemployed who get golden handshakes of £25,000. They are the people for whom the Government have found the money. They are the people who represent the social priorities of the Government. Those social priorities are repugnant to Opposition Members and we shall repudiate them in a Division.
      Question put, That the amendment be made:—
      The Committee divided: Ayes 210, Noes 275.

      Division No. 174]

      [6.37 pm

      AYES

      Abse, Leo

      Conlan, Bernard

      Adams, Allen

      Cook, Robin F.

      Allaun, Frank

      Cowans, Harry

      Anderson, Donald

      Craigen, J. M.

      Archer, Rt Hon Peter

      Crowther, J. S.

      Ashley, Rt Hon Jack

      Cryer, Bob

      Ashton, Joe

      Cunliffe, Lawrence

      Atkinson, N.(H'gey,)

      Cunningham, G. (Islington S)

      Bagier, Gordon A.T.

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

      Barnett, Guy (Greenwich)

      Dalyell, Tam

      Barnett, Rt Hon Joel (H'wd)

      Davidson, Arthur

      Benn, Rt Hon A. Wedgwood

      Davies, Rt Hon Denzil (L'lli)

      Bennett, Andrew(St'kp't N)

      Davies, Ifor (Gower)

      Bidwell, Sydney

      Davis, Clinton (Hackney C)

      Booth, Rt Hon Albert

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

      Boothroyd, Miss Betty

      Deakins, Eric

      Bray, Dr Jeremy

      Dean, Joseph (Leeds West)

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

      Dempsey, James

      Brown, Ron (E'burgh, Leith)

      Dewar, Donald

      Buchan, Norman

      Dixon, Donald

      Callaghan, Rt Hon J.

      Dobson, Frank

      Callaghan, Jim (Midd't'n & P)

      Dormand, Jack

      Campbell, Ian

      Douglas-Mann, Bruce

      Campbell-Savours, Dale

      Dubs, Alfred

      Canavan, Dennis

      Duffy, A. E. P.

      Cant, R. B.

      Dunn, James A.

      Carmichael, Neil

      Dunnett, Jack

      Carter-Jones, Lewis

      Dunwoody, Hon Mrs G.

      Clark, Dr David (S Shields)

      Eadie, Alex

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

      Eastham, Ken

      Coleman, Donald

      Ellis, R. (NE D'bysh're)

      Concannon, Rt Hon J. D.

      English, Michael

      525

      Ennals, Rt Hon David

      Morris, Rt Hon A. (W'shawe)

      Evans, loan (Aberdare)

      Morris, Rt Hon C. (O'shaw)

      Evans, John (Newton)

      Morris, Rt Hon J. (Aberavon)

      Ewing, Harry

      Morton, George

      Field, Frank

      Oakes, Rt Hon Gordon

      Fitt, Gerard

      Ogden, Eric

      Flannery, Martin

      O'Halloran, Michael

      Fletcher, Ted (Darlington)

      O'Neill, Martin

      Foot, Rt Hon Michael

      Orme, Rt Hon Stanley

      Ford, Ben

      Palmer, Arthur

      Forrester, John

      Parry, Robert

      Foster, Derek

      Prescott, John

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

      Price, C. (Lewisham W)

      Garrett, John (Norwich S)

      Race, Reg

      George, Bruce

      Radice, Giles

      Gilbert, Rt Hon Dr John

      Rees, Rt Hon M (Leeds S)

      Ginsburg, David

      Richardson, Jo

      Graham, Ted

      Roberts, Albert (Normanton)

      Grant, George (Morpeth)

      Roberts, Allan (Bootle)

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

      Roberts, Ernest (Hackney N)

      Harrison, Rt Hon Walter

      Roberts, Gwilym (Cannock)

      Hattersley, Rt Hon Roy

      Robertson, George

      Healey, Rt Hon Denis

      Robinson, G. (Coventry NW)

      Heffer, Eric S.

      Rooker, J. W.

      Hogg, N. (E Dunb't'nshire)

      Ross, Ernest (Dundee West)

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

      Rowlands, Ted

      Homewood, William

      Ryman, John

      Howell, Rt Hon D.

      Sever, John

      Hudson Davies, Gwilym E.

      Sheerman, Barry

      Hughes, Mark (Durham)

      Sheldon, Rt Hon R.

      Hughes, Robert (Aberdeen N)

      Shore, Rt Hon Peter

      Hughes, Roy (Newport)

      Short, Mrs Renée

      Janner, Hon Greville

      Silkin, Rt Hon J. (Deptford)

      Jay, Rt Hon Douglas

      Skinner, Dennis

      John, Brynmor

      Smith, Rt Hon J. (N Lanark)

      Johnson, James (Hull West)

      Snape, Peter

      Jones, Rt Hon Alec (Rh'dda)

      Soley, Clive

      Jones, Barry (East Flint)

      Spearing, Nigel

      Jones, Dan (Burnley)

      Spriggs, Leslie

      Kaufman, Rt Hon Gerald

      Stallard, A. W.

      Kerr, Russell

      Stewart, Rt Hon D. (W Isles)

      Kilroy-Silk, Robert

      Stoddart, David

      Kinnock, Neil

      Stott, Roger

      Lambie, David

      Straw, Jack

      Lamborn, Harry

      Summerskill, Hon Dr Shirley

      Leadbitter, Ted

      Thomas, Dafydd (Merioneth)

      Leighton, Ronald

      Thomas, Jeffrey (Abertillery)

      Lestor, Miss Joan

      Thomas, Dr R.(Carmarthen)

      Lewis, Arthur (N'ham NW)

      Thorne, Stan (Preston South)

      Litherland, Robert

      Tilley, John

      Lyon, Alexander (York)

      Tinn, James

      Mabon, Rt Hon Dr J. Dickson

      Torney, Tom

      McCartney, Hugh

      Wainwright, E.(Dearne V)

      McElhone, Frank

      Walker, Rt Hon H.(D'caster)

      McKay, Allen (Penistone)

      Watkins, David

      McKelvey, William

      Weetch, Ken

      MacKenzie, Rt Hon Gregor

      Wellbeloved, James

      McMahon, Andrew

      Welsh, Michael

      McNally, Thomas

      White, Frank R.

      McNamara, Kevin

      White, J. (G'gow Pollok)

      McWilliam, John

      Whitlock, William

      Magee, Bryan

      Wigley, Dafydd

      Marks, Kenneth

      Willey, Rt Hon Frederick

      Marshall,D(G'gow S'ton)

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

      Marshall, Dr Edmund (Goole)

      Wilson, Rt Hon Sir H.(H'ton)

      Marshall, Jim (Leicester S)

      Wilson, William (C'try SE)

      Martin, M(G'gow S'burn)

      Winnick, David

      Mason, Rt Hon Roy

      Woodall, Alec

      Maxton, John

      Woolmer, Kenneth

      Maynard, Miss Joan

      Wright, Sheila

      Mellish, Rt Hon Robert

      Young, David (Bolton E)

      Mikardo, Ian

      Millan, Rt Hon Bruce

      Tellers for the Ayes:

      Mitchell, Austin (Grimsby)

      Mr. James Hamilton and Mr. Frank Haynes.

      Mitchell, R. C. (Soton Itchen)

      NOES

      Adley, Robert

      Alison, Michael

      Aitken, Jonathan

      Amery, Rt Hon Julian

      Alexander, Richard

      Ancram, Michael

      526

      Aspinwall, Jack

      Gardner, Edward (S Fylde)

      Atkins, Robert(Preston N)

      Garel-Jones, Tristan

      Baker, Kenneth(St.M'bone)

      Gilmour, Rt Hon Sir Ian

      Baker, Nicholas (N Dorset)

      Glyn, Dr Alan

      Banks, Robert

      Goodlad, Alastair

      Bell, Sir Ronald

      Gow, Ian

      Bendall, Vivian

      Gower, Sir Raymond

      Benyon, Thomas (A'don)

      Gray, Hamish

      Benyon, W. (Buckingham)

      Greenway, Harry

      Berry, Hon Anthony

      Griffiths, E.(B'y St. Edm'ds)

      Best, Keith

      Griffiths, Peter Portsm'th N)

      Bevan, David Gilroy

      Grist, Ian

      Biggs-Davison, John

      Grylls, Michael

      Blackburn, John

      Hamilton, Hon A.

      Blaker, Peter

      Hamilton, Michael (Salisbury)

      Body, Richard

      Hampson, Dr Keith

      Bonsor, Sir Nicholas

      Hannam, John

      Bowden, Andrew

      Haselhurst, Alan

      Boyson, Dr Rhodes

      Hastings, Stephen

      Braine, Sir Bernard

      Havers, Rt Hon Sir Michael

      Bright, Graham

      Hawksley, Warren

      Brinton, Tim

      Hayhoe, Barney

      Brittan, Leon

      Heddle, John

      Brooke, Hon Peter

      Henderson, Barry

      Brotherton, Michael

      Heseltine, Rt Hon Michael

      Brown, Michael(Brigg & Sc'n)

      Hicks, Robert

      Browne, John (Winchester)

      Higgins, Rt Hon Terence L.

      Bruce-Gardyne, John

      Holland, Philip (Carlton)

      Bryan, Sir Paul

      Hooson, Tom

      Buchanan-Smith, Alick

      Hordern, Peter

      Buck, Antony

      Howell, Rt Hon D. (G'ldf'd)

      Budgen, Nick

      Hunt, David (Wirral)

      Bulmer, Esmond

      Hunt, John (Ravensbourne)

      Burden, Sir Frederick

      Hurd, Hon Douglas

      Butcher, John

      Jenkin, Rt Hon Patrick

      Cadbury, Jocelyn

      Johnson Smith, Geoffrey

      Carlisle, John (Luton West)

      Jopling, Rt Hon Michael

      Carlisle, Kenneth (Lincoln)

      Kaberry, Sir Donald

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

      Kellett-Bowman, Mrs Elaine

      Chalker, Mrs. Lynda

      Kimball, Marcus

      Channon, Rt. Hon. Paul

      King, Rt Hon Tom

      Chapman, Sydney

      Kitson, Sir Timothy

      Churchill, W. S.

      Knox, David

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

      Lamont, Norman

      Clark, Sir W. (Croydon S)

      Langford-Holt, Sir John

      Clarke, Kenneth (Rushcliffe)

      Latham, Michael

      Clegg, Sir Walter

      Lawrence, Ivan

      Cockeram, Eric

      Lawson, Rt Hon Nigel

      Colvin, Michael

      Lee, John

      Cope, John

      Le Marchant, Spencer

      Corrie, John

      Lennox-Boyd, Hon Mark

      Cranborne, Viscount

      Lewis, Kenneth (Rutland)

      Critchley, Julian

      Lloyd, Ian (Havant & W'loo)

      Crouch, David

      Lloyd, Peter (Fareham)

      Dean, Paul (North Somerset)

      Loveridge, John

      Dickens, Geoffrey

      Luce, Richard

      Dorrell, Stephen

      Lyell, Nicholas

      Dover, Denshore

      McCartney, Hugh

      du Cann, Rt Hon Edward

      McCrindle, Robert

      Dunn, Robert (Dartford)

      Macfarlane, Neil

      Dykes, Hugh

      MacGregor, John

      Eden, Rt Hon Sir John

      MacKay, John (Argyll)

      Edwards, Rt Hon N. (P'broke)

      Macmillan, Rt Hon M.

      Eggar, Tim

      McNair-Wilson, M. (N'bury)

      Emery, Peter

      McNair-Wilson, P. (New F'st)

      Eyre, Reginald

      McQuarrie, Albert

      Fairgrieve, Russell

      Madel, David

      Faith, Mrs Sheila

      Major, John

      Fell, Anthony

      Marland, Paul

      Fenner, Mrs Peggy

      Marlow, Tony

      Fisher, Sir Nigel

      Marshall, Michael (Arundel)

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

      Mather, Carol

      Fookes, Miss Janet

      Maude, Rt Hon Sir Angus

      Forman, Nigel

      Mawby, Ray

      Fowler, Rt Hon Norman

      Mawhinney, Dr Brian

      Fox, Marcus

      Maxwell-Hyslop, Robin

      Fraser, Rt Hon Sir Hugh

      Mayhew, Patrick

      Fraser, Peter (South Angus)

      Mellor, David

      Fry, Peter

      Meyer, Sir Anthony

      Gardiner, George (Reigate)

      Miller, Hal (B'grove)

      527

      Mills, Peter (West Devon)

      Sims, Roger

      Miscampbell, Norman

      Skeet, T. H. H.

      Moate, Roger

      Speed, Keith

      Monro, Hector

      Speller, Tony

      Moore, John

      Spicer, Michael (S Worcs)

      Morris, M. (N'hampton S)

      Sproat, lain

      Morrison, Hon C. (Devizes)

      Squire, Robin

      Morrison, Hon P. (Chester)

      Stanbrook, Ivor

      Mudd, David

      Stanley, John

      Murphy, Christopher

      Steen, Anthony

      Myles, David

      Stevens, Martin

      Neale, Gerrard

      Stewart, Ian (Hitchin)

      Needham, Richard

      Stewart, A.(E Renfrewshire)

      Nelson, Anthony

      Stokes, John

      Neubert, Michael

      Stradling Thomas, J.

      Newton, Tony

      Tapsell, Peter

      Normanton, Tom

      Taylor, Robert (Croydon NW)

      Onslow, Cranley

      Taylor, Teddy (S'end E)

      Page, Rt Hon Sir G. (Crosby)

      Tebbit, Norman

      Page, Richard (SW Herts)

      Temple-Morris, Peter

      Parkinson, Cecil

      Thomas, Rt Hon Peter

      Parris, Matthew

      Thompson, Donald

      Patten, Christopher (Bath)

      Thorne, Neil (llford South)

      Patten, John (Oxford)

      Thornton, Malcolm

      Pattie, Geoffrey

      Townend, John (Bridlington)

      Pawsey, James

      Townsend, Cyril D, (B'heath)

      Percival, Sir Ian

      Trippier, David

      Peyton, Rt Hon John

      Trotter, Neville

      Pink, R. Bonner

      van Straubenzee, W. R.

      Porter, Barry

      Vaughan, Dr Gerard

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

      Viggers, Peter

      Prentice, Rt Hon Reg

      Waddington, David

      Proctor, K. Harvey

      Wakeham, John

      Pym, Rt Hon Francis

      Waldegrave, Hon William

      Raison, Timothy

      Walker, B. (Perth)

      Rathbone, Tim

      Walker-Smith, Rt Hon Sir D.

      Rees, Peter (Dover and Deal)

      Wall, Patrick

      Rees-Davies, W. R.

      Waller, Gary

      Renton, Tim

      Walters, Dennis

      Rhodes James, Robert

      Warren, Kenneth

      Ridley, Hon Nicholas

      Watson, John

      Ridsdale, Sir Julian

      Wells, John (Maidstone)

      Rifkind, Malcolm

      Wells, Bowen

      Roberts, M. (Cardiff NW)

      Wheeler, John

      Roberts, Wyn (Conway)

      Whitelaw, Rt Hon William

      Rossi, Hugh

      Whitney, Raymond

      Rost, Peter

      Wickenden, Keith

      Royle, Sir Anthony

      Williams, D.(Montgomery)

      Sainsbury, Hon Timothy

      Winterton, Nicholas

      Scott, Nicholas

      Wolfson, Mark

      Shaw, Giles (Pudsey)

      Young, Sir George (Acton)

      Shaw, Michael (Scarborough)

      Younger, Rt Hon George

      Shelton, William (Streatham)

      Shepherd, Colin (Hereford)

      Tellers for the Noes:

      Shepherd, Richard

      Lord James Douglas-Hamilton and Mr. Robert Boscawen.

      Shersby, Michael

      Silvester, Fred

      Question accordingly negatived.
      Mr. Cook: I beg to move amendment No. 20, in page 15, line 17, leave out subsection (2).
      The Temporary Chairman (Sir Albert Costain): With this we shall take the following amendments: No.59, in page 15, line 42, at end insert
      'less any deduction made under section 6 of the Social Security (No. 2) Act 1980'.
      No. 21, in page 16, line 10, leave out from first 'the'to 'and' in line 14 and insert
      'amount specified in paragraph (a) above'.
      No. 22, in page 16, line 15, leave out 'the' and insert
      'amount specified in paragraph (a) above'.
      Mr. Cook: We shall concentrate on amendments Nos. 20 and 59, which we regard as matters of substance. The two amendments grouped with them are a modest attempt to simplify the clause, by standardising the amount liable
      528
      to taxation in each case. We hope that that will make a reasonable contribution to reducing paper-chasing and limiting the 3,500 staff, about whom we are so grievously concerned.
      Amendments Nos. 20 and 59 go to the heart of two matters about which the Opposition are concerned and about which the whole Committee should be concerned. The Financial Secretary said in his reply to the previous debate that it was common ground that short-term benefits—unemployment benefit and sickness benefit—should in principle be subject to tax. We concede that principle, but we disagree about whether this is the proper, right, just and practical way to go about it.
      There is no common ground between the Opposition and the Government about taxation of supplementary benefit paid to the dependants of a striker. That is a petty, vindictive and mean gesture, which we reject, not simply because of its practical implications, but in principle.
      Our first reason is that the proposal imports into the tax law the principle that supplementary benefit payments should be subject to taxation. We understand that, as a result of the subsection on which we have just voted, it is now inescapable that unemployed families receiving supplementary benefit because they are unemployed will come within the ambit of taxation. We understand why. One of the anomalies that embarrassed the Government when they started to examine the taxation of unemployment benefit was that if they merely taxed unemployment benefit they would create the paradoxical result that the family that had paid its contributions over the preceding year, and therefore qualified for unemployment benefit, would be subject to tax, whereas the head of household who had not paid contributions over the preceding year, and therefore did not qualify for unemployment benefit, would not be subject to tax on supplementary benefit.
      It was therefore necessary—we understand and accept why—explicitly to provide in the clause for the taxation of supplementary benefit paid to the unemployed person. That is inescapable, but it is not inescapable that supplementary benefit paid to a striker should be subject to tax. There is no necessary link or comparison between the unemployed person and the person on strike, who by definition is an employed person temporarily out of work. Indeed, many categories are in receipt of supplementary benefit and are not employed.
      There are the sick, who either receive supplementary benefit to top up their sickness benefit or receive it in lieu of sickness benefit, because they are out of contribution. There are the pensioners, just over half of whom receive a supplementary pension to top up their State pension. If for any reason they do not qualify for the State pension, they qualify for a supplementary pension to its entire value. The disabled either qualify for supplementary benefit to top up such benefit as they receive or receive a supplementary benefit entirely to make up those national insurance benefits. Finally, there is the large, growing and now significant group claiming supplementary benefit who are single parents entirely dependent on supplementary benefit for their income.
      Of all those categories in receipt of supplementary benefit, the Government have chosen for the special treatment of taxation only those receiving supplementary benefit because they are on strike. Why have the Government chosen them? Why have they picked on that group? It cannot be because that group makes up a

      529
      significant number of those receiving supplementary benefit, because strikers are a tiny proportion of the total number receiving it. Never in the past few years have those on strike receiving supplementary benefit made up more than 2 per cent. of all claimants of supplementary benefit. They are a small proportion of the total. It follows that the revenue from taxing those people's benefit will be miserable.
      That brings us to a further question. How much will the Financial Secretary get from this miserly measure? There is another question that we naturally couple with that: how much will it cost? If it is difficult to administer the taxation of the unemployment benefit, it is surely far more difficult to administer the taxation of the supplementary benefit paid to a striker's family. In the nature of things, the striker tends to be out of work for a much shorter period than the unemployed person. Therefore, far more paper-chasing is involved per week of benefit. Indeed, the paper will have to chase itself rapidly if it is ever to catch up before the man returns to work.
      The truth is that this measure is not put before the Committee either because strikers make up a large proportion of the whole number on supplementary benefit or because it is hoped to obtain revenue from it. It is put forward because the Treasury Bench are adopting, as part of the Government's general approach, what can be described in plain English only as a vindictive attitude towards the person on strike.
      We have already seen what the Government's vindictive attitude towards the striker can mean—the deduction of £12 from the supplementary benefit paid to him to support his family. It has been asserted, not in the Committee but outside the House, to the press and other media when the Bill was unveiled that what will be taxed as a result of the clause is the flat rate benefits, not the additions for heating, rent or child additions. On the day the Bill was published the Board of Inland Revenue issued a press release in which it said:
      "In the case of strikers, the benefit to be taxed is the supplementary benefit which a striker may claim in respect of an adult dependant. …
      As was announced last year, additions to unemployment and supplementary benefit, for children, housing and exceptional circumstances, are not to be brought into the charge to tax."
      That assurance is humbug. The board is plainly mistaken with reference to the striker.
      I can demonstrate why. Let us take two strikers' families. I do not want to cause any offence, so let us for the sake of example call them Rees and Lawson, who have come out in opposition to their employer for some reason.
      Mr. Rees has a wife and no children. He therefore qualifies for £18·60 as from next November in respect of his wife, who is the, adult dependant referred to in the board's press statement. However, as a result of the Social Security (No. 2) Act 1980, £12 is now knocked off that sum, leaving him with £6·60, on which he will be taxed under the clause. I do not wish to speculate on how he and his wife are to survive on £6·60 a week; I merely take the implications of the clause.
      Mr Lawson receives the £6·60 in respect of his wife, but he also has two children aged 4 and 5. Therefore, he qualifies for an additional £14·60 child addition, which when added to the £6·60, takes him back beyond the flat rate level for the adult dependant, and it is at that level that he is taxed. The effect of the £12 deduction is to make the first £12 of his child addition taxable. It must have that
      530
      effect, because there is nothing else left to tax once the £12 has been deducted from the flat rate for the adult dependant.
      Thus we can see from this illustrative example that the striker is subject to even more special treatment than at first appears from the clause. Not only is he singled out among claimants of supplementary benefit for the treatment of taxation, but he will be penalised by tax even more than the unemployed because in his case the child additions will be taxed, not the flat rate for the adult dependant. Even the toddlers of the striker will be subject to tax on the income which they receive from the State.
      7 pm
      It may be necessary at this stage to pinch ourselves and to remind ourselves what supplementary benefit is. It is an income set by Parliament as a basic subsistence income. It represents the poverty line. Academics accept the level of supplementary benefit as the poverty line, which defines the numbers living in poverty as those who are below it and the numbers not living in poverty as those who are above it.
      There is a profound paradox that Parliament should now be asked to make special provision to bring into tax the very income which Parliament has decided is the bare minimum necessary to give subsistence life.
      It is also perhaps necessary to remind ourselves what the child addition is. It represents the estimate of Parliament, based on the calculations put to it formerly by the Supplementary Benefits Commission and now by the Department of Health and Social Security, of the cost of feeding and warming a child. It is not income in the strict sense. It is the expense necessary to feed a child so that it grows and to clothe it so that it can go to school.
      Families on supplementary benefit find it difficult to achieve that on the level of income which they obtain from supplementary benefit, even with those child additions. Yet it is exactly those child additions which are to be taxed under this subsection. To use what appears to be a vogue phrase, that proposition must be distasteful to all right-minded people. If we cannot in this debate persuade the Financial Secretary of the iniquity of that proposition, we must demonstrate our distaste by voting in favour of amendment No. 20.
      Mr. Lawson: The hon. Member for Edinburgh, Central (Mr. Cook) concentrated on amendments Nos. 20 and 59. I shall do the same.
      Amendment No. 20 is a curious proposal to have tabled. As I understand it, the hon. Gentleman accepts in principle the taxation of supplementary benefit for the unemployed. As he rightly pointed out, it would be absurd if one man was getting unemployment benefit and paid tax on it, as I described in our last debate, while another man who was also unemployed was getting supplementary benefit because, for example, he had not paid sufficient contributions, and was not being taxed. So clearly the unemployed have to be on the same footing whether they receive unemployment benefit or supplementary benefit. That is one of the main elements in this subsection which the Opposition seek to delete.
      I should say that the total cost of the amendment is about £130 million.
      It appears that the Opposition are concerned about the position not so much of the unemployed person on supplementary benefit as of the striker on supplementary benefit. If the hon. Member for Edinburgh, Central wished

      531
      to concentrate on strikers, I am surprised that he did not table an amendment addressing itself specifically to them rather than one dealing with the general subject of taxation of supplementary benefit to the unemployed and strikers. But I understand now that the specific objection of the Opposition is to the treatment of strikers, and it is in this context, too that they tabled amendment No. 59 which concerns a detailed point on the position of the striker.
      Before coming to the general question, perhaps I should address myself to amendment No. 59. The hon. Member for Edinburgh, Central, suggests that the £12 reduction applies only to the claimant's adult dependant and therefore the extra supplementary benefit which the striker and his family are getting should not be taken into account in assessing how much of the benefit should be liable to tax.
      That is not the view taken by the Government. We believe that the only logical way of approaching this is that, where the total amount that the claimant is getting is in excess of the basic £17·05, as it is at present, that basic amount should be liable to tax.
      However, the general point made by the hon. Member for Edinburgh, Central—that supplementary benefit is set at subsistence level and therefore should not be taxed—falls to the ground because of the method that we have chosen. Our method does not take money from a man on supplementary benefit during the time that he is drawing supplementary benefit. In the case of the striker, the liability is taken into account when he returns to work so that the subsistence is paid in the same way.
      There is a general issue of principle here. The hon. Gentleman asks why strikers should be treated in this way when others on supplementary benefit are not. He is asking, in other words, what is special about strikers.
      Two features are special about strikers. One is that strikes do great damage to our economy. Another is that, unlike the many other disabilities mentioned by the hon. Gentleman, strikes are voluntary. People go on strike voluntarily and specifically to improve their financial position. They have a right to do so in a free society, but the nature of what they are doing is quite different from that of the various other matters mentioned by the hon. Gentleman.
      The Opposition's attitude is interesting. Whereas they accept in principle—they may have arguments about the method—the taxing of unemployment benefit and supplementary benefit for the unemployed, they reject in principle the taxation of supplementary benefit for strikers. They are saying, in other words, that the striker should be better off than the man who is unemployed. That is where they stand, and the Committee and the country will know it. The Government reject it.
      Mr. Woolmer: I wish to take up two of the remarks made by the Financial Secretary.
      I found it extremely interesting that when pushed, with his back metaphorically against the wall, the hon. Gentleman brought out the truth. He was only too happy to justify taxing the supplementary benefit of strikers because, he said, strikers damaged the country and strikes were voluntary.
      Perhaps I may spend a few moments looking at that motivation. It is a fact that the damage done by this Government to the country in terms of lost output, the
      532
      collapse of manufacturing industry, the loss now of export markets and the loss of our own industries' markets to foreign competition is far greater than the damage done by strikes since this Government came to office.
      The Financial Secretary has the gall at this time in our nation's history to repeat the pre-election rhetoric of which he should now be ashamed. He openly boasts and is proud of the claim that this clause is necessary, by implication, to teach strikers a lesson and to make sure that they suffer greater hardship. That, I suggest, is one reason why we should be on our guard against accepting the Government's proposals. At root, the matter has nothing to do with equity or a fine tuning of the taxation system. It is a political decision to rub the noses of strikers and their families in financial hardship.
      Strikers and their families suffer financial hardship that few people in work appreciate. The Financial Secretary cannot think—I do not believe that he does—that most people enter into a strike lightly and ignore or take lightly the financial consequences. Strikes are only a last resort. Workers do their utmost to avoid going on strike, not just for industrial relations reasons, but because of the financial hardship that they suffer.
      I reject the motivation that the Financial Secretary revealed in his outburst when he said that strikers damage the country and that they should therefore be taught a lesson. That is not true. Most strikers are only too pleased to get back to work, partly for financial reasons and partly because people want to work.
      The second reason given by the Financial Secretary—it is the substance of his reason for opposing the amendment—was that strikes are voluntary, and that in some way that justifies penalising them. Conservatives often say that they are the party of freedom and that choice is essential. However, strikers do not revel in the use of the strike weapon. They do not take it lightly. Strikes are voluntary, of course, in that people have the right to strike, although many Conservative Members would like to restrict that right and the voluntary nature of that action. Often, workers are forced into striking. Strikes are uncommon in industries such as the textile industries, but that has done little to save jobs or to prevent the deterioration of living standards.
      People who strike do so out of desperation and only when there is a serious situation. The Government say that the strikers' action is voluntary and that inadequate management or poor industrial relations should not be held responsible. They say that the person whose only weapon is to withdraw his labour should be penalised. That is the kind of one-sided view that causes strikes and is typical of the Government and many of their more hawkish Back Benchers. The remarks of the right hon. Gentleman, who is a leading Conservative Member—it is perhaps only by chance that he is not a member of the Cabinet—will be remembered.
      Mr. Lawson: In going through the reasons that I gave, will the hon. Gentleman address himself to the culminating reason—namely, that not to do this would put the striker in a much better position than people who are unemployed, and that, in equity, those strikers should be no better off than the man who is unemployed?
      7.15 pm
      Mr. Woolmer: People are adversely affected, whether in work or out of work on supplementary benefit, because

      533
      the Government—and, indeed, the Financial Secretary himself—have refused to uprate benefits and have deepened and widened the poverty trap.
      I do not intend to be lectured or hectored about the merits or otherwise of the problems of the low incomes that we are discussing. The Financial Secretary revealed, as tends to happen when he gets enthusiastic, that his true motive was to get at strikers. In his outburst against strikers he picked on them on a perjorative manner, and said that the person withdrawing his labour should be penalised, and that the firm or employer is not to be penalised. That is to take a one-sided view of industrial relations, regardless of the merits of the situation.
      One aspect has not been mentioned, and that is that the supplementary benefit, as my hon. Friend the Member for Edinburgh, Central (Mr. Cook) said belongs as of right to the family. The purpose is not to give a high standard of living or even a modest standard of living, but to cover the bare essentials of life for the children and the wife of the person involved. Precious few in this Chamber, if any, could face a period of living on the incomes that we are talking about, with no wage packet coming in, and with supplementary benefit being the sole pay for the family.
      I reject the notion that in a Finance Bill we should take a one-sided view of industrial relations and economic problems. Yet the Financial Secretary has made it plain that that is at the root of his thinking in seeking to tax supplementary benefit for strikers.
      Mr. Austin Mitchell: The principle underlying the amendment is exactly the same as the principle of the amendment that we tabled on taxing unemployment benefit. Two years ago the Government gave away massive tax cuts to the better-off in the hope of stimulating initiative and enterprise. The hope did not materialise, the stimulus was not there, and the economy has gone downhill since. Now the Government have the nerve to come back to the less well-off sections of the community—the unemployed, the people on supplementary benefits, the strikers—and say "You will have the privilege of paying for the failure of the grand hopes that we held out two years ago". It is typical that they ask those who are least able to bear the burden.
      In this case there is an extra twist—the lemon in the gin and tonic—in the vindictive attitude of the Financial Secretary towards strikers. His whole defence is based on a far-fetched and fictitious argument that in resisting the principle of taxation of benefits for strikers, the Opposition are saying "We want to support strikers and we think it unreasonable that strikers should be taxed". Rarely have I heard a more far-fetched and ridiculous argument.
      We oppose the measure because it is mean, vindictive and unnecessary. We have no other reason for opposing it. Strikes are the Government's fig leaf. They justify such petty vindictiveness and so much else of the Government's economy policy. In two years the Government have steered us deliberately into the worst depression that the country has faced since the war and the biggest drop in industrial output since 1929 to 1931.
      We must ask why the Government have done that. They say that it is to combat inflation. The logic of that is that as soon as the pressures are taken off and some mild expansion is allowed inflation will take off automatically again. They have economic permafrost. That is their way of defeating inflation.
      534
      We should be insulated from the world depression, since we are an oil Power We should not be going into a depression faster and deeper than any other industrial country is going in. The Government are imposing a discipline on the work force. They want to break the industrial power of the unions. They want to be able to say to people in work "Do not go for higher pay, because that will threaten your jobs and the existence of your firm." The Government's obsession with strikes motivates the clause and the Government's economic policy.
      The Government hold a whip over the working population by rapidly increasing unemployment. In addition, they are imposing extra vindictiveness against the unemployed. Supplementary benefits are already inadequate. The levels of benefit will become worse as, in the next few months and years, the Government are forced into a desperate search for further cuts and economies towards which the whole logic of their financial position pushes them. They will be under pressure to achieve the type of tax cuts forecast by the Financial Secretary on "Weekend World".
      Taxes will be increased because of the mounting burden of unemployment and the Depression. The Government will be forced into another massive internal struggle for economies. Unemployment benefit, supplementary benefit and pensions will be considered as ripe for the cheeseparing economies that the Government will have to make.
      Over the years the Tory Party has changed from the party of empire to one that rushes, in a servile and sycophantic fashion, towards Europe, to a party that insists, in its financial measures, that there are two nations and that the lower nation shall bear the burden. It was the party of Heathean technocracy that made such a mess, but it has now reneged and pulled back from that. After the abdication of all the strands of Conservative Party policy, what is left is the prejudice expressed tonight by the Financial Secretary in his juvenile little interventions. It is a prejudice against workers, trade unions, the unemployed and strikers. That prejudice is manifest in the measure and in the Financial Secretary's attitude.
      The Tory Party is now held together by prejudices, which are being put into legislative form. They have festered in Tory associations and corner grocery shops over the years. Now the prejudices are crawling on to the statute book in little vindictive measures such as this.
      The Government justify the measure by saying that income from all sources should be taxable. Why is not that social justice applied to tax evasion? The Financial Secretary told us about the economies in Inland Revenue staff. That staff could be employed in rooting out tax evasion, which is more expensive, on a bigger scale, and more harmful to the economy than strikes. Why is that same approach not being applied? Strikers are defending their standard of living against the Government's economic policies.
      If the Government insist on taxing people who, according to the Financial Secretary, are acting voluntarily in a way that is harmful to the economy, why do they not tax people who export their capital on a massive scale? It would be interesting to hear the accurate figures of the amount of capital that flows out of Britain for portfolio investment, investment in villas, and other useless activities overseas, which should be invested here to

      535
      produce jobs. What harm is done by that outflow of capital? If the Government are interested in fiscal justice, why do they not deal with that?
      The Prime Minister often says that she is concerned about the family. If that concern leads to such vindictiveness towards the families of strikers, what of that concern? How does the Prime Minister justify making a distinction between the families of strikers and the families in the rest of the community?
      The measure increases the number of civil servants when the Government are committed to reducing that number. It is unnecessarily vindictive and complicated. The Committee should oppose this squalid little measure.
      Mr. Campbell-Savours: I heard the hon. Member for Watford (Mr. Garel-Jones) ask, from a sedentary position, "Should we intervene?" It is significant that Government Back Benchers have not intervened in the debate. They have not sought to intervene, because they believe that the Government's decisions and recommendations cannot be sustained and defended on any public platform anywhere in the United Kingdom. The clauses penalise, because they are vindictive. Their objective is to undermine working men and women.
      The clause affects strikers' families rather than strikers. We can trace that to the Government's election programme. We remember the campaign that was mounted by the Tory Party to generate hysteria about the position of strikers' families and the benefits paid to them. The Financial Secretary said that we were seeking special arrangements. We are doing so in many ways. We are seeking to establish that the dependants of strikers are fully protected in any legislation that comes before the House. That is not an ignoble suggestion, but an objective that should be shared by the majority in Britain. There is no understandable reason why the wives or other dependants of strikers should be penalised in any way by Government action. It is not true that strikers draw supplementary benefits, as has been implied by the Financial Secretary and by the Conservative Party. They draw benefit on behalf of their families and dependants.
      7.30 pm
      The debate is an extension of the industrial relations debates with which the Conservative Party preoccupies itself. We can evaluate the Conservatives' attitude on the basis of what little experience they have of industrial relations problems. It is a significant point that if one visits a picket line in any major industrial action and asks those picketing whether they have met their Conservative Members of Parliament, the answer is always "No." The comments of Conservative Members, reported in the local press, are marked by the derision with which they treat those who take action, even when they believe that they have a legitimate claim.
      The root of this clause, and of other clauses in other Bills, is to be found in the fact that Conservatives have no instinctive understanding of industrial relations—why workers take industrial action, or why they need to do so to defend their interests. We can link this little measure to the Employment Act 1980, introduced soon after the general election. It had the effect of restricting trade union rights and the rights of those taking industrial action. The
      536
      obsessive support and promotion by the Conservative Parliamentary Party and the Government of postal balloting, sponsored by the State, is an extension—
      Mr. Tristan Garel-Jones: Shame.
      Mr. Campbell-Savours: It is strange how the truth hurts. A long list of measures introduced by the Government have the same effect, namely, to undermine the position of those taking industrial action, whether or not it is for legitimate reasons.
      I am sure that my hon. Friends will be quick to endorse the AUEW decision last week to reject sponsored postal balloting and to conduct balloting only on the basis that it should financially support any arrangements that it wishes to make. In addition to this clause, there is the argument about the closed shop and the little measure that was passed some months ago to allow the Army, under certain conditions, to be used in a strike-breaking move. Such little measures may not appear to be part of the general package on industrial relations, but the clause is rooted in the Government's general policy, and it arises only when the Government cannot gain agreement with trade unions about industrial relations.
      There is a distinct difference in the approach of the Government and that of the Labour Government. I do not claim that the social contract was successful in its latter days. That may have been due to a statistical error by the then Prime Minister, who imposed a 5 per cent. rather than a 10 per cent. pay limit. Many believe that if he had chosen 10 per cent. there would have been a Labour Government today. However, the principle underlying all the actions of the Labour Administration in their relationship with trade unions was to forge conditions of consent.
      When the Government were elected, and following the interesting Ridley report, produced by the present Minister of State, Foreign and Commonwealth Office, who pinpointed areas of policy initiative as far back as 1978, they said that they would pursue a different approach from that of the Labour Government. The final means that they have used to subdue strikers and reduce industrial action has been their pursuance of monetarist strategy, thereby increasing the numbers who wait for jobs at the gates of places of work. The hon. Member for Watford (Mr. Garel-Jones) may smile, but that package of proposals was used on the doorstep during the last general election campaign to justify the return of a Conservative Government. Conservative canvassers used it to illustrate how a Conservative Government would deal with what they believed to be a major problem in industrial relations.
      The next Labour Government will not pursue that approach. A number of measures will have to be repealed at an early stage if we are to reforge the links with the trade unions. Legislation on the statute book, or about to be placed on the statute book, undermines the possibility of future good relations.
      Mr. Cook: The debate has served a useful function, even if the Opposition are defeated in the Division. If nothing else, we have had fascinating glimpses into the thinking of the Financial Secretary—
      Mr. Jack Straw: Rare glimpses.
      Mr. Cook: My hon. Friends are competing with me for words to describe it. I happily accept "rare", "disturbing" or other synonyms for the fascinating glimpses. It is well for the Financial Secretary that the Minister of State, who

      537
      has some experience in his profession of precision in fiscal policy and fiscal rationale, left the Chamber before the right hon. Gentleman spoke. The Minister might have experienced some unease at the rationale produced by the right hon. Gentleman for the fiscal decision. We were told that strikers should be singled out for taxation because striking was a voluntary action. That was an interesting illustration of the way in which the Financial Secretary regards the striker—as someone who does irresponsible damage to the economy purely of his own volition and free will.
      Some who have spoken from the Dispatch Box in the past have claimed that retirement was voluntary and that it was not necessary to give up work. It is within my living memory, which is slightly shorter than that of the Financial Secretary, that some used to say that parenthood was voluntary and that those who made themselves single parents had done so of their own volition and free will. Should they also be subject to taxation? We were told by the Financial Secretary that the striker should be subject to taxation because strikes damage the economy. Retirement damages the economy. The economy would be healthier if people did not retire and did not cease to be economically active. Should they be subject to taxation?
      Lastly, the right hon. Gentleman asserted that strikers should be singled out for this special measure because in striking they are taking action to improve their income. I thought that if nothing else the Government had adjured the population to take entrepreneurial action in a rough and ready market force jungle to improve their incomes. However, the right hon. Gentleman argues that strikers should be deemed to be a special group that should be subject to the scope of taxation. They are to be treated differently from other groups in receipt of supplementary benefit.
      The right hon. Gentleman asked why the family with an unemployed head of household should be worse off than the family with a head of household who is on strike. The striker's family is already much worse off than the household that is suffering unemployment. Its income is reduced by the income that would normally be granted under the supplementary benefit rules to the head of the household. The rest of the family—the wife and the children—are worse off by the deduction of the £12, a measure that was introduced by the Government last year. Therefore, a striker's family is about £30 a week worse off than the family of the unemployed worker. It is bogus to suggest that we must import the concept of taxation to the taxable income and supplementary benefit of the striker to achieve equity between the striker and the unemployed worker. There is already gross inequity between them and that is at the expense of the striker's family.
      We are in danger of repeating granny's footsteps. We began by taxing unemployment benefit. We moved inescapably to taxing supplementary benefit received by a family whose head of household is unemployed and who has not paid sufficient contributions to obtain unemployment benefit. Thus it follows logically that that household has to come within the ambit of the taxation of unemployment benefit. I do not think that that is desirable in principle. It is one of the reasons that should weigh with us when we decide to tax unemployment benefit. However, the decision having been taken, I accept that it is an inescapable corollary.
      The argument is advanced by the Financial Secretary that there is a further inescapable corollary—that we must
      538
      tax the supplementary benefit received by the striker's household. If we are to follow that chain of reasoning, why should we stop there? Having taxed the supplementary benefit of the striker's household, should not we tax the supplementary benefit paid to other households? Why should the woman whose husband is on strike be worse off than the woman whose husband has deserted her? What fiscal rationale can be found for distinguishing between the two?
      Mr. Austin Mitchell: Vindictiveness.
      7.45 pm
      Mr. Cook: I ask my hon. Friend not to rush me. I am coming to that. If a logical break can be found in that chain of reasoning, it rests in limiting taxation to the taxation of the unemployed. We settled that for better or worse in the previous Division and that is where we should leave it.
      My hon. Friend the Member for Grimsby (Mr. Mitchell) suggests that there is vindictiveness on the Government's part. Marxists have always argued that the history of mankind is the history of class conflict. I have never been entirely persuaded of that view of history. However, the longer that we live under this Government the more I can be persuaded that there may be some truth in that argument. I was persuaded of it when listening to the Financial Secretary. It is plain that the taxation of strikers has been inserted in the Bill as a vindictive action against strikers.
      If the right hon. Gentleman is prepared rashly to endorse a view of history that is based on class conflict, I warn him that many people strike who are not necessarily Marxists. Many who are striking against the Government in the Civil Service voted for the Conservative Party at the general election. If he does not believe me, I ask him to talk to the pickets as I have. It is interesting to note that they are striking against their employer, the Government, who have unilaterally suspended their pay bargaining procedure.
      If the right hon. Gentleman speaks to the pickets, he will find that none of them thinks that he is on strike voluntarily. He will conceive that he is on strike because his employer took unilateral action. It is therefore necessary for civil servants to take action to bring their employer back to the pay bargaining system. They regard it as necessary rather than voluntary. That is not a right that has been challenged by the Government. At no stage over the past two years have the Government had the courage to say that they regard the right to strike as something suspect, which should be suspended. We may hear that but we have not yet heard it.
      Instead, we have had a series of attacks on the flank to weaken the ability to strike by hitting at the pockets not of the man on strike but of the housewife and the children. The Government do not have the courage openly to challenge the right to strike, but they intend to erode that right by making those who strike subject to a special form of taxation that will be different from that applied to any other household in receipt of supplementary benefit except the household which comes within the ambit of unemployment benefit. I do not think that the Committee can accept that proposition and challenge and it must divide on the amendment.
      Question put, That the amendment be made:—
      The Committee divided: Ayes 212, Noes 275

      Division No. 175]

      [7.47 pm

      AYES

      Abse, Leo

      Garrett, John (Norwich S)

      Adams, Allen

      George, Bruce

      Allaun, Frank

      Gilbert, Rt Hon Dr John

      Anderson, Donald

      Ginsburg, David

      Archer, Rt Hon Peter

      Graham, Ted

      Ashley, Rt Hon Jack

      Grant, George (Morpeth)

      Ashton, Joe

      Hamilton, James (Bothwell)

      Atkinson, N.(H'gey,)

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

      Bagier, Gordon A.T.

      Harrison, Rt Hon Walter

      Barnett, Guy (Greenwich)

      Hart, Rt Hon Dame Judith

      Barnett, Rt Hon Joel (H'wd)

      Hattersley, Rt Hon Roy

      Benn, Rt Hon A. Wedgwood

      Haynes, Frank

      Bennett, Andrew(St'kp't N)

      Healey, Rt Hon Denis

      Bidwell, Sydney

      Heffer, Eric S.

      Booth, Rt Hon Albert

      Hogg, N. (E Dunb't'nshire)

      Boothroyd, Miss Betty

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

      Bray, Dr Jeremy

      Homewood, William

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

      Hooley, Frank

      Brown, Ron (E'burgh, Leith)

      Howell, Rt Hon D.

      Buchan, Norman

      Hudson Davies, Gwilym E.

      Callaghan, Jim (Midd't'n & P)

      Hughes, Mark (Durham)

      Campbell, Ian

      Hughes, Robert (Aberdeen N)

      Campbell-Savours, Dale

      Hughes, Roy (Newport)

      Canavan, Dennis

      Janner, Hon Greville

      Cant, R. B.

      Jay, Rt Hon Douglas

      Carmichael, Neil

      John, Brynmor

      Carter-Jones, Lewis

      Johnson, James (Hull West)

      Clark, Dr David (S Shields)

      Jones, Rt Hon Alec (Rh'dda)

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

      Jones, Barry (East Flint)

      Coleman, Donald

      Jones, Dan (Burnley)

      Concannon, Rt Hon J. D.

      Kaufman, Rt Hon Gerald

      Conlan, Bernard

      Kerr, Russell

      Cook, Robin F.

      Kilroy-Silk, Robert

      Cowans, Harry

      Kinnock, Neil

      Craigen, J. M.

      Lambie, David

      Crowther, J. S.

      Lamborn, Harry

      Cryer, Bob

      Leadbitter, Ted

      Cunliffe, Lawrence

      Leighton, Ronald

      Cunningham, G. (lslington S)

      Lestor, Miss Joan

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

      Lewis, Arthur (N'ham NW)

      Dalyell, Tam

      Litherland, Robert

      Davidson, Arthur

      Lyon, Alexander (York)

      Davies, Rt Hon Denzil (L'lli)

      Mabon, Rt Hon Dr J. Dickson

      Davies, Ifor (Gower)

      McElhone, Frank

      Davis, Clinton (Hackney C)

      McKelvey, William

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

      MacKenzie, Rt Hon Gregor

      Dean, Joseph (Leeds West)

      McMahon, Andrew

      Dempsey, James

      McNally, Thomas

      Dewar, Donald

      McNamara, Kevin

      Dixon, Donald

      McWilliam, John

      Dobson, Frank

      Magee, Bryan

      Dormand, Jack

      Marks, Kenneth

      Douglas-Mann, Bruce

      Marshall, D(G'gow S'ton)

      Dubs, Alfred

      Marshall, Dr Edmund (Goole)

      Duffy, A. E. P.

      Marshall, Jim (Leicester S)

      Dunn, James A.

      Martin, M(G'gow S'burn)

      Dunnett, Jack

      Mason, Rt Hon Roy

      Dunwoody, Hon Mrs G.

      Maxton, John

      Eadie, Alex

      Maynard, Miss Joan

      Eastham, Ken

      Mellish, Rt Hon Robert

      Ellis, R. (NE D'bysh're)

      Mikardo, lan

      English, Michael

      Millan, Rt Hon Bruce

      Ennals, Rt Hon David

      Mitchell, Austin (Grimsby)

      Evans, loan (Aberdare)

      Mitchell, R. C. (Soton Itchen)

      Evans, John (Newton)

      Morris. Rt Hon A. (W'shawe)

      Ewing, Harry

      Morris, Rt Hon C. (O'shaw)

      Field, Frank

      Morris, Rt Hon J. (Aberavon)

      Fitch, Alan

      Morton, George

      Fitt, Gerard

      Oakes, Rt Hon Gordon

      Flannery, Martin

      Ogden, Eric

      Fletcher, Ted (Darlington)

      O'Halloran, Michael

      Foot, Rt Hon Michael

      O'Neill, Martin

      Ford, Ben

      Orme, Rt Hon Stanley

      Forrester, John

      Palmer, Arthur

      Foster, Derek

      Parry, Robert

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

      Prescott, John

      Freeson, Rt Hon Reginald

      Price, C. (Lewisham W)

      540

      Race, Reg

      Summerskill, Hon Dr Shirley

      Radice, Giles

      Thomas, Dafydd (Merioneth)

      Rees, Rt Hon M (Leeds S)

      Thomas, Jeffrey (Abertillery)

      Richardson, Jo

      Thomas, Dr R. (Carmarthen)

      Roberts, Albert (Normanton)

      Thorne, Stan (Preston South)

      Roberts, Allan (Bootle)

      Tilley, John

      Roberts, Ernest (Hackney N)

      Tinn, James

      Roberts, Gwilym (Cannock)

      Torney, Tom

      Robertson, George

      Wainwright, E.(Dearne V)

      Robinson, G. (Coventry NW)

      Walker, Rt Hon H.(D'caster)

      Ross, Ernest (Dundee West)

      Watkins, David

      Rowlands, Ted

      Weetch, Ken

      Ryman, John

      Wellbeloved, James

      Sever, John

      Welsh, Michael

      Sheerman, Barry

      White, Frank R.

      Sheldon, Rt Hon R.

      White, J. (G'gow Pollok)

      Shore, Rt Hon Peter

      Whitlock, William

      Short, Mrs Renée

      Wigley, Dafydd

      Silkin, Rt Hon J. (Deptford)

      Willey, Rt Hon Frederick

      Silkin, Rt Hon S. C. (Dulwich)

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

      Skinner, Dennis

      Wilson, Rt Hon Sir H.(H'ton)

      Smith, Rt Hon J. (N Lanark)

      Wilson, William (C'try SE)

      Snape, Peter

      Winnick, David

      Soley, Clive

      Woodall, Alec

      Spearing, Nigel

      Woolmer, Kenneth

      Spriggs, Leslie

      Wright, Sheila

      Stallard, A. W.

      Young, David (Bolton E)

      Stewart, Rt Hon D. (W Isles)

      Stoddart, David

      Tellers for the Ayes:

      Stott, Roger

      Mr. Hugh McCartney and Mr. Allen McKay.

      Straw, Jack

      NOES

      Adley, Robert

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

      Aitken, Jonathan

      Clark, Sir W. (Croydon S)

      Alexander, Richard

      Clarke, Kenneth (Rushcliffe)

      Alison, Michael

      Clegg, Sir Walter

      Amery, Rt Hon Julian

      Cockeram, Eric

      Ancram, Michael

      Colvin, Michael

      Aspinwall, Jack

      Cope, John

      Atkins, Robert(Preston N)

      Corrie, John

      Baker, Kenneth(St.M'bone,)

      Cranborne, Viscount

      Baker, Nicholas (N Dorset)

      Critchley, Julian

      Banks, Robert

      Crouch, David

      Bell, Sir Ronald

      Dean, Paul (North Somerset)

      Bendall, Vivian

      Dickens, Geoffrey

      Benyon, Thomas (A'don)

      Dorrell, Stephen

      Benyon, W. (Buckingham)

      Douglas-Hamilton, Lord J.

      Berry, Hon Anthony

      Dover, Denshore

      Best, Keith

      du Cann, Rt Hon Edward

      Bevan, David Gilroy

      Dunn, Robert (Dartford)

      Biggs-Davison, John

      Dykes, Hugh

      Blackburn, John

      Eden, Rt Hon Sir John

      Blaker, Peter

      Edwards, Rt Hon N. (P'broke)

      Body, Richard

      Eggar, Tim

      Bonsor, Sir Nicholas

      Elliott, Sir William

      Bowden, Andrew

      Emery, Peter

      Boyson, Dr Rhodes

      Eyre, Reginald

      Braine, Sir Bernard

      Fairgrieve, Russell

      Bright, Graham

      Faith, Mrs Sheila

      Brinton, Tim

      Fell, Anthony

      Brittan, Leon

      Fenner, Mrs Peggy

      Brooke, Hon Peter

      Fisher, Sir Nigel

      Brotherton, Michael

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

      Brown, Michael(Brigg & Sc'n)

      Fookes, Miss Janet

      Browne, John (Winchester)

      Forman, Nigel

      Bruce-Gardyne, John

      Fowler, Rt Hon Norman

      Bryan, Sir Paul

      Fox, Marcus

      Buchanan-Smith, Alick

      Fraser, Rt Hon Sir Hugh

      Buck, Antony

      Fraser, Peter (South Angus)

      Budgen, Nick

      Fry, Peter

      Bulmer, Esmond

      Gardiner, George (Reigate)

      Burden, Sir Frederick

      Gardner, Edward (S Fylde)

      Butcher, John

      Garel-Jones, Tristan

      Cadbury, Jocelyn

      Gilmour, Rt Hon Sir Ian

      Carlisle, John (Luton West)

      Glyn, Dr Alan

      Carlisle, Kenneth (Lincoln)

      Gow, Ian

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

      Gower, Sir Raymond

      Chalker, Mrs. Lynda

      Gray, Hamish

      Churchill, W. S.

      Greenway, Harry

      541

      Griffiths, E.(B'y St. Edm'ds)

      Murphy, Christopher

      Griffiths, Peter (Portsm'th N)

      Myles, David

      Grist, Ian

      Neale, Gerrard

      Grylls, Michael

      Needham, Richard

      Hamilton, Hon A.

      Nelson, Anthony

      Hamilton, Michael (Salisbury)

      Neubert, Michael

      Hampson, Dr Keith

      Newton, Tony

      Hannam, John

      Normanton, Tom

      Haselhurst, Alan

      Onslow, Cranley

      Hastings, Stephen

      Page, Rt Hon Sir G. (Crosby)

      Havers, Rt Hon Sir Michael

      Page, Richard (SW Herts)

      Hawksley, Warren

      Parkinson, Cecil

      Hayhoe, Barney

      Parris, Matthew

      Heddle, John

      Patten, Christopher (Bath)

      Henderson, Barry

      Patten, John (Oxford)

      Heseltine, Rt Hon Michael

      Pattie, Geoffrey

      Hicks, Robert

      Percival, Sir Ian

      Higgins, Rt Hon Terence L.

      Peyton, Rt Hon John

      Holland, Philip (Carlton)

      Pink, R. Bonner

      Hooson, Tom

      Porter, Barry

      Hordern, Peter

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

      Howell, Rt Hon D. (G'ldf'd)

      Prentice, Rt Hon Reg

      Hunt, David (Wirral)

      Price, Sir David (Eastleigh)

      Hunt, John (Ravensbourne)

      Proctor, K. Harvey

      Hurd, Hon Douglas

      Pym, Rt Hon Francis

      Jenkin, Rt Hon Patrick

      Raison, Timothy

      Johnson Smith, Geoffrey

      Rathbone, Tim

      Jopling, Rt Hon Michael

      Rees, Peter (Dover and Deal)

      Kaberry, Sir Donald

      Rees-Davies, W. R.

      Kellett-Bowman, Mrs Elaine

      Renton, Tim

      Kimball, Marcus

      Rhodes James, Robert

      Kitson, Sir Timothy

      Ridley, Hon Nicholas

      Knox, David

      Ridsdale, Sir Julian

      Lamont, Norman

      Rifkind, Malcolm

      Lang, Ian

      Rippon, Rt Hon Geoffrey

      Langford-Holt, Sir John

      Roberts, M. (Cardiff NW)

      Latham, Michael

      Roberts, Wyn (Conway)

      Lawrence, Ivan

      Rossi, Hugh

      Lawson, Rt Hon Nigel

      Rost, Peter

      Lee, John

      Royle, Sir Anthony

      Le Merchant, Spencer

      Sainsbury, Hon Timothy

      Lennox-Boyd, Hon Mark

      Scott, Nicholas

      Lloyd, Ian (Havant & W'loo)

      Shaw, Michael (Scarborough)

      Lloyd, Peter (Fareham)

      Shelton, William (Streatham)

      Loveridge, John

      Shepherd, Colin (Hereford)

      Luce, Richard

      Shepherd, Richard

      Lyell, Nicholas

      Shersby, Michael

      McCrindle, Robert

      Silvester, Fred

      Macfarlane, Neil

      Sims, Roger

      MacGregor, John

      Skeet, T. H. H.

      MacKay, John (Argyll)

      Speed, Keith

      Macmillan, Rt Hon M.

      Speller, Tony

      McNair-Wilson, M. (N'bury)

      Spicer, Jim (West Dorset)

      McNair-Wilson, P. (New F'st)

      Spicer, Michael (S Worcs)

      McQuarrie, Albert

      Sproat, lain

      Madel, David

      Squire, Robin

      Major, John

      Stanbrook, Ivor

      Marland, Paul

      Stanley, John

      Marlow, Tony

      Steen, Anthony

      Marshall, Michael (Arundel)

      Stevens, Martin

      Mather, Carol

      Stewart, Ian (Hitchin)

      Maude, Rt Hon Sir Angus

      Stewart, A.(E Renfrewshire)

      Mawby, Ray

      Stokes, John

      Mawhinney, Dr Brian

      Stradling Thomas, J.

      Maxwell-Hyslop, Robin

      Tapsell, Peter

      Mayhew, Patrick

      Taylor, Robert (Croydon NW)

      Mellor, David

      Taylor, Teddy (S'end E)

      Meyer, Sir Anthony

      Tebbit, Norman

      Miller, Hal (B'grove)

      Temple-Morris, Peter

      Mills, lain (Meriden)

      Thomas, Rt Hon Peter

      Miscampbell, Norman

      Thompson, Donald

      Moate, Roger

      Thorne, Neil (llford South)

      Molyneaux, James

      Thornton, Malcolm

      Monro, Hector

      Townend, John (Bridlington)

      Montgomery, Fergus

      Trippier, David

      Moore, John

      Trotter, Neville

      Morris, M. (N'hampton S)

      van Straubenzee, W. R.

      Morrison, Hon C. (Devizes)

      Vaughan, Dr Gerard

      Morrison, Hon P. (Chester)

      Viggers, Peter

      Mudd, David

      Waddington, David

      542

      Wakeham, John

      Whitelaw, Rt Hon William

      Waldegrave, Hon William

      Whitney, Raymond

      Walker, B. (Perth)

      Wickenden, Keith

      Walker-Smith, Rt Hon Sir D.

      Williams, D.(Montgomery)

      Wall, Patrick

      Winterton, Nicholas

      Waller, Gary

      Wolfson, Mark

      Walters, Dennis

      Young, Sir George (Acton)

      Ward, John

      Younger, Rt Hon George

      Warren, Kenneth

      Watson, John

      Tellers for the Noes:

      Wells, John (Maidstone)

      Mr. Robert Boscawen and Mr. Alastair Goodlad.

      Wells, Bowen

      Wheeler, John

      Question accordingly negatived.
      Clause 27 ordered to stand part of the Bill.

    Clause 29

      PAY AS YOU EARN REPAYMENTS
      Mr. Robert Sheldon: I beg to move amendment No. 25, in page 18, line 35, leave out paragraph (a).
      The Chairman (Mr. Bernard Weatherill): With this it will be convenient to take the following amendments:
      No. 26, in page 18, line 35, leave out 'unemployment benefit or'.
      No. 27, in page 18, line 35, leave out from benefit' to 'in' in line 38.
      No. 28, in page 18, line 38, after '1977', insert
      'which is taxable by virtue of section 27 above'.
      Mr. Sheldon: Subsection (a) makes provision for tax benefits to be withheld from the unemployed and from people on strike. The unemployment benefit office will be able to set off tax liability against the refund of the tax. Any refund due will be paid only on return to work. The Government see that as an incentive to encourage the unemployed to find work quickly. They have incentives for all sorts of things, none of which seem to work, because they fail to understand what motivates the British people. They will be disappointed yet again if they believe that this measure will get people back to work. The striker will not receive any benefit. and he will only get the tax refund when he returns to work.
      We heard earlier that the Civil Service will be increased by 3,500, yet the Government set great, if not excessive, store by reducing the Civil Service. The Inland Revenue is the major Department involved in this measure. On I April 1979 it had 84,000 civil servants. The number dropped to 79,000 on 1 January 1980, and on 1 January' 1981 the figure was 76,200. Even with their enormous impetus to reduce bureaucracy, the Government appear able to contemplate with equanimity an additional 3,500 civil servants.
      We must also bear in mind the enormous increase in the number of unemployed. In April 1979 the figure was 1,340,000. It had increased to 1,470,000 by January 1980, and is now about 2½ million.
      The Government have made the reduction of the Civil Service into almost a political philosophy in a way unprecedented in this century. Civil servants are aware that the Government do not like them and perhaps even dislike them. The Government preach the virtues of good management, so it does not make sense to have that relationship with those with whom they come into daily contact. The Government have offset their dislike for the Civil Service and their desire to reduce it against their

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      dislike for the unemployed and those on strike, and they are prepared to accept the enormous increase in the Civil Service.
      Not only are many of the measures in the Bill unfair, but they come at a most inopportune time. People are under great pressure. Fear of unemployment is spreading. In addition, it tends to affect certain parts of the country more than others. In the 1960s unemployment was only 200,000. In the 1970s it was about ½ million, rising to about 1 million in the latter half of that period. It is now about 2½ million and approaching 3 million. People are not out of work because they are workshy. It is inopportune to suggest that this legislation will encourage people to work. The Government's economic policy is failing, so they are naturally blaming others, and the ideal candidates are strikers and the unemployed. The Government's monetary policies have reduced our manufacturing output and prosperity. In January 1980, industrial output was 111·6 per cent. By January 1981 it had declined to 98·3 per cent. Srikes have had only a trivial effect on that staggering drop.
      Mr. Anthony Fell: I must have misunderstood the right hon. Gentleman. I thought that he gave the highest figure of unemployment during the Labour Government as 1 million.
      Mr. Sheldon: The hon. Gentleman misunderstood me. I was giving rough figures for the latter part of the 1970s. I said that unemployment was 1 million. In 1979 it was 1,300,000. I shall be happy to be more precise if the hon. Gentleman wishes.
      The Financial Secretary mentioned the Departments in which the additional civil servants would be employed—the Department of Health and Social Security, and the Department of Employment, but mainly the Inland Revenue.
      The provision for taxing benefits reminds one of the time, when public expenditure cuts reached the end of the line in the 1930s. Governments first cut capital projects until hardly any are left. They then turn to transfer payments. Taxing unemployment benefits is an easy option. It will not end there. The search for scapegoats went on in the 1930s. Transfer payments were taxed and unemployment benefit was cut. We shall see the same again. The Chief Secretary will apply the same pressure to transfer payments from the DHSS as his forerunners did 50 years ago.
      Mr. Ioan Evans: In their first Budget, the Government introduced massive concessions for the wealthy. The taxation of unemployment benefit is the other side of the coin. Is not that scandalous?
      Mr. Sheldon: I am grateful to my hon. Friend for that observation. I shall be dealing with the wholly unjustifiable way in which taxation is being biased, which will cause a great outcry once it is fully understood.
      Mrs. Elaine Kellett-Bowman: The right hon. Gentleman, like myself, was a member of the Select Committee which dealt with tax credits. That Committee very largely agreed that all income should be taxed, irrespective of source. There was no division between the parties on that. Does not he therefore agree that it was a pity that the Labour Government did not introduce this, as it would have been totally fair all round?
      Mr. Sheldon: It is a great pity that the hon. Lady was not present earlier, as that was dealt with on clause 27. Had she been here, she would know that every hon. Member who spoke agreed on that. There was no division whatever. I shall not go into the details, as I am sure that I should incur your displeasure, Mr. Weatherill. That was disposed of as a matter which did not divide the Committee. What we are arguing about is the means.
      In the incentives which, according to the Government, are being provided for jobs, we are seeing something not all that different from what happened in the 1930s, when there was also great talk about scroungers. Anyone who went through the 1979 election will recall strongly the antipathy felt by a large part of the electorate towards scroungers on social welfare and unemployment pay. The same happened in 1930. People were looking for scapegoats. The unemployed were held to be capable of employment if only they would seek it. Eventually, the war came along, unemployment dropped dramatically from millions to about 100,000 and there were no further arguments about scroungers. We are now having to relearn that lesson, which should not need to be relearned. The people of this country are still anxious to work. Anyone who doubts that has only to talk to people in the employment offices and the jobcentres.
      In an earlier debate, the hon. Member for Gateshead, West (Mr. Horam) put forward an argument that is relevant to this debate. He asked whether this was a serious way of widening the tax base or whether it was just at the lower end. I do not believe that it has anything to do with that. One does not employ 3,500 civil servants just to widen the tax base. There must be a greater reason than that. If one compares the amount of money that will be gained with the cost of the civil servants, the cost of collection is one that the Inland Revenue would normally boggle at and not consider to be a reasonable proportion to spend on collecting that amount of revenue—unless there were wider considerations in mind.
      As we well know, the considerations are those of getting people working again and making sure that they do not idle away their time. We are all aware of the fear of unemployment, but those of us from the North and from the other regions know perhaps rather more strongly, how it is felt in our constituencies. With the recent local elections, we were perhaps rather more prominent in our constituencies than at other times. One has only to witness the strength of feeling on the subject to appreciate how deeply these matters concern the working people of this country.
      I was told last week when we debated a number of tax measures which would normally concern my constituents and others as matters of particular importance that they were held not to have the same degree of importance as on previous occasions. I was told again and again that the major issue that affects all the people of my constituency is the fear of unemployment. It frightens every one of them. As factory after factory closes—and for every closure, there are half a dozen rumours—people in my constituency become more and more frightened at the rising level of unemployment.
      8.15 pm
      At the time of greatest fear, what do the Government do? They say that those whose fears are realised will be denied their own tax refunds, so that when the blow finally strikes, their own money will be sequestered and they will

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      not be allowed to have it until they get back to work, if and when work becomes available. Only then will they have the chance to make up the deficit which the Government will make sure that they must accept.
      It is not only that which concerns me. Another worry, to which I must return although I mentioned it earlier, is the increasingly widespread feeling that the tax system that we regarded as an open and fair system, which we could admire, run by civil servants whom we sometimes mocked but whom we fundamentally respected for their integrity and independence, will now involve privileged taxpayers due to the distortion of the system in which the clause plays its part.
      Taxpayers on schedule D, for example, will pay tax many months later. They will be able to claim a wide range of expenses that those on schedule E cannot even consider. They or their accountants will be able to conduct a dialogue with the tax inspector. A whole range of avoidance devices, some less acceptable than others, will be available and any accountant will use at least some of them. Let us compare that position with the situation of those on schedule E, whom we are considering here. The schedule E taxpayer hands over the money before receiving it. He can claim no expenses. The computation of his tax is reduced to a piece of simple arithmetic, and even that is to be withheld from him when he is unemployed. If clause 28 is accepted—and we shall strongly oppose it—the schedule E taxpayer who does not understand or who makes a mistake will find that the mistake cannot be rectified in any way.
      As my hon. Friend the Member for Edinburgh, Central (Mr. Cook) pointed out, all this would almost create a class system in this country even if one did not exist already. The Government are distorting our tax system and debasing the traditional standards of the Civil Service to ensure that their crude and even cruel method of taxation of benefits is produced at a cost of 3,500 civil servants. That is no way to change the tax system and we shall continue to oppose it.
      Mr. Richard Wainwright: At the expense of a great deal of ingenuity on the part of the Inland Revenue and an enormous burden upon employers, this country, almost alone in the world, maintains a system of pay-as-you-earn income tax so exquisitely devised, although so very difficult to operate, that from one pay day to another the average taxpayer is, as it were, up to date proportionately in his tax position. It is a remarkable system. Many people query whether it is any longer justifiable, but it has been one of the conspicuous features of British administration hitherto and it still stands.
      The Government now take it upon themselves to take power to produce regulations partially to abort that system. For the first time, so far as I am aware, the principle embodied in the taxes Acts that when the tax tables show that a refund is due it must be paid on the next pay day is to be aborted in respect of unemployment benefits. The meanness is that this will all be done through the employer. The Government will use employers to withhold refunds which, during all the years that PAYE has existed, have otherwise been made promptly to the employee.
      If the Chief Secretary can assure me that the regulations will somehow remove that distasteful burden from the employer, I shall be prepared to think again about this matter. However, the Bill contains no saving clause to
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      show that the employer will be protected. It is invidious in the extreme to ask employers to shoulder the burden of operating such a distasteful mechanism.
      There is no saving clause to ensure that the regulations will operate only where there is good prima facie evidence that the amount of PAYE refund due is at least roughly equivalent to the tax that will eventually become due on the benefits which the unemployed person has received. If there were a saving clause to ensure that as closely as possible the regulations would provide that the refund would be withheld only in so far as it roughly balanced the estimated tax due on the unemployment benefit up to the end of a certain period, I would again be prepared to have second thoughts. But the Bill contains no such saving clause.
      It will be apparent to all hon. Members that the PAYE refund due to a taxpayer who becomes unemployed may, for all kinds of reasons, be much larger than any liability on his unemployment benefit. For example, as is well known, the PAYE system takes account in one year of failures to assess tax in previous years, be it under-assessment or over-assessment. That can be brought forward into the current tax year and can be the subject of refunds.
      Such refunds can be extremely large. If a major error in a previous year is discovered, an employee can receive a large refund, far larger than his liability on unemployment benefit. However, there is nothing in the clause to ensure that the regulations will take care of what will otherwise be a gross inequity.
      There is also the question of error. We have already been told of the statement by the Chairman of the Inland Revenue that one in 10 PAYE codes are in error. That is a frequent source of substantial PAYE refunds. I cannot for the life of me see any possible justification for withholding a refund arising from a major error simply because the Government cannot think of any method within the PAYE system of taxing unemployment benefit.
      It would be a major departure of principle to withhold refunds which in equity belong to the taxpayer simply because the Government cannot apply their own laws to their own disbursements. We should not give the Government power to issue these regulations in the absence of saving clauses in the Bill which state the parameters of these regulations. The Government would be wise to pause and consider whether it will not help to destroy public confidence in the PAYE system by insisting that employers must withhold what may be large sums from their employees for reasons that have absolutely nothing to do with the liability to tax on unemployment benefit.
      Mr. John Maxton: When Labour Members complain about the Conservative Party making a distinction between the so-called scroungers on social security benefit and those who evade taxation, I have often heard Conservative Members say "Ah well, it is different". The difference seems to be that when someone receives unemployment, social security or sickness benefit he is receiving money from the State, whereas when someone pays tax it is his money and essentially he is trying to keep more of it.
      But there is now a total inconsistency in that argument. Now, when someone who is unemployed or on strike is entitled to a return on his own money, he will not receive it until such time as he returns to work. In other words,

      547
      he will no longer get what he is morally entitled to. As is typical of the Government, the only consistency is that they are hitting the poorest and making sure that their wealthy, fatted calf friends are all right. That has been the consistent theme running through the Government's economic policy, particularly their fiscal policy.
      We must look at these clauses in the context of total legislation in terms of social security, unemployment and other welfare benefits. They cannot be considered in isolation. We must look at them in the context of the person who becomes unemployed, and we must also remember that the unemployment benefit increase last year suffered a 5 per cent. abatement.
      I am glad to see my hon. Friend the Member for Renfrewshire, West (Mr. Buchan) on the Opposition Front Bench, because this is very much an area with which he is concerned. We must bear in mind the fact that the DHSS has introduced new regulations to ensure that those on social security are subject to a regime. Certainly, people in my constituency have been subjected to threats about the possibility of defrauding the DHSS. If there is the slightest suspicion, they are told "You really ought to come off benefit", which ensures that payments are kept to a minimum.
      8.30 pm
      Of the unemployed, 99 per cent. find themselves in that position through no fault of their own, and they are desperate to find work. The hard drive against the unemployed is morally indefensible. In addition, it is based on an out-of-date myth that, somehow or other, jobs are available. It is based on the myth that people strike willy-nilly and that if pressure is applied they will not do so. It is thought that people will somehow find jobs when there are no jobs to be found.
      The Government will not give the unemployed their money. Next year they will cut out earnings-related unemployment benefit. Such actions contradict something that the Prime Minister said recently, namely, that if the unemployed cannot find jobs in South Wales they should move to find them. If tax rebates are not given back immediately, and if earnings-related benefits are not given, the unemployed will find it even more difficult to look for work elsewhere. If the Government take such action they will in effect be telling people to look for jobs in their own areas. The unemployed will find it more difficult to move elsewhere if they do not have the capital to survive a period of initial unemployment.
      Mr. Campbell-Savours: That is important.
      Mr. Maxton: Of course it is an important point; I made it. In the changing world in which we live, modern technology will pose an increasing problem. The Government have not faced the fact that some unemployment is due to technological change. Unemployment can be dealt with only if the unemployed have money—through tax rebates, earnings-related benefits and redundancy payments—when they first lose their jobs. Such money would give them opportunities not only in the areas in which they live but throughout the country. The unemployed would then be able to move easily and retrain in a new skill.
      When we win the next election the economy will start to move again. However, people will still have to move
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      from one job to another. They will have to be trained and retrained between one employment and another. If that is to be done satisfactorily, people will need more money in the initial months of unemployment.
      To leave the repayment of tax until a person goes back to work—which may be a long time—is indefensible. I had thought that one of the Government's aims was to create a mobile work force. They told us that that was why they wanted to introduce the sale of council houses. This legislation will make it more difficult for people to look for work elsewhere. Most of my constituents find it desperately difficult to find a job anywhere. This legislation will make it even more difficult for them.
      Mr. Austin Mitchell: It is clear from their approach to economics and to the Bill that the Government are a body of men and women who are mad on incentives. Perhaps I should have paused between "mad" and "on incentives". They are keen on incentives, but make distinctions among the incentives that they apply. For the working class, the trade unionists and the less well off, the incentive is the whip. For them, the main incentive is a rise in unemployment. That is their incentive to stay at work and not to ask for wage increases. For the well-off, there is another incentive. The Government think that they belong to a different section of society, which needs the carrot of tax cuts and direct benefits. It is also clear that that incentive forms part of their argument in favour of the clause. The clause is an incentive to stay at work. If a person does not stay at work, his tax repayments will be delayed, regardless of whether he is out of work through his own fault. The clause represents an incentive to stay at work. I am convinced that the Government will abandon this incentive craze only when the sole incentive for Governments looms on the horizon—the threat of an election. Some Back Benchers have already seen that threat; perhaps that is why, shamefaced, they are not here. That incentive will soon be felt among the ranks of the Tory Party.
      There will be a massive and gathering protest against what is being done. There are aspects now of an economic version of Jonestown. The prophet having led the chosen people into this disastrous mess, those people are beginning to realise that the prophet is asking for ritual suicide. That realisation will spread. Tory Back Benchers, at the end of this economic folly, will wonder why, in their unemployment, which will result from the election defeat of the Tory Government, they are not getting the massive tax rebates to which most of them would be entitled through not having not only their parliamentary but their outside salaries to help them through the unemployment that the Prime Minister will force upon them.
      The incentive argument, when applied to the unemployed, is an insult to a section of society which should be helped and protected. There is no other explanation for the continued rise in unemployment than deliberate Government policy. It cannot be frictional or transitional unemployment. It cannot be unemployment generated by new technology, because we do not have the investment to produce the new technology. It cannot be unemployment generated by productivity. It is not even generated by the world recession. Why should the impact of the world recession be harder, deeper and steeper in our economy, which should be insulated by oil revenues? The only explanation is that it has been deliberately engineered to bring wage settlements down and the unions to heel.

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      The Government are now adding insult to this injury. [Interruption.] I do not know whether the hon. Member for Yarmouth (Mr. Fell) wishes to intervene to discuss the causes of unemployment. There is no other logical explanation for the rapid rise in unemployment—more than one million in two years—than deliberate Government policy. For the unemployed to be treated in this way is to add insult to injury. When this tax rebate is most necessary—they have a right to it; it is their money—it is being withheld from them. It is dangled before them like a carrot until the end of the tax year or their unemployment, whichever comes first. I repeat, when they need this money—their money—to help them plan their finances for the undoubtedly difficult period ahead, it is being withheld from them by the Government.
      Mr. Maxton: Does my hon. Friend accept that this may cost the Government more money? Many honest, hard-working people, when declared redundant, are anxious to stay off social security because they dislike the idea of receiving social security. Many use the tax benefits to keep off unemployment and social security benefits for even longer.
      Mr. Mitchell: My hon. Friend is right. Such people will obviously qualify for social security. That need will be forced on them by the Government, despite the Government's allegations of their being scroungers and layabouts. This tax rebate, which is their right and which will help to cushion them against the consequences of unemployment, is being snatched away from them by the Government for no easily understood reason. What kind of Government can do this to the unemployed, whose numbers are increasing rapidly and will continue to increase remorselessly throughout this year and next year because there is no alternative to increasing unemployment?
      The Government set out a vision of improving society in some way, but they are throwing into reverse all the gains of the post-war period. All the better understanding of social structures, all the improvements that have been made in the post-war period, have been thrown into reverse because of sheer malevolence against the unemployed—and strikers. The Prime Minister is recreating the society, with the benefits that we have built up, so hard won since the war, and rebuilding it in her own image—divisive, vindictive, embittered. At the end of it all, it is tarted up with incentives, peroxided with the kind of incentives to the well-off that have been the main motive force behind the Government's economic policy over the last two years.
      Thanks to measures such as this, Britain is becoming steadily a nastier, more unpleasant, more divisive and more hate-filled place, as a direct consequence of the present Government's policy. As despair and unemployment grow, that situation will get far worse, because the Government must now look around for someone to blame for their own failures—for the failure of these incentives to produce the promised economic results, for the failures of monetarist economic policy to produce the growth, and for the failure of night to follow day in the way in which the Chief Secretary promised it would. We are in a victim-of-the-month society where the Prime Minister and the Government look round for fresh victims to blame for their own failures.
      That might suit the temperaments and prejudices of the Conservative Party. However, from the point of view of
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      the unemployed, who are being treated to shabby measures such as this, it is nothing but vindictiveness. The unemployed, rising in number, are now to be not only belaboured with accusations but robbed of the pittance of tax repayments which is their right.
      Unemployment is an enormous personal tragedy to anyone hit by it. It deprives people of almost the nexus of their existence, because a job is so important. The contacts, workmates and friends that come with a job are very important. It is not only the money but the whole social structure of a job. It is the whole structure of a being that is provided by a job. People are deprived of their mainspring by unemployment. As they see it, they are deprived of the esteem of their fellow men and certainly of contact with workmates, and they are humiliated by unemployment. Now, this patriotic, glorious Goverment are to add to that the additional humiliation of withholding these tax payments.
      Professor Patrick Minford has talked of an economic policy of rational expectations. The only rational expectation that one can have of the consequences of the present Government's economic policy is a continuous rise in unemployment. Just when that is happening and is certain to continue, is that the moment for treating the unemployed in this shabby fashion? This is just when. the Government should be declaring their sympathy—not using those glycerine tears of sympathy for the unemployed that the Prime Minister and so many other Ministers have thought necessary to put in their eyes. They should be increasing the long-term benefits and helping the unemployed by doing something for them. What are the Government now doing in their shabby way? They are taking back from the unemployed a tax repayment which should be theirs and is theirs as of right.
      As the hon. Member for Colne Valley (Mr. Wainwright) said, this is not only breaching a basic principle of the tax system—prompt and immediate repayment. It is breaching the principle that the money is, after all, theirs. Just when the Government should be speeding up these tax repayments, they are withholding them. They are doing all this to appease a clamour in their ranks which they themselves have helped to generate—a clamour against the unemployed and against strikers and a clamour for victims.
      That is why the House should reject this measure. In a sense, that is why it is sad to see someone quite extraordinarily able, in the form of the Chief Secretary, facing the humiliating job of defending this tawdry little measure. However, as he replies, it will be useful to the House if he comments on some specific points.
      Mr. Bob Cryer: My hon. Friend has been very generous to the Chief Secretary, but, does he accept that if the Chief Secretary does not like doing the job, he does not have to do it? If the Chief Secretary finds crushing the unemployed so distasteful, he could retrieve some tangled shreds of what is left of his honour, resign and stand up for the unemployed.
      8.45 pm
      Mr. Mitchell: My hon. Friend is correct. Those identified with the policy have a choice. If they do not take the obvious choice, clearly they approve wholeheartedly of the policy and all its consequences. It is sad to see the Chief Secretary rushing in to embrace the consequences of the folly, admittedly of others, but which he had the chance to distance himself from on taking over his office.

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      I understand that tax rebates will be withheld until the end of unemployment or the end of the tax year. Does it have to be that long, in the sense that someone becoming unemployed at this time of the year—if the unemployment is prolonged—may have a long wait for tax repayment? Is it not possible to devise an interim repayment system after a shorter time for those extreme cases who would be hit hard by prolonged unemployment? Why is a distinction made in the clause between the unemployed, who receive a tax rebate at the end of a tax year or a period of unemployment, and those involved in trade disputes, from whom a tax rebate is withheld until the end of the dispute even if the tax year ends before that? Why is there that distinction and why such a long period?
      What is the main reason for this particularly nasty measure? Why should tax rebates be withheld during unemployment? Is it because it will be administratively too difficult to pay rebates during unemployment, once benefit is treated as taxable income? Or is it an attempt to reduce the living standards of the unemployed? Those are the alternatives. It is up to the Government to avow what they are doing -with this unpleasant measure.
      Mr. John Horam: I find the Government's attitude in this subsection hard to understand. The amendment refers only to the unemployed. We are not talking about the separate issue of those engaged in industrial dispute. As the hon. Member for Grimsby (Mr. Mitchell) said, we are concerned about the involuntarily unemployed and the problems that they face.
      A number of Opposition Members have said that people are morally entitled to the tax repayments that they should receive in normal circumstances when they become unemployed. Since the war, as the hon. Member for Colne Valley (Mr. Wainwright) said, we have had a cumulative tax system. The logic of that system is that every week one is roughly in balance with one's tax payments and therefore entitled to repayment should one become unemployed.
      Mr. Fell: That is correct.
      Mr. Horam: I am glad to hear the hon. Gentleman agree. That should appeal to the Government just as much as to any Opposition Member. It is something to which the Government should attach importance. As they would say, the money belongs to the people and not to the Government. It is money that has been overpaid in taxation and that the unemployed are entitled to have repaid.
      As the hon. Member for Glasgow, Cathcart (Mr. Maxton) said, the Government have been encouraging people to consider mobility and have been endeavouring to justify their housing policy. They have talked about the need to move to find other jobs. People need every penny they can get if they are to take that big and courageous step of going to another part of the country to find work.
      It is not always easy to obtain the repayment quickly in normal circumstances. If a person ceases to be employed, his employer no longer handles his tax matters, and he must deal with them himself. He must take his P45 to the Inland Revenue and claim back the tax. It does not return automatically as it would if, for example, he were on strike and still nominally employed by the same employer, who was still handling his tax matters.
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      Therefore, even in present circumstances it is by no means easy to get back reasonably quickly the money to which one is morally entitled. It usually takes at least a month before one has the money, which one may badly need earlier.
      The hon. Member for Grimsby (Mr. Mitchell) speculated about the possible reasons. I fear that the real reason is the second, dreary one that he suggested—simple administrative convenience. The right hon. Member for Ashton-under-Lyne (Mr. Sheldon) extracted from the Government earlier the information that they are committed to engaging another 3,500 civil servants to handle the changes in taxation of short-term benefits. If they continued to handle tax repayments in the traditional way they might need even more. They are having to consider this change in the system to confine the number to 3,500.
      If the Government dealt with the matter in two operations, making the repayments separate from the taxing of short-term benefits, I imagine that that would require more civil servants than the Government's proposals imply. I suspect that that is why they are trying to take it all in one go, subtracting one item from the other and giving the taxpayer a net sum. In netting his potential liability to tax on his short-term benefits from any tax repayments due to him, they are cutting administrative corners and taking less administrative time.
      It will be interesting to hear what the Chief Secretary says, but I suspect that the real reason is to save Civil Service time in dealing with the consequences of the Government's actions. That is the dreary reason why people are having to be loaded with this additional difficulty at a particularly trying time.
      Mr. Stan Thorne: When I look at this part of the Bill I am reminded of the section of the Social Security (No. 2) Act 1980, which results in the withholding of unemployment benefit from, for example, workers dismissed by an employer for belonging to a trade union, a dismissal that results in a picket. Although he has a notice of dismissal from an employer and has a P45, a person on a picket is not eligible for unemployment benefit under that Act. We have before us a similar shabby measure.
      This is another stroke by the Government that will inevitably mean hardship for the unemployed. The Chief Secretary may give figures to try to contradict what I am about to say, but I believe that very few unemployed people entitled to unemployment benefit receive more in benefit than they received as earnings. If there are such people, that is a remarkable condemnation of the level of wages paid in some of the industries concerned.
      Even if there are those in that position, we are talking about the money of a wage earner which has been taken from him in the expectation that his earnings relate to a position on the PAYE tax code documents and that at the end of the year the amount deducted will relate to the code number that he has had during that period. If he is unemployed for two or three weeks, inevitably his level of earnings, plus whatever benefits he may have received will fall during that period and therefore he will be entitled to some repayment. That must be the case, otherwise the provision would not appear in the Bill.
      One can only assume that the purpose is to save money, and it is precisely that which is immoral on the part of the Government, bearing in mind that it does not become their

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      money until the end of the financial year, when it has been determined that the deduction from the individual employee is due to the Inland Revenue.
      I suppose we should not be surprised at the nature of this mean approach by the Government to the unemployed. It is interesting to reflect on the contents of the manifesto put before the electorate by the Conservative Party in 1979. We have seen a plethora of measures taken by this Government that were not spelt out in that manifesto, and this is one of them. It would have been difficult to produce a manifesto that catalogued the hardships that the Government intended to inflict on the people, if elected, and obviously for good political reasons it was not the Conservative party's intention to keep the people very well informed about its intentions. We have had a series of measures that were never put before the British electorate.
      That, of course, explains why, on the doorsteps during the past fortnight, we continually heard one name spoken with more hatred than I should care to hear applied to my own name. I refer, of course, to the present Prime Minister. It is clear that the bulk of the electorate—certainly in the North and NorthWest—ascribe their present hardships and difficulties directly to the activities, the hard line, the intransigence, the near demagogy that we hear from the Prime Minister in this House week by week.
      It is for those reasons that, not with a great deal of optimism, I hope that we can defeat this measure. If we do not, I am convinced that it is only a matter of time before the electorate throw out of the House the architects of measures of this description who sit on the Treasury Bench.
      Mr. Cryer: I can recall, a few days ago, being with a group of Labour Members and having a small debate with the Secretary of State for Employment. The right hon. Gentleman suggested then that debates on unemployment should take place in the House. The same day, I asked the Leader of the House to arrange a general debate on unemployment. The right hon. Gentleman said that the Government had no plans for one. That being so, inevitably we have to focus our attention on the detailed attacks that the Government are making on the unemployed and their resistance to any measure designed to remedy the position of unemployment.
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      I must, of course, limit my remarks to the amendment. I want to raise one or two issues. Repayments will be regulated by statutory instrument. I do not want to anticipate amendment No. 32, which recommends that regulation be by affirmative resolution. I object to the Committee handing over an untrammelled power to make regulations for tax purposes to the relevant Minister. It is a device to hand over power to the Civil Service. We have insufficient control of statutory instruments to allow Parliament to exercise adequate scrutiny. In this instance, where provision—not a very clear provision—is envisaged by the Government to repay at some stage money which is already due to unemployed people, there is no reason why the procedure cannot be contained in the Finance Bill and be debated with the rest of the Bill, clause by clause.
      It is scandalous to withhold money from the taxpayer and from people whom even the Government must know are in difficulties. Do they realise that when a person is unemployed he is in financial difficulties? Do they know
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      that it is a shattering experience? We tell them, but it may be difficult for them to grasp. Conservative Members live cossetted lives. They earn £20,000 to £30,000, if they are members of the Cabinet, although those in marginal constituencies have little prospect of continuing in their present role after the next election. Some of them, like the Chief Secretary, will move swiftly into the courts to earn lucrative fees which are the scandal of our legal system. They can earn £400 or £500 a day. So perhaps they do not understand that when a person is unemployed they actually need money because they have no other source of income. When one is unemployed, one's wages disappear and one is reduced to living on unemployment benefit.
      Unfortunately,I have come across too many people who have been made unemployed. Sometimes they believe the rubbish that is contained in Conservative newspapers such as the Daily Mail and The Sun, saying that life on the dole is very sunny. Perhaps hon. Members will recall the report in The Sun, when Larry Lamb was busy bribing his way by laying out the inside pages of The Sun in the service of the Conservative Central Office, when he was building up to the accolade of "Sir Larry". It was discovered that there were reciprocal relations between ourselves and Spain for the payment of unemployment money. The Sun's headline was "Olé Dolé". The impression that The Sun gave was of unemployed people sunning themselves on the Spanish coast and going round the corner to collect their unemployment pay.
      When the vast majority of people become unemployed their incomes go down with a bump. There is a vast gap between some newspaper campaigns, and what actually happens. Life is not comfortable on the dole, particularly for a family man. A number of difficulties are caused.
      The kernel of the argument is that a person rendered unemployed needs money. He needs more than unemployment pay because it is a time of intense difficulty. Yet the Government propose to withhold tax rebates from the unemployed for an unspecified time. We shall be interested to hear the Minister's observations, although I do not understand why the information could not be in the Bill.
      More and more people face the problem of unemployment. Already about 2½ million people are unemployed. That will rise to 3 million. The opposition to the Government's policies was demonstrated vehemently last Thursday in one of the most splendid county council wins that the Labour Party has experienced post-war. The writing is on the wall for the Conservatives.
      The Prime Minister, when questioned about unemployment on radio or in the House puts on her Saatchi and Saatchi voice. That is a soft, slightly husky tone to show that her concern is there all the time. When the Prime Minister talks about scroungers her voice assumes the slight shrillness that we have come to know. She assumes the hectoring manner which is really hers and which shows that she does not care that much about unemployment. If she cared about the unemployed she would not attack their benefits and she would not introduce such a provision in a Finance Bill. It is no good the Prime Minister using Saatchi and Saatchi words and the soft intonations with which we were regaled after the election. She spent a lot of time learning the techniques. She was trained like a Pavlovian dog to react correctly and to respond for the media.

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      The Prime Minister is being judged by her actions. The decision that produced this legislation is that of a hard-faced, hard-hearted Cabinet. The Government are attacking people who are in the most difficult position that can be experienced today. The unemployed are bereft. They have been pushed out. Their contacts are diminished and they are no longer needed, whether they are labourers or skilled people. Skills which might have been built up over the years through training, learning and experience are rejected.
      Most people know about the reality or the threat of job loss. I was speaking to a constituent about one of his lads who has an apprenticeship with an engineering firm and considers himself to be lucky. My constituent said that when there was talk of redundancy he thought that his lad had had it. Instead, older workers were sacked. An inspector with 27 years' service is out on his neck. That means 27 years of experience and skill is thrown to the winds. That is happening all over West Yorkshire in the textile and engineering industries.
      From the bottom of their heart the Government are now saying "It is not enough that you are unemployed, that you are thrown on the scrap heap, that hope is diminished. You will not receive the bit of money that might soften the blow by an infinitesimal amount." The prospects are still gloomy in an economy that is still under-used and under-active. It is a gloomy prospect trying to obtain a job, which the Government are not relieving with a tiny bit of silver in the shape of an immediate tax rebate. It is not even the Government's money. However, we know that the Government are not too choosey when it comes to breaking pledges about people's money.
      The earnings-related scheme, which is not financed by the Treasury but is self-financing, will end in 1982. If the directors of an insurance company had broken off such a scheme, the Chief Secretary would prosecute them in the courts. Yet the Government are breaking off the earnings-related scheme. Within the terms of legislation which is far too generous in handing over powers" they are deciding when and how tax which has already been paid, and is the property of the taxpayer, should be repaid. That is not good enough.
      I hope that the message gets out of this oak-pannelled place. One comforting aspect of last Thursday's election is that, although we sometimes seem to speak in small groups in the House, and refer wistfully to the message getting outside, the Government's treatment of the economy which is producing so much unemployment is being massively criticised. It is equally clear that the Government's treatment of the unemployed will be massively criticised. This wretched clause in a wretched Finance Bill is an example of the way that the Government are kicking the unemployed when they are down. We shall vote against it. We may not win, but it is another nail in the Government's coffin.
      Mr. Campbell-Savours: When the BBC programme "Today in Parliament" is broadcast tonight, many thousands of listeners will wonder where their Conservative Members of Parliament were. I hope that those who broadcast the programme tonight and tomorrow morning will say that there was a long series of Labour speakers about the amendment relating to unemployment.
      Conservative Members intervened during the debate, but instead of rising to their feet they sought to make sedentary observations. In the European Parliament the
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      hon. Member for Lancaster (Mrs. Kellett-Bowman) represents my constitency and four other constituencies in the county of Cumbria. I understand that it is not for me to comment on the hon. Lady's relationship with her constituency. That is for her to do. I am sure that she is an assiduous Member. However, it is noticeable tonight that she has not commented on matters of vital concern.
      Mrs. Kellett-Bowman: The hon. Gentleman is aware that when I intervene in the House on matters that concern his constituency he objects most strenuously. I therefore confine my effort on behalf of Cumbria to the European Parliament, and raise in this House only matters that concern my consistituency. That is the proper way to proceed. That view is held on both sides of the House. My hon. Friend the Member for Yarmouth (Mr. Fell) raised a point about unemployment, and he was on his feet when he did so. He gave correct figures, which the right hon. Member for Ashton-under-Lyne (Mr. Sheldon) had not given. The hon. Gentleman must admit that my duty in the House is to Lancaster and in the European Parliament to Cumbria.
      9.15 pm
      Mr. Campbell-Savours: The hon. Lady represents Lancaster. She says that she speaks for Lancaster but she has not sought to rise in the debate. The people of Cumbria can rightfully ask whether the case for the unemployed in the county is being put in the European Parliament. We believe that it is not.
      Mrs. Kellett-Bowman: rose—
      Mr. Campbell-Savours: I turn directly to the amendment—
      The Second Deputy Chairman (Mr. Ernest Armstrong): I hope that the hon. Gentleman will return to the amendment.
      Mr. Campbell-Savours: I shall do that, Mr. Armstrong. The amendment illustrates perhaps more than any of the others on the Order Paper the Conservative Party's strong prejudice against the unemployed. I understand that the objective of the amendment is to ensure that the tax that is taken prior to unemployment will be paid during unemployment and not at the end of unemployment, or at the end of the subsequent financial year.
      The effect of the clause is to draw money from the unemployed that is rightfully theirs, and for the Government to use that money without paying interest on it. I am sure that Conservative Members will be aware that if a taxpayer owes money to the Revenue and if it goes beyond a certain threshold and a certain period, the taxpayer is required to pay interest upon that money to the Inland Revenue.
      Mr. Arthur Lewis: My hon. Friend is right in general, but does he agree that if the taxpayer happens to be a member of the Vestey family and is supported by Lord Thorneycroft, the chairman of the Tory Party, it will be ensured that he pays no tax? Money will be filtered into other countries and patriotism will be displayed by the payment of no tax.
      Mr. Campbell-Savours: My hon. Friend makes an important intervention. However, the Government have informed us that later in Committee there will be a statement on matters concerning the Vestey empire, if that

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      is what it be. I am told that there are clauses in the Bill that will tighten the loopholes that that body was able to use.
      If the Government require that taxpayers pay interest, I want to know why the Government should not be required to pay interest when they borrow money from my constituents and from the constituents of others. The money that they are keeping is the property of our constituents. Surely it is right that it should be subject to interest payments.
      It could be said that our taxpayers have sought not to claim money from the Government but have invested in the Government. It could be said that they have purchased a form of gilt stock. They are purchasing shares in the activities of the Government. The right hon. and learned Gentleman should tell us why taxpayers should not receive some return on the investment that they are making, which they are being required to make by the Government's refusal to pay rebates.
      I know that many who go into business treat the tax rebate that they receive at the end of their employment as part of the cash that is necessary to establish their business. When steel workers in my constituency are asked what they intend to do in conditions in which no alternative work is being created, many of them suggest that they want to go into business. They believe that one of the assets that will help them to do so is the tax rebate that is rightfully theirs. The Government are saying that all people who choose to set up a small business will be denied access to that money, either until they register as businesses—and even then there is a delay—or until the beginning of the following financial year.
      If the right hon. and learned Gentleman believes that that is incorrect, I can tell him that I was one of those people. His Treasury Ministers will be able to prove that if they dig back far enough. I remember how important my one tax rebate was when I was going into business. I ask the right hon. and learned Gentleman to consider that. If he consults the self-employed bodies outside the House and asks them about the problems that confront people when they are going into business and scratching around for funds, he will find that many self-employed people treated that first tax rebate in the same way as soldiers coming home after the war treated their gratuities. Those rebates are sources of vital cash at a difficult time. Therefore, I ask the right hon. and learned Gentleman to make particular reference to the point that I am making.
      This money—it should not be underestimated—which is rightly the property of our unemployed constituents, is of vital importance to them. They can ill afford to lend it to the Government. In conditions of unemployment, people always have cash flow problems. Their problems are far greater when their expenses are greater.
      One of the interesting aspects of the current round of unemployment is that it is affecting not only lower-paid groups but large numbers of people who earn reasonable wages and salaries. Those people have a particular use for this tax rebate. The right hon. and learned Gentleman has told them that that money is no longer theirs. He has said that the Government are borrowing it and that they shall do with it what they want. He is saying that those people cannot have it back until the financial year ends or until his Government decide that they will create conditions in which those people will be put back to work. For many people, that may be a long time.
      Mr. Arthur Lewis: I had not intended to take part in the debate until I heard my hon. Friend the Member for Workington (Mr. Campbell-Savours) speak. I then thought how unfair the measure was and I wondered how any Government, whatever their political complexion, could bring forward such a measure.
      We have a system whereby some—usually the poorer sections of the population or those on more limited means of earning capacity—pay their tax on a PAYE basis. Because of that, they cannot fiddle and work in the same way as the others who are often able to get away with that. Those who are not on PAYE dodge or fiddle legally. As I read in the press almost every day of the week, some well-known entertainer or someone in business who owes the Inland Revenue £20,000, £30,000 or £100,000 has either left the country or has gone bankrupt and will now dodge paying his tax.
      The man who is on PAYE, who cannot dodge paying tax whether he wants to or not, is estimated in a year to receive so much money and to be entitled to so many allowances. Therefore, after that is worked out, he will be liable to so much tax. He does not pay that tax willingly, but as he cannot get out of it, he acquiesces. He cannot do much else about it, so he pays.
      If, towards the end of the calendar year, through no fault of his own, the man is dismissed, he has to live on only a half or one-third of his normal income. Perhaps he has put off paying certain bills, and he hopes to use the refund from the tax that he has overpaid to pay them—but the Government do not allow that. Rather dishonestly they will now decide when he gets that money back. They will keep it immorally. The tax was calculated for the man working throughout the year, so it should be refunded. If a person found that he had paid in anticipation and been overcharged in a shop, the shop would not be able to say when he would have his refund. It would not be able to say, for example, that he would be paid back only when he was in work.
      I can understand the Government wanting to tighten the system to eliminate abuses, to save money and to obtain more for the Inland Revenue, but most of us older ones well remember the saying that there is one law for the rich and another for the poor. It is true today. There is a law on social security for the rich and another for the poor.
      A poor man like Lord Thorneycroft gets about £100,000 a year in directors' fees, and, in addition, he gets £44 a day tax free—which for him is equivalent to £120 a day—merely by going to the House of Lords and saying "Hello. I am here." He can then go to the races or wherever he likes. The unemployed man, deprived of his tax rebate, will be paying for the £44 a day that all Members of the House of Lords get.
      Sir William Clark: What about Lord Lever?
      Mr. Lewis: I could go through the whole lot. Some are millionaires. For some it is worth £150 a day. The unemployed man is paying that, because that money comes out of taxes. He is not getting the interest on the money that he should have. Instead, the money is going towards paying wealthy peers of the realm £44 a day. It is not only the unemployed. The person may be sick or disabled. He may have only one leg, or none at all. If he buys something, he has to pay VAT, which goes to the Treasury. That money goes to pay the £44 per day to Lord

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      Thorneycroft, Lord Rothermere, Lord Matthews of the Sun, Lord Kagan and all the other noble peers. Moreover, they all have three or four other jobs—sinecures as chairmen of national boards and so forth—all paid for by this unemployed taxpayer who is not allowed to get his money back when he has been overtaxed.
      9.30 pm
      If ever there was dishonesty in Government, this is it. It is the most dishonest Government and the most dishonest approach that I have seen in more than 50 years in public life and certainly in nearly 37 years in the House. I have never seen any one in any Government do a thing like this. I mean that seriously. It is a crying shame. I am glad that the hon. Member for Yarmouth (Mr. Fell) has been here throughout the debate, although I am also glad to see the newcomers who have just arrived. He himself has said that it is unfair and unreasonable.
      We may argue about whether social security is right or wrong and whether there is abuse. We may argue about whether the Government are doing the right thing economically and whether monetarism is right or wrong. But no one could maintain that it is right that a person who through no fault of his own is unemployed and who has overpaid tax not only cannot get his money back but is not even told when he will be able to get it back. There should be provision in the Bill to deal with this.
      If I underpay my tax, I get a notice. If I do not pay within 21 days, action will be taken against me and cumulative interest will be added. We should provide that if within three weeks or a month of claiming it the unemployed person does not receive his overpaid tax he will receive cumulative interest on the same basis. These people may be constituents of Conservative Members. Thay have paid their tax. They are not scroungers. Scroungers exist, but these are honest, decent people who through no fault of their own are unemployed, and they want to draw a little money. They may have a little money saved, but why should they draw on that when they have overpaid tax which they should be able to claim back?
      Under the Labour Government, I believe, there was a well known actress, Miss Diana Dors. [HON. MEMBERS: "Oh!"] Yes, indeed. She owed £64,000 in tax. How she was allowed to accumulate that kind of debt, I do not know. She went on and on refusing to pay it. Eventually the debt was washed out. The case of a chap called Michael Stern comes up next week. That is a bankruptcy case involving £240 million. He has three Rolls-Royces, a big house and all the rest. So some of them get away with it and not a word is said. I mentioned the Vestey family, who also got away with it. We should therefore protect the interests of hard-working, decent men and women who claim the right of every one of Her Majesty's loyal citizens to claim back overpaid tax and to have it when they want it and not when the Government say that they should have it.
      Mr. Ioan Evans: I agree with my hon. Friend the Member for Newham, North-West (Mr. Lewis). Of all the things done by the Government, this measure is a new low in British politics. Unemployment currently stands at 2½ million. It is said that it will reach 3 million by Christmas. Some economic experts and trade union leaders calculate
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      that it could even reach 4 million. Yet the Government are seeking to prevent the repayment of rebates to those unemployed people.
      Last Thursday was an event in British politics. Local elections give hon. Members the opportunity to meet constituents. We learn about the difficult and chronic cases in our surgeries. People tell us how they are having difficulty in obtaining mobility allowances, or how other help has been withdrawn because of Government policies. Local elections give hon. Members a chance to go on the doorstep and meet people.
      There is now 17 per cent. male unemployment in my area. More than 3,000 people are unemployed in the valley. Unemployment is not a new problem to the area. However, there is a quantitative change from what has existed in the past. More than 1 million more people have joined the unemployment queues in the last 12 months, and as a result many people now find themselves unemployed for the first time in their lives.
      Because of the Government's economic policies, skilled people who have enjoyed employment since before the war now suddenly find themselves unemployed. Some of them get earnings-related supplement, which is designed to tide them over during a difficult period. Many firms of international standing have suddenly ceased to exist. It is no use talking about an economic upturn, because those companies will no longer be there when it comes. Yet those people who have paid their bills and sustained themselves will be prevented from obtaining a rebate on tax that they have already paid.
      It is interesting that such a proposal should come from this Government, who said that they would reduce taxation. No wonder there were massive Labour successes last Thursday. The people do not have short memories. They remember that the Tories promised to reduce taxation.
      I recently asked a question about direct and indirect taxation in 1981–82. In view of the Tories' pledge, one would have thought that the figures would show a reduction. However, I discovered that in 1978–79 direct taxation amounted to £28 billion and indirect taxation to £30½ billion-a total of £58½ billion. It is estimated that in 1981–82 direct taxation will total £46 billion and indirect taxation £54 billion.
      Therefore, this Government, who were elected to reduce taxation, have increased it from £58½ billion in 1978–79 to an estimated £100 billion in 1981–82. I appreciate that inflation has increased and that allowances must be made for that, but there is no doubt that this Government have increased both direct and indirect taxation. In their third Finance Bill, why should the Government contemplate withholding the tax rebates that people are entitled to merely because they are unemployed? If a person is entitled to a tax rebate and is employed, he will receive it. However, the Government intend to pick on the unemployed. In the first Tory Budget the Government increased VAT from 8 per cent. to 15 per cent. The difference between income tax and VAT is that the unemployed do not expect to pay tax. An unemployed person should not have to pay direct tax, because that is based on income. However, VAT is a tax on spending. Therefore, the disabled, the sick, pensioners and the unemployed have seen indirect taxation doubled. That is what the Government did in their first Budget. But it was not enough.

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      The Labour Party is committed to an irreversible shift of wealth to the masses. In that same Budget the top rate of income tax was reduced from 83 per cent. to 60 per cent. It has been calculated that that reduction of 23 per cent. is worth about £600 per week back in tax. The Government may argue that they need to raise money. If that is so, why do they not reverse what they did in their first Budget? It is diabolical that a Government who gave massive tax concessions to the wealthy should tell the unemployed, whose numbers have increased tremendously as a result of the Government's policies, that they will not receive tax rebates.
      The Budget also increased the tax on petrol, cigarettes, and so on. I hope that the Chief Secretary will reconsider the situation. References have been made to the Prime Minister. She is like Marie Antoinette. The unemployed call for bread and she replies "Take off their tax rebates." She is completely out of touch with reality. There have been elections in France. Whatever one might say about the ex-President of France, he did not increase unemployment as the Government have done. Even the French Assembly would not have been offered these stupid, monetarist taxation methods. Therefore, I hope that the Government will reconsider their position.
      It must be borne in mind that there are limits in a democracy. The Government have gone beyond those limits, because they have given massive tax concessions to the wealthy. Many people are unemployed for the first time in their lives. They are trying to budget but find that they face increasing expenses. There has been an increase in water rates and local authority rates, and the unemployed face a mass of bills. The Government are primarily responsible, so I hope that they will reconsider their position and accept the amendment.
      The Chief Secretary to the Treasury (Mr. Leon Brittan): Perhaps I should make it clear that, despite the blandishments put forward with customary verve by the hon. Member for Aberdare (Mr. Evans), I shall advise the Committee not to accept the amendment which stands in the name of the official Opposition.
      The debate has been wide-ranging. In such debates it is not unusual for hon. Members to be tempted to range over the whole of the Government's economic and taxation policies. They are often tempted to go beyond the scope of the amendment. I do not complain of that, but I hope that I shall be forgiven if I do not go down some of the alleyways into which hon. Gentlemen have strayed.
      9.45 pm
      Before coming to the detail of the amendment, I observe that in the course of some of these wide-ranging observations some strong language was used. In particular, the hon. Member for Grimsby (Mr. Mitchell) used phrases such as "sheer malevolence—[HON. MEMBERS: "Hear, hear."]—"vindictive"—[HON. MEMBERS: "Hear, hear."]—and "embittered"—[HON. MEMBERS: "Hear, hear."] It is a tribute either to his eloquence or to their loyalty that even the repetition of what he said can draw the cheers of his hon. Friends.
      The hon. Member for Grimsby and I have known each other for some time. It is a sign of the maturity of a democracy for it to be possible for hon. Members on opposite sides of the Committee to disagree passionately about the consequences of what the Government are doing and the desirability of doing what the Government are seeking to do, but at the same time not to feel that those
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      who take different views can be inspired only by motives of malevolence, vindictiveness and bitterness. I hope that I shall not reach a time when I am so convinced that I am right that I shall have to conclude that any one who says or does something different can only be vindictive, embittered and malevolent.
      Those are general observations. They may have arisen because the debate has not only ranged well beyond the scope of the Bill, but because it has not fully related to the previous debate with which my right hon. Friend dealt. It is clear from what has been said with sincerity by many Opposition Members that the purpose and explanation of the clause have not become apparent to the Committee. Therefore, I welcome the opportunity to clarify it. In particular, I welcome the opportunity to deal with some of the specific points and queries which were raised by, among others, the hon. Members for Gateshead West (Mr. Horam) and Colne Valley (Mr. Wainwright.)
      The fundamental question whether unemployment benefit should be taxed was discussed and decided in the previous debate. It is in the context of that Division and decision that this clause has to be considered. In the debate on whether unemployment benefit should be taxed it was pointed out—it could not be disputed—that there was a wide degree of agreement across the Floor of the Committee that in principle it was desirable that unemployment and, indeed, other short-term benefits should be taxed. In putting forward that proposition we were not regarded as being disciples of Genghis Khan. Therefore, it is strange that on the succeeding clause, which does no more than settle—in a way which obviously will not be free from controversy, but is rational—how to implement that principle, these more extravagant allegations should fall from the lips of Opposition Members.
      My hon. Friend the Member for Lancaster (Mrs. Kellett-Bowman), in an intervention, made a highly relevant point to the consideration of these matters. There was agreement across the Floor of the Committee that unemployment benefit should be taxed. I accept that some have said—I do not propose to go over the ground again in arguing why I disagree with the view—that, even if in principle it is right that unemployment benefit should be taxed, this is not the moment or the way to do it. Those are tenable views, although I do not share them. The clause provides a way of taxing unemployment benefit. The amendment seeks to remove that method.
      Mr. Cook: If it is the purpose of subsection (a) to facilitate the taxation of unemployment benefit, or, presumably, the taxation of supplementary benefit in lieu of unemployment benefit, why cannot the Minister at least accept amendment No. 28, which would limit the cases of supplementary benefit claimants caught under this subsection to those claimants who are liable to tax under clause 29? Is it not the case that under subsection (a) as drafted, anyone who claims supplementary benefit for any reason, whether or not unemployed, will lose entitlement to any refund?
      Mr. Brittan: That is a very strange way for the hon. Gentleman to speak to his amendment No. 28. He did riot come to it, nor did his right hon. Friend the Member for Ashton-under-Lyne (Mr. Sheldon), until an intervention after a lengthy debate—[HON. MEMBERS: "Answer."] I am very happy to deal with the point, but I shall deal with it

      563
      in order. There has been a long debate, to which I have listened carefully. I propose to answer the points that have been made before coming to the last-minute matter on amendment No. 28, with which I shall happily deal.
      I was about to explain that the proposal to withhold tax refunds from benefit claimants is a basic element of the method chosen by the Government for bringing into tax benefit that is paid to the unemployed. There were alternative ways of doing it, but I shall explain why this was the preferred one. I shall also explain why, granted that the decision has been taken, it is a way of dealing with the matter which is more beneficial to the unemployed.
      I deal first with some of the specific subsidiary points that were made. It was suggested that the unemployed person is entitled on a weekly basis to a refund on his tax at present and that, therefore, the change that is made is in some sense subversive. I think that it was the hon. Member for Colne Valley who first said that of the basic structure of the PAYE system. I do not think that that is right. The point that I am making is in a sense a small one, but it illustrates the fact that we do not have an ancient and sacrosanct structure which we are now tinkering with and interfering with unacceptably, but, rather, that the structure is complex, with regulations which have come at different times and which cannot be regarded as untouchable. The point that I was about to make in illustration, but no more than that—I know that the hon. Member for Edinburgh, Central (Mr. Cook) will not think that I am trying to pick him up on a technicality—is that where a refund is due, it will be paid by the tax office after the first four weeks of unemployment, and thereafter at four-weekly intervals, until the entitlement is exhausted. I say that to illustrate the fact that it is a structure of some complication and ought not to be regarded as sacrosanct.
      We have decided not to follow the alternative method of taxing unemployment, which would be to do so in the way that would be described as the current method of operation—in other words, not to operate a version of PAYE on the benefits as they are paid. The reason why that decision was taken is that if that were done, tax would, in a proportion of cases, have to be deducted directly from the benefit, because the allowances given in the PAYE code were reduced, for example, to take account of other income or underpayments of tax from an earlier year.
      I am not suggesting that that would happen in the majority of cases, but it would in some. It would not make sense for a person to be paid supplementary benefit or unemployment benefit and to have tax deducted from that benefit. For that reason, the Government decided that the right way to deal with it is to freeze claimants' tax accounts during unemployment. In that way, tax will not be deducted and refunds will not be paid. Liability would be assessed at the end of the period of claim or the end of the tax year, if sooner.
      That gives me an opportunity to deal with another point raised by the hon. Member for Colne Valley—the role of the employer. The employer will not be involved because the unemployment benefit office will be responsible for repayment. Statements to the effect that this is robbery or that money that the employee is entitled to is being withheld are irrelevant. Those statements relate to unemployment benefit which is not taxed, but when unemployment benefit is taxed, prima facie one would expect tax to be paid currently. Some hon. Members may
      564
      query whether now is the time to introduce that, but the measure has considerable support. Therefore, the question of refunds can be seen in a different perspective. It is reasonable to assume that we shall not require the tax to be paid on a regular weekly basis and similarly we shall withhold the refunds.
      While the claimant is receiving taxable income which is currently not being brought into tax, it is anomalous to pay refunds of tax. If refunds were made, he would be receiving back tax paid earlier and, at the same time, building up a liability to tax which he would have to satisfy at the end of his claim or at the end of the tax year. That would be disadvantageous to the taxpayer, because at the end of the tax year, or when he resumed his employment, he would be facing an enormous tax liability. That would be a disincentive to return to work. Once the decision to tax unemployment benefit is taken it will be disadvantageous to make the tax bill payable when a person returns to work. For that reason this method is preferable.
      Mr. Horam: The flaw in the right hon. and learned Member's argument is that he is assuming equality in the amount due to the taxpayer by way of tax repayment of money overpaid when in employment and the amount of money that he will pay in tax benefit. Surely the amount of tax paid on benefit will be much smaller than the tax repayment due. The core of the right hon. and learned Member's argument is a false parity.
      Mr. Brittan: I was coming to that point next. I intend to analyse what will happen in practice.
      In most cases the unemployed person's personal tax allowances will exceed his taxable benefit, but in these cases he will normally have only a small net refund of tax on return to work or at the end of the tax year. On the figures, it will be only a small amount. In the majority of cases there will be the broad balance that the hon. Member for Colne Valley regarded as necessary if this method was to be fair.
      Mr. Cook rose—
      10 pm
      Mr. Brittan: I should proceed.
      In the minority of cases where an actual liability to tax arises as a result of unemployment, there is the question of what will happen to the tax that is payable. Before explaining what happens, let me make it clear that if there were any difficulties in such a case they would be infinitely worse if the tax refunds had been paid earlier, when the person concerned was out of work—once we accept the principle that unemployment benefit should be taxed.
      Mr. Cook rose—
      Mr. Brittan: I am not giving way.
      Mr. Cook: This is intolerable.
      Mr. Brittan: The hon. Gentleman can say that to his heart's content. I have listened to a long debate—
      Mr. Cook rose—
      The Second Deputy Chairman: Order. It is clear that the Minister is not giving way.
      Mr. Brittan: I shall explain what I propose to do, and I shall not take lectures from the hon. Member for Edinburgh, Central as to what is and is not intolerable.

      565
      These are complex matters. Many things have been said, and I propose to explain what is involved. I shall then give way, in my own time.
      Mr. Cook: The right hon. and learned Gentleman does not know the answers. He is terrified to leave his brief.
      Mr. Brittan: The hon. Gentleman can get as heated as he wishes. I assure the hon. Gentleman I shall give way when I wish to do so.
      I was explaining a particular point raised by some hon. Members who are concerned with the serious issues involved. I was dealing with the question of what happens in the minority of cases in which an actual liability to tax arises as a result of unemploymemt.
      Naturally, there would be some concern if the taxpayer had to pay a lump sum, but that will not happen. The tax will be collected not in a lump sum on the person's return to work but by a subsequent adjustment to his PAYE code, which will lead to an adjustment over a period of time. This is a method of providing for taxation of unemployment benefit that enables the object to be achieved with the minimum of hardship for the unemployed person. I am not saying that it is the only way, but I explained when dealing with the current method why this was preferable.
      I was about to deal with amendment No. 28. The right hon. Member for Ashton-under-Lyne did not refer to it in opening, but the hon. Member for Edinburgh, Central corrected him by raising it in an intervention. If the hon. Gentleman wishes to deal with another matter by way of intervention, I am content to give way now.
      Mr. Cook: I am much obliged to the right hon. and learned Gentleman for giving way. However, if he is not to give way to Opposition Members when we have genuine questions to put, that bodes ill for the Committee upstairs, as his right hon. Friend the Financial Secretary will tell him.
      The right hon. and learned Gentleman said a few minutes ago that it would be anomalous to make a refund where liability to tax was being clocked up by payment of benefit, because it would constitute a disincentive to return to work at the end of the period of unemployment. He has spoken of the person who is unemployed at the start of the tax year, for whom, therefore, there is no tax refund to be withheld, but who may be, as the right hon. and learned Gentleman admits, acquiring a tax liability during the period of unemployment. Why is there not the same disincentive to work when that person can return to employment? Surely the Chief Secretary does not suggest that simply because it is done by adjustment to the PAYE code, which is taken over a period of weeks rather than as a lump sum, he is not thereby increasing substantially the marginal rate of tax that that person pays on returning to work.
      Mr. Brittan: To an extent, of course, it is a disincentive, but it is very much less of a disincentive than it would be to do it in the way made necessary by the amendment. It is as simple as that.
      I tell the hon. Member for Edinburgh, Central that I have no wish for debates to be more intemperate than the hon. Gentleman feels that he must make them. However, it is one thing to be asked to give way. It is quite another for the hon. Gentleman to demand that I give way
      566
      instantly. I think that I am entitled to develop my argument and to give way—as I can assure the hon. Gentleman that I will—at what I regard as a convenient moment.
      I move to amendment No. 28. As I understand it, the purpose is to restrict slightly the scope of paragraph (a). As it stands, paragraph (a), with the initial four lines of clause 29, gives power for regulations to be made providing for tax refunds to be withheld from claimants of unemployment benefit or supplementary allowance for their period of claim. The purpose of the amendment is to restrict the provision to withhold refunds so that it applies only in the case of benefit claimants whose benefit is taxable.
      I am happy to tell the Committee that the Government are prepared in principle to accept the amendment. However, there is some doubt whether its wording is appropriate to the purpose. Therefore, I hope that the Committee will be content if I say that the Government will examine the drafting and seek to bring forward on Report an appropriate form of words to meet the point. It may be convenient, if the Opposition are content on that basis, for the amendment to be withdrawn; otherwise, I shall have to invite my right hon. and hon. Friends to vote against it.
      The remainder of the amendments in this grouping are fundamentally subversive to the purpose of the clause and therefore cannot be accepted.
      Mr. Cook: The Chief Secretary began his remarks by referring to my hon. Friend the Member for Grimsby (Mr. Mitchell), who made a notable speech in our preceding debate. The right hon. and learned Gentleman took my hon. Friend to task for speaking in such a passionate and, according to him, intemperate manner. He said that he hoped that he would never be so embittered as to be convinced that he was right, in the way that my hon. Friend spoke.
      I am sure that all Opposition Members will agree that my hon. Friend was right to speak as he did. We have to make the point that it is not surprising that there should be bitterness—given the rate at which this Government have increased unemployment—and that that bitterness should come to a head in a debate that follows a cumulative attack by the Government on the standard of living of those whom they themselves have thrown out of work.
      All that my hon. Friend the Member for Grimsby did was to articulate the bitterness that is felt already by those who have lost their jobs and the anger that will be felt by those same people as they continue to find their standard of living eroded by the Government's policy both on their benefits and on their taxation. It would be a neglect of the duty of hon. Members if that anger and bitterness were not articulated in a debate on this subject.
      Having said that, I am glad that the Chief Secretary has found his way to accept the principle of amendment No. 28. However, it is a strange state of affairs that the Opposition have to tidy up the provisions of a Bill that has come from the Treasury draftsmen.
      The Chief Secretary has acknowledged that as it stands the subsection would bite on many people who would not have taxable incomes under clause 27.
      I am glad that the Government have accepted the principle of amendment No. 28, but I must draw the Chief Secretary's attention to the debate on the next subsection, when we shall debate the same principle. The following subsection bites even deeper. I hope that the right hon. And

      567
      learned Gentleman will be able to accept the similar amendment that is based on a parallel principle in our next debate.
      However, as the Chief Secretary said, the remaining amendments, particularly amendment No. 25, are subversive of the whole subsection. I am happy to confirm that they are, indeed, subversive of the principle contained in the subsection and we are happy to stand by that subversion, even with the modest improvement that the Chief Secretary announced. We stand by the amendment because we find the principle of the subsection obnoxious.
      As the Chief Secretary admitted, we have a cumulative system of taxation in which the tax liability is based on the assumption that the income will be maintained over the year. It necessarily follows that if, in the course of the year, the taxpayer loses the source of income and employment, he has paid too much tax while in employment. Having paid too much tax over the previous months, he is entitled to get that tax back.
      We find the subsection obnoxious because it provides a means by which the Treasury can cheat—albeit legally—the taxpayer of his right to get the money back. The taxpayer has paid too much tax in the past, and the Treasury will take power to pocket it and retain it at its pleasure, because it is more convenient to approach the taxation of benefit on that basis.
      That is undesirable, for two reasons. First, it is arbitrary. The amount of refunds will vary, and the amount of liability for tax to be deducted from those refunds, even accepting taxation on unemployed benefit, will vary. Let us consider the case of a skilled man who has worked for nine months in the financial year and who, over that time, has paid a substantial amount of income tax. If that skilled man becomes unemployed he will be entitled to a substantial refund. At the end of the financial year he will be entitled to a refund because, as the Chief Secretary acknowledged, he is likely to be liable only for a small amount of tax on the unemployment benefit that he receives.
      The Financial Secretary admitted that 90 per cent. of those whose refunds were withheld would have refunds in excess of any tax liability that would arise on the unemployment benefit. So 90 per cent. of taxpayers will have withheld from them a sum in tax refund greater than anything for which they will be liable as a result of taxation of unemployment benefit. There is no possible justification for making all of them wait until the end of the financial year before they get any money back, although it may be egregiously in excess of their tax liability.
      Mr. Campbell-Savours: Did my hon. Friend hear the Chief Secretary say earlier that when the taxpayer owed the Revenue at the end of the financial year and at the beginning of the period of employment, the money would be paid through in his coding for the following year? Does that mean that conversely, when the taxpayer is owed money by the Revenue, instead of a block payment being made the sum due may be paid over the period of the following year, in the form of a coding?
      Mr. Cook: That is more for the Chief Secretary than for me, but I understand that he said that where the unemployed person is unemployed at the outset of the financial year, and therefore has no tax refund due to him,
      568
      the tax liability that will accrue will be deducted, when he returns to work, by an increase in his PAYE code. As the Chief Secretary condeded, that means that the person will pay a higher rate of marginal taxation when he returns to work. A higher rate of tax will be deducted from his pay than is deducted from the pay of his fellow workers. When he returns to work, when he could look forward to recouping his income, he will pay a higher rate of tax than will people who were employed when he was not. That is the first reason why the approach is undesirable. It withholds from taxpayers money that they have paid in tax and that they are entitled to get back.
      10.15 pm
      Mr. Brittan: I wish to deal with the question asked by the hon. Member for Workington (Mr. Campbell-Savours). I thought that I made it clear that a refund that is due will be paid in a lump sum at the moment in question.
      Mr. Cook: The second reason why we regard the approach as undesirable is that a refund due to the taxpayer, much of which will remain due irrespective of tax liability, will be paid at the end of the period of unemployment. That is daft. The taxpayer needs his money back when he is unemployed and not when he is back at work.
      The Chief Secretary has achieved the remarkable feat of withholding money from the taxpayer when he needs it most and returning it when his need is less pressing. That is being done to facilitate the convenience of the Treasury to tax unemployment benefit. That is daft.
      We should remember that Government Members campaigned at the last election on the basis that people were paying too much tax. They said that they would relieve the public of that tax burden. They also argued that the country groaned under too much bureaucracy and that therefore individual freedom and creativity were being suppressed. They promised to liberate that freedom and creativity by curbing bureaucracy. Yet the Government are introducing a measure that creates a fresh burden of taxation administered on the basis of that same bureaucracy. The Government say that to suit their convenience they will not pay tax refunds that are due to the taxpayer.
      I find that proposition harsh and lacking in logic. It is intolerable that the Government are prepared to say to an unemployed person that it is convenient for them to hold on to his money until he returns to work when it is so inconvenient for that person to lend it to the Government when he is unemployed. If that is the only way to achieve taxation of short-term benefits without employing even more than 3,500 civil servants, the whole system should be scrapped. The Committee would take a positive step towards scrapping that system by voting for the amendment.
      Question put, That the amendment be made: —
      The Committee divided: Ayes 223, Noes 277.

      Division No. 176]

      [10.18 pm

      AYES

      Abse, Leo

      Ashton, Joe

      Adams, Allen

      Atkinson, N.(H'gey,)

      Allaun, Frank

      Bagier, Gordon A.T.

      Alton, David

      Barnett, Guy (Greenwich)

      Anderson, Donald

      Barnett, Rt Hon Joel (H'wd)

      Archer, Rt Hon Peter

      Benn, Rt Hon A. Wedgwood

      Ashley, Rt Hon Jack

      Bennett, Andrew(St'kp't N)

      569

      Bidwell, Sydney

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

      Booth, Rt Hon Albert

      Homewood, William

      Boothroyd, Miss Betty

      Hooley, Frank

      Bray, Dr Jeremy

      Horam, John

      Brocklebank-Fowler, C.

      Howell, Rt Hon D.

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

      Howells, Geraint

      Brown, Ron (E'burgh, Leith)

      Hudson Davies, Gwilym E.

      Buchan, Norman

      Hughes, Mark (Durham)

      Callaghan, Rt Hon J.

      Hughes, Robert (Aberdeen N)

      Callaghan, Jim (Midd't'n & P)

      Hughes, Roy (Newport)

      Campbell, Ian

      Janner, Hon Greville

      Campbell-Savours, Dale

      Jay, Rt Hon Douglas

      Canavan, Dennis

      John, Brynmor

      Cant, R. B.

      Johnson, James (Hull West)

      Carmichael, Neil

      Johnston, Russell (Inverness)

      Carter-Jones, Lewis

      Jones, Rt Hon Alec (Rh'dda)

      Clark, Dr David (S Shields)

      Jones, Barry (East Flint)

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

      Jones, Dan (Burnley)

      Concannon, Rt Hon J. D.

      Kaufman, Rt Hon Gerald

      Cook, Robin F.

      Kerr, Russell

      Cowans, Harry

      Kilroy-Silk, Robert

      Craigen, J. M.

      Kinnock, Neil

      Crowther, J. S.

      Lambie, David

      Cryer, Bob

      Lamborn, Harry

      Cunliffe, Lawrence

      Leadbitter, Ted

      Cunningham, G. (Islington S)

      Leighton, Ronald

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

      Lestor, Miss Joan

      Dalyell, Tam

      Lewis, Arthur (N'ham NW)

      Davidson, Arthur

      Litherland, Robert

      Davies, Ifor (Gower)

      Lyon, Alexander (York)

      Davis, Clinton (Hackney C)

      Lyons, Edward (Bradf'd W)

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

      Mabon, Rt Hon Dr J. Dickson

      Deakins, Eric

      McCartney, Hugh

      Dean, Joseph (Leeds West)

      McElhone, Frank

      Dempsey, James

      McKelvey, William

      Dewar, Donald

      MacKenzie, Rt Hon Gregor

      Dixon, Donald

      McMahon, Andrew

      Dobson, Frank

      McNally, Thomas

      Dormand, Jack

      McNamara, Kevin

      Douglas-Mann, Bruce

      McWilliam, John

      Dubs, Alfred

      Magee, Bryan

      Duffy, A. E. P.

      Marks, Kenneth

      Dunn, James A.

      Marshall, D(G'gow S'ton)

      Dunnett, Jack

      Marshall, Dr Edmund (Goole)

      Dunwoody, Hon Mrs G.

      Marshall, Jim (Leicester S)

      Eadie, Alex

      Martin, M(G'gow S'burn)

      Eastham, Ken

      Mason, Rt Hon Roy

      Ellis, R. (NE D'bysh're)

      Maxton, John

      English, Michael

      Maynard, Miss Joan

      Ennals, Rt Hon David

      Mellish, Rt Hon Robert

      Evans, Ioan (Aberdare)

      Mikardo, Ian

      Evans, John (Newton)

      Millan, Rt Hon Bruce

      Ewing, Harry

      Mitchell, Austin (Grimsby)

      Faulds, Andrew

      Mitchell, R. C. (Soton Itchen)

      Field, Frank

      Morris, Rt Hon A. (W'shawe)

      Fitch, Alan

      Morris, Rt Hon C. (O'shaw)

      Flannery, Martin

      Morris, Rt Hon J. (Aberavon)

      Fletcher, Ted (Darlington)

      Morton, George

      Foot, Rt Hon Michael

      Newens, Stanley

      Ford, Ben

      Oakes, Rt Hon Gordon

      Forrester, John

      Ogden, Eric

      Foster, Derek

      O'Halloran, Michael

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

      O'Neill, Martin

      Freeson, Rt Hon Reginald

      Orme, Rt Hon Stanley

      Garrett, John (Norwich S)

      Palmer, Arthur

      George, Bruce

      Parry, Robert

      Gilbert, Rt Hon Dr John

      Prescott, John

      Ginsburg, David

      Price, C. (Lewisham W)

      Graham, Ted

      Race, Reg

      Grant, George (Morpeth)

      Radice, Giles

      Grimond, Rt Hon J.

      Rees, Rt Hon M (Leeds S)

      Hamilton, James (Bothwell)

      Richardson, Jo

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

      Roberts, Albert (Normanton)

      Harrison, Rt Hon Walter

      Roberts, Allan (Bootle)

      Hart, Rt Hon Dame Judith

      Roberts, Ernest (Hackney N)

      Hattersley, Rt Hon Roy

      Roberts, Gwilym (Cannock)

      Haynes, Frank

      Robertson, George

      Healey, Rt Hon Denis

      Robinson, G. (Coventry NW)

      Heffer, Eric S.

      Rooker, J. W.

      Hogg, N. (E Dunb't'nshire)

      Ross, Ernest (Dundee West)

      570

      Ross, Stephen (Isle of Wight)

      Tinn, James

      Rowlands, Ted

      Torney, Tom

      Ryman, John

      Wainwright, E.(Dearne V)

      Sever, John

      Wainwright, R.(Colne V)

      Sheerman, Barry

      Walker, Rt Hon H.(D'caster)

      Sheldon, Rt Hon R.

      Watkins, David

      Shore, Rt Hon Peter

      Weetch, Ken

      Short, Mrs Renée

      Wellbeloved, James

      Silkin, Rt Hon J. (Deptford)

      Welsh, Michael

      Silkin, Rt Hon S. C. (Dulwich)

      White, Frank R.

      Skinner, Dennis

      White, J. (G'gow Pollok)

      Smith, Rt Hon J. (N Lanark)

      Whitlock, William

      Snape, Peter

      Wigley, Dafydd

      Soley, Clive

      Willey, Rt Hon Frederick

      Spearing, Nigel

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

      Spriggs, Leslie

      Wilson, Rt Hon Sir H.(H'ton)

      Stallard, A. W.

      Wilson, William (C'try SE)

      Stewart, Rt Hon D. (W Isles)

      Winnick, David

      Stoddart, David

      Woodall, Alec

      Stott, Roger

      Woolmer, Kenneth

      Straw, Jack

      Wright, Sheila

      Summerskill, Hon Dr Shirley

      Young, David (Bolton E)

      Thomas, Dafydd (Merioneth)

      Thomas, Jeffrey (Abertillery)

      Tellers for the Ayes:

      Thomas, Dr R.(Carmarthen)

      Mr. Donald Coleman and Mr. Allen McKay.

      Thorne, Stan (Preston South)

      Tilley, John

      NOES

      Adley, Robert

      Cockeram, Eric

      Aitken, Jonathan

      Colvin, Michael

      Alexander, Richard

      Cope, John

      Alison, Michael

      Corrie, John

      Amery, Rt Hon Julian

      Cranborne, Viscount

      Ancram, Michael

      Critchley, Julian

      Aspinwall, Jack

      Crouch, David

      Atkins, Robert(Preston N)

      Dean, Paul (North Somerset)

      Baker, Kenneth(St.M'bone)

      Dickens, Geoffrey

      Baker, Nicholas (N Dorset)

      Dorrell, Stephen

      Banks, Robert

      Dover, Denshore

      Bell, Sir Ronald

      du Cann, Rt Hon Edward

      Bendall, Vivian

      Dunn, Robert (Dartford)

      Benyon, Thomas (A'don)

      Dykes, Hugh

      Benyon, W. (Buckingham)

      Eden, Rt Hon Sir John

      Berry, Hon Anthony

      Edwards, Rt Hon N. (P'broke)

      Best, Keith

      Eggar, Tim

      Bevan, David Gilroy

      Elliott, Sir William

      Biggs-Davison, John

      Emery, Peter

      Blackburn, John

      Eyre, Reginald

      Blaker, Peter

      Fairgrieve, Russell

      Body, Richard

      Faith, Mrs Sheila

      Bonsor, Sir Nicholas

      Fell, Anthony

      Boscawen, Hon Robert

      Fenner, Mrs Peggy

      Boyson, Dr Rhodes

      Fisher, Sir Nigel

      Braine, Sir Bernard

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

      Bright, Graham

      Fletcher-Cooke, Sir Charles

      Brinton, Tim

      Fookes, Miss Janet

      Brittan, Leon

      Forman, Nigel

      Brooke, Hon Peter

      Fowler, Rt Hon Norman

      Brotherton, Michael

      Fox, Marcus

      Brown, Michael(Brigg & Sc'n)

      Fraser, Rt Hon Sir Hugh

      Browne, John (Winchester)

      Fraser, Peter (South Angus)

      Bruce-Gardyne, John

      Fry, Peter

      Bryan, Sir Paul

      Gardiner, George (Reigate)

      Buchanan-Smith, Alick

      Gardner, Edward (S Fylde)

      Buck, Antony

      Garel-Jones, Tristan

      Budgen, Nick

      Gilmour, Rt Hon Sir Ian

      Bulmer, Esmond

      Glyn, Dr Alan

      Burden, Sir Frederick

      Goodlad, Alastair

      Butcher, John

      Gow, Ian

      Cadbury, Jocelyn

      Gower, Sir Raymond

      Carlisle, John (Luton West)

      Gray, Hamish

      Carlisle, Kenneth (Lincoln)

      Greenway, Harry

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

      Griffiths, E.(B'y St. Edm'ds)

      Chalker, Mrs. Lynda

      Griffiths, Peter Portsm'th N)

      Churchill, W. S.

      Grist, Ian

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

      Grylls, Michael

      Clark, Sir W. (Croydon S)

      Hamilton, Hon A.

      Clarke, Kenneth (Rushcliffe)

      Hamilton, Michael (Salisbury)

      Clegg, Sir Walter

      Hampson, Dr Keith

      571

      Hannam, John

      McNair-Wilson, P. (New F'st)

      Haselhurst, Alan

      McQuarrie, Albert

      Hastings, Stephen

      Madel, David

      Hawksley, Warren

      Major, John

      Hayhoe, Barney

      Marland, Paul

      Heddle, John

      Marlow, Tony

      Henderson, Barry

      Marshall, Michael (Arundel)

      Heseltine, Rt Hon Michael

      Maude, Rt Hon Sir Angus

      Hicks, Robert

      Mawby, Ray

      Higgins, Rt Hon Terence L

      Mawhinney, Dr Brian

      Holland, Philip (Carlton)

      Maxwell-Hyslop, Robin

      Hooson, Tom

      Mayhew, Patrick

      Hordern, Peter

      Mellor, David

      Howell, Rt Hon D. (G'ldf'd)

      Meyer, Sir Anthony

      Hunt, David (Wirral)

      Miller, Hal (B'grove)

      Hunt, John (Ravensbourne)

      Mills, lain (Meriden)

      Hurd, Hon Douglas

      Mills, Peter (West Devon)

      Jenkin, Rt Hon Patrick

      Miscampbell, Norman

      Johnson Smith, Geoffrey

      Moate, Roger

      Jopling, Rt Hon Michael

      Molyneaux, James

      Kaberry, Sir Donald

      Monro, Hector

      Kellett-Bowman, Mrs Elaine

      Montgomery, Fergus

      Kimball, Marcus

      Moore, John

      King, Rt Hon Tom

      Morris, M. (N'hampton S)

      Kitson, Sir Timothy

      Morrison, Hon C. (Devizes)

      Knox, David

      Morrison, Hon P. (Chester)

      Lamont, Norman

      Mudd, David

      Lang, Ian

      Murphy, Christopher

      Langford-Holt, Sir John

      Myles, David

      Latham, Michael

      Neale, Gerrard

      Lawrence, Ivan

      Needham, Richard

      Lawson, Rt Hon Nigel

      Nelson, Anthony

      Lee, John

      Neubert, Michael

      Le Marchant, Spencer

      Newton, Tony

      Lennox-Boyd, Hon Mark

      Normanton, Tom

      Lloyd, Ian (Havant & W'loo)

      Onslow, Cranley

      Lloyd, Peter (Fareham)

      Page, Rt Hon Sir G. (Crosby)

      Loveridge, John

      Page, Richard (SW Herts)

      Luce, Richard

      Parkinson, Cecil

      Lyell, Nicholas

      Parris, Matthew

      McCrindle, Robert

      Patten, Christopher (Bath)

      Macfarlane, Neil

      Patten, John (Oxford)

      MacGregor, John

      Pattie, Geoffrey

      MacKay, John (Argyll)

      Pawsey, James

      Macmillan, Rt Hon M.

      Peyton, Rt Hon John

      McNair-Wilson, M. (N'bury)

      Pink, R. Bonner

      Question accordingly negatived
      10.30 pm
      Mr. Cook: I beg to move amendment No. 30, in page 18, line 40, leave out paragraph (b).
      The Second Deputy Chairman: With this it will be convenient to take amendment No. 31, in page 18, line 40, leave out from 'is' to end of line 4 on page 19 and insert
      'in receipt of supplementary allowance reduced by application of section 8 of the said Act of 1979 (trade disputes) and paragraph 10 of Schedule 2 to the Supplementary Benefit (Requirements) Regulations 1980 applies to him.'.
      Mr. Cook: The hour is growing late. I appreciate that it would be the wish of the Committee to make progress as speedily as possible, consisitent with doing justice to the clauses which have been put before us by the Treasury. Therefore, I do not propose to rehearse in this debate the general arguments on why the striker should be singled out for special treatment among those who claim supplementary benefit in the way in which we dealt with them in clause 27.
      I stand by anendment No. 30. The Opposition may wish to divide on it, but the arguments on it are on an issue of principle which we substantially debated when we debated the parallel amendment to clause 27. I therefore turn to amendment No. 31. I am encouraged to do so by the response of the Chief Secretary to our previous debate, when he accepted the principle of our amendment No. 28 to limit the withholding of refunds to claimants who came within the scope of the tax provisions of clause 27.
      As the Chief Secretary will have apprehended, amendment No. 31 would do for the striker what amendment No. 28 was intended to do for the unemployed person. In other words, amendment No. 31 would limit the scope of the subsection to strikers who have made a claim for supplementary benefit which is taxable under clause 27. I go further and say—I hope with some confidence—that at least amendment No. 31 is not defective, because it lifts bodily the wording of clause 27 and inserts it as our amendment. If we are defective, it follows that the Bill is defective in the first place.
      The Chief Secretary admitted in his reply to the previous debate that the subsection to which he was speaking went wider in its application than to households who would find that they had a taxable benefit under clause 27. Not only does the subsection also so wider in its application than strike families whose benefits would be taxable under clause 27, but the vast majority of households who would find that their refund was withheld under the subsection would have no benefit which was taxable under clause 27.
      I can demonstrate that from figures produced by the Government. In answer to a parliamentary question, a former Minister at the Department of Health and Social Security gave the percentage of strikers in receipt of supplementary benefit. It varied from 3·3 per cent. in 1975 to 1·1 per cent. in 1979. In a previous debate, we explored the myth that the generosity of supplementary benefit enabled strikers to subsist. Only a tiny fraction of strikers claim benefit, and many in that tiny fraction claim only derisory amounts. In no year between 1975 and 1979 did more than 5 per cent. of those on strike claim supplementary benefit. Nineteen out of 20 did not claim benefit, which demonstrates more clearly than the rhetoric of the previous debate that it is fanciful to suggest that the
      574
      generosity of supplementary benefit encourages people to strike. It has nothing to do with supplementary benefit, which is not available to the majority of strikers.
      More than 95 per cent. of strikers do not claim supplementary benefit. As worded, the subsection would also cover that 95 per cent. It bites on both categories. For those 95 per cent. there is no benefit which is liable to tax. A striker with no dependants cannot claim supplementary benefit. In long strikes, single people subsist on their tax refunds. The subsection will deny those people their own money on which they have hitherto relied.
      I am anxious to find out what possible reason the Government will give for the arrangement. What is their justification for singling out strikers, even those who are not claiming benefit? In a previous debate the Financial Secretary said that strikers were carrying out a voluntary activity. Will we be told that the reason is that strikes damage the economy? We were also told that strikers were taking action consistent with improving their income. All those arguments are risible, but are preferable to the breathtaking argument that it is administratively convenient to treat all strikers the same, which is further insulting to those who will have their own money withheld from them, even though the State will not give them any benefit. It would be an outrage. I hope that the Chief Secretary will spare us that.
      I hope that, as in the previous debate, the right hon. Gentleman will accept, at least in principle, that the scope of the subsection should be limited to households that are covered by clause 27. Anything else could be explained only on the basis of the arguments used by my hon. Friends in previous debates—namely, that the measure is put forward in a vindictive spirit, to penalise the striker. The Chief Secretary took exception to those terms. I assure him that none would be happier than we to withdraw those phrases if he could establish that there is a rational ground for withholding refunds to those not claiming benefit. If he cannot do that he will confirm the accusation that there is no rational explanation for such a proposal and that it can rest only on a vindictive attitude towards the striker and his family.
      Mr. Ennals: Like my hon. Friend the Member for Edinburgh, Central (Mr. Cook) I look forward with great interest to hearing the Minister's justification for this measure. We have already passed a mean and miserable measure penalising the unemployed. The Government now seek to pass a measure which will be even more damaging to those involved in industrial relations. As I understand it, under the previous clause, tax rebates will be withheld until the end of the year or the end of the period of unemployment. But for those involved in trade disputes, rebates will be withheld until the end of the dispute, even if the tax year ends before that.
      Why are those involved in trade disputes to be treated differently from the unemployed in this respect? I can only regard it as a vendetta against those involved in industrial disputes, whatever the rights or wrongs of the dispute may be. What can be the Government's justification for doing this in the first place, and for taking it further in this provision than in the previous clause? What is the Government's view of the legality of industrial disputes? If those involved in industrial disputes are to be placed in a separate category from the unemployed, whom we have already treated meanly, that issue must arise. Is there something illegal about industrial action? If so, why do not

      575
      the Government declare it to be illegal? Is there something worthy of victimisation about those involved in industrial action, whatever may have been the cause of that action? Are industrial disputes automatically wrong, even if the employer is in breach of a solemn agreement reached with his employees? Why should we assume that those involved in an industrial dispute should automatically be penalised by the tax laws that the Government wish to introduce?
      My right hon. Friend the Member for Ashton-under-Lyne (Mr. Sheldon) referred earlier to the Government's attitude to the Civil Service. I shall not take that any further. I merely point out that those who will suffer most if the clause is passed will not be those on high pay. Those who will be hit will be those on the lowest pay, who most need the rebate. People on high rates of pay will be able to manage without the rebate to which they are entitled. It is those living from week to week or month to month who will need the rebate.
      The question must be asked. Whose money are we talking about? We are talking about money that belongs to the citizens of this country. Any Government who decide to withhold, for however long, tax rebates due to citizens are taking away the rights of their own citizens. The Government claim to believe that we are too heavily taxed, yet they are simply picking on those at the lowest end of the scale. This paragraph is almost as iniquitous as the previous paragraph dealing with tax rebates to the unemployed.
      10.45 pm
      I see the proposal as a vendetta against those involved in an industrial dispute. What action do the Government propose to take against employers who may be responsible for an industrial dispute? None at all. What about those involved in an industrial dispute who have had no part in the decision? They and their families will still be penalised. What possible justification is there not only for withholding tax rebates during unemployment, but during trade disputes?
      I am also worried about the position of single people involved in a trade dispute who are not entitled to supplementary benefit and who may have no other source of income. What justification is there for denying them the right to a tax rebate until they have returned to work or until the dispute is over?
      The Government are denying to the citizens funds which are the citizens' funds. If there has been an over-payment of tax, it is the Government's responsibility to ensure that that money is returned to the citizen at the earliest possible moment. Their motives for not doing so can only be that they wish to penalise the unemployed and bring excessive political pressures upon those who rightly and properly take part in industrial disputes.
      Mr. Winnick: Although the hour is late, the principle is important. It is so important to Labour Members that we are entitled to make these remarks, however briefly.
      This is a vindictive measure. It will undoubtedly strengthen the view of Conservative Members that they are getting their way—at least, the view of those Conservative Members who are militant in their anti-trade union feelings. Only recently we learnt that there had been
      576
      increasing pressure on the Secretary of State for Employment to introduce more penal measures against the trade unions and strikers.
      Under the clause, the tax refund will be withheld until the person goes back to work. As my right hon. Friend the Member for Norwich, North (Mr. Ennals) said, that is even worse than the person who is unemployed. At least in his case, the refund will be paid either when he goes back to work or at the end of the tax year. But if a person goes on strike the tax refund will be withheld until he returns to work. That is why we stronly object to this proposal. The money that belongs to the citizen will not be returned to him, even though he has not committed a crime. Even under this Government strikes are not illegal. [HON. MEMBERS: "Yet."] The citizen has exercised his democratic rights, yet will be penalised in every conceivable way. The Budget and the Finance Bill are being used as a means of punishing the striker.
      In effect, the Government are saying "We cannot take away your right-to strike, but we inend to do everything to hurt you by fiscal means." Labour Members believe that the clause is an open, anti-trade union measure. Earlier today the Financial Secretay was quite blunt. When pressed he said that strikes caused real damage. To do him justice, the Financial Secretary was only echoing the view of many of his right hon. and hon. Friends. They do not like strikes. They object to the withdrawal of labour. They consider that wrong. On the other hand, we believe that in the large majority of cases people do not strike lightly or because of wicked agitators. They do so because they passionately believe that there is no other way of resolving their difficulties.
      I speak as an active lay member of a white-collar union. Like several white-collar unions, my union experiences difficulties over recognition. Unbelievable as it may seem in the 1980s the union experiences difficulties similar o those seen at Grunwick. In that case, people were refused the elementary right to belong to a trade union at their place of work. [Interruption.] We know the reactions of Conservative Members who have no sympathy for workers who are struggling for the basic right of recognition for their trade union.
      If workers decide that there is no alternative—as in the Grunwick dispute—but to take industrial action, they will not be entitled, of course, to supplementary benefit. A striker's family is entitled to some benefit. Although supplementary benefit is the bare minimum on which to exist, £12 is being deducted because of the measures that the Government took last year. Clearly, both the striker and his family will find themselves in dire financial difficulties. The striker might have hoped for a tax refund, but the clause will deny him that.
      The chairman of ACAS has not been associated with the trade union side of industry. When he gave his report, he said that employers were wrong to exploit the present difficulties over unemployment and to break agreements. No doubt the breaking of a number of agreements will lead to strike action. We know that the Government intend to penalise those who exercise their rights. Many of us in the trade union and Labour movement are sickened because the Tory Government and Tory Members go on and on about Poland. They say that they sympathise with the workers there and appreciate what is being done. Labour Members understand and appreciate the struggle of Polish workers in the past 12 months to obtain basic democratic rights. We also, however, support the right of working

      577
      people in Britain to defend their living standards and, if necessary, to take strike action. They have a right to do that in Britain. We are not hypocrites. We do not support strikes only when they occur in Eastern Europe.
      The trade union movement has a pretty long memory. We have not forgotten the Industrial Relations Act 1971 of the previous Conservative Government. The trade union movement will not forget the Employment Act 1980 or the squalid little penal measures that are aimed at undermining the citizen's right to take strike action. When a Labour Government are re-elected, we must ensure that the shabby, squalid measures that are aimed against the trade union movement are removed from the statute book as quickly as possible.
      Mr. Maxton: It will be interesting to hear the Chief Secretary's reply to this debate. Under clause 29(a) those who claim unemployment benefit cannot claim a rebate. Clause 29(b) covers those who cannot receive unemployment benefit. They will not be able to receive a rebate, either. On Clause 29(a) the Chief Secretary argued that the measure was for administrative convenience and would ensure that no one would suddenly find himself with a massive tax bill at the beginning of a financial year or on returning to work. He cannot put forward that argument now. In this instance, a person is not entitled to unemployment benefit. He will not be paid unemployment benefit, so he will not pay tax. There is no way in which an adjustment can be made at the end of the period during which he is on strike. It would mean that he would be paying tax instead of receiving a rebate. The clause should not be in the Finance Bill. It should be presented not by a Treasury Minister, but by the Department of Employment, because this is not about tax revenue and rebates; it is about trade union legislation.
      As my hon. Friend the Member for Walsall, North (Mr. Winnick) said, this is a way of hitting the striker. This is vindictiveness by the Government. They believe that strikes are wrong. As my hon. Friend said, strikes in Poland are all right, but the Government and their supporters do not believe they should take place in any circumstances in this country. Indeed, they will do everything possible to ensure that they do not take place, to the extent of stopping a person getting money to which he is entitled.
      The Chief Secretary cannot put forward the argument that he set out the last time round; he can argue this matter only on anti-trade union legislation grounds. He is trying to stop people going on strike. In an attempt to do that, he will stop them getting money to which they are entitled. I am not an expert on fiscal matters and I hope that the Chief Secretary will explain some of these points. The first part of the clause makes it clear who will not get rebates—namely, those who are
      "disqualified at the time from receiving unemployment benefit by virtue of section 19 of the Social Security Act 1975 or section 19 of the Social Security (Northern Ireland) Act 1975".
      But will the Chief Secretary explain what is meant by
      "or would be so disqualified if he otherwise satisfied the conditions for entitlement"?
      If people are disqualified on the first ground, on what other ground will they be disqualified as well?
      Who will be covered? Will those who have taken strike action be covered? will those who form part of a trade union which has called them out on strike be covered? If an employer locks out the whole work force—not just those who are in dispute—will those not in dispute be
      578
      disqualified from receiving a rebate? Some workers may be locked out by their employer as a result of a dispute between him and others of his work force.
      Will the right hon. and learned Gentleman tell me what is meant by
      "and such regulations may make different provision with respect to persons falling within paragraph (b) above from that made with respect to other persons"?
      What will the regulation say? I find this part unclear. I am not sure what is meant by it. It seems to give the Government the opportunity to introduce harsher measures against those who may be in dispute with their employers than is implied in this harsh clause.
      The Minister must give us some clear answers. I accept that the hour is late, but answers are required. We consider this to be part not of the Government's fiscal strategy and economic policy but of their vindictive campaign against the trade union movement.
      11 pm
      Mr. Brittan: The two amendments are not acceptable to the Government. The first amendment seeks to remove from the clause the power to provide regulations for tax refunds to be withheld from strikers until the end of the strike. The second, more narrowly phrased, amendment does not go as far but seeks to confine the right to withdraw tax refunds from those who claim benefit. I ask the Committee to reject them.
      The reason why refunds are to be deferred until the end of a strike is that that will align the treatment of strikers with that of the unemployed. Hon. Members have mentioned those who do not claim benefit. It is correct: that the rights of strikers should be broadly comparable with those of the unemployed.
      Mr. Ennals rose—
      Mr. Brittan: I shall answer the right hon. Gentleman, but I am sure that he wishes to hear what I have to say first.
      The majority of the unemployed claim that benefit and tax refunds will be withheld. In theory, it would be possible to withhold tax refunds only from strikers who are benefit claimants. However difficult it may be to accept, in practice that would be difficult to do if the group concerned were a minority. I do not accept that it is such a small minority as was suggested by the hon. Member for Edinburgh, Central (Mr. Cook), because his figures included short strikes. The more extended strikes are relevant because in a short strike a person probably would not be away from work long enough to qualify for a refund.
      Mr. Ennals: The Minister did not answer my question. Perhaps I am a little stupid in not understanding. If the industrial dispute goes on after the tax year, does the striker receive his refund at the end of the tax year or does he have to wait until the end of the industrial dispute?
      Mr. Brittan: As so often, one is reluctant to give way because one was about to speak about that subject. I shall answer that question. However, I should first say that if refunds are withheld only from strikers who claim benefit, the majority of strikers who do not claim benefit would be more favourably treated than the unemployed. I readily accept that that is the majority, although not the overwhelming majority as has been suggested. The relevant figure is about two-thirds. That is not a defensible proposition, and in the circumstances it is reasonable to withhold the refunds from strikers at large.

      579
      The right hon. Member for Norwich, North (Mr. Ennals) asked when the refund is to be made. We considered whether the same conditions should apply to strikers as to the unemployed—that a refund should be payable at the end of the tax year. We came to the conclusion that that is the right way to do it. We have decided that the right course in a trade dispute is for tax refunds to be withheld until the person has returned to work.
      Essentially, there are two reasons. First, unemployment is likely to be a much longer experience for many people than going on strike. There are long strikes. We can all mention them, and we all have views about their rights and wrongs. But there is no doubt that in today's conditions unemployment usually lasts longer. Moreover, if tax refunds to strikers were made in the middle of a strike merely because the tax year had ended, that would be arbitrary action that could not be justified. It would be at random, and it would provide an unwarranted incentive for some disputes to continue.
      Mr. Cryer: What will be the position of a single person, in receipt of no benefits, who is locked out in an industrial dispute, or as a consequence of an industrial dispute, because the production process has come to an end, but who is not on strike? Is he affected in exactly the same way as anyone who is directly on strike?
      Mr. Brittan: The matter is governed by section 19 of the Social Security Act 1975, which provides
      "A person who has lost employment … by reason of a stoppage of work … due to a trade dispute at his place of employment"
      will be covered by this provision. But that statute also provides that that does not apply to those who are
      "not participating in … or directly interested in the trade dispute".
      Exactly the same provision is being used for the purposes of the fiscal legislation.
      Mr. Cook: One or two of my hon. Friends, particularly my hon. Friend the Member for Walsall, North (Mr. Winnick), asked why the striker should be treated differently in respect of how long he must wait for his refund compared with the unemployed person. As my hon. Friend pointed out, the striker apparently is to be kept waiting until the end of the strike, whereas the unemployed person will receive his refund at the end of the period of unemployment or at the end of the tax year if it intervenes.
      Having listened to the Chief Secretary elaborate the view that there should be broad comparability between the treatment of the unemployed person and that of the striker, I should have expected him to accept my hon. Friend's contention that the striker should be on the same footing if the end of the tax year intervened. I entirely accept the Chief Secretary's point that the dates of the tax year are arbitrary, but we are familiar with the many occasions on which the end of the tax year and the start of a new one have that arbitrary effect.
      We provide in the statute that at the end of the tax year the taxpayer is entitled to an adjustment, and, as part of that adjustment, if a rebate is due he is entitled to receive it. The clause sets aside the Inland Revenue's obligation to make that payment to one group of people who have been singled out for special treatment. We cannot repeat
      580
      too often how, throughout these clauses, those who are party to industrial disputes are singled out. They are treated on a different basis from the unemployed, a basis that is special to strikers. It is not surprising that some Opposition hon. Members have formed the view that that special treatment does not reflect any underlying principle, which would surely argue the same treatment for other groups, but is pure, petty vindictiveness towards those involved in a strike.
      The clause does not say that the refund will be withheld until the end of the strike. We are advised that that will be its effect, because press notices have been issued. The press has been advised, even if it has not been included in the statute, that the regulations that will be laid under the clause will have that effect.
      We have still to see those regulations, and we shall have an opportunity to debate that matter when we consider a later amendment. But we shall want to express the view that Parliament should see those regulations before we complete the Report stage so that we at least are privy to the consultation which is to take place about those regulations.
      I see from the press notice that the consultation on the regulations will take place with "interested parties". I hope that a random sample of the unemployed and those on strike will be included among the interested parties, because some of the responses which the Chief Secretary may have to his consultation will be very interesting when they discover what is to be done to them.
      The right hon. and learned Gentleman picked me up on my reference to the percentage of strikers who have claimed supplementary benefit. The Committee will remember my pointing out that in 1979 a marvellous total of 1·1 per cent. of all strikers received supplementary benefit; in other words, 98·9 per cent. of all strikers did not. The Chief Secretary said that I exaggerated, and that he would come down to a figure of 33 per cent., although we are not quite sure, who claimed and obtained supplementary benefit, leaving 66 per cent. who did not. The basis on which he did that was by concentrating on longer strikes.
      As the Chief Secretary generously admitted, this is a matter of some speculation. For a start, it depends upon the definition of "longer strike" that is chosen. But let us waive any cavilling about how we define a long-term striker, and let us waive any speculation about whether the figure of one-third is too high or too low. Let us simply accept the figure. It leaves us with the conclusion that under the clause tax refunds will be withheld from 100 per cent. of those on strike, although on the right hon. and learned Gentleman's admission only 33 per cent. of them are receiving income which is taxable under the provisions of clause 27.
      That is scandalous. It is shameful. It is imposing a new burden, a new loss of right on the other 66 per cent. who are not receiving taxable income. Under the clause they will have removed from them their right to have the tax refund in respect of the preceding month to which they have been entitled hitherto.
      There are numbers of people who cannot claim supplementary benefit when on strike, even if they wish to do so. There are single people, who will be deprived of the sole source of income to which they have been entitled hitherto. The Chief Secretary said that the reason why they had to be deprived of that right and the reason why the 66

      581
      per cent. who were not claiming benefit would have their refunds withheld was to put them on the same footing as the unemployed.
      With respect, that is not the case. Under paragraph (a), only the unemployed person who
      "has claimed unemployment benefit or a payment of supplementary allowance."
      will be affected. In other words, there may be unemployed people who may not make a claim for unemployment benefit or supplementary allowance, and in those circumstances para (a) does not bite and they are entitled to their refunds. The Inland Revenue has no power under para (a) to withhold their refunds. But that will not be the case with a striker. The 66 per cent. who will not, or who cannot find their way through the regulations to claim their supplementary benefit will have their tax refunds withheld. The option is not extended to them in the way that it is to the unemployed.
      If the Chief Secretary is anxious to put both classes on the same footing, in logic he is bound to accept amendment No. 31, which limits the scope of clause 29 to those who come within the scope of clause 27. But the Chief Secretary says that he will not do that and, to be honest, I do not expect him to. As my hon. Friend the Member for Glasgow, Cathcart (Mr. Maxton) said, the reality is that what we are discussing has nothing to do with tax policy. This proposal is not made out of any high consideration of fiscal policy, nor is it made out of any consideration of the necessity to raise revenue for the Government.
      The measure is brought before us as part of a sustained programme by the Government to try to shift the bargaining strength from workers to management and to try to weaken the power of labour so as to strike a bargain with management. That is its purpose. It is part of the Government's policy to run up a large reserve army of unemployed people to undercut the bargaining strength of those who have managed to remain in work, even under this Government.
      11.15 pm
      We find the principle of such an approach repugnant. We find the tactics short-term and short-sighted. The Chief Secretary complained of the mood of bitterness ain this debate—a mood which reflects the bitterness outside the Committee. Nothing is more likely to encourage that bitterness than this type of tactic, which can only backfire on those who invented it. The Committee has a duty to try to protect the wives and children of strikers who will be denied refunds under the provision. Perhaps we should try, too, to protect the Chief Secretary from their anger by voting for amendment No. 30.
      Question put, That the amendment be made: —
      The Committee Divided: Ayes 216, Noes 275.

      Division No. 176]

      [10.18 pm

      AYES

      Abse, Leo

      Ashton, Joe

      Adams, Allen

      Atkinson, N.(H'gey,)

      Allaun, Frank

      Bagier, Gordon A.T.

      Alton, David

      Barnett, Guy (Greenwich)

      Anderson, Donald

      Barnett, Rt Hon Joel (H'wd)

      Archer, Rt Hon Peter

      Benn, Rt Hon A. Wedgwood

      Ashley, Rt Hon Jack

      Bennett, Andrew(St'kp't N)

      569

      Bidwell, Sydney

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

      Booth, Rt Hon Albert

      Homewood, William

      Boothroyd, Miss Betty

      Hooley, Frank

      Bray, Dr Jeremy

      Horam, John

      Brocklebank-Fowler, C.

      Howell, Rt Hon D.

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

      Howells, Geraint

      Brown, Ron (E'burgh, Leith)

      Hudson Davies, Gwilym E.

      Buchan, Norman

      Hughes, Mark (Durham)

      Callaghan, Rt Hon J.

      Hughes, Robert (Aberdeen N)

      Callaghan, Jim (Midd't'n & P)

      Hughes, Roy (Newport)

      Campbell, Ian

      Janner, Hon Greville

      Campbell-Savours, Dale

      Jay, Rt Hon Douglas

      Canavan, Dennis

      John, Brynmor

      Cant, R. B.

      Johnson, James (Hull West)

      Carmichael, Neil

      Johnston, Russell (Inverness)

      Carter-Jones, Lewis

      Jones, Rt Hon Alec (Rh'dda)

      Clark, Dr David (S Shields)

      Jones, Barry (East Flint)

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

      Jones, Dan (Burnley)

      Concannon, Rt Hon J. D.

      Kaufman, Rt Hon Gerald

      Cook, Robin F.

      Kerr, Russell

      Cowans, Harry

      Kilroy-Silk, Robert

      Craigen, J. M.

      Kinnock, Neil

      Crowther, J. S.

      Lambie, David

      Cryer, Bob

      Lamborn, Harry

      Cunliffe, Lawrence

      Leadbitter, Ted

      Cunningham, G. (Islington S)

      Leighton, Ronald

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

      Lestor, Miss Joan

      Dalyell, Tam

      Lewis, Arthur (N'ham NW)

      Davidson, Arthur

      Litherland, Robert

      Davies, Ifor (Gower)

      Lyon, Alexander (York)

      Davis, Clinton (Hackney C)

      Lyons, Edward (Bradf'd W)

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

      Mabon, Rt Hon Dr J. Dickson

      Deakins, Eric

      McCartney, Hugh

      Dean, Joseph (Leeds West)

      McElhone, Frank

      Dempsey, James

      McKelvey, William

      Dewar, Donald

      MacKenzie, Rt Hon Gregor

      Dixon, Donald

      McMahon, Andrew

      Dobson, Frank

      McNally, Thomas

      Dormand, Jack

      McNamara, Kevin

      Douglas-Mann, Bruce

      McWilliam, John

      Dubs, Alfred

      Magee, Bryan

      Duffy, A. E. P.

      Marks, Kenneth

      Dunn, James A.

      Marshall, D(G'gow S'ton)

      Dunnett, Jack

      Marshall, Dr Edmund (Goole)

      Dunwoody, Hon Mrs G.

      Marshall, Jim (Leicester S)

      Eadie, Alex

      Martin, M(G'gow S'burn)

      Eastham, Ken

      Mason, Rt Hon Roy

      Ellis, R. (NE D'bysh're)

      Maxton, John

      English, Michael

      Maynard, Miss Joan

      Ennals, Rt Hon David

      Mellish, Rt Hon Robert

      Evans, Ioan (Aberdare)

      Mikardo, Ian

      Evans, John (Newton)

      Millan, Rt Hon Bruce

      Ewing, Harry

      Mitchell, Austin (Grimsby)

      Faulds, Andrew

      Mitchell, R. C. (Soton Itchen)

      Field, Frank

      Morris, Rt Hon A. (W'shawe)

      Fitch, Alan

      Morris, Rt Hon C. (O'shaw)

      Flannery, Martin

      Morris, Rt Hon J. (Aberavon)

      Fletcher, Ted (Darlington)

      Morton, George

      Foot, Rt Hon Michael

      Newens, Stanley

      Ford, Ben

      Oakes, Rt Hon Gordon

      Forrester, John

      Ogden, Eric

      Foster, Derek

      O'Halloran, Michael

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

      O'Neill, Martin

      Freeson, Rt Hon Reginald

      Orme, Rt Hon Stanley

      Garrett, John (Norwich S)

      Palmer, Arthur

      George, Bruce

      Parry, Robert

      Gilbert, Rt Hon Dr John

      Prescott, John

      Ginsburg, David

      Price, C. (Lewisham W)

      Graham, Ted

      Race, Reg

      Grant, George (Morpeth)

      Radice, Giles

      Grimond, Rt Hon J.

      Rees, Rt Hon M (Leeds S)

      Hamilton, James (Bothwell)

      Richardson, Jo

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

      Roberts, Albert (Normanton)

      Harrison, Rt Hon Walter

      Roberts, Allan (Bootle)

      Hart, Rt Hon Dame Judith

      Roberts, Ernest (Hackney N)

      Hattersley, Rt Hon Roy

      Roberts, Gwilym (Cannock)

      Haynes, Frank

      Robertson, George

      Healey, Rt Hon Denis

      Robinson, G. (Coventry NW)

      Heffer, Eric S.

      Rooker, J. W.

      Hogg, N. (E Dunb't'nshire)

      Ross, Ernest (Dundee West)

      570

      Ross, Stephen (Isle of Wight)

      Tinn, James

      Rowlands, Ted

      Torney, Tom

      Ryman, John

      Wainwright, E.(Dearne V)

      Sever, John

      Wainwright, R.(Colne V)

      Sheerman, Barry

      Walker, Rt Hon H.(D'caster)

      Sheldon, Rt Hon R.

      Watkins, David

      Shore, Rt Hon Peter

      Weetch, Ken

      Short, Mrs Renée

      Wellbeloved, James

      Silkin, Rt Hon J. (Deptford)

      Welsh, Michael

      Silkin, Rt Hon S. C. (Dulwich)

      White, Frank R.

      Skinner, Dennis

      White, J. (G'gow Pollok)

      Smith, Rt Hon J. (N Lanark)

      Whitlock, William

      Snape, Peter

      Wigley, Dafydd

      Soley, Clive

      Willey, Rt Hon Frederick

      Spearing, Nigel

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

      Spriggs, Leslie

      Wilson, Rt Hon Sir H.(H'ton)

      Stallard, A. W.

      Wilson, William (C'try SE)

      Stewart, Rt Hon D. (W Isles)

      Winnick, David

      Stoddart, David

      Woodall, Alec

      Stott, Roger

      Woolmer, Kenneth

      Straw, Jack

      Wright, Sheila

      Summerskill, Hon Dr Shirley

      Young, David (Bolton E)

      Thomas, Dafydd (Merioneth)

      Thomas, Jeffrey (Abertillery)

      Tellers for the Ayes:

      Thomas, Dr R.(Carmarthen)

      Mr. Donald Coleman and Mr. Allen McKay.

      Thorne, Stan (Preston South)

      Tilley, John

      NOES

      Adley, Robert

      Cockeram, Eric

      Aitken, Jonathan

      Colvin, Michael

      Alexander, Richard

      Cope, John

      Alison, Michael

      Corrie, John

      Amery, Rt Hon Julian

      Cranborne, Viscount

      Ancram, Michael

      Critchley, Julian

      Aspinwall, Jack

      Crouch, David

      Atkins, Robert(Preston N)

      Dean, Paul (North Somerset)

      Baker, Kenneth(St.M'bone)

      Dickens, Geoffrey

      Baker, Nicholas (N Dorset)

      Dorrell, Stephen

      Banks, Robert

      Dover, Denshore

      Bell, Sir Ronald

      du Cann, Rt Hon Edward

      Bendall, Vivian

      Dunn, Robert (Dartford)

      Benyon, Thomas (A'don)

      Dykes, Hugh

      Benyon, W. (Buckingham)

      Eden, Rt Hon Sir John

      Berry, Hon Anthony

      Edwards, Rt Hon N. (P'broke)

      Best, Keith

      Eggar, Tim

      Bevan, David Gilroy

      Elliott, Sir William

      Biggs-Davison, John

      Emery, Peter

      Blackburn, John

      Eyre, Reginald

      Blaker, Peter

      Fairgrieve, Russell

      Body, Richard

      Faith, Mrs Sheila

      Bonsor, Sir Nicholas

      Fell, Anthony

      Boscawen, Hon Robert

      Fenner, Mrs Peggy

      Boyson, Dr Rhodes

      Fisher, Sir Nigel

      Braine, Sir Bernard

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

      Bright, Graham

      Fletcher-Cooke, Sir Charles

      Brinton, Tim

      Fookes, Miss Janet

      Brittan, Leon

      Forman, Nigel

      Brooke, Hon Peter

      Fowler, Rt Hon Norman

      Brotherton, Michael

      Fox, Marcus

      Brown, Michael(Brigg & Sc'n)

      Fraser, Rt Hon Sir Hugh

      Browne, John (Winchester)

      Fraser, Peter (South Angus)

      Bruce-Gardyne, John

      Fry, Peter

      Bryan, Sir Paul

      Gardiner, George (Reigate)

      Buchanan-Smith, Alick

      Gardner, Edward (S Fylde)

      Buck, Antony

      Garel-Jones, Tristan

      Budgen, Nick

      Gilmour, Rt Hon Sir Ian

      Bulmer, Esmond

      Glyn, Dr Alan

      Burden, Sir Frederick

      Goodlad, Alastair

      Butcher, John

      Gow, Ian

      Cadbury, Jocelyn

      Gower, Sir Raymond

      Carlisle, John (Luton West)

      Gray, Hamish

      Carlisle, Kenneth (Lincoln)

      Greenway, Harry

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

      Griffiths, E.(B'y St. Edm'ds)

      Chalker, Mrs. Lynda

      Griffiths, Peter Portsm'th N)

      Churchill, W. S.

      Grist, Ian

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

      Grylls, Michael

      Clark, Sir W. (Croydon S)

      Hamilton, Hon A.

      Clarke, Kenneth (Rushcliffe)

      Hamilton, Michael (Salisbury)

      Clegg, Sir Walter

      Hampson, Dr Keith

      571

      Hannam, John

      McNair-Wilson, P. (New F'st)

      Haselhurst, Alan

      McQuarrie, Albert

      Hastings, Stephen

      Madel, David

      Hawksley, Warren

      Major, John

      Hayhoe, Barney

      Marland, Paul

      Heddle, John

      Marlow, Tony

      Henderson, Barry

      Marshall, Michael (Arundel)

      Heseltine, Rt Hon Michael

      Maude, Rt Hon Sir Angus

      Hicks, Robert

      Mawby, Ray

      Higgins, Rt Hon Terence L

      Mawhinney, Dr Brian

      Holland, Philip (Carlton)

      Maxwell-Hyslop, Robin

      Hooson, Tom

      Mayhew, Patrick

      Hordern, Peter

      Mellor, David

      Howell, Rt Hon D. (G'ldf'd)

      Meyer, Sir Anthony

      Hunt, David (Wirral)

      Miller, Hal (B'grove)

      Hunt, John (Ravensbourne)

      Mills, lain (Meriden)

      Hurd, Hon Douglas

      Mills, Peter (West Devon)

      Jenkin, Rt Hon Patrick

      Miscampbell, Norman

      Johnson Smith, Geoffrey

      Moate, Roger

      Jopling, Rt Hon Michael

      Molyneaux, James

      Kaberry, Sir Donald

      Monro, Hector

      Kellett-Bowman, Mrs Elaine

      Montgomery, Fergus

      Kimball, Marcus

      Moore, John

      King, Rt Hon Tom

      Morris, M. (N'hampton S)

      Kitson, Sir Timothy

      Morrison, Hon C. (Devizes)

      Knox, David

      Morrison, Hon P. (Chester)

      Lamont, Norman

      Mudd, David

      Lang, Ian

      Murphy, Christopher

      Langford-Holt, Sir John

      Myles, David

      Latham, Michael

      Neale, Gerrard

      Lawrence, Ivan

      Needham, Richard

      Lawson, Rt Hon Nigel

      Nelson, Anthony

      Lee, John

      Neubert, Michael

      Le Marchant, Spencer

      Newton, Tony

      Lennox-Boyd, Hon Mark

      Normanton, Tom

      Lloyd, Ian (Havant & W'loo)

      Onslow, Cranley

      Lloyd, Peter (Fareham)

      Page, Rt Hon Sir G. (Crosby)

      Loveridge, John

      Page, Richard (SW Herts)

      Luce, Richard

      Parkinson, Cecil

      Lyell, Nicholas

      Parris, Matthew

      McCrindle, Robert

      Patten, Christopher (Bath)

      Macfarlane, Neil

      Patten, John (Oxford)

      MacGregor, John

      Pattie, Geoffrey

      MacKay, John (Argyll)

      Pawsey, James

      Macmillan, Rt Hon M.

      Peyton, Rt Hon John

      McNair-Wilson, M. (N'bury)

      Pink, R. Bonner

      Porter, Barry

      Stokes, John

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

      Stradling Thomas, J.

      Prentice, Rt Hon Reg

      Tapsell, Peter

      Price, Sir David (Eastleigh)

      Taylor, Robert (Croydon NW)

      Prior, Rt Hon James

      Taylor, Teddy (S'end E)

      Proctor, K. Harvey

      Tebbit, Norman

      Pym, Rt Hon Francis

      Temple-Morris, Peter

      Raison, Timothy

      Thomas, Rt Hon Peter

      Rathbone, Tim

      Thompson, Donald

      Rees-Davies, W. R.

      Thorne, Neil (Ilord South)

      Renton, Tim

      Thornton, Malcolm

      Rhodes James, Robert

      Townend, John (Bridlington)

      Rhys Williams, Sir Brandon

      Trippier, David

      Ridley, Hon Nicholas

      Trotter, Neville

      Ridsdale, Sir Julian

      van Straubenzee, W. R.

      Rifkind, Malcolm

      Vaughan, Dr Gerard

      Rippon, Rt Hon Geoffrey

      Viggers, Peter

      Roberts, M. (Cardiff NW)

      Waddington, David

      Roberts, Wyn (Conway)

      Wakeham, John

      Rossi, Hugh

      Waldegrave, Hon William

      Rost, Peter

      Walker, B. (Perth)

      Royle, Sir Anthony

      Walker-Smith, Rt Hon Sir D.

      Sainsbury, Hon Timothy

      Wall, Patrick

      Scott, Nicholas

      Waller, Gary

      Shaw, Michael (Scarborough)

      Walters, Dennis

      Shelton, William (Streatham)

      Ward, John

      Shepherd, Colin (Hereford)

      Warren, Kenneth

      Shepherd, Richard

      Watson, John

      Shersby, Michael

      Wells, John (Maidstone)

      Silvester, Fred

      Wells, Bowen

      Sims, Roger

      Wheeler, John

      Skeet, T. H. H.

      Whitelaw, Rt Hon William

      Speed, Keith

      Whitney, Raymond

      Speller, Tony

      Wickenden, Keith

      Spicer, Jim (West Dorset)

      Williams, D.(Montgomery)

      Spicer, Michael (S Worcs)

      Winterton, Nicholas

      Sproat, Iain

      Wolfson, Mark

      Squire, Robin

      Young, Sir George (Acton)

      Stanbrook, Ivor

      Younger, Rt Hon George

      Stanley, John

      Steen, Anthony

      Tellers for the Noes:

      Stevens, Martin

      Mr. Carol Mather and Lord James Douglas-

      Stewart, Ian (Hitchin)

      Stewart, A.(E Renfrewshire)

      Hamilton.

      Division No. 177]

      [11.16 pm

      AYES

      Abse, Leo

      Bennett, Andrew (St'kp't N)

      Adams, Allen

      Bidwell, Sydney

      Allaun, Frank

      Booth, Rt Hon Albert

      Alton, David

      Boothroyd, Miss Betty

      Anderson, Donald

      Bray, Dr Jeremy

      Archer, Rt Hon Peter

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

      Ashley, Rt Hon Jack

      Brown, Ron (E'burgh, Leith)

      Ashton, Joe

      Buchan, Norman

      Atkinson, N.(H'gey,)

      Callaghan, Rt Hon J.

      Bagier, Gordon A.T.

      Callaghan, Jim (Midd't'n & P)

      Barnett, Guy (Greenwich)

      Campbell, Ian

      Barnett, Rt Hon Joel (H'wd)

      Campbell-Savours, Dale

      Benn, Rt Hon A. Wedgwood

      Canavan, Dennis

      582

      Cant, R. B.

      Johnston, Russell (Inverness)

      Carmichael, Neil

      Jones, Rt Hon Alec (Rh'dda)

      Carter-Jones, Lewis

      Jones, Barry (East Flint)

      Clark, Dr David (S Shields)

      Jones, Dan (Burnley)

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

      Kaufman, Rt Hon Gerald

      Coleman, Donald

      Kerr, Russell

      Concannon, Rt Hon J. D.

      Kilroy-Silk, Robert

      Conlan, Bernard

      Kinnock, Neil

      Cook, Robin F.

      Lambie, David

      Cowans, Harry

      Leadbitter, Ted

      Craigen, J. M.

      Leighton, Ronald

      Crowther, J. S.

      Lestor, Miss Joan

      Cryer, Bob

      Lewis, Arthur (N'ham NW)

      Cunliffe, Lawrence

      Litherland, Robert

      Cunningham, G. (Islington S)

      Lyon, Alexander (York)

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

      McCartney, Hugh

      Dalyell, Tam

      McElhone, Frank

      Davidson, Arthur

      McKay, Allen (Penistone)

      Davies, Rt Hon Denzil (L'lli)

      McKelvey, William

      Davies, Ifor (Gower)

      MacKenzie, Rt Hon Gregor

      Davis, Clinton (Hackney C)

      McNally, Thomas

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

      McNamara, Kevin

      Deakins, Eric

      McWilliam, John

      Dempsey, James

      Magee, Bryan

      Dewar, Donald

      Marks, Kenneth

      Dixon, Donald

      Marshall, D(G'gow S'ton)

      Dobson, Frank

      Marshall, Dr Edmund (Goole)

      Dormand, Jack

      Marshall, Jim (Leicester S)

      Douglas-Mann, Bruce

      Martin, M(G'gow S'burn)

      Dubs, Alfred

      Mason, Rt Hon Roy

      Duffy, A. E. P.

      Maxton, John

      Dunn, James A.

      Maynard, Miss Joan

      Dunnett, Jack

      Meacher, Michael

      Dunwoody, Hon Mrs G.

      Mikardo, Ian

      Eadie, Alex

      Millan, Rt Hon Bruce

      Eastham, Ken

      Mitchell, Austin (Grimsby)

      Ellis, R. (NE D'bysh're)

      Mitchell, R. C. (Soton Itchen)

      English, Michael

      Morris, Rt Hon A. (W'shawe)

      Ennals, Rt Hon David

      Morris, Rt Hon C. (O'shaw)

      Evans, Ioan (Aberdare)

      Morris, Rt Hon J. (Aberavon)

      Evans, John (Newton)

      Morton, George

      Ewing, Harry

      Newens, Stanley

      Faulds, Andrew

      Oakes, Rt Hon Gordon

      Field, Frank

      Ogden, Eric

      Fitch, Alan

      O'Halloran, Michael

      Flannery, Martin

      O'Neill, Martin

      Fletcher, Ted (Darlington)

      Orme, Rt Hon Stanley

      Foot, Rt Hon Michael

      Palmer, Arthur

      Ford, Ben

      Parry, Robert

      Forrester, John

      Prescott, John

      Foster, Derek

      Price, C. (Lewisham W)

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

      Race, Reg

      Freeson, Rt Hon Reginald

      Radice, Giles

      Freud, Clement

      Rees, Rt Hon M (Leeds S)

      Garrett, John (Norwich S)

      Richardson, Jo

      George, Bruce

      Roberts, Albert (Normanton)

      Gilbert, Rt Hon Dr John

      Roberts, Allan (Bootle)

      Ginsburg, David

      Roberts, Ernest (Hackney N)

      Graham, Ted

      Roberts, Gwilym (Cannock)

      Grant, George (Morpeth)

      Robertson, George

      Hamilton, James (Bothwell)

      Robinson, G. (Coventry NW)

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

      Rooker, J. W.

      Harrison, Rt Hon Walter

      Ross, Stephen (Isle of Wight)

      Hart, Rt Hon Dame Judith

      Rowlands, Ted

      Healey, Rt Hon Denis

      Ryman, John

      Heffer, Eric S.

      Sever, John

      Hogg, N. (E Dunb't'nshire)

      Sheerman, Barry

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

      Sheldon, Rt Hon R.

      Homewood, William

      Shore, Rt Hon Peter

      Hooley, Frank

      Short, Mrs Renée

      Howell, Rt Hon D.

      Silkin, Rt Hon J. (Deptford)

      Howells, Geraint

      Skinner, Dennis

      Hudson Davies, Gwilym E.

      Smith, Rt Hon J. (N Lanark)

      Hughes, Mark (Durham)

      Snape, Peter

      Hughes, Robert (Aberdeen N)

      Soley, Clive

      Hughes, Roy (Newport)

      Spearing, Nigel

      Janner, Hon Greville

      Spriggs, Leslie

      Jay, Rt Hon Douglas

      Stallard, A. W.

      John, Brynmor

      Steel, Rt Hon David

      Johnson, James (Hull West)

      Stewart, Rt Hon D. (W Isles)

      583

      Stoddart, David

      Welsh, Michael

      Stott, Roger

      White, Frank R.

      Straw, Jack

      White, J. (G'gow Pollok)

      Summerskill, Hon Dr Shirley

      Whitlock, William

      Thomas, Dafydd (Merioneth)

      Wigley, Dafydd

      Thomas, Jeffrey (Abertillery)

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

      Thomas, Dr R.(Carmarthen)

      Wilson, Rt Hon Sir H.(H'ton)

      Thorne, Stan (Preston South)

      Wilson, William (C'try SE)

      Tilley, John

      Winnick, David

      Tinn, James

      Woodall, Alec

      Torney, Tom

      Woolmer, Kenneth

      Wainwright, E.(Dearne V)

      Wright, Sheila

      Wainwright, R.(Colne V)

      Young, David (Bolton E)

      Walker, Rt Hon H.(D'caster)

      Watkins, David

      Tellers for the Ayes:

      Weetch, Ken

      Mr. Joseph Dean and Mr. Frank Haynes.

      Wellbeloved, James

      NOES

      Adley, Robert

      Dunn, Robert (Dartford)

      Aitken, Jonathan

      Dykes, Hugh

      Alexander, Richard

      Eden, Rt Hon Sir John

      Alison, Michael

      Edwards, Rt Hon N. (P'broke)

      Amery, Rt Hon Julian

      Eggar, Tim

      Ancram, Michael

      Elliott, Sir William

      Aspinwall, Jack

      Emery, Peter

      Atkins, Robert(Preston N)

      Eyre, Reginald

      Baker, Kenneth (St.M'bone)

      Fairgrieve, Russell

      Baker, Nicholas (N Dorset)

      Faith, Mrs Sheila

      Banks, Robert

      Fell, Anthony

      Bendall, Vivian

      Fenner, Mrs Peggy

      Benyon, Thomas (A'don)

      Fisher, Sir Nigel

      Benyon, W. (Buckingham)

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

      Berry, Hon Anthony

      Fletcher-Cooke, Sir Charles

      Best, Keith

      Fookes, Miss Janet

      Bevan, David Gilroy

      Forman, Nigel

      Biggs-Davison, John

      Fowler, Rt Hon Norman

      Blackburn, John

      Fox, Marcus

      Blaker, Peter

      Fraser, Peter (South Angus)

      Body, Richard

      Gardiner, George (Reigate)

      Bonsor, Sir Nicholas

      Gardner, Edward (S Fylde)

      Boscawen, Hon Robert

      Garel-Jones, Tristan

      Boyson, Dr Rhodes

      Gilmour, Rt Hon Sir Ian

      Braine, Sir Bernard

      Glyn, Dr Alan

      Bright, Graham

      Goodlad, Alastair

      Brinton, Tim

      Gow, Ian

      Brittan, Leon

      Gower, Sir Raymond

      Brotherton, Michael

      Gray, Hamish

      Brown, Michael(Brigg & Sc'n)

      Greenway, Harry

      Browne, John (Winchester)

      Griffiths, E.(B'y St. Edm'ds)

      Bruce-Gardyne, John

      Griffiths, Peter Portsm'th N)

      Bryan, Sir Paul

      Grist, Ian

      Buchanan-Smith, Alick

      Grylls, Michael

      Buck, Antony

      Hamilton, Hon A.

      Budgen, Nick

      Hamilton, Michael (Salisbury)

      Bulmer, Esmond

      Hampson, Dr Keith

      Burden, Sir Frederick

      Hannam, John

      Butcher, John

      Haselhurst, Alan

      Cadbury, Jocelyn

      Hastings, Stephen

      Carlisle, John (Luton West)

      Hawksley, Warren

      Carlisle, Kenneth (Lincoln)

      Hayhoe, Barney

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

      Heddle, John

      Chalker, Mrs. Lynda

      Henderson, Barry

      Channon, Rt. Hon. Paul

      Heseltine, Rt Hon Michael

      Churchill, W. S.

      Hicks, Robert

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

      Higgins, Rt Hon Terence L.

      Clark, Sir W. (Croydon S)

      Holland, Philip (Carlton)

      Clarke, Kenneth (Rushcliffe)

      Hooson, Tom

      Clegg, Sir Walter

      Hordern, Peter

      Cockeram, Eric

      Howell, Rt Hon D. (G'ldf'd)

      Colvin, Michael

      Hunt, David (Wirral)

      Cope, John

      Hunt, John (Ravensbourne)

      Corrie, John

      Hurd, Hon Douglas

      Cranborne, Viscount

      Jenkin, Rt Hon Patrick

      Crouch, David

      Johnson Smith, Geoffrey

      Dean, Paul (North Somerset)

      Jopling, Rt Hon Michael

      Dickens, Geoffrey

      Kaberry, Sir Donald

      Dorrell, Stephen

      Kellett-Bowman, Mrs Elaine

      Dover, Denshore

      Kimball, Marcus

      du Cann, Rt Hon Edward

      King, Rt Hon Tom

      584

      Kitson, Sir Timothy

      Rees-Davies, W. R.

      Knox, David

      Renton, Tim

      Lamont, Norman

      Rhodes James, Robert

      Lang, Ian

      Rhys Williams, Sir Brandon

      Langford-Holt, Sir John

      Ridley, Hon Nicholas

      Latham, Michael

      Ridsdale, Sir Julian

      Lawrence, Ivan

      Rifkind, Malcolm

      Lawson, Rt Hon Nigel

      Rippon, Rt Hon Geoffrey

      Lee, John

      Roberts, M. (Cardiff NW)

      Le Marchant, Spencer

      Roberts, Wyn (Conway)

      Lennox-Boyd, Hon Mark

      Rossi, Hugh

      Lloyd, Ian (Havant & W'loo)

      Rost, Peter

      Lloyd, Peter (Fareham)

      Royle, Sir Anthony

      Loveridge, John

      Sainsbury, Hon Timothy

      Luce, Richard

      Scott, Nicholas

      Lyell, Nicholas

      Shaw, Giles (Pudsey)

      McCrindle, Robert

      Shaw, Michael (Scarborough)

      Macfarlane, Neil

      Shelton, William (Streatham)

      MacGregor, John

      Shepherd, Colin (Hereford)

      MacKay, John (Argyll)

      Shepherd, Richard

      Macmillan, Rt Hon M.

      Shersby, Michael

      McNair-Wilson, M. (N'bury)

      Silvester, Fred

      McNair-Wilson, P. (New F'st)

      Sims, Roger

      McQuarrie, Albert

      Skeet, T. H. H.

      Madel, David

      Speed, Keith

      Major, John

      Speller, Tony

      Marks, Kenneth

      Spicer, Jim (West Dorset)

      Marland, Paul

      Spicer, Michael (S Worcs)

      Marlow, Tony

      Sproat, Iain

      Marshall, Michael (Arundel)

      Squire, Robin

      Mather, Carol

      Stanbrook, Ivor

      Maude, Rt Hon Sir Angus

      Stanley, John

      Mawby, Ray

      Steen, Anthony

      Mawhinney, Dr Brian

      Stevens, Martin

      Maxwell-Hyslop, Robin

      Stewart, Ian (Hitchin)

      Mayhew, Patrick

      Stewart, A.(E Renfrewshire)

      Mellor, David

      Stokes, John

      Meyer, Sir Anthony

      Stradling Thomas, J.

      Miller, Hal (B'grove)

      Tapsell, Peter

      Mills, Iain (Meriden)

      Taylor, Robert (Croydon NW)

      Mills, Peter (West Devon)

      Taylor, Teddy (S'end E)

      Miscampbell, Norman

      Tebbit, Norman

      Moate, Roger

      Temple-Morris, Peter

      Molyneaux, James

      Thomas, Rt Hon Peter

      Monro, Hector

      Thompson, Donald

      Montgomery, Fergus

      Thorne, Neil (Ilford South)

      Moore, John

      Thornton, Malcolm

      Morris, M. (N'hampton S)

      Townend, John (Bridlington)

      Morrison, Hon C. (Devizes)

      Trippier, David

      Morrison, Hon P. (Chester)

      Trotter, Neville

      Mudd, David

      van Straubenzee, W. R.

      Murphy, Christopher

      Vaughan, Dr Gerard

      Myles, David

      Viggers, Peter

      Neale, Gerrard

      Waddington, David

      Needham, Richard

      Wakeham,John

      Nelson, Anthony

      Waldegrave, Hon William

      Neubert, Michael

      Walker, B. (Perth)

      Newton, Tony

      Walker-Smith, Rt Hon Sir D.

      Normanton, Tom

      Wall, Patrick

      Onslow, Cranley

      Waller, Gary

      Page, Rt Hon Sir G. (Crosby)

      Walters, Dennis

      Page, Richard (SW Herts)

      Ward, John

      Parkinson, Cecil

      Warren, Kenneth

      Parris, Matthew

      Watson, John

      Patten, Christopher (Bath)

      Wells, John (Maidstone)

      Patten, John (Oxford)

      Wells, Bowen

      Pattie, Geoffrey

      Wheeler, John

      Pawsey, James

      Whitelaw, Rt Hon William

      Peyton, Rt Hon John

      Whitney, Raymond

      Pink, R. Bonner

      Wickenden, Keith

      Porter, Barry

      Williams, D.(Montgomery)

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

      Winterton, Nicholas

      Price, Sir David (Eastleigh)

      Wolfson, Mark

      Prior, Rt Hon James

      Young, Sir George (Acton)

      Proctor, K. Harvey

      Younger, Rt Hon George

      Pym, Rt Hon Francis

      Raison, Timothy

      Tellers for the Noes:

      Rathbone, Tim

      Lord James Douglas-Hamilton and Mr. Peter Brooke.

      Rees, Peter (Dover and Deal)

      Question accordingly negatived
      Mr. Robert Sheldon: I beg to move amendment No. 32, in page 19, line 5, after 'regulations', insert
      'which, without prejudice to the generality of section 204 of the Income and Corporation Taxes Act 1970, shall be subject to an affirmative resolution of the House of Commons'.
      Under the clause, regulations can be introduced dealing with the details of how refunds to strikers will not be made. The regulations will deal with the withholding of taxpayers' money, as we have discussed in previous debates. The unemployed will lose a certain amount of income but will gain something from the benefit side of the equation. The strikers will gain nothing. That is a penal use of taxation. Strikers will lose their refunds when they need their money most. Their commitments do not usually stop when their income stops. Their income will not increase again until they return to work and can pay for the continuing commitments.
      Those matters have been the subject of discussion during the day. We are now debating whether the regulations should be made in an affirmative or negative manner. They should be the subject of a schedule so that they can be properly discussed and examined. We shall require to have a much closer understanding of the regulations. If they are not in final form, we shall need to share in some of the thinking that will lie behind them. That will be necessary before we accept this part of the legislation in Standing Committee. There will be plenty of time for debate at that stage.
      11.30 pm
      Mr. Cryer: The amendment adds the requirement that the regulations under the clause shall be made by affirmative resolution rather than by the negative procedure, which I assume is that involved in the legislation mentioned in section 204 of the Taxes Act.
      My right hon. Friend the Member for Ashton-under-Lyne (Mr. Sheldon) has mentioned the onerous nature of the proposed legislation—namely, that the unemployed will not have their tax rebates returned to them as at present. Strikers are placed in a much worse position than others. Contrary to the claims of many of the daily newspapers which play a subservient role to Conservative Central Office, they receive no benefit. Therefore, there will be some who will be dependent entirely on tax rebates for any form of sustenance. Single persons will have no other income. They have no dependants and there will be no income to share. They will be devoid of income.
      The governing of payment is to be laid down in regulation. It would be far more desirable if the method of payment were laid down in a schedule to the Bill. Parliament's function is to pass primary legislation. The clause contains such important and unusual provisions, including an element of punitive legislation against strikers, that the matter should not be left to regulations.
      Where the House of Commons agrees to regulations —as we know, the Government have a majority and they can get the clause through the House—it should insist that they are subject to the affirmative procedure and not the negative procedure. I hope that the Minister will assure us that the Government will undertake that procedure.
      Workpeople have the strength to equal the power of the employer only through combination. Workpeople do not want to go on strike, because that is an action that involves sacrifices. However, they are sometimes faced with no
      586
      alternative if they are to obtain negotiating rights or a proper understanding of reasonable wage or working conditions claims. Therefore, it is important that this attack on strikers is dealt with by Parliament. It should not be managed by the antique backstairs method of delegated legislation that is undertaken by the House of Commons.
      Far too much of our legislation is subject to the negative procedure. We all know that if a prayer is set down against a statutory instrument it is rarely, if ever, debated unless it is supported by the Front Bench. Only one and a half hours is available in any case, and, whichever procedure is used, instruments cannot be changed. That is most unsatisfactory: one must have the instrument or nothing.
      Therefore, the proposal for the affirmative procedure is a democratic improvement. Whether one agrees with clause 29 or not, even some Conservative Members might just conceivably have a vague aspiration towards sustaining the democratic processes. In that case, they might have considered the general desirability of using the affirmative rather than the negative procedure wherever possible.
      To us, the powers in clause 29 are particularly onerous. They are an attack on the unemployed and on strikers. We know that that is what the Government are about, that they do not much care about the unemployed, that they do not mind burdening them and that they are only too delighted to attack strikers. But the amendment is not about he merits of the clause—[Interruption.] I understand that the hon. Member has difficulty in stretching his mind this far, but if he could devote lengthy study to reading the clause he would see that it affects both categories.
      Apart from the merits of these powers, the amendment seeks simply to give the House a better opportunity of debating the method of implementing it. That is a reasonable aspiration for both the Opposition and for Conservative Members who want to improve our debating procedures and make this place more accountable. We are asking the Government to ensure that democratic procedures are adhered to, and I hope that the Minister will respond.
      Mr. Brittan: It is always a matter for judgment whether regulations under an Act of Parliament should be subject to the affirmative or the negative resolution procedure. Without wishing to sound cynical or cavilling, I would say that it is natural that the Opposition, who challenge the basis of this legislation, should be more prone to favour the affirmative procedure. However, in this case, there is good reason for the negative procedure.
      Clause 29 clarifies and supplements the powers to make regulations under section 204 of the Taxes Act, so that regulations can be made providing for tax refunds to be withheld from benefit claimants during unemployment and from strikers. Section 204 is the enabling legislation which provides for regulations to be made for the operation of the PAYE system. When it was enacted, Parliament decided that the powers exercisable under it should be subject to the negative resolution procedure. Therefore, I find it difficult to see why, in relation to broadly similar regulations extending them under clause 29, a different procedure should be adopted. It is for that reason that I cannot commend the amendment to the Committee.
      Amendment negatived.
      Question put and agreed to.
      Clause 29 ordered to stand part of the Bill.
      To report Progress and ask leave to sit again tomorrow.—[Mr. Brittan.]
      Committee report Progress; to sit again tomorrow.

  Local Loans
  11.42 pm
  The Financial Secretary to the Treasury (Mr. Nigel Lawson): I beg to move,
  That the draft Local Loans (Increase of Limit) Order 1981, which was laid before this House on 16 April, be approved.
  After the tranquil waters of the Finance Bill, we now move on to the highly controversial and electrifying subject of the Local Loans (Increase of Limit) Order 1981.
  The order increases by £3,000 million the amount available for lending to local and other eligible authorities by the Public Works Loan Commissioners. The Finance Act 1978, which was passed by the Labour Government, increased the lending powers of the commissioners by £12,000 million, that sum to be made available in tranches of £3,000 million, each tranche after the first requiring an order subject to affirmative resolution. This is the second of those tranches requiring an order. It is the third of the four tranches altogether.
  I hasten to reassure my hon. Friends that the order does not sanction any increase in local authority capital expenditure, which is controlled by the Government by other means. The order, therefore, does not affect public expenditure in the slightest, nor does it affect the amount which local authorities may borrow from the commissioners, which is fixed by quotas which are related to their agreed capital expenditure. The impact on the PSBR is wholly neutral as regards borrowing from the market or from the commissioners. Either source of borrowing has the same effect on the total of the PSBR. The purpose of the order is to give the House an opportunity to debate the matter.
  The commissioners still have about £1,333 million, which is nearly 45 per cent. of the £3,000 million which was made available to them under the 1980 order. That is a sizeable sum. However, under the arrangements for access to the commissioners, the local authorities can draw 45 per cent. of the 1981–82 quota between 1 April last and the end of June. That amounts to about £1,600 million. While that it is only an entitlement and while, so far since 1 April only £21 million of it has been drawn, it is obviously necessary for the Government to have the legislative authority to fulfil that commitment. That makes it prudent for us to seek the additional tranche tonight.
  Hon. Members will be aware of the important role played by the commissioners in providing local government with finance at virtually the rates at which the Government borrow, which cuts down costs for local government and assists local authorities to maintain adequate debt maturity.
  The Government consider that it is in the interests of local authorities, individually and collectively, and of monetary policy, that progress should be made in lengthening the residual maturity of local authority debt. To help local authorities achieve that end, the Government have extended that facility for privileged borrowing in a number of ways.
  Firstly, there has been a reallocation of the lapsed 1980–81 quotas. Secondly, we have continued the 1981–82 quotas at the level prevailing in 1980–81, that is to say, 50 per cent. of approved capital expenditure plus 4 per cent. of outstanding long-term debt, with a minimum entitlement of £5 million. Thirdly, we have continued to

  589
  allow authorities with a borrowing requirement of up to £5 million in 1981–82 to draw the whole amount from the commissioners.
  Finally, I am sure that the whole House will join me in expressing thanks to the Public Works Loan Commissioners for the services that they render with such skill and dedication and entirely on a voluntary basis.
  11.45 pm
  Mr. Jack Straw: We are pleased that the Financial Secretary has come to the House to increase the Public Works Loan Board's borrowing powers by no less then £3,000 million so soon after the substantial Labour gains in the county council elections, not only in metropolitan counties but also in what were previously Conservative strongholds such as Lancashire, Cheshire, Humberside and Avon. I hope that this means that they will respect the decision of an electorate which voted in large numbers for Labour councillors, who are committed to restoring many of the public expenditure cuts imposed by Conservative councils.
  Mr. R. B. Cant: Would my hon. Friend add to his short list of Labour-controlled authorities the shire county of Staffordshire, in which the Tories were unexpectedly but totally routed?
  Mr. Straw: I am glad that my hon. Friend reminds us of the great triumph in Staffordshire, with which he was associated. He has a long-standing association with Staffordshire. It is a long list and I referred only to some of the major triumphs. My selection of Lancashire was entirely impartial.
  I hope that the Financial Secretary's decision to come to the House today of all days—the first possible day after the local elections—to seek the increase in borrowing powers means that the Government recognise that the mandate of the new Labour-controlled councils is clearer and more recent than theirs. I hope that the Government will not follow the recommendations of the Secretary of State for the Environment. We read in the Sunday newspapers that he regards all Labour local councillors as extremists and wishes to control local authorities even more tightly.
  We object to controls on local freedom introduced by the Government. In introducing controls they are going against the long-standing Conservative tradition of respecting local democracy. In the 1970 Conservative campaign guide, we see the words of the right hon. Member for Sidcup (Mr. Heath) when he was Leader of the Opposition. He said of the Socialist Government:
  "They lose the argument, they lost the local elections, but they refuse to abandon their doctrines. Instead, they impose them by force on local representatives where democratic authority in these matters is clearer and more recent than their own."
  What was good for a Labour Government and newly elected Conservative local authorities in 1968 is good for a Conservative Government and newly elected Labour local authorities in 1981.
  The Financial Secretary said this year, as indeed he said on 6 May last year when he introduced the first of these orders, that the order by itself would not increase the public sector borrowing requirement, and of course we understand that. He said tonight that it does not affect the PSBR or the level of local authority loans in the slightest.
  The House, however—and, I think, even the hon. Member for Chippenham (Mr. Needham) who, I note, is
  590
  not showing his usual assiduity in attending to the debate—needs to know why the authorisations of the Public Works Loan Commissioners have increased threefold, from the modest sum of £3,000 million that the Labour Government left to the Conservatives in 1979, to £6,000 million last year and £9,000 million this year. I note that perhaps the rest of the House takes a more relaxed view of the matter than those of us who remain here tonight. Nevertheless, by any analysis, those are substantial sums.
  When the Financial Secretary spoke on this matter last year he said that he hoped that it would be "well over a year" before the Government sought a further increase in the order. It is, in fact, only a few days over a year. Why have the Government had to come back so soon for an increase?
  Does the decision to ask for an increase of such a sum in the Public Works Loan Commissioner's funds herald a change in the Government's policy towards the methods by which local authorities raise their funds? Does it mean that the Government wish local authorities to raise a higher proportion of their capital requirements from the board rather than directly through the markets or through the sale of bonds? I note that the proportion of local authorities' total borrowings represented by Public Works Loan Commissioner funds rose from 23 per cent. in 1979 to 39 per cent. in 1980. Is it the Government's intention that that proportion should increase still further?
  When questioned on the reasons for last year's order, the Financial Secretary said:
  "In so far as there is a shift from local authorities' borrowing from banks to borrowing from the board, that can assist monetary control."—[Official Report, 6 May 1980; Vol. 984, c. 239.]
  Has there been a shift in borrowing from the banks to the Public Works Loan Commissioner, bearing in mind that borrowing from banks accounts for only about 18 per cent. of the total outstanding debt by local authorities? I should be grateful if the Minister would answer that as well. If that is not a reason for introducing the change, perhaps he will say what other reasons there are.
  Question put and agreed to.
  Resolved.
  That the draft Local Loans (Increase of Limit) Order 1981, which was laid before this House on 16 April be approved.

  Local Loans

    TOWN AND COUNTRY PLANNING (MINERALS) BILL [LORDS]
    Order for Second Reading read.
    Motion made, and Question put forthwith, pursuant to Standing Order No. 66 (Second reading committees), That the Bill be now read a Second time.
    Question agreed to.
    Bill accordingly read a Second time.
    Bill committed to a Standing Committee pursuant to Standing Order No. 40 (Committal of Bills).

  Town and Country Planning (Minerals) [Money]
  Queen's Recommendation having been signified—
  Motion made, and Question proposed,
  That, for the purposes of any Act of the present Session to make amendments relating to the winning and working of minerals in the Town and Country Planning Act 1971 and the Town and Country Planning (Scotland) Act 1972 and amendments relating to rights for the purpose of the conveyance of minerals in section 2 of the Mines (Working Facilities and

  591
  Support) Act 1966, it is expedient to authorise the payment out of money provided by Parliament of any increase attributable to the said Act of the present Session in the sums so payable under any other Act.—[Mr. Thompson.]
  11.53 pm
  Mr. Tam Dalyell: I do not know who the Minister is, but he seems not to be here.
  Mr. Deputy Speaker (Mr. Bernard Weatherill): Perhaps the hon. Member would like to continue. It is unusual for a Minister not to be present, but I think that he may be coming shortly.
  Mr. Dalyell: I do not make too much complaint about such things, but there are issues to be raised on this motion. Partly, it is the concern of Lothian region relating to a report that we have received from our director of physical planning, who believes that there is considerable doubt whether the proposed subsection (3A) which clause 18 proposes to insert in section 19 of the Town and Country Planning (Scotland) Act 1972 encompasses the removal of material from waste retorted oil-shale bings.
  It seems that this process is peculiar to the area of West Lothian and that the method of working oil-shale is such that the material eventually deposited in the bing may be seen as the product of an industrial process as opposed to a mineral working deposit. Consequently, a case may exist for the contention that the removal of material from a deposit of retorted oil-shale is not a mining operation and is not, therefore, brought within the limits of planning control.
  It is suggested that to close this potential loophole an amendment might be forthcoming from the Government to clause 18(1) along the lines that a new paragraph (ii) should be added to the proposed subsection (3A)(a) to read:
  "from a deposit of retorted oil-shale; or"
  and that consequential amendments should be made to existing sub-paragraphs. I do not expect an answer from the Government tonight, but I undertook to the local authorities concerned to put that on the record.
  There is considerable concern about the Bill because it imposes a duty on local planning authorities to review mineral planning consents. It also permits them to review and alter consents at five-yearly intervals, removing the operators' present entitlememt to compensation for alterations made with that frequency.
  Although a few types of alterations remain fully compensable, these are types which can hardly be altered restrictively in any case. Although the Bill provides for modified compensation for alterations made, the scale of modified compensation is not contained in the Bill, and the intention is clearly that in making alterations the authorities will plan their revisions of consents entirely in the non-compensable area.
  The effect of the Bill is to place the planning authorities under pressure and incentive to alter our planning conditions at five-yearly intervals, and whether they change them at five-yearly or at greater intervals the operator is faced with additional resultant costs and losses to which no maximum is set by the Bill.
  Does the Minister agree that no maximum is set by the Bill? What figures are involved? The power given by the Bill to impose additional costs on the industry, without ceiling, may well be fairly objectionable.
  592
  Although these costs are not quantified in the Bill, we have taken account of the indications given to us by the Department of the Environment on the extent of the costs which, by the later issue of regulations by the Minister under the enabling powers of the Bill, they will for the meantime permit local authorities to impose on firms in the industry.
  The proposal advanced by the Department is that the authorities will be able immediately to impose costs not exceeding 20 per cent. of the mineral value of our assets and to repeat such imposition every five years or possibly at somewhat longer intervals.
  In principle, the imposition of a five- or ten-yearly regime on an industry which must take a long-term view of its operations and of its investment decisions is misconceived and represents, one might justifiably say, a trivialisation of the planning system. It does not fit the industrial policy of any party. It may represent an accommodation of dated and marginal environmental pressures, or the official interpretation of these at local or national level, without realistic assessment of their environmental benefits. Even if the industry could afford it, we seriously doubt that the measures capable of being exacted from the industry by the local authorities, in pursuit of this power to impose costs, will be of value to the environment.
  The dated pressures which have led to the Bill relate to derelict mineral workings of a former era. Planning conditions now being agreed between mineral operators and planning authorities for current workings already represent the fullest exercise of the ingenuity of both the industry and the planners in contributing to the environment. In any case, the contribution to be made to the environment by tidy restoration of mineral workings is now quite unimportant in the total spectrum of environmental interest and frequently counter-environmental as regards genetic diversity. The proposals for more intensive control reflect the expired period of expanding government.
  That view has been put to the Government by British Industrial Sand Ltd. and by other companies. There is a case to be answered. BIS states that the Bill is thus something of an anachronism and that its principal effect in return for the non-productive costs imposed on operators will be merely to make the administration of planning control even more complicated and expensive than it is already. The industry's main protest at this time against the Bill is an economic and financial one.
  The industry states that it stands to forfeit up to 20 per cent. of the mineral value of its assets at every review. The total of this burden on the industry, for each review period, is calculated by the industry and the government alike at £100 million, which can be repeated. Although the industry fully appreciates genuine environmental advance and accepts that in times of reasonable prosperity it should meet part of its costs, it rejects the present imposition. Its customer industries are not able, it says, to absorb these non-productive and non-beneficial costs by way of increased prices.
  The proposals as they stand can only lessen the industry's ability to employ its depleted labour force and to supply essential user industries. In current conditions the proposals, according to the industry, should have been suspended. Any legislation at this time should provide for an effective date after the recovery of the economy. Even in the best circumstances, a level of additional costs at 20

  593
  per cent. of the mineral value every five to 10 years is not supportable. The maximum burden that the industry could contemplate would be 10 per cent. arising at minimum intervals of 15 years. If this ceiling is to produce confidence and stability in the industry, the industry says that it should be written into the Bill.
  This is a serious case. I have to declare a constituency interest, although it is not a personal one. Instead of automatically accepting the Bill, we should ask the Minister for the explanation that I am sure he is prepared to give.
  12.2 am
  The Under-Secretary of State for the Environment (Mr. Giles Shaw): I shall comment on the points raised by the hon. Member for West Lothian (Mr. Dalyell). He mentioned the problems of the shale-oil workings in relation to his constituency. As he will understand, that is a matter for my right hon. Friend the Secretary of State for Scotland. Although the Bill has a remit over Scotland, I should wish to discuss the matter with my right hon. Friend before giving the hon. Gentleman a detailed answer in writing.
  The hon. Gentleman has raised several important points on the two most obvious and outstanding matters—namely, the compensation formula and the formula's effect on the industry and, therefore, on the environmental pressures that the Bill seeks to apply to the restoration of mineral workings. In the past few weeks, significant discussions have been held with local authority representatives and with representatives of the CBI minerals committee in order to arrive at an agreed formulation for the compensation clauses.
  The hon. Gentleman spoke of a significant 20 per cent. impost involving £100 million per quinquennium. That burden would add too significantly to the industry's costs and would be detrimental to this valuable industry. I can give the hon. Gentleman two assurances. First, the Government recognise the importance of arriving at a formula that is less destructive of the industry's potential than that which was originally discussed and quoted by the hon. Gentleman. Secondly, on reflection, we agree that some parameters to the compensation policy should be included in the Bill in Committee, if hon. Members so wish. It would be our intention to move in that direction if the Bill should reach Committee, which I sincerely hope it will.
  Question put and agreed to.
  Resolved,
  That, for the purposes of any Act of the present Session to make amendments relating to the winning and working of minerals in the Town and Country Planning Act 1971 and the Town and Country Planning (Scotland) Act 1972 and amendments relating to rights for the purpose of the conveyance of minerals in section 2 of the Mines (Working Facilities and Support) Act 1966, it is expedient to authorise the payment out of money provided by Parliament of any increase attributable to said Act of the present Session in the sums so payable under any other Act.

  Town and Country Planning (Minerals) [Money]
    STATUTORY INSTRUMENTS, &c.
    Motion made, and Question put forthwith pursuant to Standing Order No. 73A (Standing Committee on Statutory Instruments, &c.)

    NEW TOWNS
    That the New Towns (Limit on Borrowing) Order 1981, a copy of which was laid before this House on 8 April, be approved. —[Mr. Le Marchant.]
    Question agreed to.

  Nuclear Shelters (Planning Applications)
  Motion made, and Questions proposed, That this House do now adjourn.—[Mr. Le Marchant.]
  12.5 am
  Mr. Richard Needham: I am grateful that the House is prepared to listen to me at this late hour on this important matter of the Department of the Environment's approach towards planning applications for nuclear shelters. This matter causes great concern to both sides of the House, as can be seen.
  The Government, in their guidelines on domestic nuclear shelters, have gone some way towards making clear what the public should or should not do in the event of the horrible possibility of a nuclear war. This has inevitably created considerable debate within the country as a whole. Obviously, the tensions in the world have heightened the debate and in some sense made the matter more immediate and, therefore, more important to debate.
  The domestic nuclear shelters that the Government have proposed are all very well for those who are able to purchase them and have sufficient ground in which to build them. They do not, however, deal with the problems of those who live in high-rise flats or those who do not have cellars. Therefore, many people who cannot have domestic nuclear shelters might, in the event of such a holocaust, look for some alternative.
  That alternative concerns me, because no solution has been offered by the Government for such people. Into this gap have come various companies, some extremely reputable and others not so reputable, which have offered some kind of solution to the question of people's safety in the event of war.
  There is such an application in my constituency, before the local district council. It is in the name of a company called Rusepalm Shelters. I am not sure whether "Rusepalm Shelters" is a hidden pun on the confidence trick that the company may be attempting to play on the ordinary public or on the fact that the Russians may attack us.
  In any event, the company, playing on the legitimate fears of many people, has produced a pamphlet to encourage people to take up shelters in an underground ammunition dump sold by the Ministry of Defence. The brochure, nicely printed, introducing the chairman, Maureen Whittart—who looks the part—states:
  "The main shelter will house up to 2,500 family units and there will be facilities for recreation and exercise, even during a nuclear attack."
  One can imagine that such facilities would be necessary in such circumstances. It continues:
  "Among the apartment owners will be doctors, nurses, social workers, craftsmen, sportsmen, teachers and experts in many fields but, most of all, responsible people, with families, and the will to survive a nuclear war. This main shelter is constructed to provide safety for you, your children and your children's children. That the human race is meant to survive is proved every time a child is born."
  I cannot argue against those sentiments. However, beneath the photograph which shows this complex is the caption:
  "All photographs taken prior to development."

  595
  It states:
  "The main shelter will provide the following facilities for communal use: Dining facilities for all main meals"—
  which is lucky for those who wish to eat—
  "fully lit corridors; toilets; showers; laundry facilities; library which will contain a mini-computer programmed with survival technology, updated from time to time … The most modern and sophisticated electronic system for building services monitoring will be provided",
  whatever that might mean.
  "Estimated survival of our population in the event of a nuclear attack is 43 per cent. Take advantage of this offer and you can be part of that 43 per cent."
  Hidden at the bottom of the same page is the statement:
  "These apartments are offered subject to planning permission being granted. 99 year leases are offered for a capital consideration of £8,000 for a standard 13 ft by 14 ft four bunk unit. Mortgage facilities available—25 per cent. down, balance over five years".
  It is monstrous that such a brochure should be presented to the public in such circumstances. One of my constituents in a letter to me said:
  "The exploitation of people's fears (aroused by very mention of the project) purely for personal monetary gain is peculiarly revolting. The applicants if ignorant of what nuclear war would mean are incompetent; if they do know they should be charged with fraud."
  Let us consider the site. What about sewerage? That might be a problem in a nuclear war as it is a problem at any other time. It gets very little mention. What about air supply and filtration? There is little mention. I pass from internal problems and ask what about the external problems. How would people get there in the event of a nuclear war or the tensions preceding it? It is proposed to accommodate 10,000 people on the site, brought in from all over the country. How would they protect themselves from the locals, who, seeing the massive underground shelter where people had purchased places for themselves, would undoubtedly try to get in with their families? My locals are tough and strong. The yeomen of England live in the Chippenham constituency. They would make every effort to ensure that they and their families were properly protected.
  What about the military bases in the area and the need to ensure that during times of such tension the military traffic and operations continued? In my constituency there are Copenacre, Colerne, Rudlow, Lyneham and Hullavington, to name but a few.
  Most important, who would look after these people when they emerged from their bunker—if, in the interim, they had not been roasted alive? They could hardly expect to get into their cars and drive away. The cars would have been incinerated on the 41-acre car park.
  Into this matter comes the local authority, which is presented with a planning application for the site. It is difficult for a local authority to determine such an application. There is nothing clear in planning law about how it should go about it. I have a letter from the chief planning officer dated 13 April, which says:
  "The type of considerations raised by this application are fundamentally different to those raised by the majority of applications."
  He can say that again.
  "During peacetime one would expect little activity on the site. The activity and difficulties would occur in an emergency context, the exact nature of which cannot be accurately foreseen and the assessment of which must pose problems for a committee of a local authority".
  The need for Government policy to be co-ordinated on the issue is clear. People are now trying to make money on the legitimate fears that many hold about their future.
  596
  As my hon. Friend the Under-Secretary can see from the glossy brochure that I have with me, those involved are trying to spread their views to obtain money. This is an illegitimate trade. It would be wrong to use the Government's proposals on domestic nuclear shelters to try to advance arguments for massive underground shelters.
  I am talking about old quarries that have been used over the years as ammunition dumps. They contain a few old machines with their innards left rotting. The quarries have been taken over by speculators, whose plans have been thrust upon the public.
  The Government must co-ordinate a policy towards such shelters. They cannot rely on the local authority, which in this case is faced with a planning application for a site in the middle of a farm. It would not create a large number of above-ground problems in its construction, and when the authority looks at the regulations it may find considerable difficulty in turning the application down.
  Therefore, the Home Office and the Department of Trade must come together to set the standards and specifications for such shelters. The Department of the Environment must issue instructions on placement and access. The matter cannot be left to the whim of a district authority.
  This debate is very important to my constituents, who have genuine fears about what will happen to them if such a horrific eventuality as we are considering comes about. I hope that my hon. Friend the Minister will make it clear that the Government are determined that such disgraceful proposals as are being put forward by Rusepalm will not go without proper condemnation and criticism.
  I ask the Government to examine the matter seriously and ensure that such an application is at least called in. I ask that they will then, in line with their policy document on domestic nuclear shelters, provide guidelines and instructions on the much larger shelters that may be needed for those living in flats or houses with no gardens or cellars. I ask my hon. Friend to make clear where the Government stand and how they intend to operate.
  12.17 pm
  The Under-Secretary of State for the Environment (Mr. Giles Shaw): My hon. Friend the Member for Chippenham (Mr. Needham) has raised a matter of considerable importance to his constituency—one that goes far wider than normal constituency questions. The subject of tonight's debate raises issues far beyond those normally found in planning applications. The question of civil defence, which is not the least of those issues, is of course entirely the responsibility of my right hon. Friend the Home Secretary. I make no apology, therefore, for quoting my right hon. Friend during this debate.
  The proposal to which my hon. Friend refers concerns the adaptation of extensive underground storage areas, now disused, for use as a communal nuclear shelter. The storage areas were originally Bathstone quarry workings. During the late 1930s the old workings were acquired by the then War Department. They were reconstructed and refurbished and made into a vast, fully serviced, underground complex of dry storage space. The complex was used for the storage of all types of ammunition until 1967, when it became surplus to the Ministry of Defence's requirements. In 1975 the site was put up for sale, and the

  597
  sale included along with the underground storage complex, over 40 acres of land, together with a variety of buildings on the surface.
  The site is in a rural area, east of Bath and west of Chippenham. The surrounding area is agricultural, but not within a designated area of outstanding natural beauty. At the time of the sale, Wiltshire county council, as the local planning authority, indicated that it would be prepared to consider future uses for the property for agricultural purposes and also for the warehousing and storage of certain unspecified types of goods.
  Sale of the property was completed in 1976, and the site is now owned privately. As my hon. Friend spelt out, a planning application has been submitted to the North Wiltshire district council, which is now the appropriate local planning authority, to use the site for emergency residential accommodation.
  This would be a commercial venture. My hon. Friend suggested that the terms of reference in relation to the application made to members of the public were a matter which should involve consumer protection activities and my right hon. Friend the Secretary of State for Trade. No doubt my hon. Friend will consider such movements as well as raising the matter in this debate in connection with the planning application.
  It is intended, apparently, that the underground storage areas should be converted into small residential units in which up to 2,500 families—perhaps as many as 10,000 people—would be able to live for up to three months in the event of a nuclear attack. Family units are apparently to be offered for sale on a 99-year lease at £8,000 each. there would also be extensive communal underground facilities for the residents.
  As I am sure my hon Friend knows, the Town and Country Planning Act 1971 places on the local planning authority for the area the responsibility in the first instance for determining planning applications. The Act contains provision for the Secretary of State to direct that an application should be referred to him instead of being dealt with by the local planning authority. The overwhelming majority of planning applications, however, raise issues which, though they may sometimes be controversial, are primarily of local importance. Accordingly, it has been the policy of successive Governments that applications should be called in for the Secretary of State to determine only if they raise issues of more than local importance, and even then only if there are strong reasons why the decisions should not be left for the local planning authority to take.
  The case to which my hon. Friend has drawn attention is clearly one of some difficulty. He could argue, as he has done persuasively, that the matter which is of concern to him is greater than that of a merely local planning issue. However, he will recognise that the local planning authority has powers available to it to determine the planning application on grounds such as sewerage, air supply, filtration, or transport in terms of access to and from the development. In other words, there are many aspects of this planning application which are not in themselves unusual for a local planning authority which has to deal with problems of this kind.
  Mr. Needham: Does not my hon. Friend accept that in this instance it is not so much a matter of what the ordinary run of events will be? It is how such an application should be considered in use during the event, either immediately preceding or after a nuclear war. The
  598
  local authority concerned cannot conceivably know exactly what the position will be, either in terms of sewage or in terms of access and, least of all, in terms of what the local surrounding conditions will be. Therefore it is not just a consideration which the local authority can deal with. It will have a much greater impact on and significance for the country as a whole, and I am sure that my learned Friend will deal with the disgraceful way in which this proposal has been presented to the public.
  Mr. Shaw: But my hon. Friend touches immediately on the question which overlays his anxiety in this instance. It does not concern the planning application so much as the relevance of the application to the problems involved in nuclear dispersal, nuclear accommodation or the consequences of a large population unit surviving a nuclear attack. I suggest that these are matters which are not in themselves the responsibility of the planning authority or the Department of the Environment but probably are the responsibility of the Home Department in terms of the advice which it should be able to offer as the co-ordinating Department in these matters.
  I accept that my hon. Friend has raised what I consider to be a matter of some importance, in that there could be for local planning authorities the requirement to determine an application in good faith relative to local planning requirements and to the 1981 conditions under which they operate, which somehow transfer them, given the possibility of nuclear attack, into realms where they have not either the relevant experience or where, perhaps, they lack the relevant advice. I understand my hon. Friend's emphasis on those aspects of this application.
  Of course, the matter fundamentally relates to planning for nuclear conflict or nuclear fall-out. My hon. Friend will know that the Home Office is the main Department concerned. The local planning authority will clearly want to consider carefully many of the aspects relating to nuclear policy before determining the application. I know that it has sought advice from the Wiltshire county emergency planning officer. But these planning issues, while I admit their importance, are essentially matters on which the local planning authority concerned is still best placed to reach a decision.
  Civil defence is, of course, a different matter. It may be helpful if I say a few words about the subject. Before doing so, however, I must stress that I can offer no opinion tonight, one way or the other, on the planning merits of this application, although I have taken on board my hon. Friend's anxiety about the terms under which this offer is being made to members of the public. I shall draw the attention of my right hon. Friend the Secretary of State for Trade to the matter and invite his comments on it.
  There is of course nothing new about communal shelters. A great many were constructed for use in the Second World War, and some of these are still in being. My right hon. Friend the Home Secretary announced in his statement on civil defence to this House last August that the Government propose that
  "a survey of existing structures suitable for communal shelter purposes should be conducted".—[Official Report, 7 August 1980; Vol. 990, c. 793.]
  A survey of this type is a rather more complex matter than may be generally appreciated, and while a possible approach to the task has been carefully developed over the past few months, the Home Office has yet to discuss with the local authority associations, as my right hon. Friend undertook, how best to carry out the survey. I cannot,

  599
  therefore, say tonight how the workings, subject to the planning application, might rank in the results of the survey.
  Naturally, if they were to be successfully adapted to shelter use their significance would be enhanced, but even then their precise ranking in the war emergency plans which Wiltshire county council is obliged to prepare under the Civil Defence (Planning) Regulations 1974 would be essentially a matter for that authority. In exercising its judgment in the matter the council would take account of local opinion.
  In response to public and parliamentary interest, the Government have published in recent weeks detailed guidance on the construction of domestic nuclear shelters. However, contrary to suggestions in some quarters, the Government are not advocating the acquisition or provision of nuclear shelters, whether communal or domestic. The Government are certainly not offering special financial incentive, by way of tax or rate rebates or outright grants.
  It is commonly overlooked that most houses in this country offer a reasonable degree of protection against radioactive fall-out and that protection can be substantially improved by quite simple measures. The material is ready now, should the need arise, for an intensive publicity campaign on television, radio and in the press, informing people what they can do quickly to effect the improvement and what other steps to take to increase their prospects of survival. The booklet "Protect and Survive" was designed to supplement this campaign. The plan has been for rapid printing and circulation in a war crisis at a time when its impact would be greatest. In keeping with this Government's belief that the public has a right to information about civil defence, and the likely effects of a future war, the booklet has been made available to the public and for the last 12 months has been on sale through Her Majesty's Stationery Office. There are copies of the booklet in the Library, together with copies of the Home Office guides on domestic nuclear shelters and on nuclear weapons. The "Protect and Survive" measures, simple though they are, could enable millions of people to survive who would otherwise be killed.
  This proposal, if it went ahead, might encourage a section of the population, in the event of an emergency,
  600
  to move out into rural areas to seek shelter. The Government's advice, however, is that in a crisis people should stay put. The implications of applications such as this one for national civil defence policy are clearly of wide interest, and I give my hon. Friend an undertaking that I shall involve my hon. and learned Friend the Minister of State, Home Office in discussions on the matters raised in this debate. He is right to alert the House to this issue, and I shall see that it is properly drawn to the attention of those who are responsible in the Home Office.
  In addition, if the local planning authority dealing with the application has any specific questions on national civil defence policy relating to the application I shall ask the Minister of State to consider what advice might be offered.
  In relation to the Department calling in the application, what has been said is important. I have not given the undertaking which my hon. Friend sought. I cannot leave the matter there. I should like to consider the issue and discuss whether there is ground for calling in the application. I am not persuaded that the ground, in terms of local planning requirement, is such that it requires the Secretary of State to act under section 35 of the Act and call in the application, although significant planning elements are associated with the application.
  My hon. Friend raised the question of how a particular application fits into the Government's advice on planning for nuclear emergencies and whether advice should be given to local authorities about the way in which they handle such applications. That is not the same as saying that the planning aspects of the application are such that they warrant the Department taking action under section 35.
  I shall write to my hon. Friend after I have had more time to consider whether action should be taken on the planning merits. I have said sufficient to show that I believe that my hon. Friend has raised a matter of considerable merit. I understand why he has raised the topic. The issue requires slightly more consideration than I have been able to give it before determining my Department's view. Discussions with the Home Office are relevant and necessary.
  Question put and agreed to.
  Adjourned accordingly at twenty-eight minutes to One o' clock.

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

Defence Sales Organisation: Staffing
Lord Hylton: 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, given that overseas trade missions supported by the British Overseas Trade Board are being halved, they will make similar cuts in the staff of the Defence Sales Organisation.
Viscount Long: My Lords, the Defence Sales Organisation is financed and staffed as part of the Ministry of Defence and is subject to the resource constraints imposed on the defence budget. This arrangement reflects the benefits which the defence programme derives from defence sales. No direct comparison can be made with programmes undertaken by the British Overseas Trade Board.
Lord Hylton: My Lords, I am grateful to my noble friend for his reply. Can he say whether it is true that the Defence Sales Organisation employs nearly 400 persons, and does this figure include or exclude a further 135 employees of International Military Services Limited, a so-called commercial subsidiary of the Ministry of Defence? Are not these figures somewhat surprising when one compares them with the 15 people working in the arms control and disarmament office of the Ministry of Defence?
Viscount Long: My Lords, I have been asked by my noble Leader to give short answers to all supplementary questions, but my noble friend has asked me two or three questions. The current size of the Defence Sales Organisation is about 350, excluding International Military Services Limited. I do not believe that one can draw any conclusions from comparing this number with other areas of government, such as arms control, whose role is completely different.
On the second question, national defence is, of course, a matter that is dealt with by Governments. It is frequently the case that overseas Governments ask for a Government-to-Government arrangement to cover a sale of defence equipment, together with demonstrations of the equipment, training and support of sales. So the British Government have to take an active role. That is rarely the case with civil sales and in this respect the task of the Defence Sales Organisation is quite different from that of the British Overseas Trade Board. On my noble friend's third supplementary question, the Government hope that British industry will seek every opportunity to expand exports, but, as regards defence equipment exports,
326
the Government have a more definite role to play in what we hope will be an expanding market.
Lord Taylor of Gryfe: My Lords, will the noble Viscount accept that it presents a rather unfortunate image for Britain that we are cutting back our commercial sales organisation but at the same time maintaining this sales capacity in defence equipment?
Viscount Long: My Lords, the British Overseas Trade Board is only cutting down those missions that are probably not all that successful. As regards defence sales, as your Lordships will know, my right honourable friend the Prime Minister went to sell equipment in the Middle East and did so very efficiently. Although we are hoping to cut down, and are prepared to review, staff in the Defence Sales Organisation in the Ministry of Defence, we must still have an enormous number of representatives to sell abroad.
Lord Brockway: My Lords, is not this an appalling situation? When we are cutting down expenditure to end poverty in the third world, at the same time we are increasing expenditure on selling them arms, when their own money is so necessary to deal with the poverty in their countries.
Viscount Long: My Lords, I have to inform the noble Lord that without sales you cannot help other nations.
Lord Goronwy-Roberts: My Lords, I wonder whether the Minister will take this opportunity of confirming that the promotion of arms' sales in any country continues to be subject to a proper evaluation of the effect of such a transfer of arms on the political situation in that part of the world? One has very much in mind the situation in the Middle East, where an even-handed political approach and, therefore, of sale of arms, is essential to the continuing, if precarious, stability of that area.
Viscount Long: My Lords, I agree and, therefore, we still reserve the right of deciding to whom we sell. Apart from that, I agree with the noble Lord.
Lord Goronwy-Roberts: My Lords, how much, of what and to which side?
Viscount Long: My Lords, I am not very familiar with that aspect of the matter. All I know is that in the past, under Governments of either party, the Ministry has reserved the right to be very careful, politically, to whom it sells arms.

Anglo-Romanian Trade
2.42 p.m.
Lord Auckland: 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 discussions took place with a view to increasing Anglo-Romanian trade during the recent visit of

327
the Prime Minister of Romania to the United Kingdom and, if so, what progress has been made and what further action is contemplated.
The Parliamentary Under-Secretary of State, Department of Trade (Lord Trefgarne): My Lords, during his visit the Romanian Prime Minister discussed trade matters with my right honourable friends the Prime Minister and the Secretaries of State for Industry, Trade and Energy. Both sides expressed their desire to see the further development of United Kingdom-Romanian trade. A number of sectors offering particularly good opportunities for industrial co-operation were identified; these included the energy and aviation fields. In addition, representatives from a number of British companies were able to meet the Romanian Prime Minister. Particular opportunities discussed during the visit will be followed up with the firms concerned.
Lord Auckland: My Lords, I thank my noble friend for that very satisfactory Answer. Is he aware that, despite obvious political differences between our two countries, relations, trade-wise, with Romania should be enhanced at every opportunity? Can my noble friend say whether the construction industry, which is suffering a down-turn at the present time, was involved in these talks, particularly in view of previous work in the Danube basin, and also the chemical industry, where there is surely quite a potentiality in that particularly lovely country?
Lord Trefgarne: My Lords, I understand that the construction industry was not one of those that was in fact discussed at the time of the recent visit. I do not have information upon whether or not the chemical industry was raised, but I feel certain that there must be some prospects there none the less.
Lord Elwyn-Jones: My Lords, would the noble Lord bear in mind the importance of sustaining, within our resources, the Government in Romania, which has shown such a courageously independent posture on so many critical international questions?
Lord Trefgarne: Certainly, my Lords; the noble and learned Lord is of course quite right.
Lord Derwent: My Lords, can my noble friend tell me—it is a matter purely of curiosity, but all questions ought to be asked out of curiosity—at what stage Roumania started being spelt "Romania"?
Lord Trefgarne: My Lords, must say that that question occured to me when I was preparing myself to answer this Question this afternoon. I am afraid that I do not, as yet, have an answer.
Lord Auckland: My Lords, may I, on a point of elucidation, ask my noble friend whether he is aware that it comes, I think, from ancient Rome, where they had strong links?
Lord Taylor of Gryfe: My Lords, will the noble Lord tell us what is the ECGD cover on Romania and
328
whether British exporters are fully protected in dealings with that country; whether it has been extended or not?
Lord Trefgarne: My Lords, as I think the noble Lord knows, the precise level of cover available in any specific market is not normally published, but I can assure the noble Lord that ECGD cover is fully available for the Romanian market, and indeed is fully adequate for the needs.

Museums and Galleries: May Day Closure
2.46 p.m.
Lord Donaldson of Kingsbridge: 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 all national galleries and museums in the metropolitan area were closed on the holiday of 4th May last, and, if not, which were open.
The Earl of Avon: My Lords, all national museums and galleries in the metropolitan area were closed on the May Day bank holiday on 4th May last.
Lord Donaldson of Kingsbridge: My Lords, while thanking the noble Earl for that brief and not unexpected piece of information, may I ask him, out of curiosity, the reason for this? Was it the unwillingness, or perhaps the inability, of the institutions to pay the necessary overtime? Or was it the unwillingness of the employees to work on a May Day holiday, and was that under the instruction of the unions and had it anything to do with the Civil Service strike?
The Earl of Avon: My Lords, to take the last point first, No. As I believe the noble Lord is well aware, it is for the authorities responsible for the museums and galleries, most of which are run by independent boards of trustees, to arrange for opening or closing on public holidays in the light of their own priorities and following previous practice. The Directors of the Trustee Museums and Galleries established a central negotiating team to act for all 10 national institutions. It was their decision on the May Day bank holiday in 1978 to proceed, after discussion with Civil Service unions, to close on the May Day bank holidays. If I may remind the noble Lord, I believe that in 1978 he was in a position of responsibility then.
Lord Donaldson of Kingsbridge: Indeed, my Lords, I was; and it is because of that that I am asking these questions. I said at that time, "This is disastrous. We must try to get it altered". I was prevented from doing so by the general election, and I wondered what steps the Government had since taken?
The Earl of Avon: My Lords, at the moment we believe that we ought to leave this matter with the Directors of the Trustee Museums and Galleries in view of their established practice and their own con-

329
tacts with the Civil Service unions. I am only sorry that this particular date has been established now for four years.
Lord Strabolgi: My Lords, is the noble Earl aware that until recently it was a long tradition that all our museums in the metropolitan area were always open on bank holidays? Are they aware of the educational value? Will they try to do something to get back to the original tradition, because this means a great loss, particularly to children and young people?
The Earl of Avon: My Lords, on this side of the House we could not agree more with the noble Lord. However, it was introduced, I think probably in 1978, as the May Day bank holiday, and it is the unions' bank holiday, and this is the day that they have asked that the museums be closed.
Lord Annan: My Lords, will the noble Earl confirm that the agreement which has been reached on the matter of the closure of museums and galleries was an agreement imposed upon the trustees of museums and galleries by the Department of Education and Science? For that reason the noble Earl will perhaps not be surprised to learn that I, as chairman of the National Gallery Trustees, am somewhat surprised to hear that it is in the power of the trustees to alter this matter. Does the noble Earl agree that this decision was in fact negotiated over the heads of the trustees of museums and galleries, and against their will? Is he also aware that the trustees of museums and galleries deplore the present circumstance in which it is impossible to open on public holidays, and that they look back with some nostalgia to the days when the only day on which museums and galleries were closed was Good Friday?
The Earl of Avon: My Lords, I agree with the sentiments of all that the noble Lord has said. I am not willing to comment on the pressure that anyone may have put on one department or another, but the Directors of the Trustee Museums and Galleries, on which of course, as the noble Lord is aware, the gallery he mentioned is represented are the ones which have negotiated these terms with the Civil Service unions.
Lord Donaldson of Kingsbridge: My Lords, is the noble Earl finally saying there is nothing whatever that can be done about this situation? It has always seemed to me—I admit to having been in the hot seat originally—that while one could not do anything about it quickly or immediately, one could release the galleries to make their own arrangements with their own staffs. Is the noble Earl aware that it would then be very clear, if the staffs were prevented from doing anything, at whose behest they were so prevented?
The Earl of Avon: Again, my Lords, all I can say is that there is a set body, the Directors of Trustee Museums and Galleries, who established the central negotiating team, and it is up to them whether they want to keep to that or negotiate separately. I should say at once that it is the May Day bank holiday about which we are talking about which the unions have put on particular pressure.
Lord Annan: My Lords, is the Minister aware that the trustees are very willing indeed that the galleries and museums should be open in the evenings so that the working public could visit them on weekdays between, say, 6 and 8 p.m., but that we are unable to arrive at any satisfactory conclusion with the trade union concerned?
The Earl of Avon: My Lords, I shall certainly draw the noble Lord's remarks to the attention of my right honourable friend.

Human Rights: Sacked Railwaymen
2.51 p.m.
Lord Orr-Ewing: My Lords, I beg leave to ask the Question which stands in my name on the Order Paper.
The Question was as follows:
To ask Her Majesty's Government whether they will meet the request of the Registrar of the European Court of Human Rights that they deposit by 5 p.m. on Monday 11th May their final observations concerning the three railwaymen sacked five years ago under the closed shop procedure and thus honour the Government's ministerial assurance in November 1980 that they would not ask for a tenth postponement.
Lord Lyell: My Lords, Her Majesty's Government have today filed with the European Court of Human Rights their observations on the further written observations of the applicants. There is and has been no question of the Government asking for a postponement and I must point out that if the applicants' counsel has not asked for additional time to submit further written observations, the proceedings would have been concluded as soon as those concerned had answered the questions which were put to them by the court at the end of the oral hearing. The Government, for their part, submitted their answers well within the time limit set by the court.
Lord Orr-Ewing: My Lords, is my noble friend aware that since this case started in February 1977 this is the first time successive Governments have met the dates required by the commission and/or the court? There were six delays under the Labour Government and a further three, much shorter, delays under the present Government. Will my noble friend therefore accept congratulations in that at last some justice has been done, though at some cost to the litigants?
Lord Lyell: My Lords, we are always pleased to receive congratulations from whatever quarter of the House, and we are grateful to my noble friend for his comments.
Lord Paget of Northampton: My Lords, would the Minister agree that while considerable service has been rendered by ad hoc submissions on particular issues to such a court as The Hague, a general submission by sovereign states to a court of this court is an absurdity

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and nuisance, that the sooner it is terminated the better and that this case well illustrates that?
Lord Lyell: No on both counts, my Lords.
Lord Spens: My Lords, is it true that the Government had some weeks of prior knowledge that the TUC were going to put in a last-minute submission in this case? Is it also true that the Government even gave some assistance to the TUC to make their submission? Is it further true that the Government did not have the courtesy to warn the three railway employees or their legal advisers that those last-minute submissions were going to be made?
Lord Lyell: My Lords, I do not think it is the Government's duty to come between the TUC and various other parties who wish to take their case to the European Court. The answer to the other two questions the noble Lord put to me is, no.
Lord Orr-Ewing: My Lords, while in his main Answer my noble friend said that the last delay was due to the applicants, may I ask whether or not it is a fact that at the very last hearing of the court, in front of the 21 judges, the noble Lord, Lord Wedderburn of Charlton, his solicitors and three advisers from the TUC turned up, for the very first time in the four and a quarter years that this case has lasted, and submitted 58 pages of evidence and an appendix amounting to 325 further pages, and therefore it was necessary for the applicants' legal advisers to consider those representations? Is my noble friend aware that they have now spent £65,000 fighting this case? Would he agree that this is a gross miscarriage of justice and that these matters should be speeded up so that people who feel they have been wronged may have those wrongs put right much more speedily and cheaply?
Lord Lyell: My Lords, much of what my noble friend said may be true, but it is certainly not the Government's fault, since the Government are in the position of replying to any submissions that have been requested, both by the court and the applicants.
Lord Elwyn-Jones: My Lords, is the noble Lord, Lord Lyell, aware that unfortunately my noble friend Lord Wedderburn is not present on this occasion—no doubt due to other important duties he is performing—and therefore he cannot deal with this attack on his professional involvement in this matter? The interest of the court will be to ensure that both parties have a fair opportunity of presenting their cases, and I have little doubt that this eminent court will do just that.

Business
Lord Denham: My Lords, at a convenient moment after 3.30 this afternoon, my noble friend Lord Bellwin will, with the leave of the House, repeat a Statement which is to be made in another place on the review of policy on environmental lead.
It may also be for your Lordships' convenience if I announce that dinner will be available this evening
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at the usual time. Subject to business, the House may adjourn at approximately 7 o'clock for a short period. Dinner will also be available tomorrow evening.

Forestry Bill
2.57 p.m.
The Minister of State, Scottish Office (The Earl of Mansfield): My Lords, I beg to move that the House do now resolve itself into Committee on this Bill.
Moved, That the House do now resolve itself into Committee.—(The Earl of Mansfield.)
On Question, Motion agreed to.
House in Committee accordingly.
[The Lord Aberdare in the Chair.]
Clause 1 [Disposal of land]:
Baroness Jeger Baroness Jeger moved Amendment No. 1:
Page 1, line 8, at beginning insert—
("(a) It shall be a condition of sale in any disposal that existing public access and amenity provisions shall be maintained.").
The noble Baroness said: This amendment is absolutely essential to the proper working of the Bill. I must remind your Lordships that, in the view of most people in this country, the purpose of the Forestry Commission is not just an economic exercise in the buying and selling of timber; the commission has a very important social, recreational and educational purpose. By its work, it has contributed enormously to knowledge and understanding of the countryside and has promoted access to its woodlands to people from all over the world. The fear of many of us is that by its sales of Forestry Commission land to private owners, there might be some diminution in the provision of these vital facilities.
I call them vital facilities without any exaggeration whatever because I am sure the whole Committee will agree that in the stresses and tensions of modern life, particularly urban life, recreation in the countryside and the use of leisure in fresh air, particularly amid woodland beauty, is of special value. Access to the countryside and the ability to walk in the woods and get to know country life is of infinite importance in trying to instil in young people some balance and understanding of what life is about.
This question involves not only health but relaxation and education. I am encouraged to have a note from the Whitley Council, trade union side, of the Forestry Commission which says:
"The maintenance of public access and recreational facilities which already exist should be a condition of sale, especially in national forest parks and areas of outstanding natural beauty."
It is not just a question of asking the new purchasers to leave open the footpaths. The Forestry Commission does a much more important promotional job through the erection of forest cabins and educational centres, and I might add—though perhaps it does not fall strictly within the amendment—undertakes the building of houses for the accommodation of foresters, as well as training, and the supply of trees for breeding and so on. To sell on a purely commercial basis to

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faceless investors, or to people who would not know a pine beauty moth from a cabbage butterfly if they saw one, the woods where special promotional measures have been taken would seem not to fulfil the real purpose of the forests of our country.
I am thinking in particular—to give just one example—of Placked Walk, designed for the disabled by the Forestry Commission at Abbots Wood, in Bedgebury Forest. That was done well before the International Year for the Disabled. The Forestry Commission definitely and purposely laid out a walk through the woods, accessible to people suffering from disabilities, including those in wheel chairs.
There might be angelic commercial purchasers or private forest owners—and I hasten to say that I know many private owners of forests who do much to promote public access and understanding. But I honestly have my doubts as to whether we could take it for granted that all such amenities would continue to be available, with high standards not only of access, but of education about flora and fauna, with facilities for school camps and for day visits by school children, where they can have practical geography and botany lessons. What confidence could we have that new owners would necessarily spend resources on these kind of projects?—since to do so would demand a great deal of money and attention. The marking of forest trails and the setting up of camp sites, for instance, are essential in what can be, especially for many urban children, a rather frightening environment. Such facilities are necessary, but they all cost money. It has been estimated that this side of the commission's activities cost about £3½ million last year. That figure was given in a Standing Committee in another place, and I mention it in order to remind your Lordships' Committee that the problem of access and amenity is not without an economic aspect.
It might well be said that we can trust whoever buys any of the lands to continue this good work. It might be said that the Forestry Commission will not sell unless there is this kind of understanding. If that is the view of Her Majesty's Government, why not put it in the Bill? In the meantime we can go only by advice. The Association of County Councils, in its memorandum on the Bill, observed:
"Private ownership usually reduces opportunities for access and public recreation."
I have not heard any equivalent statement of the other point of view: that private ownership increases access, or even maintains access and public recreation.
An anxiety was also expressed by the Royal Society for Nature Conservation. In a statement the society said:
"If these woodlands are offered for sale on the open market, we believe that there is a danger that some will attract prices beyond the means of any organisation prepared to acquire them for conservation reasons and further losses or damage of important wildlife habitat would result".
I think that we are all aware that often when pension funds (which have been mentioned as potential purchasers of our woodlands) or other financial institutions buy works of art for investment purposes, the first thing they do is to lock them away. Where people make purchases purely for investment purposes there is no earthly reason why they should share the things with other people. The last thing that they want is
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public enjoyment. I am afraid, and so are many of my noble friends, that the same attitude will apply to land if the motive for acquisition is basically financial and is without any social purpose.
Therefore I move the amendment, very much hoping that the anxieties that I have expressed will find sympathy on all sides of your Lordships' Committee. It seems to me perfectly reasonable that with the pressures of modern urban life, with the pressure on land for all kinds of purposes all over the country, the one thing that we must make sure about is that there is no deprivation of access or of leisure facilities or holiday amenities for the people of this country. I beg to move.
3.8 p.m.
Lord Gisborough: First, I should like to commend the amendment to some extent. One has in mind a picture of a nice open forest, with fairly mature trees, and paths, and it would be very unfortunate if such an area were sold and immediately closed to the public. In fact, I think that would be inexcusable. But one must look a little further than that. First, the Forestry Commission planted its trees entirely for investment purposes. They were planted probably at 4-ft. intervals and were thinned out over many years until they were growing at intervals of 15ft. or so, as is seen, for instance, in the attractive Scots pine forests through which one very much likes to walk. To suggest that such a forest, having been grown at enormous expense, should then be sterilised forever as a conservation area, is to negate the whole point not only of planting, but of the Forestry Commission itself.
Whether the Forestry Commission keep the forest—and the commission would fell it in due course—or whether it is sold, it must be felled at some time. That is what it is there for. Probably it will be felled in 10-acre lots. There might be a gap of half a mile before the next area to be felled. One sees in particular in Scotland that next to an area that has been felled, there are young trees, and further along there is an area of 30-year old trees. Half a mile further on another lot has been felled. It is not a question of felling an entire hillside at a time. But felled the trees must be, and then there must be replanting.
The question then arises as to what happens if access is statutorily allowed through such a wood which has been planted with young trees at 5-foot intervals. I can from personal experience tell your Lordships' Committee what happens. If people are allowed into the forests, they will break down the fences. Sheep will get in and do much more damage than rabbits will do, though they will get in, too. People will get in and set fire to the forest, and I know to my cost that once a forest is on fire, it has to be left to burn, or it is extremely difficult to put it out if it is at a young stage. Therefore, while it might be all right to have access while the forest is a high forest, the right to access must not be tied because otherwise following replanting access would be totally and utterly impracticable.
Lord Hunt: I wish to support the amendment that was so movingly and tellingly moved by the noble Baroness, and I endorse totally the reasons that she advanced for ensuring through legislation that access

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by members of the public will not in any way be prejudiced by the passing of the Bill into law. The noble Lord, Lord Gisborough, began his intervention by saying that it would be inexcusable if access were denied to members of the public as a result of a transaction made possible by the Bill, but, if he will forgive me for saying so, so far as I could understand he then proceeded to excuse that very thing.
I rise only to make one additional point. It is one which came up time and again during the consideration of the Wildlife and Countryside Bill. It is to remind your Lordships that we are legislating in this Forestry Bill not for a matter of months and that once this Bill is law it will remain on the statute book, probably unamended, for a number of years. At least four years will elapse until after a new Parliament has been elected before any kind of modification can be brought in. In those several years following the passage of this Bill into law, no end of harm could be done to the interests of the public and to young people in particular.
Lord Inglewood: I have sympathy for much that the noble Baroness has said but I did not think that the picture she painted was the picture of Britain today. The time may come when the people in this country share the same sort of feelings that the Germans have, which is almost a mystic interest in their woods. It is a country where people go out in thousands every weekend. That is not the case in this country. None the less, I think it is our responsibility to see that access and the sort of opportunities that the noble Baroness spoke about are not unduly restricted. I should like to see the word "equivalent" here as far as access is concerned. When one is dealing with any sort of estate or forest management, it is often inconvenient to have an ancient footpath running in a certain line when there would be little hindrance or inconvenience if it were to be moved. I should like to think of the use of the word "equivalent".
When it comes to the question of who buys woodland in this country, I cannot believe that it is done only for financial reasons. Anybody who has been a woodland owner with his family for some generations will know that nobody ever made any money out of woods. There are mixed motives. In general, those people who have owned private woods in this country have been reasonably generous in the opportunities for access. What is difficult is access to the smaller woods. It is easier when you own a big block to have a footpath or even a bridlepath running through one part of it; but when you own a number of small woods it is more difficult to welcome access on a wide scale. I should like the noble Baroness to withdraw the amendment if she can get an assurance from the Minister that he will look at it again before the next stage of the Bill to see whether he could not put in proper safeguards but which would not bind us as tightly as the noble Baroness would like.
Lord Mackie of Benshie: I support the noble Lord who has just spoken. This appears to be a sensible and harmless amendment. I do not think the objections of the noble Lord, Lord Gisborough, are valid. It says in the amendment:
"It shall be a condition of sale…existing public access…"
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The Forestry Commission do not give access to young woods, newly planted where people can wreak the destruction that the noble Lord was talking about. Also, speaking for myself, it is a sensible condition to put in because all countrymen have a dislike of seeing a certain type of townsman about their property. In my breast there often arises the old feeling: "Here be a townsman, 'eave half a brick at him", when I see people come out into the country and pull the daffodils that I have planted for their edification. I think protection is necessary because owners do not like to see people walking about their property and, where there has been existing public access, I cannot see why the Government should not give an assurance that this right will be protected.
Lord Gisborough: I take up the point that the noble Lord made in referring to me. The point is that the timber of today will be the young plantations of tomorrow, and if you put a footpath through you cannot or may not be able to replant.
Lord Hawke: As one who lives at the edge of a fairly large Forestry Commission estate I would regret it if it were ever sold and went into private hands. I am sure that the first thing that would go up will be the "Trespassers will be prosecuted" boards. It is the favourite dog walk area for most of the large town of Horsham. As my noble friend Lord Inglewood has said, I do not think the amendment is quite practical because we have access at the moment to this forest only by courtesy of the Forestry Commission. To give anybody a legal right to go there would be inimical possibly to the growing of timber.
We must get some sort of compromise. I personally have never seen this wanton destruction of young plantations going on in this large area. They continue to extend their forest, plant new bits and put up rabbit fences. I have never seen anybody pulling them down or hopping over them. There are rides there. The chief menace is the little girls on their ponies who cut up the rides. Even there the Forestry Commission, by putting up polite notices, "Please do not ride here", or, "You can ride here", have managed to curb that slightly. What is wrong is that this Bill exists at all. Why Her Majesty's Government, who say they are short of time for everything, should waste time on this silly step, I do not know.
Lord Taylor of Gryfe: I should like to support the amendment moved in the name of the noble Baroness, Lady Jeger. It has been said that what we are talking about is protecting existing rights in the forest. What are these existing rights? The annual report of the Forestry Commission reports that an estimated 24 million day visits were made to commission land during the year and that 1.5 million camper nights were spent on Forestry Commission property during the year. To me that is an important right to protect. The access to forest land which is taken advantage of to that extent should be protected in the legislation.
I can recall, when I used to go hill climbing and walking in Scotland, that it was not unknown to find a notice at the access to some of the mountains, "Private property. Keep out!" I remember what is now one of the most beautiful parts of the Forestry Commission property, the Queen Elizabeth Forest Park. It was

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formerly owned by the Duke of Montrose. It was known as Duke's Road. You had to pay a toll to the Duke to get access to the Trossachs and that part of Scotland. If the Forestry Commission have contributed anything, they have contributed a great deal to providing a source for home grown timber supplies, but they have also provided a revolution in access to the countryside. That has been taken advantage of by young people who go out from the cities at the weekend and camp and walk the forest trails. It is done with great good sense and protection for young plantations. It is well designed. Their notices are not offensive. They protect the quietness and beuty of the forest.
I would suggest that that protection is worth writing into the Bill. I am not suggesting that all private owners of forests are imbued solely with the desire to make more money out of their investment. I have been impressed by the responsibility shown by many, even many noble Lords in this House, who are large forestry owners; but there is a danger that in introducing this commercial aspect we will sell off assets of the Forestry Commission to private ownership as a source of investment; and that we shall destroy the kind of relationship which existed between the commission and private ownership and will transfer the concern of the people who owned woodlands over many generations to pension funds and others who look at the balance sheet at the end of the year and say, "How much is this earning for the potential pensioners in the pension fund?" I suggest there ought to be this very important part of our national heritage. The right of young people to have access to the countryside should be protected and should be written into the Bill in terms of the amendment which has just been moved.
3.20 p.m.
Lord Roberthall: I was hoping to support the amendment. I am very much in favour of it. However, our attention has been called by the noble Lord, Lord Gisborough, to the dangers which are in the word "existing". If to include the word "existing" is taken to mean that the whole pattern that exists at any moment is frozen, then there may be something in the feeling that this condition would prevent the good management of the woodlands. I wonder whether the Government will accept the suggestion which has already been made that some other word, such as "equivalent", may be substituted, keeping the meaning. However, if it is the case that the word "existing" is too restrictive and would freeze the pattern, then perhaps this matter could be looked at.
Lord Dulverton: It is not very often that I find myself differing from the noble Lord, Lord Taylor of Gryfe, with whom I have worked for many years in the world of forestry. In giving his support to the noble Baroness's amendment I think he is getting too worried. I know he has proclaimed his interest in the House before now as chairman of a commercial forestry enterprise. Commercial as they may be, they provide very good facilities for the public in many of their large forests.
I believe that this safeguard could be written into the Bill in a simpler and all-embracing manner, and
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there are amendments coming later this afternoon which suggest that it should be written into the Bill that sales of land should be carried out only in consultation with and on the advice of the Forestry Commissioners. The Forestry Commissioners have it in black and white in their terms of reference that they are, among other things, to take care to provide facilities for the public recreation in their woods. If this point was written into the Bill, that the Minister must consult with and get the advice of these commissioners before he sells any land, then I do not believe there would be any need for the amendment of the noble Baroness, although I am entirely in sympathy with its purport.
Baroness Elliot of Harwood: May I ask whether the Government realise the number of amenity places that have been provided by the Forestry Commission for the public in the areas in which the commission operate? I happen to live almost in the middle of the largest forest in the South of Scotland. The noble Lord, Lord Taylor of Gryfe, who is chairman of the Forestry Commission, initiated a number of excellent picnic places and areas where people can go and study. There is a place where one can study the different kinds of trees. It is not exactly a museum but it is a place where one can learn about the trees. It is an absolutely first-class amenity. I cannot imagine anybody—if they were rash enough to buy some of that vast forest—who would do away with that. It is most important that people should realise what an extremely good organisation the Forestry Commission has been regarding the public.
The noble Lord, Lord Taylor, referred to the trails that people can follow. He mentioned the Queen Elizabeth Forest. I cannot say I know it fairly well, but I am a member of the Carnegie Trust which was responsible for erecting a very good building where meals and so on are served. People can walk all round the forest which is now managed by the commission. All these facilities make forestry far more important and interesting to the public than just miles of conifers, which is what the alterative is. I am not very much in favour of miles and miles of conifers, as your Lordships know. If the amenities are there then it is a good idea for the public to be able to use them. I do not think that they should have access to destroying or spoiling them. Indeed, if they do that they should be prosecuted. But when it comes to the amenity arrangements that have been made by the commission and by some of the private forestry companies it is important that these arrangements should be safeguarded and open to the public if they want to go there.
I should like to ask whether or not this could be done without the amendment. Is this amendment essential for access to be available to the public? It ought to be available. Whether or not the wording is correct (and the noble Lord who has just spoken feels it is not quite right) the principle that has been established particularly for the Forestry Commission—as I say, I live in the middle of a forest—is something that should be preserved.
The Earl of Mansfield: I am very conscious of the feelings which have been expressed from all parts of

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the Committee that the existing facilities and recreational enjoyment, which is a feature of some of the woodlands which have been established by the Forestry Commission, should be maintained for public enjoyment. The Government have been conscious of this in the deliberations which have gone on before the publication of this Bill. There are difficulties about writing this kind of provision into a Bill. I shall have to go into them in a minute although one hesitates and does not like to be too legalistic.
The noble Baroness's amendment is designed to ensure that facilities for public access provided by the commission should be maintained after sale. That is the first part of her amendment. She goes further and wishes to ensure that what she calls "amenity provisions" should be maintained. If I may say so, that is a very vague term. I assume, being as charitable as I can, that it is really linked to public access because it follows the phrase and therefore we can include what I might call recreational facilities and amenities and so on.
Baroness Jeger: I am sorry if the noble Earl did not hear what I said. I thought I made it clear that "amenity provisions" referred to forest cabins, camping sites, forestry trails and caravan sites.
The Earl of Mansfield: With respect to the noble Baroness, it is not what she tells the Committee; it is a question of what people who come after all of us have to read into this Bill. So we have to try to get it right. Most of the forests are totally uninteresting except for those who wish to grow trees there. I do not know how far out of the towns noble Lords and Ladies go, but I have seen vast ranges of sitka. If one tried to get into them one would merely injure oneself, unfortunately. If there are existing rights of way then nothing that this legislation will do will interfere with them.
But we have tried to take into account the sentiments which the noble Baroness has expressed. One of the matters which the Forestry Commission will have to pay heed to when considering such sales is the extent to which an area is used by the public. I use that phrase advisedly. If the Forestry Commission decides that public access is important, then it will not sell the area at all, but it will have a sale and lease-back, and in that way all the amenities can be preserved and there will be no change. In my submission, that is an important safeguard.
The trouble with the amendment moved by the noble Baroness, Lady Jeger, is that there are some major legal difficulties. If the purchaser were required to maintain, for instance, access and amenity provisions, that would be a duty for the benefit of the public at large and not to any one person. That really does not fit into our conveyancing system in this country, and that remark applies to Scotland just as well, because the system is concerned essentially with private rights. It would be difficult to define in detail these rights for the purposes of conveyancing. If they were not set down at very considerable length, there could be endless disputes as to what they meant and their precise extent.
The next difficulty would be the enforcement of the
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covenant by the public. Any action to do so would have to be taken by the relevant Minister because he would be the vendor; but by then he would have relinquished his interest and, since he would not have suffered any damage, it is difficult to see what form of redress would be available against the purchaser. The next point is that covenants of this type cannot be framed to bind successors in title to the original purchaser. In other words, whatever one might wish to achieve so far as what I might call the first generation is concerned, it certainly would not bind successors in title.
Apart from problems with the legal difficulties, I do not believe it is right to require someone to allow the public on to his land as a matter of legal right without any form of control; although as I have said, if there are rights of way then this legislation will make no difference to them. It would be an extremely odd and very difficult statutory requirement, for instance, to make a purchaser legally responsible for maintaining such facilities as picnic sites or way-marked trails. The Forestry Commission can, of course, vary its facilities and the way in which it makes them available according to its by-laws; that is very useful for the Forestry Commission, but those provisions would not be available to the purchaser. One control which is exercised by the Forestry Commission is that to prohibit the lighting of fires which, particularly in the case of young woodland, can be very dangerous indeed; no such control would be made available to the purchaser.
I do not believe that in many cases the public will, in fact, be barred from access to the forests if they are sold. I was slightly surprised by the remarks made by the noble Lord, Lord Taylor of Gryfe, because in the Recess I took up an invitation which his company very kindly extended to me to visit Eskdalemuir to see what facilities have been made available there to the public. Although the weather was not exactly kindly, I did see for myself the immense trouble which has been taken by the company, not only to make the forest accessible but also safe, interesting, informative and indeed educational to the thousands of children who make use of its visitors' centre every year. I have no doubt that that company, under the able chairmanship of the noble Lord, is looking to the bawbees just as much as any other! I am very aware of the concern which people may feel if they believe that the public cannot avail themselves of our countryside, and that obviously includes woodlands, if a sale takes place. I myself do not believe that the pension funds and similar institutions will jeopardise their goodwill by closing off these woods or forests. Other corporations which I know a little about certainly do not take that view although I know I must not mention them. I do not believe it would be right—and certainly it is not legally possible—to put some kind of statutory burden of this kind on the buyer. I have refrained from pointing out, at least in detail, the depressive effect that this sort of statutory requirement would have on the possible price, because I do not believe that that consideration is as important as the consideration which I have set out. In those circumstances and with a mild sense of regret, I cannot accept the amendment. I hope that upon reflection the noble Baroness, Lady Jeger, will see that, however well-intentioned this

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amendment is, it cannot be put into the Bill, and I hope that she will join me in that view.
3.37 p.m.
Lord Sandford: I am entirely in sympathy with the intentions behind the amendment put by the noble Baroness, Lady Jeger, but I have to agree with my noble friend Lord Inglewood and my noble friend Lord Dulverton that, for a whole variety of reasons, this is not perhaps a topic that can be dealt with very conveniently, if at all, as my noble friend has said, in primary legislation. For instance, it would not deal with the problem which concerns the district of Forest of Dean, with which authority I have had some discussions about this. Public access there does not rest on rights but on privileges accorded to the Crown, so the public access there would not be safeguarded by this amendment even if it was passed.
I am disappointed that my noble friend is not able to say any more than that it is not legally possible. I was relieved that he did not say he would give a personal assurance that all this would be all right because, as he has just told the noble Baroness, Lady Jeger, it is not what people say during the debate that matters, whatever their personal integrity—and nobody's integrity is in question in this case—but what is actually in the Bill. We have to get into the Bill some way of ensuring that the purposes of this amendment are safeguarded in a way whereby Parliament can call the Minister to account. If that cannot be done in primary legislation, then we can see if it can be done in some form of secondary legislation, in papers, in notices, in memoranda, or something else which has to be submitted to Parliament by the Minister before he intends to act. Perhaps my noble friend the Minister would care to comment on this suggestion before the noble Baroness, Lady Jeger, decides what to do with her amendment. I hope that at this stage the noble Baroness will leave it to see whether discussions could carry the matter forward before the Report stage.
Lord Mackie of Benshie: May I also seek clarification on a point that was made by the Minister? I believe he said that, in consideration of the sale of any forest which had a large number of amenities and was much used by the public, then the commissioners and the Minister certainly would not sell it but they might instead arrange a sale and lease-back. Did the Minister actually say that there was an instruction to that effect, because I do not see it in the Bill?
The Earl of Mansfield: I believe there is a danger of going down a woodland path much further than this comparatively simple amendment justifies. I have quite a lot to say about this when I come to speak to future amendments, but what the noble Lord will know from previous debates is that the way in which the Forestry Commission is expected to carry out its function—which is the important function under this Bill—is not to sell woodlands which, for a variety of reasons, may not in fact lend themselves to sale in a particular instance. This applies to the matter of such amenities as access.
Lord Davies of Leek: I have listened to the Minister and I am sure that he meant what he said, but he seemed to contradict what he said earlier, because he appeared
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to imply that nobody would struggle into these coniferous forests; they would get scratched with prickles and so on. Then, later on, he talked about people enjoying amenities. This Bill seems to give such wide qualifications to a Minister. This is happening with every kind of Bill that we have. The Bill says in the Explanatory Memorandum:
"Clause 1 substitutes for section 39(2) of the Forestry Act 1967 a provision enabling Forestry Ministers to dispose,"—
and here is the active bit—
"without restriction or qualification, of land acquired for forestry purposes.".
That may be land acquired centuries ago for forestry purposes. It may be land where privileges exist, as they do in the Forest of Dean; and without any restriction or qualification the Minister has this power. We are giving away heaven and earth in this Bill.
Baroness Jeger: I should be modest to a fault were the drafting of this amendment to be questioned, and if there had been any constructive suggestion from the Minister I should most happily have received it. I say to the noble Lord, Lord Inglewood, and the noble Lord, Lord Dulverton, whose sympathetic approach to this problem I very much appreciated, that when this amendment was drafted in a form of words referring to "existing public access", that did not mean in my mind or, I am sure, in the minds of my noble friends that every single footpath must be maintained exactly where it is. "Access" is a much wider word. "Access" means that people can get into a wood. It does not mean that if there were new plantations, to which the noble Lord, Lord Gisborough, referred, the owners would not have the right to say, "Access is not to be here. Will you please take your ponies up there?" I am sure that that is the only sensible way to interpret the term "public access".
As for the question of "amenity provisions" being rather vague, I thought that that would be helpful to your Lordships. I thought that if I had made a list of pony trails, caravan sites, rivers for fishing and rocks for climbing, that would be restrictive and boring, and rather a nuisance to those who have to implement the Bill. The noble Earl the Minister has great faith in the Forestry Commission's powers in this matter and he believes—and I share this belief with him—that they would be most sensitive about the future disposal of their land. But the trouble with this Bill is that we are not talking about the Forestry Commissioners; we are talking about Clause 1, which enables the Minister to dispose of land.
If noble Lords would look not only at Clause 1 but at the Explanatory and Financial Memorandum, they will see that Clause l is explained as:
"enabling Forestry Ministers to dispose, without restriction or qualification, of land acquired for forestry purposes."
So what is the good of the Minister's saying to this House, "We know that there are to be no restrictions and no qualifications, but we will have a word with the chaps and try to see that everybody plays the game"? I really think that that is an insult to your Lordships and to any legislative chamber. We are here to lay down the law of the land, and the law of the land is set out in the Bill. It is not set out in jolly assurances from optimistic Ministers.

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The Minister said—and I am glad that he spelled this out—that the amendment would benefit the public at large and not any one person, and therefore it does not fit into our conveyancing. The whole purpose of this amendment is to benefit the public at large and not to benefit any one person because he happens to have the money to buy up precious land which ought to be the heritage of the public in this country. As for the argument that it does not fit into conveyancing, I would ask: Was conveyancing made for man, or was man made for conveyancing? As an old civil servant, I know too well that argument about things that are not legally possible. In the course of my long and varied life, I have seen so many things that were said not to be legally possible suddenly become more than possible, when any Government so wished.
The Minister objected to the amendment on the grounds that it was not legally enforceable on a subsequent purchaser. There is a future amendment which I hope will allow us to raise that point and to keep in order on it. I should have thought that this was another very substantial reason for throwing out the whole of Clause 1. But I shall not get myself out of order on that point at the moment. Then the Minister said that putting in such a condition of sale would have a depressive effect on prices and sales. There is nothing that I should like better. I do not want to see spiralling land prices and competition for the purchase of the land of this country which is in ever short supply, with the demands of industry, agriculture and so on. I should be very happy if there were a depressive effect on prices. We are not playing a game of Monopoly here; we are talking about land which cannot be reproduced in any shape or form.
Therefore, if these purchasers were frustrated silviculturists, who really wanted to buy woods because they liked woods, then I should be happy for them to get them at a lower price by virtue of accepting this condition of sale. The only people who will not want to accept this condition of sale are those who do not care about public access and do not want people to go on to their land. That is why such people would not buy land with this condition of sale on it. Therefore I submit that those are not the kind of landowners that we want to replace the Forestry Commission, with all the care that they are taking in dealing with their lands.
I wish that we had been able to have some meeting of minds over this. But I think that it would be unfair to expect the noble Earl the Minister to come even a couple of steps along the woodland path, or half a mile along the bridleway, because I have read very carefully the reports of the debates in another place, and I know perfectly well the hard-nosed Government attitude to this Bill and to this amendment. I am sorry to have to speak a little more roughly than I should wish, but I feel that the division in our thinking is absolute and total. I am not prepared to withdraw the amendment, and I hope that there will be support from all sides.
The Earl of Mansfield: Before the matter is put to a Division, perhaps I may remind the noble Baroness,
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and your Lordships, that she herself said that she had drafted her amendment quite deliberately so that, if the words "public access" were not meaningless, they were deliberately vague. She said that she wanted to write something into the law of the land, and confessed that the words "amenity provisions" were deliberately vague. I told her—and I do not think that anybody has sought to deny what I said—that even if the words were not deliberately vague they were legally unenforceable. In these circumstances, the noble Baroness is asking the Committee to support her in the Lobby; in other words, she wants to write into this Bill two phrases which are deliberately vague and, as she said, not framed in a boring manner so that they will be specific. In this case, if there is an abuse of the Committee I know very well who is abusing it. It is surely not right to try to write into a Bill what is very nearly a wrecking amendment simply because one does not like the principle behind a Bill. On that basis, if the noble Baroness insists upon dividing the Committee I hope your Lordships will know which way to go.
Baroness Jeger: I must take issue with the Minister on that point. This amendment was put forward with all goodwill, and I thought moderately, and with the support of many people. The correspondence I have had from many conservation societies certainly echoes much of the debate which we had on the Countryside Bill a little while ago. I think it was an abuse of the Committee for the Minister to speak as he did.
3.51 p.m
On Question, Whether the said amendment (No. 1) shall be agreed to?
Their Lordships divided: Contents, 78; Not-Contents, 100.

CONTENTS

Airedale, L.

Grey, E.

Amherst, E.

Hale, L.

Amulree, L.

Hampton, L.

Ardwick, L.

Hanworth, V.

Avebury, L.

Henderson, L.

Banks, L.

Houghton of Sowerby, L.

Beaumont of Whitley, L.

Hunt, L.

Beswick, L.

Irving of Dartford, L.

Birk, B.

Jacques, L.

Blease, L.

Janner, L.

Blyton, L.

Jeger, B.

Boston of Faversham, L.

Kennet, L.

Briginshaw, L.

Kilmarnock, L.

Brockway, L.

Leatherland, L.

Brooks of Tremorfa, L.

Listowel, E.

Byers, L.

Llewelyn-Davies of Hastoe, B.

Cledwyn of Penrhos, L.

Lloyd of Kilgerran, L.

Clwyd, L.

Longford, E.

Collison, L.

Mackie of Benshie, L.

Cooper of Stockton Heath, L.

McNair, L.

David, B. [Teller.]

Mishcon, L.

Davies of Leek, L.

Oram, L.

Davies of Penrhys, L.

Paget of Northampton, L.

Denington, B.

Pargiter, L.

Donaldson of Kingsbridge, L.

Peart, L.

Elwyn-Jones, L.

Ponsonby of Shulbrede, L.

Fisher of Rednal, B.

Reilly, L.

Goronwy-Roberts, L.

Richardson, L.

Gosford, E.

Robson of Kiddington, B.

Granville of Eye, L.

Rochester, L.

Greenwood of Rossendale, L.

Ross of Marnock, L.

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Sainsbury, L.

Taylor of Mansfield, L.

Saltoun, Ly.

Underhill, L.

Seear, B.

Vernon, L.

Shinwell, L.

Wallace of Coslany, L. [Teller.]

Spens, L.

Stewart of Fulham, L.

Wells-Pestell, L.

Stone, L.

Willis, L.

Strabolgi, L.

Wootton of Abinger, B.

Taylor of Gryfe, L.

NOT-CONTENTS

Alexander of Tunis, E.

Kimberley, E.

Allerton, L.

Kinloss, Ly.

Alport, L.

Long, V.

Avon, E.

Loudoun, C.

Balfour of Inchrye, L.

Lyell, L.

Bathurst, E.

Mackay of Clashfern, L.

Bellwin, L.

Macleod of Borve, B.

Belstead, L.

Mancroft, L.

Bessborough, E.

Mansfield, E.

Birdwood, L.

Margadale, L.

Bledisloe, V.

Marley, L.

Bridgeman, V.

Melville, V.

Brownlow, L.

Morris, L.

Caccia, L.

Mowbray and Stourton, L.

Campbell of Croy, L.

Newall, L.

Clancarty, E.

Northchurch, B.

Clinton, L.

Nugent of Guildford, L.

Cockfield, L.

Onslow, E.

Cottesloe, L.

Orkney, E.

Cullen of Ashbourne, L.

Orr-Ewing, L.

Daventry, V.

Pender, L.

Denham, L. [Teller.]

Perth, E.

Derwent, L.

Portland, D.

Dormer, L.

Powis, E.

Dulverton, L.

Radnor, E.

Dundee, E.

Redmayne, L.

Ebbisham, L.

Reigate, L.

Eccles, V.

Renton, L.

Effingham, E.

Romney, E.

Ellenborough, L.

St. Aldwyn, E.

Elles, B.

St. Davids, V.

Elphinstone, L.

St. Germans, E.

Exeter, M.

Sandys, L. [Teller.]

Faithfull, B.

Sharples, B.

Ferrers, E.

Skelmersdale, L.

Forbes, L.

Soames, L.

Forester, L.

Somers, L.

Gainford, L.

Stamp, L.

Gibson-Watt, L.

Strathclyde, L.

Gisborough, L.

Thorneycroft, L.

Grey of Naunton, L.

Trefgarne, L.

Gridley, L.

Trenchard, V.

Haig, E.

Trumpington, B.

Hailsham of Saint Marylebone, L.

Vaux of Harrowden, L.

Vickers, B.

Hawke, L.

Vivian, L.

Henley, L.

Waldegrave, E.

Hood, V.

Westbury, L.

Hylton-Foster, B.

Wigram, L.

Ilchester, E.

Willoughby de Broke, L.

Killearn, L.

Resolved in the negative, and amendment disagreed to accordingly.
House resumed.

Lead Pollution
4 p.m.
The Parliamentary Under-Secretary of State, Department of the Environment (Lord Bellwin): My Lords, with the leave of the House I will now repeat a Statement which is being made in another place by my
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right honourable friend the Minister for Local Government and Environmental Services. The Statement is as follows:
"The Government have now completed their review of policy, in the light of the report by the working party under the chairmanship of Professor Lawther, set up by my right honourable friend the Secretary of State for Social Services. The Government accept the general conclusion of the report that current policy needs to be tightened in a number of respects, building on what has already been achieved.
"The report makes clear the need to improve our knowledge of the effects of lead in our environment, and particularly of possible effects on children's intelligence. Some studies have been completed on this, and more are in hand; the Government have invited the Medical Research Council to commission a major study in this area.
"The report emphasises the importance of a comprehensive approach towards tackling the problems of lead pollution. I have placed in the Vote Office a paper outlining the Government's response to the detailed recommendations in the report. In this Statement I shall deal with the main points.
"First, paint. The real problem here is not paint currently on sale to the public—most of which is virtually lead-free—but old paintwork in many houses and other buildings. This will be tackled by information and advice to local authorities, and by increased emphasis in health education programmes on ways to counter the hazards. There will be early discussion with the local authority associations on this and on other matters concerning local authorities.
"Second, water. High levels of lead can occur in drinking water in some areas. The problem arises only in the minority of households which have both lead-solvent water and lead plumbing. Water authorities have been working to identify the problem areas, and are taking steps to tackle the problem at source. This work is being pressed ahead as rapidly as possible. Meanwhile water authorities, local authorities and area health authorities are being asked to co-operate to provide information and advice to people who may be affected.
"In some cases, and particularly where drinking water comes from lead-lined tanks, the only answer is to alter the plumbing. The Government propose that such work should be eligible for home improvement grants; this will be considered in consultation with the local authority associations. My right honourable friend will be taking corresponding action in Scotland, where there is a particularly severe problem in those areas where lead-lined tanks are common.
"Third, food. New regulations reducing the maximum permitted levels in food offered for sale came into force last year. The Food Additives and Contaminants Committee have already been asked to study the implications of the use of lead solder in cans in their study of metals in canned foods.
"Finally, emissions of lead to air. The Lawther Report recommends an air quality standard for lead

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of 2 micrograms per cubic metre. The Government agree that this standard, which is also proposed in a draft European Communities directive, should be adopted.
"So far as the control of industrial emissions is concerned, current powers are adequate to allow the proposed standard to be met. But, as the figures quoted by Lawther show, the standard cannot be met in some areas of heavy traffic. Petrol-lead emissions may also result in high levels of lead in dust, and contribute to lead in food.
"The Government have decided that the maximum permitted lead content of petrol should be reduced as far as is possible, without ruling out the continued use of car engines of present design—that is, from the present limit of 0·40 grammes per litre to 0·15 grammes per litre. This will reduce by about two-thirds lead emissions from cars some 10 years earlier than any other practicable method.
"The aim will be to introduce the new limit not later than the end of 1985. The oil industry will need to install substantial new plant in order to produce the new low-lead petrol in sufficient quantities; and we shall discuss the practical requirements with the industry. There will in time be some increase in the cost of producing petrol, but we believe that such extra costs are reasonable in relation to the environmental benefits of an early and substantial reduction in lead emissions.
"Professor Lawther's report warned of the need to take further effective action to deal with lead pollution. The measures I have announced today show the Government's acceptance of the importance of his report and our intention to take all necessary steps to reduce the hazards arising from lead in our environment".
4.5 p.m.
Baroness Birk: My Lords, I want first to thank the Minister for reading that Statement which has been made in another place, but I should like to point out right away that I find it slightly misleading that the Statement should say that the working party set up under the chairmanship of Professor Lawther was,
"set up by my right honourable friend the Secretary of State for Social Services"—
that is the Minister speaking, not me. In point of fact this working party was set up in December 1978 by the Labour Government and, in this House on 14th March 1979, in answer to a Question for Written Answer tabled by the noble Lord, Lord O'Hagan, my noble friend Lord Wells-Pestell spelled out the terms of reference of the working party and also confirmed that it had started work in December 1978. I do not know what the procedure is, but I suggest that this should be altered in order to put the record right.
I now come to the main body of the Statement. I can see the emphasis that the Government give—and I do not blame the particular Minister who was around at the time for his adoption of Professor Lawther and his working party. We welcome very much what has been said on paint and food but, when it comes to water, there are some questions that I should like to ask. Do the water authorities have the resources
348
to carry out the work that will be needed? Have the Government any idea what the costs will be, and why should householders receive only the general improvement grant of 50 per cent? What would happen if people could not afford the change? In a case like this, where it is so important for the community, the community should pay, and I should like to ask the Minister how this fits in with the Government's insistence on cuts all round.
The principal issue here is what the Lawther Committee's working party was mainly concerned with—namely, lead in petrol. We believe that what the Government have proposed is entirely the wrong decision. Is it not inevitable that environmental considerations, health considerations and a developing public opinion will all combine to make this halfway-house decision obsolete before it can be implemented? Certainly, so far as the Opposition is concerned we shall seek to go for lead-free petrol as soon as the opportunity occurs. I should like to ask the Minister, what will be the cost of moving from 0.15 grammes of lead per litre to zero-lead petrol when that step has to be taken?
What we are seeing here is really a policy of procrastination. We have already had a number of reports: we have had the Lawther Report; we have had the Wodip Report, which is the Working Party on Transport Lead in Petrol—I think that is the right interpretation of it. This was presented in July 1979. The Lawther Report on Health Hazards was presented in March 1980 and since then we have had further researches by Dr. Lansdown of Great Ormond Street and Dr. Yule of London University, who incidentally were both members of the Lawther Committee. This has significantly moved the balance of the argument in favour of the health and environmental considerations. Last year the GLC scientific department carried out a study into the effect of lead on children in playgrounds of schools in the ILEA areas and came to the very firm conclusion that the emission of lead was having a deleterious effect on the children's performances in school.
The Statement refers to the EEC levels, but although the EEC levels are set at 0·15 maximum, would the Minister not agree that it would reflect great credit on this country if we pioneered a lead-free situation? Would he confirm that it is perfectly lawful under EEC directives for petrol companies to offer and motorists to buy lead-free petrol?
There has been tremendous delay all the way through since the last committees and working parties reported. One suspects that there has probably been a tremendous dog-fight between the Treasury on the one hand and the Departments of Environment and Health on the other. I should like to know why there has been no White Paper, which we requested, setting out all the alternative considerations and costs so that informed debate could be held throughout the country before the decision was announced. While we think another major study is necessary, what is the point in coming to a decision which is going to be extremely costly and lengthen the time before we get lead-free petrol by setting up another commission to inquire into it? Does the Minister not agree that the absorption of lead into the body from any source, whether from air, water or food, is an evil? And what is the Govern-

349
ment's assessment of the effect of lead poisoning on children at the two alternatives of 0·15 and zero?
Next we come to industry. Is it not the case that industry wants the major decision taken now? To go for 0·15 now and move to zero later is the worst of both worlds. It is going to mean enormously increased costs to industry; they have to make the adjustments twice. The report in yesterday's Observer stated industry's view on this matter. Finally, what is the Government's estimate of the additional cost to industry and motorists of a two-stage operation? I am sorry to have asked so many questions, but I consider this is such an important Statement and its effects are so important for the whole community that we need to delve into it pretty deeply.
Lord Avebury: My Lords, while thanking the Minister for repeating the Statement, and agreeing with the noble Baroness that this is a vitally important subject, may I ask the Minister whether he does not think that sufficient studies have already been undertaken to render the proposed MRC work unnecessary? Is he not aware that in addition to the work of Lansdown and others at Great Ormond Street there have been a considerable number of studies, by David and Needleman in the United States, by Garnys Freeman and Smythe in Sydney and by a host of other workers whose literature has been reviewed by the United States Environmental Protection Agency? Does he not think that the evidence accumulated is sufficient to establish beyond all reasonable doubt that the neuro-behavioural effects of lead on children are completely proven?
My Lords, turning to the question of water, do I understand correctly that removal of lead lined tanks would be eligible for improvement grant, but where you have only a combination of lead plumbing and lead solvent water the householder will be able to look only for advice from the local authorities, water authorities or public health authorities? Does the noble Lord not think that the improvement grant should extend to plumbing as well as to tanks? What advice could the authorities concerned give to the householder other than that the plumbing in question should be removed?
Turning to the proposal on petrol, we give a muted welcome to the idea that the concentranton should be reduced to 0·15 grammes per litre by 1985. We agree with the noble Baroness that this is an insufficient rate of progress and that it should have been done much earlier. How could the Japanese have produced lead-free petrol by 1975? How could the Swedes be planning to introduce lead-free petrol by 1985, the Australians to produce lead-free petrol by 1985, and the United States already have a substantial number of filling stations selling lead-free petrol now? Is it not clear that this is the way the whole world is moving, and that if we continue to produce vehicles designed to run on 0·15 grammes per litre we shall have to modify our cars and commercial vehicles for sale in overseas markets, thus making the costs of our motor industry higher than necessary?
Finally, could the noble Lord say anything about the long-term intentions of the Government? If it is necessary, as the oil industry claims, to give so much notice of changes, ought they not to be told now if it is
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our policy in the long run after 1985, as we very much hope, to move to lead-free petrol?
Lord Bellwin: My Lords, to deal first with the points raised by the noble Baroness, Lady Birk, I did know that the original study was set up under the previous Administration, but it is now this Administration which is charged with doing something about the conclusions which it has reached, and that is why we are making this Statement today.
Baroness Birk: My Lords, with great respect, I think we should have it right on the record. The Minister said that it was set up but we are doing the report. I think he must either agree or not agree that the working party under Professor Lawther was set up by the last Government. This is a fact.
Lord Bellwin: My Lords, I thought that was exactly what I had said.
Several noble Lords: No.
Lord Bellwin: Well, that is what I meant to say. I thought I was paying tribute to them for having set it up.
With regard to cost, so far as the water aspect is concerned, the cost estimates are about £4½ million. I think the important point the noble Baroness raised, as also did the noble Lord, Lord Avebury, is whether or not one should have gone at this stage to a lead-free situation. As with so many things in these matters, one has to take a view. What we were and are most concerned about is the quickest way in which we can make a substantial impact upon this situation. The view is that the quickest way is by doing what we are now proposing. If we were to go for the lead-free situation—which would have some of the advantages the noble Baroness and the noble Lord have mentioned so far as industry is concerned in terms of time and probably cost—the fact is that we would be talking of at least 10 to 15-year periods, and we think the need is a great and immediate one now. It is a long enough time in any case that we are talking about before it becomes fully effective.
This is a judgment that we have had to make. What it really amounts to is that we are going for most of the loaf now rather than the whole of the loaf later. The fact is also that the great majority of existing engines cannot run on lead-free petrol, Firm planning for lead-free petrol by both the motor and the oil industries would have to wait until at least all Community member states had agreed. Then it would take time for new engines to become available, and it would take 10 to 15 years for existing engines to come to the end of their useful lives and be phased out together with lead in petrol. We think that, rather than take that as an option, what we are doing is the best course to follow.
The noble Baroness also asked why should we not take the lead and push Europe into the lead-free situation. There is no doubt that if our Community partners want to explore the scope of prescribing "lead-free" we would certainly want to play our part in that, although it must be said that at present none of them seems to be very keen to do so. By coming

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to a ·15 situation we are, in fact, joining Denmark and Germany. which have the lowest standards in the Community—I say "lowest", but it could be "highest" depending which way one looks at it. We believe that this meets the air quality standard which the Lawther working party and our partners in the European Community feel adequate to reflect the health evidence.
I do not know whether I can cover much more any of the other points which the noble Baroness made. If I have missed any of the number of questions which she put to me, she knows that I shall always write to her. I should also like to stress that when I mentioned in the Statement the paper which has been placed in your Lordships' House, it is, of course, in the Printed Paper Office—it has another name in another place. I would not agree with the noble Baroness that industry says that this is the worst of all worlds. As I have said, we have had to take a balanced view about this matter.
The noble Lord, Lord Avebury, asked whether sufficient studies had not already been made. I think that he would agree with me that this is an ongoing subject. It is true that a great deal has been learnt, but I am sure that he would agree that there is a great deal more that has to be learnt. I think that that would be justification for continued studies. If we were simply to use as an excuse for delay or non-action that further studies should be undertaken, then I think that his point would be valid. I should like to stress to him that we are certainly not using that as an excuse for doing nothing, as I hope I am showing in what we are doing today. As regards the other point which he made about the effect of the removal of only lead-lined tanks by grant and the question of whether plumbing should also receive a grant, I must say that I entirely agree with him. I think that that is so. If there is any doubt about whether that is so, then I shall take the matter up and make it clear.
Lord Kennet: My Lords, I think that the noble Lord will see when he looks at his own text in Hansard tomorrow that he did say that the Lawther Committee was set up by his right honourable friend the Secretary of State for Social Services. I am glad to know that he is now prepared to correct that and to admit that it was set up by the last Government.
Will the Government accept that there are two points in this Statement which I believe will be very generally welcomed in the country? The first is that the changing of old lead tanks and lead plumbing will become eligible for housing improvement grants and the second is that our lead in petrol limit will come down from ·4 per litre to ·15. It seems to me that both of those changes begin to put an end to an era of almost intolerable carelessness by Governments of both parties as regards the health of our people and that there is no reaction that the House can have but to welcome these with open arms. Naturally I share the opinion which has been expressed so far that as soon as we can reach zero the better. However, I think that the Government's point that no Community country is going for zero at the moment is one that perhaps must hold us back, to our regret.
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Finally, I should like to ask a particular question. I have read in the press that the cost of the measures as regards lead in petrol will be £450 million. Can the Government confirm that and, if so, can they say upon whom those costs will fall? What is that an estimate of the cost of?
Lord Bellwin: My Lords, I see from reading the Statement again that what was said previously about the setting up of the committee was quite right. I was wrong in the first place, but I thought that I had put it right when I answered previously. However, I gladly confirm that fact.
I hear what the noble Lord, Lord Kennet, says and I am grateful to him for his observations. He has asked upon whom will the cost of the grants fall. It will fall basically upon the existing resources, but we must have discussions with the local authority associations to decide how to make the necessary adjustments and at this point I do not have the detailed answer to that matter. However, clearly that is the amount of money that we expect it will take.
Lord Kennet: My Lords, I am loath to prolong the discussion, but my question about the £450 million was referring not to lead tanks, but to lead in petrol.
Lord Bellwin: Yes, my Lords; I am sorry, that is the cost to the industry.
Lord Somers: My Lords, 1985 seems rather a long time to have to wait. Can the Minister say whether it is not possible to extract the existing lead content in petrol already on sale?
Lord Bellwin: My Lords, I raised that very point myself when querying the Statement that I was to make. I am advised that it may be that there will be an improvement on that time, but I cannot give any commitment to that extent. Clearly it is in everybody's interests to do it as quickly as possible and I assure the noble Lord and indeed the whole House that the Government will not just sit back and let it go. We are very anxious that this should be done at the earliest possible moment.
Baroness Birk: My Lords, I am sorry to come back to this matter and I apologise to the Minister for putting so many questions to him. It was all done so quickly that I did not have a chance to "sub" my own questioning so he was landed with the lot. I would like, if possible, to have the answers in writing when he gets them. However, I should like to say, having listened carefully to what he said in reply not only to me, but to the noble Lord, Lord Avebury, and to the noble Lord, Lord Kennet, that it appears that the Government do not seem to be sufficiently apprised of how public opinion is moving in this area and having reached the point of talking about.15 the noble Lord has not yet really gone into the question which I tried to press him on as regards the cost. By doing it in two bites it will be not only very much more unhealthy for the country, but very much more costly for industry, for the oil companies and for individual motorists. I beg him to use what I am sure is his considerable influence to make the Government think about this again and to discuss the matter further and really consider reducing

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it to zero. Instead of reducing it to.15 by 1985 it would be much better to have it on a lowering graph and to reach zero in seven or eight years, which I believe is what industry and the oil companies believe can be done.
Lord Bellwin: My Lords, I can only add that this obviously has been considered at great length and in great depth. Our major concern was to get action at the earliest possible time. This we feel is the quickest way to get very close to where we want to be. The noble Baroness and, indeed, I think the noble Lord, Lord Avebury, took the other view—to go now for the "lead-free" completely and take, according to what the noble Baroness has said, seven or eight years, but I am advised that it will be 10 to 15 years. I do not know the answer to that. The fact is that we want action as quickly as possible and this is the line that we have taken at present.

Forestry Bill
4.28 p.m.
House again in Committee on Clause 1.
Lord Ross of Marnock Lord Ross of Marnock moved Amendment No. 2:
Page 1, line 8, at beginning insert—
("Provided that he is satisfied that such a transaction does not conflict with the interest of rational land management, of the proper discharge by the Commissioners of any of their functions and that in all cases existing arrangements for access and amenity are safeguarded").
The noble Lord said: I beg to move Amendment No. 2. We have had a very disappointing start in the responses from the Government to what was to my mind as reasonable an amendment as one could get on this particular Bill. It will be noticed that some of the same phrases are in this particular amendment and I hope that the Committee will forgive me if I say a word or two about that. Indeed, it might be as well to say them right away.
We are not opposing in our amendments the principle that the Government seek to lay down. We know the desperate straits that the Government are in: they must get money; they must cut down public expenditure. That is the whole reason for the Bill. I think that the concern (it is the concern of the whole Committee) is the integrity of the work that has been done by the Forestry Commission over decades and the extent to which they have moved from not only providing necessary timber and hoping to provide even more necessary timber that the country needs—and will need more and more as the years go on—but also the extent to which they have responded to appeals for public enjoyment of the forest lands. I was horrified to learn that existing "amenity" is a vague term. It is there. If the Government are under any difficulty about that and if this has been the stumbling block to accepting the amendment, the simplest thing would have been to say:
"…as defined in paragraph (b) below",
and we could easily define it. I am perfectly sure that we could define it by reference to the Countryside Act.
Therefore, that is the weakest of all excuses that a Government can use—that it could not be done, that
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it would not be legal, that it would be vague and all the rest. That is just not true. Noble Lords on the other side-Scottish landowners, et cetera—will remember all those things they have been able to do, perfectly legally, by continuing restrictions of use in whole villages in some particular cases. We have not yet wiped out the feudal system; we have only wiped out feu duty. You can still feu land and put into that feu charter any restriction you like. One of the matters to which we shall come later is that the National Trust, in its confidence in the Forestry Commission and its trust in the Forestry Commission carrying on in future, did not use the restrictive covenant more, and we might have been easy in our minds today about the future under this Bill if it had done so.
Again, this is a very reasonable amendment. It adds a proviso to the disposal of the land, that the land can still be disposed of provided that it meets certain conditions; provided that the Minister
"is satisfied that such a transaction does not conflict with the interest of rational land management".
If anyone has been pursuing these amendments with care, he will see that the same phrase arises in an amendment that has been tabled by my noble friend Lord Taylor of Gryfe. It is not that we just think alike; evidently we do not think as much alike as we used to. My noble friend knows who appointed him to the Forestry Commission, but he will also appreciate that this phrase comes straight from the actual section that we are amending. Noble Lords must remember that at present the Minister has power to dispose of land. He can dispose of any land that is not needed or which, in his opinion:
"ought not to be used, for the purpose of afforestation or any purpose connected with forestry".
That is the limitation at present—he can dispose of land if, in his opinion, it is not needed for afforestation or it would be better used for some other purpose.
Lord Gibson-Watt: Will the noble Lord put me right and say whether he is speaking about the law in Scotland or the law in England and Wales?—because in fact it is slightly different.
Lord Ross of Marnock: The law may well be slightly different, but I am reading from subsection (2)(a) which is to be removed from the 1967 Act, which applies to both countries. When it comes to the practice of how you do it, it may well be that it will have to be administered in different ways, because the law of Scotland and the law of England as regards land are different. The noble Lord has made a very good point, to which I hope I will come in a few seconds. That is applicable to the whole lot, but when it comes to Scotland, there is subsection (b) which says:
"in the case of land so acquired in Scotland"
the Minister can
"sell it if he is satisfied that the sale—(i) is desirable in the interests of rational land management".
That is one of the phrases that we are wiping out which means—if words mean anything-that he can sell the land even though it is not desirable so to do in the interest of land management. For we are wiping out the whole of Section 39(2) as it presently stands. So even though it is against the good sense and the

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rational use and management of land, the Minister can still sell it to anybody and for any purpose.
I think that many people are frightened about the power that the Minister is taking here; that is, the lack of any limitation on the purpose for which the land will be used after sale. The Minister himself has said that that is all right, that if they put some limitation on it, it can only hold good for the original purchaser and it could not be applied to the second purchaser. But that, of course, is not true in relation to Scottish land, as the noble Earl should well know, but, as I have said before, he is an English lawyer and we can excuse his difficulties there.
The Secretary of State for Scotland has already told us that the Minister could dispose of at least one-third of all the plantable land that is held in reserve, and most of that plantable reserve is, as those who have been Ministers know, in Scotland. Therefore, the idea of giving the Minister this blanket power to sell whatever he likes creates a very considerable difficulty and we certainly could not allow this clause to pass as it presently stands. It is no good suggesting, "Oh well, he will consult the Forestry Commission". He virtually told us on Second Reading that the land is not the Forestry Commission's; it is the Minister's. He is under no obligation here to consult the Forestry Commission, far less to get the agreement of the Forestry Commission. I think that later on he will order the commission to find a certain amount of money, which they will have to do. It would mean a forced sale, for in order to get the price that the Treasury demands, the Forestry Commission may have to sell land which, in their own good sense, they would never dream of selling. This is the great danger here. It is a danger that is recognised by everyone, not just by those who enjoy the youth camps, which evidently we cannot define, or the picnic sites, which we cannot define, or the ramblers' routes, which we cannot define.
Those routes can be put on the Ordnance Survey maps, so the Government must have given permission to the Ordnance Survey actually to mark out Forestry Commission land and to show the paths through that land. All that can go. It is no use the Minister saying, "But we would not dream of doing that". He himself has said that what matters is what is in the Bill. We are giving the Minister power to do it. I can assure the Minister that the Treasury will ensure that it gets the amount of money that it wants. We have already been told that it will advance by at least 10 years the wiping out of the grant-in-aid. Depite the good sense of the Forestry Commission, that is the target that is laid down.
In some way we seek to limit, not to destroy, the power. The amendment states that the Secretary of State should be satisfied that the transaction:
"does not conflict with the interest of rational land management, or the proper discharge by the Commissioners of any of their functions and that in all cases existing arrangements for access and amenity are safeguarded".
I admit that on this last part the Committee has voted quite wrongly; and it has been misled by the Minister. But we will return to that because I shall certainly comb through the Countryside Act, and the others, and see whether or not the noble Earl was right in I saying that these things could not be done. I am
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perfectly sure that they can be done if there is a will to do them.
He rather gave the case away, in saying that if you put a condition into the purchase of any block of woodlands when you are selling for any purpose, of course you reduce the price. That is the concern of the Government. It is not the enjoyment of the public. It is the public that has provided the money for the creation of this, not the Government as such. But the Government are taking to themselves the power to direct the Forestry Commission, irrespective of the loss to the public, that they shall so benefit someone else. It may well be a speculator for some reason or other.
This is not something that any honest to goodness Government claiming that they are going to act in terms of the benefit of the public in the long term can justify. I wondered why the Minister had lost his temper just at the last minute after my noble friend's reasoned, inoffensive, gentle speech—something that I could not even pretend to attain. I am perfectly sure that many Back-Benchers opposite are as worried as I am about the effect of this Bill, but if they go on supporting the Government in amendment after amendment, the same will happen in this House as happened in the last. Not a single word was changed. If not a single word is changed then what do we do? We give this power to the Minister to:
"dispose for any purpose of land acquired by him under this section."
And we wipe out all what little limitations there were before, on what land could be sold or what few conditions there were, and this is the only power through which the Ministers can handle the position of the Forestry Commission. I am sure that this is not a Forestry Bill at all. It is a Treasury Bill. It is a Treasury Bill, and there we are. A lackey of the Treasury. What Mansfield and Mansfield has come down to! I hope the Committee will not support the noble Earl in keeping this subsection as it is and indeed will support this amendment. I beg to move.
4.44 p.m.
The Earl of Mansfield: I think the less said about the last words in the amendment, the better.
Lord Ross of Marnock: You have said enough, in other words.
The Earl of Mansfield: As the noble Lord has already accused me of being what I think the Americans call a bum lawyer, and I do not want to foist my opinions, such as they are, on the Committee—
Lord Ross of Marnock: I said that the noble Earl's knowledge of English law was probably greater than his knowledge of Scottish law.
The Earl of Mansfield: Well, I am grateful for that expression of support, at any rate. Quite apart from the last part of the amendment, I am afraid, lackey or not, that the first part is wholly unacceptable, not least because of the difficulties which it would create for the commissioners in operating the disposals programme. What the noble Lord has done, as he said, is in effect to rely on the provisions of Section

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39(2)(b) of the Forestry Act 1967, which applies to Scotland and the Secretary of State, and enables him to sell land acquired for forestry purposes if he is satisfied that the sale is desirable in the interests of rational land management, and if it would facilitate the discharge by the commissioners of any of their functions.
These provisions, even when taken with the other disposal powers in the Forestry Acts, have already proved too limited to be applicable to more than a few cases. They would certainly not be adequate for the rather more extensive sales which the Government intend under the powers sought in Clause 1. The effect of the noble Lord's amendment, although its wording does not slavishly follow Section 39(2), would be largely, or even precisely, the same. It would in fact put the position back to what it is already, and it would open the door to individual sales being challenged by various interests.
The noble Lord said in his opening remarks that he was not opposing the principle of the Bill. But by tabling an amendment like this, he is, if he seriously expects it either to be accepted by the Government or voted on and put into the Bill by the Committee, in effect opposing the principle of the Bill. As I have said, the effect of the amendment would be really to leave the forestry Ministers with precisely the same powers as they have at present. For those reasons, quite apart from the considerations which we have already gone into as regards arrangements for access and amenity, I hope that, on reflection, the noble Lord who, as he says, is not opposing the principle of the Bill, will withdraw his amendment.
Lord Ross of Marnock: There is only one point about this matter. The actual clause that we are amending gives powers of disposal. To the extent that I am still in favour of powers of disposal I am not opposing the principle of the Bill, but it would seem to be the implication of what the Minister says that any amendment at all is opposing the principle of the Bill. That is going a bit far in enshrining this new principle that a Minister can sell anything he likes to anybody he likes for any purpose that he likes and for any sum that he likes. If that is going to be construed as the principle of the Bill, then I am opposed to it; but I am still in favour of the power of the Commission, on instruction, on the authority of the Minister, to dispose of land that is not needed for forestry and indeed could better be used for other purposes; but not on the kind of terms given here.
In view of the fact that the Committee has made a decision about the last phrase, it would be wrong of me to divide the Committee again, although it is a matter that we shall have to come back to, because I still think that the Minister was quite wrong in his opposition, and in what he said was the basis of his opposition, to that last amendment.
Amendment, by leave, withdrawn.
4.48 p.m.
Lord Ross of Marnock Lord Ross of Marnock moved Amendment No. 3:
Page 1, line 8, after ("Minister") insert ("with the agreement of the Commissioners").
The noble Lord said: This amendment will not take very much time, because I am sure that I have some
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supporters. I remember, I think it was, the first speech from Back-Benchers in respect of this matter. Amendment No. 3 just says "with the agreement of the commissioners". We shall be told, "We do not need to get the agreement of the commissioners, but of course we will consult them. Of course we will get their agreement". If these words are not inserted we cannot be satisfied that is what the position will be. I beg to move.
The Earl of Mansfield: This amendment raises a constitutional point which is quite novel in my experience, because apart from practical considerations what the amendment would do if it were written into the Bill would be to give the Forestry Commission a power of veto over the sale of land belonging to Ministers. As a consequence, the Forestry Commission, could defeat the Government policy. That would be quite unpredecented. I just wonder what would have happened in the days when the noble Lord, Lord Ross, held sway in New St. Andrew's House if he had wanted—and he was answerable to Parliament—to do something which was within his powers but was told that he could not do it because he did not have the agreement of what, in effect, is a Government department which is not answerable to anybody. I think that the air would have turned blue. That is what the noble Lord is asking the Committee to accept now.
The Forestry Commission is to all intents and purposes a Government department; it is answerable to Ministers who are themselves answerable to Parliament, and the Forestry Commission, as a Government department, carries out Government policy. It would be, as I said, unprecedented and quite wrong to put that Government department in a position where it could frustrate the execution of policy decisions reached by the Government, the Government of course (or their individual Members) being answerable to Parliament. For both those reasons I hope that that staunch defender of our liberties and constitution, the noble Lord, Lord Ross, will withdraw the amendment pretty quick.
Lord Ross of Marnock: I do not think I should. If it is novel but sensible, why baulk at it? As for any suggestion of what I would have done at New St. Andrew's House, I was there for only a couple of years, whereas I was at old St. Andrew's House for about six years. The true answer of course concerning what I would have done is that I would not have introduced this Bill in the first place, and I see nothing constitutionally wrong about consulting and getting the agreement of the Forestry Commission.
If it is a Government department, then there is less reason for the Minister to be worried about it, as the noble Earl said. But of course it is not a Government department, and it is wrong of the noble Earl to give that impression. If it were purely and simply a Government department, I do not think we should have set up or retained the Quango of the Forestry Commission. The noble Earl and most others call it a Quango, but as such it is not a Government department. It is the body to whom, if he thinks fit, the Minister, having bought land, hands it over—
"subject to the provisions of this Act…the Minister may acquire, by purchase, lease or exchange, land which in his opinion is suitable for afforestation or purposes connected therewith,

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together with any other land, and place this at the disposal of the Commissioners".
That is not a Government department; he would hold it in the Scottish Office and govern it from the Scottish Office if it were. The noble Earl should know that only a small part of the work of the Secretary of State for Scotland is related directly to forestry; he leaves that to the Forestry Commission. To say it is Government-run is nonsense, and I therefore maintain it would be right and sensible to seek the agreement of the Forestry Commission before such disposal is proceeded with, and for that reason I will not withdraw the amendment.
The Earl of Mansfield: It is extremely important to realise throughout the Bill that the Forestry Commission is not a quasi-autonomous non-Government organisation; it is to all intents and purposes a department of state. It carries out Government policy and advises forestry Ministers in the way that any other Government department does. I hesitate to use the word "mischievious", but to describe the Forestry Commission as a Quango operating on a semi-autonomous basis is totally removed from the facts, as is evidenced by the officials who advise Ministers on these matters and indeed fill the Box when forestry matters are the subject of discussion in Parliament. I do not think I can say more, but if it is the noble Lord's point that he is by the amendment introducing some sort of control over sales which is external to a Government department, then I emphatically reject that.
The Earl of Onslow: Does not the amendment also by implication say that one forestry commissioner could frustrate the Government's will? The amendment says, "with the agreement of the commissioners", which implies that all the commissioners have to agree, so that if one said, "No", we should be like the 18th century kings of Poland and Government would come to a complete halt.
Lord Mackie of Benshie: I am sure the Minister does not mean that the Government can settle their policies as they go along. The Government are guided by Acts of Parliament which go through the House. While I do not agree with the amendment, there are later amendments indicating that Parliament lays down how the Government will implement their policy. It must be right for us to consider the limits that should be on the Government in their actions. That is the whole purpose of any Act of Parliament, is it not?
The Earl of Mansfield: Obviously, in many cases the purpose of an Act is to define and lay down, and if necessary confine, the powers of the Executive as carried out by Ministers, but that is not what we are talking about here. We are here discussing an amendment which in effect is asking a Minister to go to officials of his own department to seek their consent before he does something he wants to do, and that I suggest is novel, unconstitutional and undesirable.
Lord Ross of Marnock: It would be equally interesting to learn which department it is because there are three Ministers involved—a Scottish, English and Welsh
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Minister. So would the noble Earl please tell me whose department it is?
The Earl of Mansfield: The Ministers concerned act rather like a troika.
Lord Ross of Marnock: The air, which I suggested earlier had been blue but had become red, has now evidently become scarlet.
Earl Waldegrave: I was for a short time chairman of the Forestry Commission, although that was 20 years ago, and during that time I may have been under a gross misapprehension; I was always told we were not a Government department. I was told that the commission did not go to a department either but went direct to its Ministers. When we asked, "Why not for tidiness call the Minister of Agriculture the Minister of Agriculture, Fisheries, Forestry and Food?"—putting another "F" in his title—we were told that would be quite inappropriate.
Baroness Jeger: I was emboldened to support the amendment largely because of a statement made in another place on January 26th by the Secretary of State, when he said:
"The Forestry Commission will be in full control of the disposal programme, the scale and location of which will be at its disposal".
If the Secretary of State meant what he said, the amendment must be acceptable because it would simply put into the Bill what the Secretary of State said on that occasion.
4.58 p.m.
Lord George-Brown: The Minister must at least undertake to reconsider the matter. I was for a long time a Minister responsible for the operations of the Forestry Commission. We never assumed that it operated on the basis that it was part of any of the departments for which I then answered. It was always accepted that it was a commission for the reasons we said it was—namely, that it had the authority which the Act gave it, and that we could not, as a ministerial act, simply tell it what to do as one would tell maybe a principal assistant secretary what to do.
I think the noble Earl must have it wrong, and if he does not want to get us into difficulties he had better consult with his people again over this. He must discover whether or not he is stating as a constitutional doctrine what has never been accepted to be a constitutional doctrine. Admittedly, at my advanced age my experience at the Ministry of Agriculture goes back 40 years—I had better not overdo it; it goes back 35 years—and that number of years ago nobody accepted that the Forestry Commission was a Government department. That must be wrong; and if we acquire land for the purposes of afforestation and choose to hand it over to the Forestry Commission, we should do so in the terms that the noble Baroness has just read out and the sale or disposal of it is then handed over to them. If the Minister thinks that it should be so, he has to discuss it with them. We have already handed over the veto to them; there is nothing new in that. I do not feel that we need particularly to push the amendment; rather I should like it to be

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looked at again. But if the Minister persists in his present attitude, one would have to support the amendment.
Lord Taylor of Gryfe: The constitutional position of the Forestry Commission arises also in an amendment in my name, Amendment No. 7, and I would resist developing at this stage the argument on that account. As a matter of interesting history I would point out that the Forestry Commission was set up before the structure of nationalised industries, before Morrison, and consequently it had no regular constitutional basis. I understand that the Government at the time sent for the constitution of the Church Commissioners and started to model the Forestry Commission on that constitution. So it remains a somewhat strange body, not—and it never has been—accepted as a department of the Government. Nevertheless, so long as the Forestry Commission is dependent on grant in aid, there will be a measure of Government oversight from the Treasury, and, as has been said previously in the debate, the Bill is all about the exercising of Treasury control over forestry.
Lord Ross of Marnock: We are certainly grateful to the noble Lord for putting the Minister right in respect of that point. It is Parliament that determines what sums will be given to the Forestry Commission; it is not the Secretary of State for Scotland, the Secretary of State for Wales, or the Minister of Agriculture in England. Neither the English Minister, nor the Secretary of State for Wales (now that we have one) is held to account for every day-to-day action of the Forestry Commission. If it were a Government department, that would be so, but it has never been so.
The suggestion made by the noble Lord, Lord George-Brown, is right; we should give the Government time to think about this matter, because they will have to sort it out, and then with complete confidence tell your Lordships exactly what is the position. The question of the relationship of the Government to the Forestry Commission might arise in regard to other amendments; not only the amendment of the noble Lord, Lord Taylor of Gryfe, but another amendment that I shall be putting forward. With those words I think that I shall beg leave to withdraw the amendment, so that we can return to it. I beg leave to withdraw—
The Earl of Mansfield: Before the noble Lord sits down, may I ask him whether he is aware that at least in its own mind the Forestry Commission is to all intents and purposes a Government department? There has been discussion in the past on the point, but I suggest that it is now recognised unequivocally as a Government department. The Treasury and the Treasury Solicitor agree with that point of view. The Forestry Commission does not answer to another department, which it would if it were not itself a Government department. In other words, it advises Ministers direct in its own right as a department, and it fulfils the functions of a department. That it is a department is amply borne out by the fact that it has recently been included within the jurisdiction of the Parliamentary Commissioner. So for all those reasons I cannot agree with the noble Lord, Lord George-Brown, in his reminiscences of long ago. The Forestry
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Commission is not like other departments. Indeed it has a flavour (if I may so call it) of its own, and I see the noble Lord, Lord Taylor of Gryfe, nodding; he was chairman of it. Nevertheless, to all intents and purposes it is a department of state.
Lord George-Brown: This is not a question of my having reminiscences of long ago. This is a question of a quite new and rather junior Minister trying to alter a state that has existed historically for a very long time. While there may be no sanctity in having been at the Ministry of Agriculture 30 or 35 years ago, there is certainly no very great distinction in having suddenly arrived. I suggest that the Minister really ought to go and find out—as the noble Lord, Lord Taylor of Gryfe, was saying to him—how this body grew up, why it was invested with the authority with which it was invested, and how it has exercised that authority for very many years, going back to a time when the noble Earl the Minister was still in short pants.
If the noble Earl wishes to change it, he should come along with a proper constitutional Act to change it. The Forestry Commission is not, I submit, suddenly to become a department of state by the ipse dixit of the noble Earl. He might think that it should be a department. I am not at all moved by his argument that the Treasury and the Treasury Solicitor think that it should be a department and have now declared it so to be. There is no constitutional authority in this country that has yet invested the Treasury, much less the Treasury Solicitor, with that power. The Treasury is always trying to lay claims to everything all around the place, as I well remember from my days at the Department of Economic Affairs. If the Treasury had its way, there would be no other department of state, no Quangos, no other Ministries. They would all sit in Great George Street—in the front of Great George Street, at that! But that does not happen to be so.
If your Lordships are inclined to allow my noble friend to withdraw the amendment, I for one shall accede to the request only on the understanding that at a later stage the noble Earl will come back with a considered view about the Forestry Commission and its constitutional position. If the noble Earl's word is to be regarded as the last word, and if it is just another part of the departments of state and the chairman of the Forestry Commission is answering to a principal in each of those departments of state, who in turn is advising an assistant secretary, who is advising an under secretary, who is advising a PUS at the end of the day, then we might as well wind up the whole damn thing, since there could be nothing more ridiculous on earth than to retain it.
I live near a forest, almost in one. There are great notices, but they do not state "Ministry of Agriculture, Fisheries and Food"; they state, "Forestry Commission". They cannot mean anything if they simply mean the Ministry of Agriculture, Fisheries and Food. There is much more to this matter. The noble Earl is sliding away with something which quite clearly he does not himself understand, relying upon a brief which has been handed down and which no doubt the Treasury would very much like to be accepted.

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I should like my noble friend to press the noble Earl again before proceeding to withdraw the amendment. If the noble Earl insists that what he is now saying is the position, perhaps the amendment should not be withdrawn. On the other hand, I would suggest to the Minister that it would be more sensible to say, "OK, I shall look at it again and come back with a considered view". We cannot leave the matter as it is, because if what is stated is in fact the position, we simply must wind up the Forestry Commission; that must be so.
Lord Gisborough: Would it not set an interesting precedent if this amendment were accepted? There must be many boards which could claim the same right; and the Minister would not be able to do anything without the agreement of those many boards in various departments which might not agree with what he wanted to do. For future Governments this might be more interesting when Ministers might find themselves hemmed in from their rather hare-brained schemes. On the other hand, on this particular point, the Minister would act only on the advice of the Commissioners and would rely entirely on their advice as to which plots of land would best be sold. I wonder whether the noble Lord who is moving this amendment would consider another amendment at a later stage using the words "with the advice of the Commissioners" or some wording like that, rather than "with the agreement".
Lord Ross of Marnock: I am being pressed to ask for an assurance that the Minister will have another look at this point and go back to those who advise him to come to some suitable definition of what the Forestry Commission really is. It is very interesting. Not every Government department has a fund like the Forestry Fund. But there you are. I do not think it would be an onerous task for the Minister if I suggested that he should give us a considered version of what the Forestry Commission really is and how it differs from other departments, if it be a department. He insisted on making the speech. He would not allow me to withdraw the amendment. He has brought it on himself. I have already called him the master of the infelicitous phrase and he would have done better not to refer to reminiscences. He would have saved himself some trouble. I am not asking for much; just for him to come back at some stage in the Bill and say what is the real position of the Forestry Commission. If he does that, I will withdraw the amendment.
I am interested in the performance of the noble Lord who has just intervened. He was the first from the Back Benches to speak on any amendment. The one thing that he said was that the words which should be there were "with the agreement" of the Forestry Commission. Now he says—
Lord Gisborough: I think I said "on the advice".
Lord George-Brown: Only on the advice.
Lord Ross of Marnock: I am not talking about what he said on this amendment. I am talking about Amendment No. 1. If he has forgotten it, I have not.
Baroness Jeger: I have it written down.
Lord Ross of Marnock: It has been written down by my noble friend. We were storing it for ammunition for this amendment. Dare I say that we are sure of one supporter when we come to Amendment No. 3? Now, as weak as water, he races away and says: "I did not mean to say 'agreement'. I shall be satisfied with 'advice '." I may well be, too; but we shall not get that until we get the answer from the noble Earl. Is he prepared to go back to his (shall I say?) department or to the rest of the Government and come back and give us a definition—I do not know whether it will be satisfactory or not—of what the Forestry Commission is and how it differs from any other department?
The Earl of Mansfield: Of course. If I have got it wrong I will come back and tell the Committee. I will even write to the noble Lord, Lord George-Brown, although—
Lord George-Brown: What does "even" mean?
The Earl of Mansfield: The noble Lord's remarks might have been expressed in a little more friendly fashion and that would have been more in the spirit in which this Committee normally conducts its business. I will go and do my homework again; and if the position is not as I said it is, I will tell the Committee.
Lord Ross of Marnock: Nobly done! In view of that I will seek to withdraw my amendment.
Amendment, by leave, withdrawn.
The Deputy Chairman of Committees (Lord Jacques): If Amendment No. 4 is agreed to, I shall not be able to call Amendments Nos. 5 and 6.
5.15 p.m.
Lord McNair Lord McNair moved Amendment No. 4:
Page 1, line 8, leave out from ("may") to end of line 9 and insert—
("(a) subject to the restrictions in paragraph (b) below, dispose for any purpose of land acquired by him under this section; and
(b) in the case of the Forest of Dean, sell any land acquired by him under this section which in his opinion is not needed, or ought not to be used, for the purpose of afforestation or any purpose connected with forestry, or exchange any such land for other land more suitable for either of the said purposes and pay or receive money for equality of exchange.").
The noble Lord said: I rise to move Amendment No. 4. This Bill is about trees and money, but my amendment is about people, quite a large number of people, perhaps 50,000 or so, who live in or near the Royal Forest of Dean in Gloucestershire. It is an extremely unimportant amendment from the point of view of the Bill or from the point of view of Government policy as we have heard it; but to the people who live in or near the forest it is of absolutely paramount importance. Perhaps I should make it clear that I have no declarable interest either in the Bill or in the amendment. I do not live in the Dean and I have never owned or am ever likely to own so much as a coppice.

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It is simply the coincidence of an old friendship with a man who now has become a district councillor in the Forest of Dean which brought this matter to my attention.
Although I speak for myself, as we all do, I am greatly encouraged and strengthened in moving what happens to be the first amendment I have ever moved in this Committee by the knowledge that what I have to say reflects, I honestly believe, the unanimous opinion of the people who feel that their traditional way of life is threatened by this Bill—and that seems to be all the people in the Forest of Dean. I have had a remarkable number of letters; 21 parish councils have seen fit to write to me and four councils higher than that, including Monmouth and Gloucester; I have had any number of letters from individual cottagers and householders; and letters from such organisations as the CPRE, the Wye-Dean Tourist Board, the Ramblers' Association and, most important, the Court of Verderers.
I have said that the opinion was unanimous. I think this is the last introductory point that I need to make. I want to emphasise that there is no party politics at all in this amendment. The friend who first alerted me to the danger is a Liberal; the chairman of the district council who came to London last Wednesday to plead with the Ministers to accept the amendment is a Labour councillor; and we have the wholehearted support of the Member of Parliament concerned for West Gloucestershire who is, of course, a Conservative. I am hopeful, too, that support may come from all points of the compass in this Chamber. So let us forget party politics—as we often do, I think, when we are at our best—and discuss this very important matter entirely on its merits.
I should now explain why this little Bill has aroused such universal alarm and apprehension throughout the Forest of Dean. There are two reasons. The first is the breath-taking audacity of those 15 words in Clause 1:
"The Minister may dispose for any purpose of land acquired by him under this section".
No qualifications at all. Absolute power is to be conferred upon the Minister and upon all future Ministers, and I am sure that this Committee does not need me to remind it of what absolute power tends to do to those upon whom it is conferred.
Is it surprising that the possibility of waking up one morning in the future to find that their homeland, their native woodland and their human habitat have been sold off in the night to some unknown person or some pension fund by a Minister under no obligation to consult them or even warn them or even to come down to Parliament, has terrified the foresters and united them in the appeal which I am making on their behalf to your Lordships' Committee for protection? They have a special reason for being frightened. The legal position in the Royal Forest of Dean concerning the rights of common and access is obscure and, I think, unique. I am neither a lawyer nor a historian; but I do not think that I am over-simplifying the position if I say that in strict law there are no common rights at all within the perambulation of the Forest of Dean. That was the belief of the Forest of Dean Committee which in 1958 submitted what was called the Creed Report.
If you were able to prove that your
"predecessors in title enjoyed rights of common in the Forest in or before the 10th year of the reign of Charles I"
and that
"on or before that date they did in fact hold and enjoy the privilege of running sheep in the forest,"
then you might be able to claim commoners' rights. However, I must warn the Committee that no such claim has ever successfully been lodged.
The position was not improved by the Dean Forest (Timber) Act of 1808, which,
"freed and discharged of and from all rights of common, and from all manner of rights…or privileges or claims whatsoever…".
However, we are not concerned with these archaic provisions of long ago but with the present and the future. The fact is that although they may have no de jure rights of access or of anything else, the foresters have traditionally enjoyed, and do enjoy at this moment, de facto rights of access and sheep-grazing which are recognised by the Forestry Commission.
In selling off some parts of the "waste of the forest", the commission has frequently insisted that the purchaser should respect some traditional right of way over the piece of land affected in spite of the fact that its legal position was shaky or even non-existent. This is as it should be and how we want it to continue.
The foresters treasure their de facto freedom to wander more or less at will through the forest. The grazing of sheep is important to them. The right of access for visitors and holday-makers is becoming more and more important both to the local economy and to employment. One of the many letters that I have had was from a leader of a scout troop—an Akela, I suspect—who likes to take her troop camping, following nature trails and so on in the forest. None of these customary privileges—let us not call them rights because they really are not rights—would be safe and none of them could be assured if sections of the forest proper were to be sold into private hands. Fences would go up and "No admittance" signs would appear.
Now a brief account of what this amendment seeks to achieve. There is nothing revolutionary, retrograde or restrictive about it. It is simply designed to preserve the status quo as under the 1967 Act as far as the Forest of Dean is concerned. The 1967 Act has worked well. An excellent relationship exists between the Forestry Commission and the people. This we all surely would wish to preserve. That is why the wording of paragraph (b) in my amendment follows exactly the wording of Section 39(2)(a) of the 1967 Act. The commission would remain free to sell off small parts of the forest "waste" and cottages, tidying up operations, just as it does today. There is no desire to stop that. That is how I claim that, outside the Forest of Dean, this amendment makes no difference to the Bill at all. If the Committee likes the Bill, then it can support this amendment and leave the Bill quite intact outside the Forest of Dean.
What is more, it in no way conflicts with ministerial policy, as we have heard it expounded in the repeated assurances from all the Government spokesmen. They have no intention of selling off all or part of the Royal forests. They have again and again made this

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quite clear, and I do not for one moment question their sincerity. All I ask—and all my amendment would achieve—is that they should write those assurances into the Bill and thereby make certain that all future Ministers will have to be as intelligent, public-spirited and enlightened as Her Majesty's present forestry Ministers so obviously are. We should like to see it in writing in the Bill.
I suppose that the final stage in moving an amendment is to try to anticipate the arguments which may be used against it. I can only think of two. There is what one might call the "thin-end-of-the-wedge" argument. It may be said: "If exemption is given to the Forest of Dean, then other places would say 'What about us?'" I never find this very convincing. If there are any other places with as good a case for exemption as the Forest of Dean, then surely they should have it; but I doubt very much whether any such places will be found. For the curious legal and historic reasons which I have tried to explain (which are much more complicated than anything I have said will lead the Committee to suppose) I believe that the Forest of Dean is uniquely vulnerable to this Bill.
The only other counter-argument that we have heard is that Ministers are such sensible, amiable and thoroughly reasonable chaps that all our fears are groundless. They simply would not ever do anything so dreadful. A very distinguished Back-Bencher in another place—and I describe him like that because (a) he is my own MP, (b) he is an old friend and (c) he is very distinguished—was speaking against a similar amendment to this and he said that to sell off the Forest of Dean was unthinkable. To do so, he said, would be an act of historic vandalism and of course he was right. It would indeed be an act of historic vandalism, but it would be an act of perfectly legal vandalism if this Bill went through unamended.
May I for my final minute share my private nightmare with the Committee? I am worried about the next Government but two. Who will lead it and who will be in charge of forestry? The Committee has not the faintest idea, and nor have I. However, I can imagine a Minister, perhaps not too bright—it would not be unprecedented—or perhaps all too bright and perhaps with the Treasury breathing down his neck, and he suddenly discovers this amazing power offered him on a plate in the Forestry Act 1981. He uses it and "bang" goes the Forest of Dean. We can exclude that nightmare from the realm of possibility by passing this very simple amendment. I beg to move.
5.30 p.m.
Baroness Jeger: I am sure that the whole House will have appreciated the moderate and persuasive way in which the noble Lord, Lord McNair, proposed this amendment. I should like to emphasise that I am speaking very much in a personal capacity when I give it my strong support. I do not know by what malevolence on the part of official channels we are taking this Bill today, because had it not been for the Bill I would have been a member of a parliamentary delegation visiting the Forest of Dean. Today I would probably have been at Cinderford and tomorrow at
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Tintern; there is nowhere I would rather have been since that is the land of my fathers. I very much regret that parliamentary arrangements have denied me this pleasure and have denied other noble Lords such an education, because such a visit might have influenced the way in which your Lordships voted on this amendment. Nobody who has walked from Parkend to Moseley Green or from Yorkley Slade to Cinderford could possibly oppose this amendment.
It would be a hard-hearted and insensitive brute who would want to oppose a suggestion that the Forest of Dean should continue in all its glorious beauty for ever after. Let me remind your Lordships that the Forest of Dean was a Royal forest at the time of Edward the Confessor, who specifically exempted it from taxation. The noble Lord, Lord McNair, is not asking for anything so generous or as extravagant as that, but I believe the feeling among the foresters that they should have some kind of special status which would set them apart has very deep roots. We from the forest are not as other people are and we expect Parliament to appreciate that.
After all, the Forest of Dean now takes up 40 square miles and is very densely populated. It has been the scene of much coalmining; in olden days both of my grandfathers were free coalminers. I have seen the character of the Forest change very much with the introduction of a great deal of light industry and the establishment of much residential accommodation brought within its boundaries. Above all, the Forest of Dean is a place of exceptional beauty.
May I remind your noble Lordships that in 1938 the Forestry Commission formed the Forest of Dean into the very first National Park together with Tintern Forest in the Wye Valley, in the same part of the world. Like the noble Lord, I too have received many letters—not all of them from my cousins or other relatives—expressing the hope that this amendment will be accepted by your Lordships today. Many of these letters were written after the debates which took place in another place. Those debates and the statements which were made when a similar amendment was rejected have completely failed to satisfy the majority of people in the forest.
I do not understand why the Government should go out of their way to perpetuate a sense of uneasiness and anxiety among so many people. It is so little to ask of your Lordships but it is something that would mean so much to hundreds of people in this area. In a statement made in another place they were told not to worry because the Government would not, of course, allow the Forest of Dean to be sold; but still the letters came because these hard-headed people said that no Government can bind another, and they hope to live longer than the life of this Government. So let us have it in the Bill that the Forest of Dean shall be exempt. The Ramblers' Association is most anxious that this should happen, and that organisation, above all, knows about the usefulness of the Forest of Dean and the joy and pleasure it brings to people who wish to walk and camp there.
The last reason for supporting this amendment that I wish to put to your noble Lordships is that the present position is working well. The amendment does not ask for the Forest of Dean to be "frozen"

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so that no changes at all can take place there. It suggests, in effect, that the powers under Clause 39 of the Forestry Act 1967, which enables land to be sold which ought not to be used for the purpose of afforestation or for any purpose connected with forestry, shall stand. We are not asking your Lordships' House for anything unreasonable. So far as I know, there has been no reason since the 1967 Act for the Forestry Commission, the Government or the Foresters themselves to have any reason to complain of the present situation. I cannot understand why a state of affairs which commends itself to the people who live in the Forest of Dean, which has apparently commended itself to the Forestry Commission, and which has apparently as yet caused no problem to the Government, should be disturbed. For all these reasons I ask your Lordships to have a meeting of minds on this amendment, in particular, and to come together for the sake of this lovely place—not for the reason of perpetuating any particular party political dogma but just because we call all agree that the Forest of Dean is too good to be disturbed.
Lord Dulverton: Having connections with Gloucestershire, it is only right that I should briefly say that I, too, have been approached by at least four rural district councils in and around the Forest of Dean, as well as by Gloucestershire County Council, to put the case before your Lordships—as the noble Lord, Lord McNair, has done—and I will not attempt to better his description of the problem. I can see that feeling on the points he has described is particularly strong. But I also appreciate that the Minister is in some difficulty over this because if he exempts (if that is the right word) the Forest of Dean from this Bill, what is to prevent a number of other well-known and—some of them—old Royal forests from asking for exactly the same treatment? I can sympathise with my noble friend in respect of the problem we are putting before him, but I should not like it to be thought among my friends in Gloucestershire that I had failed to stand up and state their case, as I do by concurring with the words spoken by the noble Lord, Lord McNair.
5.38 p.m.
Viscount Bledisloe: I too wish to commend this amendment to your Lordships. I speak as one who lives on the very edge of the Forest of Dean and whose family have lived there for something more than 250 years; whose father and grandfather and more remote ancestors, I believe, have all been verderers of the forest.
This amendment fully accepts the general position that there should be powers to sell land which has been acquired for forestry purposes; that is, land which has been private before and which was acquired and planted as an investment. The Forest of Dean is wholly different. It is an historic Crown forest in which an entire community has developed, using and enjoying the land in many ways which are not protected by legal rights. It is also an area in which nowadays visitors come from all over the country, and indeed from elsewhere, to picnic, to camp, and to do other things which do not exist as legal rights. It is those privileges which can be wholly lost if this land is sold to private persons. Unlike the noble Lord, Lord
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McNair, I am a lawyer and it was for that reason that I felt wholly unable to support the first amendment.
It is pure accident that this Bill covers the Forest of Dean at all. This Bill deals with land which has been acquired under Section 39 of the Forestry Act 1967. Of course, the Forest of Dean was not so acquired. It was not acquired at all. It was transferred to the Forestry Commissioners under an Act of 1923, and, when the Minister commending that Bill in another place spoke to it, he said that it was being transferred merely as a matter of practical convenience and that it would make no difference at all to the Forest of Dean and what happened in it. Then some deeming provision deems that also to have been acquired under the section, and now his words look like being much belied. But it really is a wholly different position.
The Government have never sought to justify a power to sell the forest. They do not say that, in this present dire economic position, if needs be, Crown forest must be sold; if needs be, Crown jewels must be sold. They do not say that they need this power. They merely say that they do not intend to sell it and, therefore, there is nothing to worry about. But they will not exclude it. Why? one asks. I suppose it is because some draftsman or some bureaucrat would find it inconvenient to have it excluded—
Lord George-Brown: The Treasury Solicitor, I suspect.
Viscount Bledisloe: The Treasury Solicitor is suggested, but as a practising barrister it would hardly be suitable for me to make critical remarks of that from where my work might come. The Forest of Dean is a place where history combines with beauty to produce a unique national possession. That must surely not be imperilled for the convenience of parliamentary draftsmen or the Treasury Solicitor.
Your Lordships have heard—and it is undoubtedly right—that there is massive opposition and feeling in the neighbourhood; and why should this position not be written into the Bill? Your Lordships have recently spent many hours, indeed many days, on the Wildlife and Countryside Bill to enhance and protect the national heritage for the benefit of all who enjoy it. That is wholly inconsistent with what is now suggested by the Government; namely, that there should be power to sell this priceless national possession.
It is not a question of Government policy, and noble Lords on the Benches opposite are not being invited to fly in the face of any Conservative dogma. Surely, if they call themselves Conservatives, they should be keen to conserve this asset which combines both history and beauty. I invite your Lordships not to be attracted by the suggestion: "Oh! well; we would never do that". Surely it is one of the first principles of legislation that you do not grant an undesirable power, merely in the hope that it will not be used. The noble Earl sold that pass, when he said to the noble Baroness; "It is not what you say; it is what is in the Bill itself". I say to your Lordships that this exclusion of the forest should be in the Bill itself.
Also, to anticipate what may be the last resort of any Minister in difficulties, I invite your Lordships not to be attracted by any suggestion that this amendment is defective. This amendment is not, in my

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humble opinion, defective. It may be that if it is passed there are other national forests which ought also to be exluded, and which the Government can exclude at a later stage, but this amendment is perfectly effective to achieve the right purpose of excluding the Crown forest. That is something which no other amendment which is down to this Bill will do. I ask your Lordships very strongly to support this amendment.
Lord Dormer: May I very heartily support the two noble Lords who have just spoken; in particular, my noble friend Lord Dulverton. I also have family connections near the Forest of Dean and I can testify to the enormous feeling that there would be if power were given to the Government to sell off any part of it. I should also like, at some future time in this Committee stage, to see other Royal Forests excluded, but perhaps I may speak on them when the time comes.
Earl Bathurst: As a Member of your Lordships' House and one coming from Gloucestershire—albeit on the other side of the Severn—may I emphasise what my noble friend Lord Dulverton has said about the enormous amount of interest that has been taken in this amendment? Local councils which have never, to my knowledge, had any interest at all in forestry, let alone in the Forest of Dean, except those which are actually in it, or which consist of the Forest of Dean, have all asked us, please, to see that the Forest of Dean is excluded. I cannot understand why, as the noble Lord, Lord McNair has said, it cannot be excluded from the Bill. It will not affect the Bill; it will not affect forestry in the slightest degree. I should be very much in favour, as my noble friend Lord Dormer and my noble friend Lord Dulverton have said, of some provision for all these very special forestry areas which the Forestry Commission are administering.
As my noble kinsman Lord Bledisloe has said, it is, in any case, an accident that we are talking about the Forest of Dean. Since 1923, all and sundry in the Forest of Dean have been able to walk about on what is your Lordships' property, and the property of the rest of the people in the country. When I first heard about this amendment, I was not too sure. As a part-owner of the Forest of Dean, I am very keen on everybody in the Forest of Dean, and from elsewhere, walking about on our property. But I know only too well, as do the Forestry Commission, of the terrible damage that is done by the sheep, and now the ponies, of the noble Baroness's many friends in that area, to your Lordships' and my property, which is the small trees in the forest.
How the Forestry Commission have done it since 1923, I do not know. But they have planted masses of the most magnificent conifers—some of the finest conifers that were saved from being felled during the last war—which are the admiration of all in this country, if not the world. However, that is quite another story, but great damage can be done to our property. The Forestry Commission have earned a great reputation and are living extremely well with those in the Forest of Dean. I suspect that if this Bill goes through without something like this amendment there may be a complete change in the Forest of Dean, which would be very damaging indeed to the interests not only of the Forestry Commission, but of
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forestry, and of your Lordships' and the country's property; namely, the trees within that forest.
We remember Robin Hood and Maid Marian in Sherwood Forest, and it is argued whether they ever existed. But what is absolutely certain is that the bold barons who administered Sherwood Forest did so to the intense dissatisfaction of all the neighbours. Somehow the position has become reversed, and the Forestry Commission have a great working relationship, as the noble Viscount knows very well, since he lives within the forest. They have tamed the Robin Hoods in that area, and it would not occur to them to do the kind of things that, if legend is correct, happened in Sherwood. But we need something on the lines of this amendment, and I would beg the noble Earl who will reply to say how these magnificent forests in this country can be conserved, or preserved, within the Forestry Commission, under the present arrangements. It would take so little trouble and give so much benefit, and in no way would it upset the principles, in which I and many of your Lordships believe, on the modest scale in the Bill for disposing of Forestry Commission property. Whether the amendment of the noble Lord, Lord McNair, is absolutely correct, as my noble colleague suggested, I do not know, but a principle of that kind I do beg the noble Earl and his colleagues to consider.
Lord Kilmarnock: This amendment has been so ably moved by the noble Lord, Lord McNair, that further remarks might seem to be almost superfluous. However, there is one point of detail that I want to make. The Forestry Commission now allows the public to have access on foot to almost all the land which it owns. As part of this policy, the commission is now allowing the Ordnance Survey to mark Forestry Commission land on their maps.
I think it emerged during consideration of the Wildlife and Countryside Bill that walking in the countryside is easily the most popular of all outdoor recreations in this country. This struck me forcibly during the Committee stage debates on that Bill. The same point is relevant to this matter.
The particular case of the Forest of Dean is that, due to the long-standing legal argument to which the noble Lord, Lord McNair, referred, there is no definitive map of rights of way in the forest. The Ramblers' Association has waymarked a number of permissive paths through the forest, but if the land were to be sold off there is absolutely no guarantee that these or any other paths would remain open to the public.
Other noble Lords have referred to letters they have received from the public and from district and other councils. The Forest of Dean District Council makes the point in a letter to me:
"The Dean is in fact the only state forest where the local people have no rights whatsoever, and the present position under Section 39(2)(a) of the Forestry Act 1967 has worked satisfactorily for some 13 years".
This point was made also by the noble Lord, Lord McNair. The chief executive officer of this district council ends his letter by saying:
"My council pleads with your Lordships to support Lord McNair's amendment and not to allow this acknowledged centuries-old freedom of access to the Forest of Dean to be sacrificed on grounds of short-term expediency."

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I refer finally to one letter from a local resident, who says:
"The Government objects to any restriction on disposal, saying that large parts of the forest will not be sold for commercial gain, as is feared. It is not clear, however, why the Government in that case objects to statutory protection for the Forest of Dean being incorporated in the Bill".
I support the amendment.
Lord Taylor of Gryfe: Everything has been said. All that I want to add is a little historical note regarding the Forest of Dean. It is almost 300 years to the day when the Speech House was opened in the Forest of Dean. The Speech House was opened in the Forest of Dean because of the fact that in the early 17th century the land, the Crown estates, had been sold to a private owner. The private owner promptly cut down most of the trees, denuded the forest, sold for profit and closed down the ironworks which were dependent upon timber. The Speech House was built as the centre of administration and activity in the Forest, with the purpose of protecting the rights of the people within the Forest of Dean. It was totally ineffective. Riots and violence continued in the Forest until subsequently a commission re-established constitutionally the rights of the people in the forest.
I hope that that passage of history will not be repeated if the amendment moved by the noble Lord, Lord McNair, falls. Nevertheless, it is interesting to remember that this is an area which has provided that historical example and experience.
5.56 p.m.
The Earl of Mansfield: I should like to congratulate the noble Lord, Lord McNair, upon the very moderate way in which he moved the amendment and, generally speaking, the moderation which has been adopted by all noble Lords who have taken part in the debate. I am fully aware of the concern which has been expressed both inside the House and outside as to the provisions of this Bill.
The Forest of Dean has a special status. The Government recognise it and, of course, the Forestry Commissioners fully recognise it as being in a category which perhaps is shared only by the New Forest. But the Forest of Dean is not inalienable, as the noble Lord said. The commissioners have in the past sold small parcels of land under the disposal powers contained in the 1967 Act. These sales are usually very small, consisting perhaps of a few square metres—up to a half hectare or so. They are not detrimental to the forest; they are frequently beneficial. And the noble Lord's amendment is so drafted that such sales could continue. I know that the Forest of Dean Council, whose representatives I met a few days ago, would also like such sales to continue.
Equally, I can tell the noble Viscount, Lord Bledisloe, that, so far as I know and have been advised, there is nothing defective in this amendment as it stands, so there is no question of asking the Committee to reject the amendment because of any such defects.
There really is no question of the commissioners taking advantage of the wider powers of sale which would be given under Clause 1 to sell off larger tracts of the Forest of Dean, nor would the Government allow it to happen. I put this to your Lordships: is it
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conceivable that any Government, of whatever persuasion, at this moment would fly in the face of public opinion on an environmental and conservation and, indeed, countryside issue of the greatest sensitivity? I cannot believe that it is conceivable that any Government would so act. It would be very stupid if they even tried.
I accept that the amendment as drafted would do no more than restore the status quo so far as the Forest of Dean is concerned. In fact, it would reflect the limited nature of the disposals expected there in the future. But I have to tell the Committee that, as my noble friend Lord Dulverton said, it would be difficult not to enact similar statutory restrictions in respect of disposals in, for instance, the New Forest, where the current policy will also continue to apply. It would be equally difficult to resist special pleading for other areas such as the forest parks. It is a very real difficulty.
There is a further practical point which would militate against large-scale forest disposals in the Forest of Dean. Because of the terms under which the Forest of Dean and other Crown areas such as the New Forest were acquired, there is a contingent liability for them in the commission's accounts. This means that, in the case of any individual sale of more than two hectares, the proceeds, less expenses and the value of improvements, which include plantations, would be transferred to the Crown Estate Commissioners. If therefore the Government, or indeed the commissioners, were motivated purely by financial considerations there would be less incentive to select large areas of the Forest of Dean for disposal, even if they were inclined to do so—which they are not.
The Committee will recall that during the Second Reading debate on this Bill I mentioned the various factors which the Forestry Commission will take into account in selecting areas for disposal. The status of the Forestry Commission is of course important. Since then, forestry Ministers have considered the matter further. As a result, we have decided to issue a formal letter of guidance setting out the objectives of the disposals programme, together with the main considerations which we wish the commissioners to take into account in selecting areas for disposal. This letter I will have placed in your Lordships' Library.
I make no apology for setting out again the "guts" of the matter because I regard it, and I hope the Committee will agree, as of the greatest importance. As I have said, the letter will be addressed to the chairman of the Forestry Commission and it will set out the considerations which the commissioners are requested by the forestry Ministers to take into account in selecting areas for disposal. They are—not in any order of precedence—

(a) the financial implications including the need for disposals to be fully in accordance with the principles of public accountability;

(b) the maintenance and development of the wood processing industry;

(c) the maintenance of employment and the viability of local communities, especially in socially fragile areas;

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(d) the use of forests for public access and recreation;

(e) the interests of conservation, research and education;

(f) market preference;

(g) the effect on efficient management of the Commission's remaining land holding;

(h) the rationalisation of the forest estate;

(i) the procedures for "offer back" to former owners which are generally in force for the disposal of Government property in the case of freehold or outright sales to be extended as appropriate to areas held on lease by the forestry Ministers if any of these are selected for disposal.

In addition, the commissioners should have full regard to the following:

(a) the special status of the former Crown land in the New Forest and the Forest of Dean, where disposals will, as hitherto, be on a very limited scale;

(b) the undertaking given by the forestry Ministers that in the case of plantations on land originally leased from the National Trust and still owned by them, the lease will not be assigned without the Trust's consent. This will similarly apply to properties leased from the National Trust for Scotland;

(c) the need to consult the forestry Ministers in the event of potentially significant aggregate sales to foreign or multi-national buyers.

I am painfully aware that by repeating the whole of the letter I may have stirred up a hornets' nest for myself in that a lot of the considerations go to future amendments, particularly, for instance one that has been tabled by the noble Lord, Lord Taylor of Gryfe, and I only wish to pray in aid the draft for this particular regard which the commissioners should have for the character of the Forest of Dean, because it is to that amendment that the Committee is now addressing itself.
I want to remind your Lordships that this is going to be a public document in the sense that everybody will know about it. It will be, as it were, a published framework within which the commissioners will be expected to carry out their duties and, bearing in mind the intense public interest which there now is in matters such as access, the enjoyment of the countryside and the preservation of all that is undoubtedly good in the countryside, I would suggest to your Lordships that in effect this will act as just as effective a fetter on sales of land in the Forest of Dean as anything else.
The noble Lord, Lord McNair, said, "Yes, but what about the next Government but two?"—I think it was. I quite agree. No Government can bind its successor and I can perfectly well appreciate that this letter can always be countermanded by something else in the same way as this Bill can either be changed or repealed by future legislation. Nothing is certain in this world, least of all the intentions of future Governments.
I have responded to this amendment at considerable length because it is a terribly important matter. Obviously it goes to the future of the Forest of Dean
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but equally obviously it goes to the character of this Bill and, as I have tried to say, besides the fact that there is absolutely no intention on the part of Ministers to sell off any part of the Forest of Dean, other than the small parcels which I have spoken about, I should have thought that this was a way of going about protecting the Forest of Dean—and everybody wants to do that—but at the same time compromising in respect of this Bill in a way which I hope will commend itself to your Lordships. I hope very much that in fact members of the Committee will respond to what I have proposed and let me, as the Government spokesman in this House on this matter, get the feel of the Committee.
Earl St. Aldwyn: I have listened with great interest to what the Minister has said. I think he has done a great deal to try his best to help the Committee in this very difficult problem, but with due respect to him it does not really get to the nub of the problem. The problem is that we want safeguards written into the Bill. Letters are no good. Any Minister in the second, third or fourth Parliament from this can perfectly well cancel that letter.
The noble Earl said that other places will also want to be exempted, and he quoted the New Forest. The position in the New Forest is entirely different. They have inumerable rights; they have rights of way; they have powerful verderers with very considerable powers. They can use those powers. In the poor Forest of Dean we have nothing! There is nothing whatever to stop a Government or a Commission in the future saying, "The Forest of Dean is no use to us; we will sell it as a block", whereupon somebody will buy it and turn it into a wildlife park, put a high wire fence all round it and fill it with lions and tigers, and the public will be told that they may drive through but they cannot walk through. I really do not think that the Minister has made a case, and I hope that the noble Lord will press his amendment.
Lord George-Brown: I am fascinated with the reply of the noble Earl, Lord Mansfield. He has just spent a long time on the previous amendment, telling us that the Forestry Commissioners are not Forestry Commissioners; they are a Government department. He has now read out to us a letter which he said he will place in our Library, which the Minister of that department will write to himself in his capacity of that department and which will bind him so long as he is the Minister for that department and he suggests that in some way that meets the purposes of this Bill. Either his defence on the previous amendment was wrong or this one is absolutely ridiculous. Ministers writing letters to themselves may occupy interestingly and amusingly a part of their time, but it cannot possibly be a substitute for giving protection to the Forest of Dean, to those who are interested in forests in general and to those who live there.
I think the noble Earl is either playing with the House or somebody is playing with him. The only way in which the purposes of this amendment can be achieved is by putting it into the Bill, because we think there is a particular reason for putting it into the Bill and that reason was spelt out in absolutely clear detail by my noble friend Lord Bledisloe. There is

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no other way one can protect it and with great respect to the noble Earl—and I am sure he will regard this as a reminiscence from long ago, but may I tell him that the bureaucrats of today are very similar to the bureaucrats of long ago. The argument that, "If you allow this to go through, Minister, somebody will claim it for somewhere else", is the oldest argument any bureaucrat has ever produced, and the silliest argument any Minister has ever accepted. Of course, it is true of everything that, "If you give way on this, Minister, you will be pressed to give way on something else". The answer to that damned argument is, "In that case, if I think it is wrong I will stand up and fight". It is an argument I do not happen to think is strong enough.
The Forest of Dean does have a special place. It came into the Act in 1923. The noble Earl may like to know it was longer ago than my own reminiscences. It came into the Act as a matter of convenience. If the present-day bureaucrats in the department concerned will look up the history they will see that it was nobody's intention that it should become even possibly alienable in this way. It just looked at that time as though it would be an odd contrivance to leave it outside, since we were setting up something new that nobody before had thought about. Lord Addison, who had a great deal to do with this matter and was a noble predecessor of many of us who subsequently have taken an interest in agriculture and forestry, would have been absolutely outraged if he had thought that bringing this in then as a matter of practical convenience meant that the noble Earl today could argue against our enshrining it, since we are offering powers elsewhere to do something else.
I hope the noble Earl will not persist in that argument. He clearly cannot persist in the letter argument, in view of his answers on the previous amendment, his insistence that the Forestry Commissioners are just a fantasy with no reality and the Commission is only a department of the Ministry. It simply means that any Minister at any time can tell his bureaucrats to ignore the letter which his predecessor was stupid enough to write to the previous set of bureaucrats.
As to Lord McNair's point about the next Government but two—I know the noble Earl gets fidgety with me, but will he please listen to this—it is easily within the bounds of possibility that we are not talking about the next Government but two, we could easily be talking about the very next Government. It is easily within the bounds of possibility that Mr. Foot could do what M. Mitterrand did yesterday. The immediate consequence of that: the abolition of this place. The possibilities of the then Minister being pushed very hard to find money, as M. Mitterrand's Ministers will be, to carry out the other things which will be in his manifesto, as they are in M. Mitterrand's, will be very considerable indeed. And they exist; they are already written down. If we have a Bill which does not protect the Forest of Dean—we cannot protect others apparently—there is a very great possibility of large areas being sold off in the period of the next Government—not the next Government but two.
And no judge is going to hold—I am not sure, but I believe I am right in thinking the noble Earl is a lawyer—that what the noble Earl said in this House this
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evening makes law. What the judge is going to hold is the statute and the purposes which the House had in mind in the passage of that statute. If this were allowed to go through unamended, simply on the grounds that this Minister says he thinks it would be stupid of the next Minister to do such a thing—the words he used—no judge is going to be impressed very much by that. He may think this Minister thought a great many other things were stupid; he may even think that some things this Minister does are not altogether sensible either; he is not going to make law and give judgment on those grounds. The fact that this Minister said he issued a letter to his bureaucrats is not going to be construed by the judge as changing the law. The fact that this Government does not want to do it and that Mr. Foot/M. Mitterrand might quite well want to do it is not going to affect it if this is the law and we pass it in this form.
I beg the noble Earl to take us seriously on this matter—even those of us who can reminisce from long ago. As a matter of fact, those of us who can reminisce from long ago happen to have seen these very things happen in our lifetime; things that Ministers had assured us they did not intend should be done have in fact subsequently been done. I lend such support as I can bring to Lord McNair's amendment, and I again say to the noble Earl, although he obviously thinks I am a rather immoderate chap in a House of worthy moderates with all the force I can summon up, that simply coming down here and reading us bureaucratic answers to serious questions, and when ultimately pushed relying on the Treasury Solicitor, is really no way to deal with arguments that are of tremendous importance.
I do not, obviously, for various reasons, share the personal emotional attachment of those who live in and around the Forest of Dean, but I have been for a long part of my life involved with the work of the Forestry Commission. Tremendous work it has done. I am very conscious of the history of my country. I do not want to see us do anything which will enable some chap a little bit later on, for purely temporary reasons, give it away, sell it away, in order to finance some other thing that he has in mind. And I repeat, we shall not be here then to resist. I beg the noble Earl to keep that in mind. I suggest very strongly that the Government should not resist this amendment.
6.27 p.m.
Lord Sandford: This is indeed a very important amendment and my noble friend does well to take care, because, unlike what happened with the first amendment, he has now got, I suspect, something like 12 Gloucestershire Peers on this side of the House ranged against him. If the noble Lord, Lord McNair, intends to press this amendment, I, too, would have to follow him into the Lobby. But with my noble friend Lord Dulverton, I do not believe, that this is the best way of dealing with these problems. I was greatly encouraged when my noble friend read out the instructions, in the form in which they are so far, which are to guide the Forestry Commission in this matter of the disposal of land.
Nevertheless, as the noble Lord, Lord George-Brown, and many others have said, letters in the Library are no good when it comes to law. Parliament must have

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some control and scrutiny over these instructions. If my noble friend could say that those instructions, or something similar, would be re-drafted in a form which could be laid before Parliament and subsequent instructions would be laid before Parliament, or something along those lines, then I think we should all be greatly helped, because all these detailed points could then be embraced in what would then be secondary legislation and we could make progress. If he cannot say that, I do not think I have any option but to support the noble Lord, Lord McNair.
The Earl of Mansfield: If I may intervene before the noble Lord, Lord McNair, speaks, may I say that I have been very struck by my noble friend's suggestion. I have also been very struck by the reaction of the Committee, which I invited. I do not conceal from the Committee that I think that it will be a very difficult problem to resolve. Nevertheless, in view of the way in which the Committee has expressed itself this evening, I think that it would be churlish of me not to say that I shall take this back and consult with my colleagues to see whether we can do something, possibly on the lines suggested by my noble friend Lord Sandford, which will have such form as will commend itself to the House at a later stage of our deliberations on the Bill and thus effect a compromise. I hope that, with that assurance, the noble Lord, Lord McNair, might, for this stage, see fit to withdraw his amendment and let me take it away as I have been invited to do by the noble Lord, Lord George-Brown, and see what I can do.
Lord George-Brown: Before the noble Lord, Lord McNair, answers that point, would it not be better, knowing the ways of Governments, Government departments and draftsmen, for us to insert the amendment leaving the Government to invite us to take it out in place of another amendment at a later stage? I hope that the noble Earl will believe me when I say that I am not seeking here churlishly to reject or to react to what he thought was an unchurlish act on his part. But if we do not put the amendment in and it then comes back later at another stage, perhaps at an inconvenient time or at an inconvenient point, we shall be left without any defence at all. I invite his reaction to that. I also invite the reaction of the noble Lord, Lord McNair. I must say that my own reaction would be to try to put the amendment in at this stage with the assurance—genuine assurance—on the part of all of us that, if the Government then come back with some other amendment which seems to meet what we want, we would not resist them replacing our amendment with theirs.
The Earl of Mansfield: I must come back to the noble Lord, Lord George-Brown, on this matter. The Government came with a very pronounced view on this matter, as I hope I made clear from my remarks. I was invited to think again by a number of noble Lords including the noble Lord, Lord George-Brown, who said—to paraphrase his remarks—that I should take it away and do something about it. When I say, "Yes, I shall respect, obviously, the concern of the House about this matter"—a matter of deep concern to a number of your Lordships, the noble Lord then says, "Oh, No, write it into the Bill and see what the
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Government can do on Report". With the greatest respect to the noble Lord, I do not think that that is responding in anything but a throughly churlish way to the offer of the Government to take something back and see, on a matter as important as this and about which there are such deeply held convictions, if we cannot come to a compromise which, after all, is the way in which your Lordships' House usually works.
Lord McNair: If I have the temperature of the Committee I think that a very short speech from me might be welcome rather than a long one. The noble Earl has put me in a difficult position. He came a long way to meet me to start with and he has now come further. My feeling is that it would be churlish on my part if I were not to accept what he offers. But clearly he knows the strength of feeling in this House about the Forest of Dean—he can be under no misapprehensions about that—and some magnificent speeches were made in support of my amendment for which I thank noble Lords. However, in view of what the noble Earl has offered, until the Report stage I shall, for now, beg leave to withdraw the amendment.
The Deputy Chairman of Committees (Baroness Wootton of Abinger): Is it your Lordships pleasure that the amendment be withdrawn?
Lord George-Brown: No.
The Deputy Chairman of Committees: If there is a single objector the amendment cannot be withdrawn. I shall put the Question. The Question is, That this amendment be agreed to? As many as are of that opinion will say "Content". The contrary, "Not-Content". I think that the "Not-Contents" have it. Clear the Bar.
Tellers for the Contents have not been appointed pursuant to Standing Order No. 50. A Division therefore cannot take place, and I declare that the Not-Contents have it.
6.30 p.m.
Lord Gisborough Lord Gisborough moved Amendment No. 5:
Page 1, line 8, after ("any") insert ("productive").
The noble Lord said: I beg to move Amendment No. 5. The Minister will be well aware of the figures in the Case for Forestry—imports 92 per cent.; 7 per cent. forestry in England and so on—without my going through them. Therefore he will be as aware as any of us of the importance of using an increasing amount of our land for forestry. This amendment is to try to ensure, or at least to discuss, the possibility of making certain that, when land is sold by the Forestry Commission which has been earmarked for forestry, they should make reasonable provision that it will be used either for planting by somebody else, or for a return to agriculture, or for some other productive use. Apart from anything else, if it is not to be used for a productive use, then the purchaser—and knowing something of buying from Government departments this could well happen—could argue that as he did not want to use it for forestry or for productive use, therefore the price should be less. It is quite likely, believe it or not—and I have a recent example of this—that the Government department

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would say: "Fine, you can have it for a much lower price".
Therefore from a price point of view, as well as for the production of the country, it is very important that the Forestry Commission should ensure that the land will be used for production; otherwise what could well happen is that the land would not be planted, or replanted as the case may be, and could be allowed to fall virtually into dereliction. Of course, in particular this would apply in Scotland. There is much too little forestry in England and Scotland and we must make sure that the maximum amount is maintained. The Commission must satisfy itself that the land is to be used properly.
The Earl of Mansfield: I entirely sympathise with my noble friend. I think that we would all wish to see land which the commission sells maintained in a productive way. I think that the vast majority of purchasers interested in the mainly commercial plantations that the commission will be offering will wish to protect their investment by sensible management. However, I do not think that the additional word proposed in the amendment will ensure that this is achieved. Although the Forestry Commission, by virtue of its felling licensing powers, will be able to require that land remains under trees where appropriate, it has no means of ensuring that a woodland will continue to be managed in a productive fashion after the sale takes place.
Then there are a number of other difficulties which spring to mind. First, what is the meaning of the word "productive"? I suppose that it could be any kind of activity which puts the land to some form of positive use; certainly forestry, certainly agriculture, and arguably sporting could all be described as productive. Whether or not it is capable of definition, I do not see how the commission could ascertain the motives of prospective purchasers. Whatever they say at the time that they entered into negotiations for the purchase, they could change their minds after the sale had gone through. I do not think that there is any means of the commission, as it were, enforcing what would be in Clause 1 of the Bill if the situation changed at a later stage. Although, as I have said, I am sympathetic to my noble friend's reasoning, I am afraid that this amendment would cause more problems than it would solve. Therefore, I hope that he will see that it is not really desirable, and I would ask him to withdraw it.
Lord Gisborough: I thank my noble friend for that explanation. I do not think that there is much point in my pressing the amendment and, therefore, I beg leave to withdraw it.
Amendment, by leave, withdrawn.
Lord Ross of Marnock Lord Ross of Marnock moved Amendment No. 6:
Page 1, line 8, after ("any") insert ("forestry").
The noble Lord said: More than once the Minister has taken refuge in the difficulty of definition. I hope that he will not lean heavily on that for my amendment, which is to put in, where the noble Lord, Lord Gisborough, would have put in "productive", the word "forestry". It is not a wrecking amendment.
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It is to allow to have carried on that which is being carried on prior to the purchase.
I do not think that there is any difficulty about the definition of the word "forestry". It does not preclude the Minister from selling land which can be forested, which is one of the limitations of the subsection that we seek to remove. If the suggestion is, as the Government have put forward, that there are people who are anxious to buy land for forestry purposes, then this amendment meets that. From the point of view of most people who are concerned, I think that it will be satisfactory, provided of course that the forestry is carried on in a sensible way. There is no reason at the moment to think that it will not be.
However, this amendment will at least limit the power of the Minister in these disposals; in other words, he can dispose provided that the land will be used for forestry purposes. He says that he cannot be assured of that. With all due respect, I think that he can; certainly as regards Scotland he could, and I am perfectly sure that a conditional lease or a conditional sale could be effected. That would certainly allay some of the fears that are presently being expressed by those most concerned about the disposal of Forestry Commission land and, of course, land which was not originally in some cases Forestry Commission land, but land which passed into the keeping of the Forestry Commission when people thought that the commission was pretty safe from exploitation of the land for purposes for which the land would probably not be suited. This is the danger. The disposal of any land "for any purpose" is a serious concern of people. Of course, we could all sit here and think of exactly what purposes some strange person would put land to. Admittedly, there is the planning permission procedure, et cetera. But if we are told that the Forestry Commission is just a department of the Government, then in relation to a change of use for what would be forestry or agricultural land that matter would go back to that department. That department would not oppose itself.
I hope that the Minister appreciates the kind of net that he has woven for himself in his declaration that for all practical purposes the Forestry Commission is a department. I think that I am right in saying that if there is to be a change of use from agricultural land, it is the Department of Agriculture, certainly in Scotland, that has to give the say-so. Therefore, the noble Earl will probably find himself in trouble over this phrase "for any purpose". He would be on far safer ground and certainly allay the fears of many people if he said yes to, "for forestry".
I would go so far with the noble Lord whose amendment has, I think, rightly been turned down because of the difficulty of the word "productive". If asked to, I would gladly have this amendment extended at a later stage to "forestry and agricultural purposes". I think that that limitation of the future use of the land to forestry and agriculture would also meet some of the fears that have been expressed. However, in the meantime I rest on the word "agriculture" being arid. I beg to move.
Lord Gisborough: I should just like to add to what the noble Lord, Lord Ross, has said inasmuch as one could well get the situation where a previous owner had sold land adjacent to his own interests to the

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Forestry Commission on the clear and obvious understanding that it would be put into forestry. What happens when it is sold for some purpose about which he had never dreamt and he finds on his doorstep, instead of forestry, some other enterprise which clashes with his own interests? I think that that could well happen.
Lord Mackie of Benshie: While I sympathise with the points made on both these amendments, it appears to me that it might have a bad practical effect on the Forestry Commission in that if they bought a whole estate and parts of it were not suitable for forestry, then they would not be able to realise realisable assets. I wonder whether that is not a snag to this.
Lord Ross of Marnock: Under the present Section 39(2) they can do that at the moment. They can dispose of such land.
Lord Mackie of Benshie: The point I was making was that it appears to me that if this is inserted in the Bill then they would not be able to dispose of such land.
Lord Ross of Marnock: No, quite wrong.
The Earl of Mansfield: I can deal with my noble friend's point shortly by saying that if somebody wants to develop land in a way which is different from the use to which it is presently put, he has to seek outline planning permission. Therefore, all the various checks and balances would come into play which habitually do. But that really is not the point of this amendment. Again, I have a certain sympathy for the amendment in the same way as I did for my noble friend's amendment.
The difficulty is that the noble Lord, Lord Ross, seeks to put in a restriction which is in fact totally sweeping. I respectfully agree with the noble Lord, Lord Mackie. If, for instance, whether or not it buys an estate, it possesses agricultural land which is not to be used for planting, if this amendment were accepted and written into the Bill then the commission would be unable to dispose of that agricultural land as agricultural land. Nor could it dispose of residential properties, for instances. Nor could it dispose of land which in the general interest should be used for other purposes. It would not be able to cater for developments which have taken place in the past. For instance, the Forestry Commission would not be able to sell land for road widening, the construction of a reservoir, the making of a new town, and so on. In fact, the position would be such that the Forestry Commission would be restrained from disposing of a great deal of land which it is probably right and proper that it should dispose of.
As I said to my noble friend, I should have thought that the vast majority of purchasers will wish to manage their new estate for purposes of forestry, and that they will do so with the intent of maximising their investment, and therefore they will do so along the lines of sound forestry management and practice. If the land is under trees, the Forestry Commission will be able, by virtue of felling licences, to require that the land remains under trees after felling if such is considered appropriate. The amendment which the noble Lord
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seeks to write into the Bill in fact would be more restrictive than the powers are at the moment, as I think he himself acknowledged. As such, I am afeard that it is not acceptable.
Lord Ross of Marnock: I think that the noble Earl is right. One of the troubles is that the Minister under the present Section 39(2) has a limited power enabling him to dispose of land. He is now seeking to take a power which is far too sweeping. It is unlimited. It is open-ended. What we have been trying to do on this side of the Committee and in other parts of the Committee as well is in some way to limit this. The trouble is—and I do not know whether noble Lords have appreciated this—that they start by wiping out what is already there in Section 39(2), which gives the Minister power to sell land which in his opinion is not needed, or ought not to be used for forestry again. Of course, forestry Ministers and the Forestry Commission have been doing this for years.
Certainly it was not from the Forestry Commission that the demand came for greater powers of sale. They have been doing the kind of thing that the noble Earl says. It is rather strange that he should come along and say, "Here, you are amending it in such a way that they will not be able to do that". I admit that with this wording. I can think of other ways of doing it, of course. I thank the noble Earl for his answer. He has drawn attention to what was certainly wrong in my amendment, but I can think of one or two ways in which we can put that amendment right.
The Earl of Mansfield: If the noble Lord can, perhaps he would like to tell me what he has in mind, because I am conscious that noble Lords wish to improve the Bill. If the noble Lord has any ideas by all means let us debate them and then possibly they could come in the form of a Government amendment, or an agreed amendment, at a later stage of the Bill. I am by no means adamant about anything in the sense that I refuse to look at the other person's point of view.
If the noble Lord, as he says he has, has something up his sleeve to try to ensure that forestry land remains forestry land but yet, if it is desirable, should, as it were, go out of forestry without causing too much bother either to the Forestry Commission or to the purchaser, then I should like to hear it. The noble Lord says that in Scotland the Forestry Commission can write into the instrument of disposal a power, which of course it would not in England. If it did, it would not have any effect against a later purchaser. No doubt the noble Lord will bear this in mind. If he is going to come up with something it would certainly be desirable that it should obtain in each country, because obviously we want to try to have the same powers in each country. Perhaps the noble Lord can tell us if he has thought of anything.
Lord Ross of Marnock: Well, I have not, but it is not beyond the wit of a place with the experience and knowledge of your Lordships' House to look at the problem and see a way around it. It is not a case of having any cards up my sleeve. If I had cards up my sleeve I would have played them a long time ago. But I am not given to that kind of attitude. We have a problem. We have to find a solution. I think it can

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be done. I think it could be done quite easily, and I am not so despondent of the ability of even lawyers to draw up some kind of form of contract.
But the noble Earl cannot have it every way. They cannot always be to the advantage of the public and at the same time the advantage of the seller. The noble Earl keeps bringing this in, and this is where we come to the big difficulty. If we want to retain the wider public interest beyond just purely the interests of finance and the Forestry Commission, then it may well be that the restriction placed into any covenant on sale would be such that you will produce less money. But I appreciate the weakness of this particular amendment, and I beg leave to withdraw it.
Amendment, by leave, withdrawn.
6.50 p.m.
Lord Taylor of Gryfe Lord Taylor of Gryfe moved Amendment No. 7:
Page 1, line 9, at end insert ("where, after consultation with the commissioners, it may seem expedient for him to do so, and if he is satisfied—

(i) that the sale would facilitate the discharge by the commissioners of any of their functions; and

(ii) that the total receipt from such sales in any financial year will not exceed the grant in aid to the commission estimated for that year unless it is for the purpose of rational land management that further disposals are necessary.").

The noble Lord said: This is a fundamental amendment and I am pleased to see the names of the noble Lords, Lord Dulverton and Lord Sherfield, attached to it also. I hope it will commend itself to the Government so that we may restore in forestry a consensus view. If there is one thing the Bill has done, it has disturbed the basic consensus on forestry policy which has existed for 50 or 60 years, and that is unfortunate. Perhaps the amendment, in so far as it acknowledges the Government's wish but limits it, will find acceptance generally.
It would achieve two things. First, it would establish the place of the Forestry Commission as the manager of and authority over the forest enterprise, and, secondly, it would place some limitation on disposal. My noble friend Lord Ross has rightly said several times that the real difficulty about this piece of legislation is that it places no limitation on the present or future Minister. The Times had an editorial the other day on this subject. Headed "Too much Forest at Risk", it said:
"The Government disclaim any thought of wholesale auctions of national park woodland, or of letting Royal forests pass under the plough. But in legislation it is always the letter of the Bill that counts, rather than the ministerial assurances. If limited sales are all that is envisaged, means of limiting them should be written into the Bill."
That is precisely the case that has been argued this afternoon, and we are trying by this amendment to place some limitation on the Bill, at the same time accepting the Government's intentions.
The amendment says initially that the Minister, after consultation with the commissioners, may think it expedient to dispose of land:
"if he is satisfied…that the sale would facilitate the discharge by the Commissioners of any of their functions."
We have had a long constitutional argument already today about whether the Forestry Commission is part of the Government machine or Civil Service or whatever,
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but the commissioners as such have certain statutory obligations, and they are laid down in the 1967 Act. That states:
"The Commissioners shall be charged with the general duty of promoting the interests of forestry, the development of afforestation and the production and supply of timber and other forest products in Great Britain, and in that behalf shall have the powers and duties conferred or imposed upon them by this Act."
It goes on:
"The Commissioners' general duty includes that of promoting the establishment and maintenance in Great Britain of adequate reserves of growing trees".
That is the statutory responsibility of the commission and the amendment says that the Minister may dispose of land provided that is consistent with those statutory obligations, for unless those statutory obligations are recognised there will be no limit on the disposal. If a constitutional difficulty arose in which the Minister sought to impose a policy of disposal which was not consistent with those statutory obligations, there would be an interesting legal case and, I presume, as was the case with the National Enterprise Board, the board might resign. At least the amendment would lay down and confirm that obligation.
I have always assumed that it was basic to Conservative philosophy, in dealing with nationalised industries or government-supported industries, to give management powers to manage, and assess management on their performance. I suggest that the amendment would do that precisely, for it says that the commissioners have responsibility for carrying out their function and should be judged accordingly. Thus, there is no difficulty about defining the Minister's powers and the Forestry Commission's responsibilities.
Secondly, the amendment would place a maximum on the disposal of land in any one year. It says that the disposal of land must not exeed the grant-in-aid, and to that extent it meets one of the Government's objectives, namely, to move towards a situation when the Forestry Commission will be free from Government support and aid, and I hope therefore free from Treasury control. That is what the two parts of the amendment seek to achieve.
We have been all tied up today discussing the mechanics of the Forestry Commission, its relationship with government and so on, but the main objective of any forestry policy is not only to provide for the amenity and recreation of the public, a subject which we have already discussed, but also to increase the total amount of timber produced from home sources. It has not been argued by the Government today that the powers for the general disposal of land will make any sizeable contribution towards that economic objective.
The Forestry Commission does not crowd out (to use the modern expression) investment in private forestry. There is no state monopoly about the Forestry Commission; it buys land in the market, in exactly the same way as E, F, G or any other private investor buys land in the market, so the mere fact that one proceeds to dispose of a Forestry Commission asset does not necessarily mean there are immediate takers in the private market for it. Indeed, at present the private market is rather sluggish and private owners would not need to buy Forestry Commission land unless it was at very low and deflated prices. If that

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were to happen it would be a very serious matter indeed; it would be asset stripping on a massive scale. We must therefore recognise that what is proposed by the amendment would at least help the Government to realise their objectives, but at the same time would place certain limitations on their activities.
Lord Dulverton: Although my name appears with that of the noble Lord, Lord Taylor, to the amendment, I have been preceded by such an explicit speech, making the argument so clear, that I need not delay the Committee. I agreed with every word the noble Lord said. I must at the outset apologise on behalf of the noble Lord, Lord Sherfield, whose name also appears to the amendment. He has informed me that other urgent business has prevented him from being here; had he been here he certainly would have spoken to the amendment.
As I have pointed out when discussing the Bill on other occasions, there is a widespread feeling about what is described as the open-endedness of the ability of Ministers to sell off bits of the Forestry Commission, and that worries everybody, even the private sector of forestry. One reason is that private foresters have always had a high regard for the Forestry Commission as its partner, not in crime but in the beneficent work it has done for forestry. Furthermore, the noble Lord, Lord Taylor of Gryfe, made the point just now that the argument over the Bill has—only momentarily, let us hope—destroyed and broken up the all-party approach to forestry, which has been so notable and so good a feature of the forestry subject over many years. I hope that this very moderately phrased amendment will in this case commend itself to my noble friend on the Front Bench, and I am sure that it will have support from all sides of the Committee.
Lord Mackie of Benshie: We from these Benches should very much like to support the amendment. What the noble Lord, Lord Dulverton, said just now is very true—that the Government should be extraordinarily worried about the reaction of the private sector to the Bill. The open-ended, nay sweeping, powers that we have already discussed at some length are the really worrying factor. Another point, which has not been mentioned today, but which is of desperate importance, is that of the confidence of the commission itself. If the Minister, and the Treasury in particular, have these sweeping powers, then no commission can feel that it really being trusted to carry out this very important part of Government policy. At any time in bad financial circumstances its work might be swept away and the fruits of that work might be enjoyed by some other person, not by the nation for whom all the work has been done.
Furthermore, the amendment answers the arguments put forward by the Minister when he said that a Minister must be responsible and cannot be tied completely by the commission that he might have appointed. This proposal answers that point completely, in that the Minister is required only to consult and to be satisfied
"that the sale would facilitate the discharge by the commissioners of…their functions…".
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In other words, he has guidance, but he has responsibility, and if he makes a bad decision, he must carry the brunt of parliamentary and other criticism, and perhaps have to face legal action. So the amendment does not take away the Minister's responsibility. It safeguards the commission. It safeguards the ultimate objective, and I believe that it answers in a very large part the arguments that have been put forward in that it allows the sale of land up to the amount of the annual grant of Forestry Commission property which could save the Treasury money in grant, but it limits it to a reasonable proportion. It is a very moderate amendment. It is sensible, and it is put forward by people who know the business, who know about forestry from both the public and the private sectors, and I think that the Government would do well to accept it.
Lord Gibson-Watt: In speaking to the amendment I wish to declare an interest as a part-time Forestry Commissioner. Looking at the Companion to the Standing Orders I see that I am not debarred from speaking on forestry matters, but naturally there are certain things to which I am not allowed to refer. The matter under discussion is certainly of fundamental importance to the forestry industry as a whole, both public and private, but I wish to make my personal opinion on it very clear to your Lordships' Committee. I do not speak for my other colleagues on the Forestry Commission.
Those who have tabled the amendment are men of long experience and knowledge of the industry and they have voiced the apprehension which has been shown here, and in another place, and generally throughout the forestry industry. It is I believe only upon the open-endedness of Clause 1 that the fears are centred. The theory is that there could be no limit to the proportion of the Forestry Commission enterprise that could be sold off. Everyone is agreed that it is necessary to give the Forestry Commission greater powers to sell off uneconomic and ill-fitting parts of the forestry property—I referred to that earlier. Many people, including myself, believe it to be right that the taxpayer should no longer be asked to find large sums of money—about £34 million last year—for a state enterprise that has been growing and growing since 1919 and which, as other noble Lords have said, has been such a success in so very many ways.
What the amendment seeks to do is to limit the amount that the commissioners may sell in any one year; although I do not happen to agree with the details of the amendment, I shall not argue that now. What I say is that the size of future sales could be a matter of very great concern to us all. I agree that the figure at present suggested by Ministers of £40 million in three years is not unattainable or unreasonable. Ministers have repeatedly said that the Forestry Commissioners will decide what is to be sold; and that is the crux of the matter that has been touched on this afternoon. To me this is the crucial factor. The commissioners have a duty to carry out the policies of forestry Ministers and to administer the forest enterprise. What happens if a pension fund comes up with an offer of £500 million? I am not saying that it will. But when one considers the total value of the commission today—just over £1,000 million—this is a matter of some concern.

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If forestry Ministers should be pressurised by Treasury Ministers, and in turn instruct the commissioners to sell off in any one year a very large proportion of the enterprise, I would consider that to be emasculation, not disposal. Let nobody say that that is a totally impossible situation. I have been a forestry Minister in the past, though not perhaps quite as long ago as the noble Lord, Lord George-Brown, who is not in this place at the moment, though he referred to this earlier. I know that there are pressures from other Ministries upon forestry Ministers when difficult decisions have to be taken. If disposal of the size to which I have referred was requested, I would consider it unacceptable, and it would certainly put part-time commissioners in a very difficult position. There are five of them, as the commission is now set up, and it is suggested that after the Bill is passed there should be one more; but as I say, the position would be very difficult.
I would certainly support the Government, but I would ask the Minister to repeat that the Forestry Commissioners will decide what is sold. I would ask him, too, to pass on to his colleagues the reason for my fears, based on a very long experience of forestry as a practical forester, a commissioner, and a former forestry Minister. I shall live in hope that what Ministers have said in assurance will be honoured in the event.
Lord Gisborough: I should like to oppose the amendment. I can see no reason why the particular maximum proposed should be fixed. I see no harm in selling forestry. Obviously I would make the firm proviso that the Forestry Commission must have a minimum acreage for all its requirements regarding experimentation and so on. That might amount to 500,000 or a million acres. But subject to that minimum, I can see no harm in any amount of forestry going under certain conditions.
First, to argue that the fruits of the nation's investment are being given away is absolute nonsense. There is the cost of planting and maintenance and the growth compared with the value, which is considerably greater, and the value is what should be paid for that forestry. The country having gained the sale, the money could then he invested in the country at 15 per cent. bank rate (or whatever it is) instead of at 3 per cent. in forestry. Therefore, the country would be very much better—
Lord Taylor of Gryfe: Will the noble Lord accept that if large amounts of forestry land were unloaded on the market, the inevitable consequence would be that the taxpayer would not gain the benefit of his investment?
Lord Gisborough: I was going to come to that. I agree. I was talking about the investment. It would be 15 per cent. investment for the country instead of 3 per cent., and therefore the country is better off.
Lord Mackie of Benshie: I am sorry to interrupt, but that argument does not hold water. Inflation takes care of the lower interest rate, and the inflation-rate effect on money is what trees overcome.
Lord Gisborough: You can argue that backwards
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and forwards. I do not think that anybody would argue that there is a high return from forestry, and everybody would agree that the bank rate is high. You can end up by arguing all night. The timber, having been sold, remains growing and to the benefit of British timber production. What is being said by this amendment is that £30 million or £40 million should be the limit annually. As regards the noble Lord's point, that sum might be far too high or it might be too little. It depends on the demand. If there is a strong demand you could sell £200 million worth. If there is no demand, you might sell nothing. The important thing is that the price should not be depressed. I believe that this amendment should stipulate something to the effect that forestry should not be sold below a certain price, or a certain yardstick could be used so that the price is maintained. If that price can be maintained, related to demand, that might dictate that either £1 million worth is sold of £500 million worth is sold. To set £40 million or £38 million or whatever it is, is pointless; it bears no relation to demand. One must guard against the flooding of the market. Finally, if forestry which is growing is sold, then what could happen and one hopes will happen is that the extra funds should enable twice as many new acres of young forestry to be planted.
The Earl of Wemyss and March: I think that this is a reasonable amendment and deserving of support. Although it is right that the Forestry Commission land should be sold off with greater freedom than in the past, I think we are all worried at the extreme open-endedness of Clause 1. It is not reasonable in this very long-term situation (which is the intrinsic character of forestry) to rely on the statements of Ministers, mortal Ministers, however sincere they may be. If Parliament intends some limitation of this nature it should say so. I see no reason why my noble friend Lord Mansfield should not accept this amendment. I sincerely hope that he will do so. Reading the report of the Second Reading debate, I notice that the noble Baroness, Lady Jeger, said that the nation's forest estate as a whole should be made inalienable, like the National Trust estates. Especially and above all, I think this might apply to the ancient royal forests that remain—and we have heard much mention of the Forest of Dean and the New Forest.
Being deeply concerned, as I am, with both the National Trusts, I was glad to find that this invaluable characteristic of inalienability so impressed the noble Baroness. Although I do not think that one could go so far as to say that all Forestry Commission land should be inalienable, the fact remains that some of us and many of our predecessors, in selling or leasing land to the Forestry Commission not only were thinking of the money we should be getting by the transaction but were also under the general impression that the land would be in safe hands forever, or, at least, for a very long time, in hands just as stable and just as reliable as the state itself. There used to be a phrase: "As reliable as the Bank of England". Therefore, there should be some brake, some sort of control, on the uncontrolled impulses of future Ministers and future Treasury officials, to oppose excessive selling off of this priceless asset. I hope my noble friend the Minister will accept this amendment, even if he accepts no other.
The Earl of Mansfield: For reasons which I have already touched on, the first part of the subsection—that is, subsection (1)—is by no means acceptable to the Government. I have already touched on the reason but I had better do so again. I think that the noble Lord has borrowed, if that is the word, the words in Section 39(2)(b) of the Forestry Act 1967. I have already said that if the clause is worded in that particular way, we shall be right back to the position that we should be in if we did not have a Bill at all. In other words, the commissioners would not find it possible to sell off much, if any, forest land at all; and any powers that this Bill gave them would be so limited in scope that they would be totally inadequate for the more extensive sales which the Government intend and which we discussed on Second Reading. From that point of view, and from that point of view alone, this amendment does not commend itself to the Government. I want to say that right away.
I concede that the whole idea of selling off land in this manner does not commend itself to noble Lords opposite. They, if anything, want to advance the state and the state sector. They certainly do not want to restrict the state in any way; nor do they want the frontiers of the state to be rolled back. But we think, as my noble friend Lord Gisborough has said, that there is no reason why, both for the good of forestry and for the good of the taxpayer, these sales should not take place which, as I have said repeatedly and I say again, will be under the control of the Forestry Commission and indeed part of their function. They will make the Forestry Commission less dependent on the taxpayers' money and, in the end, will give back to the taxpayer a little of what has been taken from him over years and years.
As far as rational land management is concerned, this is a factor which the commissioners will take into account when they are selecting areas for sale. If they had to confine themselves to the rigid statutory obligation which the first part of this amendment would impose on them, they would be, as I have said, unable to carry out their function of sales and they would be open to constant challenge that in selecting a particular area they were not advancing a particular function.
I want to come to the matter of quantum. I was very appreciative of the remarks of my noble friend Lord Gibson-Watt and I confirm that for the first year (and this figure appeared in the Supply Estimates for 1981–82) the total value of sales of land and plantations other than surplus property are estimated at £10 million; and we do not expect the total to exceed more than £40 million in the first three years.
I appreciate that there is concern about the open-endedness of the powers in Clause 1. I accept that there are no restrictions on sales of the kind contemplated by this amendment. We do not consider that a restriction is called for. After all, the powers of acquisition are not constrained; the commission, which is responsible for acquisitions and disposals, buys whatever is necessary and wherever it can be found in order to carry out its responsibilities. Naturally, however, other interests are taken into account in making decisions about what land to buy. This is not a statutory requirement, but merely part of the accepted and well understood arrangements for ensuring
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that forestry finds its proper place in the management of the countryside.
I suggest that there are no differences in principle between these arrangements which effectively constrain acquisitions and work perfectly well without the need for legislation and various limitations which by virtue of administrative means will be placed in the operation of Clause 1. The objective has been spelled out frequently and consistently in both Houses. I know that the noble Lord, Lord Ross, if nobody else, will not accept this; I have made it abundantly clear—and I shall do so again—there is no ulterior motive, this is not a Treasury Bill, there is no intention to engage in wholesale and indiscriminate disposals. The commissioners will be in full charge of the operation. They will decide which areas are to be sold and also such matters as the size of the parcels and the terms of the sale.
The commissioners will decide whether they want an outright sale or whether they want a sale and leaseback for management, and they will take into account all the factors which I have already related to the Committee in the draft letter and they will have consideration for all the matters which are placed before them by virtue of that letter. They will have full regard for any assurances which may be made in relation to particular parts such as the New Forest or indeed, bearing in mind the particular interests of my noble friend Lord Wemyss, the properties leased from the National Trust.
The second part of the amendment would limit Government action and flexibility. That, I suggest, is required if we are to have regard to market forces in a disposals programme because, if for no other reason, the amount of land which may be sold per year is limited by the second paragraph in the amendment.
The Government have taken powers which are similar to if not strictly identical with these. For instance, the Civil Aviation Act of 1980 places no limitation on the number of shares which may be sold in British Airways. The Government have made it clear that at the time of the initial flotation a substantial minority of the shares will be offered for sale. The Transport Bill, currently being considered by the House, confers on the Railways Board broad powers of disposal in respect of their subsidiaries and the powers of direction being accorded to the Secretary of State are very wide. There is no statutory fetter of the kind proposed in this amendment on either the Secretary of State or the Railways Board. I would remind the Committee—and I do not want to get into the old argument of what the precise legal position of the Forestry Commission is again—that the Railways Board is an organisation at one remove from the Government and is unlike the Forestry Commission.
So I say that Governments are responsible and, as I have said in a previous debate, Governments are accountable, and the Government think that they should be given freedom to act. Although one realises the concern, one asks: Why should forestry be singled out in this way? I have been conscious of what the Committee have said and I have replied at fairly considerable length because I wanted noble Lords, both those who have contributed to your Lordships' deliberations this evening and also others who

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may well be interested, to know full well what the Government's position is.
I have said to the noble Lord, Lord Taylor of Gryfe, that his amendment is so drafted that it would place a restriction upon the freedom of action of the Commissioners which really the Government cannot accept. Having said that, without giving a commitment—which at the moment I cannot give for obvious reasons—I shall be prepared, without this commitment, to take the matter away and to discuss with certain noble Lords a possible amendment or avenues which might be explored with a view to seeing how we get on at a later stage of the Bill.
I hope that the Committee will treat this commitment on my part with the same generosity as it did my last one after what I might describe as a hiccup. It is of course up to the noble Lord, Lord Taylor of Gryfe, but this is the course which for the moment I commend to the Committee.
Lord Gisborough: Could my noble friend say a little more about price and flooding the market? I am not sure whether he is covering this point. This is one of the real points; how the prices are going to be maintained so that the sales of private forestry do not drop through the flooding of the market by the Forestry Commission.
The Earl of Mansfield: With respect, I do not think that a sales programme estimated at £10 million in the first year is going to flood the market exactly. May I just repeat what I have said at various moments and try to encapsulate it? The commission will be in charge of sales. I anticipate that the vast majority of these sales will take place by open tender and it would be a matter of the commission accepting or not the bid which most commended itself to them at the time when they had to make up their minds.
If the market is depressed, I anticipate that sales would be very low in that particular year or possibly non-existent. On a previous occasion I illustrated—and I did not tonight because we have been considering a whole lot of other things—one of the purposes of this power, besides making the Forestry Commission less dependent on the taxpayer, is that if the sales go very well and prices keep up then of course by agreement with the Treasury we would be able to increase the grant-in-aid for the Forestry Commission to increase its planting in later years if such a course was thought desirable.
Lord Mackie of Benshie: I understood his commitment to my noble friend on the Forest of Dean was a definite one that he would go away and try to meet the wishes of the House. I got the feeling that his commitment here was rather more qualified. Is that the case or not?
The Earl of Mansfield: It would be honest of me to say that it is more qualified. However, an undertaking is an undertaking. Some undertakings are given more wholeheartedly than others. I hope that most members of the Committee know that when I say I am going to do something I do it.
7.29 p.m.
Lord Ross of Marnock: We are grateful for any undertaking, be it qualified or unqualified. As I understand it, the noble Lord the Minister was going to speak to certain Members. We are not all anxious to be in this privileged committee, but I thought this was the point: that the noble Lord, Lord Mackie, was going to ask the Minister about this. I think we are entitled to know.
Secondly, there is something else I should like to ask the Minister. I applaud the efforts made by Lord Taylor of Gryfe to limit in some way the amount of land that is disposed of in any one year. In four or five years—in fact, I think the Government aim at 10 years—we could easily see the grant in aid wiped out altogether, without any guarantee at all that there is going to be any further extended plantings by the Forestry Commission. As I read it, unless we get land that is disposed of producing timber, then in the long run—unless the grant in aid is to be increased—it will mean a reduction in the timber potential of this country. If land passes out of timber, then obviously no timber is going to be produced on that land. If land passes out in a way that justifies the Treasury in not financing further each year a greater planting programme—and I am here meeting the point about the country's replanting needs—then obviously it will work against the whole national aspect of timber development.
I was interested to see that although the noble Earl, Lord Wemyss and March, supported this amendment and "coshed" the Government, he was not included among the land nationalisers; only noble Lords on this side of the House were included. I bow to the noble Earl because he is the President of the National Trust in Scotland and I am only his lackey, the Deputy Chairman. However, I feel that it should be appreciated that we on this side of the Committee are equally concerned for the national good and about the proper use of the land of the country. Indeed, the first nationalisers were from the opposite side of the House. Is it thought that all the people who established or who worked for the national good and the Forestry Commission should be called "land nationalisers"? I have said before that the Minister is the master of the infelicitous phrase; if there is anyone guaranteed to get peoples' backs up, he is there. We are always hoping that he will learn.
I do not know what the noble Lord, Lord Taylor of Gryfe, is going to do. He has been given some kind of promise and I will bow to his decision as to the future of the amendment.
Lord Taylor of Gryfe: I must make clear my lack of enthusiasm for the concession that was made by the Minister a few moments ago. It is extremely difficult for me to consider dropping this amendment because if the Minister is prepared to look at some form of limitation against the open-ended commitment of this Bill, then I—and those of my noble friends who have supported this amendment—would be happy to accept such an olive branch. I hope that the combined wisdom of the noble Lords who will look at this again will produce some formula.
The noble Lord the Minister does seem to presume that the argument involved in this amendment has

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something to do with pushing the frontiers of the state further and further against the disposal and sale of assets. If one thing has justified the presence of these Benches it is the belief that British politics have become sterile because of the dogmatic arguments of the nationalisers, on the one hand, and the de-nationalisers, on the other. We look at politics in terms of what is the best solution for the nation and for the industry. Ours is a purely pragmatic approach.
Insofar as this amendment was designed to restore this sense of purpose in the forestry industry, it has our support. I would hope that the Minister would depart from the dogmatic and ideological arguments in this connection because ideological argument have never really affected the general consensus view of the forestry industry. The mere presence of the noble Earl, Lord Wemyss and March, of the noble Lord, Lord Dulverton, and the noble Lord, Lord Ross of Marnock, in support of this amendment is some indication of the view we hold that the problems of the Forestry Commission, the expansion of timber production, the provision of amenities and recreation, and the safeguarding of assets and National Trust land can all be done by agreement but not by arguing ideological cases one against the other.
May I make one further economic point? The noble Earl, Lord Mansfield, said that if the market is difficult then sales will be low. I cannot really understand that because if he is establishing certain objectives for the sale of the land—he mentioned up to £10 million this year and £40 million in three years' time—then he has to meet those objectives. If he offers land to meet that objective of 10 million, that will not be a market assessment and the price of land will fall. He will be compelled to sell more land in order to realise the £40 million in three years. This case is not to be compared with the British Railways Board, the Civil Aviation Authority or British Airways, where we sell shares. This is a different kind of animal. This is not a state monopoly. The private sector and the state are one together in this industry and are not in opposition to one another. There is no ideological difference. Do not let us divide this and say that it is like selling off shares in British aerospace or in the British Railways Board.
I must confess that I am in some difficulty. If the noble Lord the Minister said he would look at this again and would try to get advice and guidance from other noble Lords who have a special interest and concern in these matters, then I would be prepared to accept that and withdraw the amendment. But if no progress is made in this direction then we shall be compelled to introduce some kind of amendment at Third Reading. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
The Earl of Mansfield: This might be a convenient moment to adjourn the deliberations of the Committee, and the Chief Whip suggests that we reconvene at 10 minutes past eight o'clock. I beg to move.
Moved accordingly, and, on Question, Motion agreed to.
[The Sitting was suspended from 7.38 until 8.10 p.m.]
[Amendments Nos. 8 to 10 not moved.]
Lord Ross of Marnock Lord Ross of Marnock moved Amendment No. 11:
Page 1, line 9, at end insert—
("(c) The power of disposal referred to above shall not apply to land in an area designated as a Forest Park nor to Crown woods transferred to the Crown Commissioners (Transfer of Woods) Act 1923)").
The noble Lord said: We have a slight change of subject here. This is a fairly serious amendment. It goes much wider than the Forest of Dean and takes us into forest park areas and so on. I do not think it would be good enough for the Minister to say, "We do not mean to dispose of anything here". I certainly would be one of the strongest objectors if, by any chance, the circumstances were such that the Forestry Commission, in order to meet an annual claim for a certain amount of money, were forced to sell off part of the Queen Elizabeth Forest Park, to which the noble Lord, Lord Taylor of Gryfe, referred earlier.
We cannot get away from the fact that what we are left with, at the end of the day, are the naked words of that exceedingly extensive power which we are giving to Ministers:
"The Minister may dispose for any purpose of land".
It could quite well be, as the Bill stands at the moment, that the persons who are purchasing have no obligation to tell the Forestry Commission of the purpose to which they are going to put the land. Then all that will stand before the beauty of the forest park is probably just the planning commission. As I said earlier, if land is construed as agricultural, the first consent must be given by the agriculture Minister in the country concerned. In Scotland, it would be the Agriculture Department of the Secretary of State for Scotland. It is not good enough that we should risk what could well be the desecration of forest parks or Crown woods, by leaving the Bill unamended.
I certainly would not be satisfied with the kind of explanation which we have so far had from the Government, that this would never happen. It is not right that this noble House, especially, should accept such a position. In this House, we probably have more experience of private forestry and of the Forestry Commission, and have ties with it that extend as long as the life of the commission itself. That being so, it is particularly incumbent upon us to do something that it was not possible to do in another place: that is, to put some limitation on the powers of Ministers in respect of the disposal of land.
This is a fairly simple amendment. I do not think there is anything that requires much definition, on which the Minister can ride away. He certainly knows what we mean. If he says, "This is what we are going to do anyway, and we shall ensure that there is no encroachment here", then I must plead with him again. He must put it into the Bill. Otherwise we shall be entirely dependent on what will happen to Ministers and Governments in future. At least, we shall be able to ensure that, if this is to be set aside, Ministers will need to come back to both Houses with a piece of legislation, which we can argue about all over again. So I say to the Minister: Please do not say "We are not going to do it". That is no safeguard for the future and for things as important as forest parks or Crown woods transferred to the Crown Commissioners. I beg to move.
8.17 p.m.
The Earl of Mansfield: I well understand the desire of the noble Lord to ensure that the special features of the forest parks designated by the Forestry Commission are maintained for the enjoyment of the public and I share that desire. The first forest parks were designated before the Second World War and could well be regarded as having set a precedent for the introduction of national parks in later years. I know that the commissioners would not lightly dispose of land in the parks, if there was any possibility that this would detract from the special features which have made them so popular.
I have to return to the matters on which I have already touched in a number of debates, that a comprehensive set of factors and criteria have been drawn up which the commissioners will take into account when they select areas for disposal. One of these concerns the use of the forests for public access and recreation. These criteria will be applied to sales in forest parks, as in any other area. The recreational and amenity value will be taken fully into account in assessing whether, and in what manner, any disposal should take place. But I have to say that it would be wrong to prevent the sale of any land in a forest park, even, for instance, for the purpose of a road improvement, or something like that, which is what the noble Lord seeks to do by his amendment.
I have to say to him that the Crown Commissioners (Transfer of Woods) Act 1923 does not exist, so a bit of redrafting would have to be done if the noble Lord was so minded. I have no doubt that the noble Lord was concerned with, for instance, the New Forest and the Forest of Dean which we have talked about. But I recognise that these woods, in their different ways, have a special status and that is fully recognised by the Forestry Commissioners. I do not think I can add very much to what I said in relation to the Forest of Dean debate. There are other smaller Crown woodlands scattered around the country which were transferred under the 1923 Act. There is no reason why these should not be regarded as part of the normal forest estate and disposed of if it is considered appropriate, but having regard to the criteria which the commissioners have developed for the selection of areas for sale. It is on that basis that I ask the noble Lord to withdraw his amendment.
Baroness Jeger: I apologise that I was not here to hear the Minister refer earlier to the Forestry (Transfer of Woods) Act 1923. I am very puzzled about this matter, because I have here a copy of that Act from the Library. There is therefore a certain amount of confusion in my mind. In supporting the amendment, I had in mind the fact that in the United Kingdom there are seven forest parks with a total area of 450,000 acres. It seems to me that we ought to be able to ensure that at least that land remains free from any sales under the Bill.
I do not always agree with what is said in leading articles in The Times, but on 24th April 1981 a leading article in that newspaper said:
"The Government disclaim any thought of wholesale auctions of national park woodland, or of letting Royal forests pass under the plough. But in legislation it is always the letter of the Bill that counts, rather than the ministerial assurances. If limited
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sales are all that is envisaged, means of limiting them should be written into the Bill".
While I was thinking about the amendment I re-read the proceedings of the Standing Committee in another place and was very disturbed to see that on 17th February the Minister said, at col. 42:
"The same criteria will be applied to sales in forest parks as in any other area. That means that the special recreational and amenity value will be taken into account fully in assessing whether or in what manner disposal shall take place."
If words mean anything, these must mean that the same criteria will govern decisions as would govern decisions about selling any scrubby old rough patch anywhere.
It was the Minister who said that the same criteria will be applied. We are thinking about Crown woodlands like the New Forest, Alice Holt, the Isle of Wight, Beddgelert, Tintern, Chopwell in Tyneside, and Delamere in Cheshire. As I understand it—I am humble about this, in view of the possibility of my having been misled earlier—the Act of 1923, which the Minister says does not exist, seemed to provide that if such lands were sold the original owners (that is, the Crown) would have to be reimbursed. Therefore the Consolidated Fund for once would not benefit. So why do we not leave everything as it is? Surely this would be just a bookkeeping transaction.
If I am wrong in thinking that the Act of 1923 exists, perhaps I may quote with more confidence from the Forestry Act 1967. It appears from Section 43 that if land is sold which has been transferred from the Crown Commissioners under the Forestry (Transfer of Woods) Act 1923—this non-existent Act—then the net proceeds of sale shall be paid by the Minister to the Crown Estate Commissioners. This leaves me, as I have already said, in a state of great confusion. I hope your Lordships will understand the argument of my noble friends and myself about the need to exclude from the Bill these forest parks and similar areas. At col. 44 on 13th February the Minister said:
"At no time did I say the Forestry Commission would not sell forest parks or parts of forest parks. Under the Bill, it will have the right to sell anything".
That is rather depressing. I am wondering whether there is any way in which the provisions regarding National Trust land which is inalienable could apply in the same way to some of these Crown woodlands and forest parks. It does not seem to be a lot to ask and it would put many people's minds at rest, people who feel that the very wide powers which are given under the Bill will enable some of the really precious and long appreciated areas which the public have enjoyed to be subject to sale under the Bill. That is why in putting down the amendment I hoped that at least I should meet some of the difficulties advanced by the Minister when, during earlier debate about the Forest of Dean, he said that this would arouse difficulties because other places would want to be treated similarly. The amendment makes it possible for the Minister to look after all 24 forest parks. It would be a very happy moment if, for once, he were to say tonight, "Yes, let us leave the forest parks alone".
Lord Ross of Marnock: Could I put the record straight? There is a Transfer of Woods Act 1923.
The Earl of Mansfield: I agree.
Lord Ross of Marnock: The error is in the wording of the amendment, in which there is a reference to the Crown Commissioners. This is fairly obviously a reference to the Forestry Commission.
The Earl of Mansfield: The noble Lord is quite right. There is no mystery about this; he has just got it wrong in his amendment. It is what when I was a pupil at the Bar was called idle drafting. I do not make any further point than that.
Turning to the points made by the noble Baroness, Lady Jeger, I would point out that if the criteria are to be comprehensive, objective and logical they must apply to all woods, whatever their character and status. In other words, the commissioners apply these criteria when making up their minds about whether to put a particular parcel of land on the market, whether they are to have a sale and lease back or whether they are not to sell it at all. If they did not apply the same criteria to every parcel of woodland, then there would be no point in having the criteria. So my honourable friend in the other place was perfectly consistent when he said that this is the way in which the commissioners would go about their duties.
We have already covered the second matter in the Forest of Dean debate. May I say to the noble Baroness that in the case of these Crown forests there is in the commission's accounts a contingent liability. If, therefore, there is an individual sale of more than two hectares in a parcel, the proceeds, less expenses and valuable improvements, would be transferred to the Crown Estate Commissioners. I said that there will therefore be that much less inducement to the Forestry Commissioners to sell because the proceeds, less expenses and the value of improvements, would go to the Crown Estate Commissioners and not into the Forestry Fund. There is even less inducement therefore to the commissioners to sell in any particular instance than there would be in the case of an ordinary parcel of woodland.
May I also remind the noble Baroness that if one were to have such blanket protection for the forest parks as she would like, then, as I have said, it would prevent the commissioners from selling off a small portion for such beneficial improvements as a road, or the upgrading of a road, or any small portions of the parks which are of no amenity value and which should be sold if the criteria meant just the same as any other parcel of forestry land. That is, briefly, the sum of my objections to the amendment moved by the noble Baroness.
Baroness Jeger: May I just take a moment to explain that some of the confusion has arisen as a result of my bad writing. I have the original manuscript of my amendment which quite clearly says (to me) "from" the Crown Commissioners and not "to" the Crown Commissioners, as appears in the Marshalled List. I am blaming nobody and I take responsibility for my bad writing and I am sorry for any confusion which it has caused.
The Earl of Wemyss and March: Before the noble Baroness decides whether to press or to withdraw the
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amendment, I should like to make one point. Earlier, in her absence, I was referring to the inalienability of the National Trust, which I was glad to see she had referred to on Second Reading. I should like to reassure the noble Earl, Lord Mansfield, that the inalienability which affects both the National Trusts does not, if properly used, prevent the selling off, as necessary, under safeguard of the small pieces of land which he is anxious not to have sterilised. That is perfectly easily done.
The Earl of Mansfield: I do not think I can help the Committee further. I have tried to say that this amendment—I appreciate the thought behind it—is badly conceived and is already catered for in the arrangements.
Lord Ross of Marnock: Here we have this reference to a letter, part of which has been read out and the promise in respect of which is that it should be placed within your Lordships' Library. I do not think any assembly is prepared to accept this kind of thing. In the first place we have not seen it; we have only heard part of it and we are relying entirely on what we could comprehend from that. In any case, I have never heard that it was acceptable in respect of Bills with which I have been concerned, where the Opposition always insisted that they should see these things in full and very often demand—and have been granted their demand—that it should be included in a schedule.
Until we get that, I do not think we should go farther down this road of surrender to the Government. It is far from satisfactory to rest on the position of the roads, and so on. We could quite easily cover that in a letter, too; that this will not apply to areas of ground required for something beneficial to the Forestry Commission and to the public at large. I wonder how many new streets and new roads that have not been made by the Forestry Commission are driven through the forest parks. I am perfectly sure that that is already covered at the present time, and there will be no difficulty in dealing with that particular point, as I said in respect of an earlier amendment.
We should remember that what the Government are doing is creating their own protections in respect of getting these amendments through, by referring to powers which are being abolished, which are already there in Section 39(2) of the 1967 Act as it stands. If they wanted to get some greater flexibility out of that subsection, this is not the way to do it. This is the way in which we get justified fears arising on the part of the National Trust and the National Trust of Scotland, and those interested in the Crown woods and forest parks. I do not think the Government have done nearly enough to meet the fears that have been expressed from both sides of the Committee.
8.35 p.m.
On Question, Whether the said amendment (No. 11) shall be agreed to?
Their Lordships divided: Contents, 26; Not-Contents, 64.

CONTENTS

Adrian, L.

Loudoun, C.

Birk, B.

Milner of Leeds, L.

Blease, L. [Teller].

Oram, L.

Boston of Faversham, L.

Peart, L.

Brockway, L.

Ross of Marnock, L.

Collison, L.

Stewart of Alvechurch, B.

Davies of Leek, L.

Stewart of Fulham, L.

Glenamara, L.

Stone, L.

Greenwood of Rossendale, L.

Strabolgi, L.

Houghton of Sowerby, L.

Taylor of Gryfe, L.

Irving of Dartford, L.

Tweeddale, M.

Jeger, B.

Underhill, L.

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

Wemyss and March, E.

NOT-CONTENTS

Abinger, L.

Long, V.

Airey of Abingdon, B.

Lyell, L.

Alexander of Tunis, E.

Mackay of Clashfern, L.

Auckland, L.

Macleod of Borve, B.

Avon, E.

Mansfield, E.

Bathurst, E.

Margadale, L.

Bellwin, L.

Marley, L.

Belstead, L.

Murton of Lindisfarne, L.

Bessborough, E.

Norfolk, D.

Brabazon of Tara, L.

Northchurch, B.

Bridgeman, V.

Portland, D.

Brougham and Vaux, L.

Radnor, E.

Cathcart, E.

Rankeillour, L.

Cockfield, L.

Redesdale, L.

Craigavon, V.

Reigate, L.

Craigmyle, L.

Romney, E.

Crathorne, L.

St. Aldwyn, E.

Cullen of Ashbourne, L.

Sandford, L.

De La Warr, E.

Sandys, L. [Teller.]

Denham, L. [Teller.]

Savile, L.

Drumalbyn, L.

Sharples, B.

Dundee, E.

Skelmersdale, L.

Elles, B.

Stradbroke, E.

Ferrers, E.

Stuart of Findhorn, V.

Fortescue, E.

Trefgarne, L.

Gainford, L.

Trenchard, V.

Gisborough, L.

Vaux of Harrowden, L.

Gowrie, E.

Vickers, B.

Gridley, L.

Vivian, L.

Hailsham of Saint Marylebone, L.

Waldegrave, E.

Windlesham, L.

Inglewood, L.

Young, B.

Killearn, L.

Resolved in the negative, and amendment disagreed to accordingly.
8.43 p.m.
Lord Gisborough Lord Gisborough moved Amendment No. 12:
Page 1, line 9, at end insert—
("( ) There shall be inserted at the end of section 39 of the Forestry Act 1967 the following subsection—
"(7) In any sale of land made under this section it shall be a condition of sale that vermin-proof fencing shall be maintained by the purchaser."").
The noble Lord said: During the period of time in which the Forestry Commission have either owned land or rented land from owners they have built up in so many cases a working arrangement, sometimes going back to the original agreement and sometimes simply by arrangement. This very often covers fencing and sporting and other aspects. When new owners come on to the scene it would be only reasonable if the Forestry Commission passed on to the new owners the same duty as they have had or been prepared to undertake to protect their adjacent owners. This amendment is designed to ensure that the successor should take on, in this particular case, fencing, where the Forestry Commission have done it in the past. I beg to move.
The Earl of Mansfield: This amendment would really impose an unreasonable, and, dare I say, in many cases unnecessary, burden on the purchasers of forestry land. Foresters often erect vermin-proof fencing, but they do so to keep the vermin out, not to keep them in, and when the trees grow out of the vulnerable stage they allow the vermin proof fence to fall into disuse, since it is no longer needed. I really do not think any purchaser would accept a burden of this kind, and I do not think it is appropriate to impose one by statute. I have to come back, I fear, to the same difficulties as we spoke of in previous amendments, the difficulties of imposing a covenant and enforcing it on subsequent purchasers, at least in England and Wales.
In England and Wales, following a ministerial policy statement in 1956, the Commission agreed to maintain stock fences erected round its plantations in hill farming and upland grazing areas even when they are no longer needed for forestry purposes. This undertaking only covers the maintenance of existing stock fencing. It does not apply in Scotland or in the English and Welsh lowlands. It is not a legal obligation, and the agreement does not oblige the Commission to maintain any vermin proofing which may have been erected as part of the fencing process.
It is not the commission's intention to require purchasers to maintain fences of any kind, unless there is an existing legal obligation, which will, of course, be passed on. To do otherwise would, I feel, be an unwelcome precedent for other land transactions elsewhere, particularly for woodland owners.
In therefore declining to accept my noble friend's amendment, I end on what is possibly a somewhat frivolous note. There is no definition in the 1967 Act of vermin, and indeed that refers to "rabbits, hares and other vermin". I suppose, therefore, it might be argued, if this amendment was written into the Bill, that purchasers would have to maintain some kind of fence which would keep out grey squirrel. With that Parthian shot I invite my noble friend to withdraw his amendment.
Lord Gisborough: I thank my noble friend for that answer. Before I withdraw the amendment, can he say whether the condition that the purchaser should continue to maintain the stockproof fencing, which it may be the duty of the Forestry Commission to maintain, would be framed in such a way that it would have to be passed on again to a subsequent purchaser should the forestry be resold?
The Earl of Mansfield: Not in England and Wales. No covenants of this nature can bind subsequent purchasers.
Lord Gisborough: I thank my noble friend. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord Gisborough Lord Gisborough moved Amendment No. 13:
Page 1, line 9, at end insert—
("( ) There shall be inserted at the end of section 39 of the Forestry Act 1967 the following subsection—
"(8) The Minister shall have power, in the case of land disposed of by him under this section, to impose such conditions as he may think fit for the purpose of securing that the land will be used for forestry; and such conditions

403
may include provisions relating to management of the land, the planting of trees or the continuity of forestry use."")
The noble Lord said: Most of these forestry sales, I believe, will probably be made to oil companies, pension funds and that sort of enterprise. I believe there is every indication that the management will be first class; it will be undertaken by management companies and will probably be just as good as the Foresty Commission. Many sales will be to private owners, and again many private estates are extremely well looked after, and there will be no problem. But it is also true that some private estates are not well looked after; in fact, there are under-thinned woods, and woods one sees in the countryside sometimes leave a gret deal to be desired. Furthermore, there are some sales which will take place to people who do not want them for forestry at all but for game cover and that sort of thing. There are many cases—again, I have experience of them myself—where woods have been totally neglected; I think we can all think of cases
One gets a situation of lack of adequate thinning, lack of maintenance, the drains not kept up, disease allowed to come in, the fire risk allowed to increase by inadequate cleaning; possibly replanting and felling is done at the wrong time or inadequately. Access may be a problem. There is also, of course, the problem of road sharing; it may have been the custom to share the cost of a shared road. This may be a problem.
The object of this amendment is to allow the commission to lay down such conditions as they may think fit in order to ensure that woods which they have taken a great deal of trouble to plant and to look after are not allowed to fall into disrepair, and to enable them to go and inspect them to ensure to the best of their ability that the full potential is met. I beg to move.
The Earl of Mansfield: Again, I appreciate the motivation behind my noble friend's tabling of this amendment. But we come back to the same considerations as we have had in previous amendments, and particularly the last one. The clause is quite impracticable from the point of view of its legal effect. While conditions of the kind could be attached to any sale of commission land, they could not be passed on, at least in England and Wales, to any successor in title to the original purchaser. If one were trying to impose a restrictive covenant preventing the use of the land other than for forestry, this would only run with the land if the Forestry Commission held adjoining land which would benefit from the restrictive covenant and in most cases, of course, this would not apply.
So the only way in which the restrictive covenant could be made to run in those circumstances would be for special statutory provision to be made under which the commissioners would be deemed to possess land adjacent to the land subject to the covenant, and the covenant would also have to be expressed as being for the benefit of that adjacent land. In other words, one would have to create some sort of a legal fiction which would require special statutory provision.
The more positive provisions in my noble friend's amendment to do with the management of the land, the planting of trees and so on, would need to be expressed as positive covenants and there really is no precedent for such covenants to run with the land. They could, I
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suppose, be done as part of the contract of sale, but they would not run with the land and it would be far-reaching indeed to start writing them into this kind of land transaction.
I should imagine that, so far as the future use of land for forestry is concerned—as I have said on previous amendments—in the ordinary case the Forestry Commission before issuing a felling licence would require reinstatement of the wood after the felling had taken place. But a felling licence can always be made subject to replanting conditions. If there was a change of land use contemplated which seemed to be beneficial, then in those circumstances I do not suppose that the commission would insist on such an undertaking as a prerequisite of the felling licence. In other instances I would imagine—in fact, believe—that the people who buy these woodlands will be, to a large extent, people who want to maximise their investment. The best way of doing that will be to manage the land as well as it possibly can be managed to give the highest yield on the investment in due course. So for all those reasons which go to the practicalities as well as to the legalities and conveyancing difficulties, I am unable to accept the amendment.
Lord Gisborough: I thank my noble friend for that explanation. I think that there would be no reason why, in the sale of a plot of forestry, discussions could not take place with the purchaser regarding the plan of operations and what was expected to be done and that that plan of operations could perhaps be included in the contract of sale with conditions. It may be that the Forestry Commission could not follow it up if they were ignored, but I believe that if that plan and those conditions were included and discussed with the purchaser thoroughly, then in a great number of cases it would be very helpful for the purchaser, and indeed might make the difference between those woods being well looked after and neglected. I do not know whether the Minister would like to take up that suggestion?
The Earl of Mansfield: I really cannot agree with a proposal which is apparently unenforceable and in any event only cosmetic in its intent. If one is to have a power which is written into a contract of sale, then it must be such a power that it can be enforced and—my noble friend touched obliquely on this—the resource implications for the Forestry Commission in seeking to carry out the work of monitoring what happens after the sale has taken place would be very severe. I just do not think that the commission would be in a position to undertake that.
Lord Gisborough: I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord Sandford Lord Sandford moved Amendment No. 13A:
Page 1, line 9, at end insert—
("( ) In section 40 of the Forestry Act 1967, for subsection (4) (which enables the Minister to purchase compulsorily land belonging to the National Trust notwithstanding that it is held inalienably by the Trust) there shall be substituted—
"(4) The purchase of land held inalienably by the National Trust shall be subject to the special provisions of Part III of the First Schedule to the Acquisition of Land (Authorisation Procedure) Act, 1946.",").
The noble Lord said: I beg to move Amendment No. 13A on behalf of my noble friend Lord Dulverton who has just had to leave us to catch a train to Scotland and has asked me to present his apologies. If he had been here he would have offered the Committee the apologies of the noble Lord, Lord Gibson—Chairman of the National Trust—who had intended to move this amendment himself. However, I am glad to do it for them.
If I may say so, I think that the amendment as it has come out—and it is a new amendment—is not quite right. I ought to make it clear that this is not an amendment to be tacked on to Clause 1, but an amendment to stand in its own right as a new clause. Therefore, strictly speaking I suppose that we should be debating it after the debate on the Question, Whether Clause 1 shall stand part of the Bill. However, I have taken this over at a late stage and all that I can do is to apologise. It should also include the rubric, "Compulsory purchase of land" because it is that to which Section 40 refers rather than "Disposal of land" which is Section 39 of the Forestry Act, and the "Forestry fund" which is Section 41. I apologise to your Lordships for, in a sense, being out of order.
Having made that clear, I wish to get to the heart of the matter which is that the National Trust—and I am referring to the National Trust of England; it does not affect the National Trust of Scotland—has realised that Section 40(4) of the 1967 Act incredibly reads as follows:
"Land belonging to the National Trust may be compulsorily purchased under this Act notwithstanding that it is held inalienably by the Trust".
If any such thing were attempted today there would be a prodigious public outcry quite transcending any of the outcry there has already been this afternoon. The point that my noble friends were certainly going to make was that, in fact, the Forestry Commission have not exercised this power in the whole of their 60-year life. That itself seems to be a good reason for taking this opportunity, with a Bill which amends the Forestry Act, to delete it altogether.
It is well within the general thrust of the Bill, that which is to get the Forestry Commission to dispose of land. A step which prevents the Forestry Commission from acquiring land has much the same effect and, therefore, I think should commend itself to my noble friend. But for some reasons which are not clear to me the National Trust has been advised not to seek the deletion of subsection (4), but the substitution incorporated in the amendment. Because the amendment has come in rather late and because we are somewhat out of order, I would not want to do more than to seek from my noble friend an undertaking to look at this matter again and see whether the general intentions of my two noble friends can be met. I beg to move.
Earl Waldegrave: I should like to support this amendment very strongly. As the amendment, as it now stands, is defective—as has been said—and as the noble Lord, Lord Dulverton, is not here to move it because of the lateness of the hour and his having to catch a train, I would simply like to back up everything that the noble Lord, Lord Sandford, has said. It is only quite recently that I read Section 40(4) of the 1967 Forestry Act and it is quite astonishing that that clause
406
was ever passed. However, there it is; it is the law of the land.
It did get passed and it says that:
"Land belonging to the National Trust may be compulsorily purchased"—
as the noble Lord, Lord Sandford, told us—
"under this Act notwithstanding that it is held inalienably by the Trust".
Of course, this, if I may use the word, offending clause has never been used; but if it had been invoked it surely would have created an outcry because it would have undermined the whole principle of the National Trust's power, granted by Parliament, to hold land inalienably for permanent preservation. Therefore, when this point came to the attention of the National Trust that is why it's chairman, the noble Lord, Lord Gibson, sought to come to this House to move an amendment that if that clause could not, in some way or other, be removed, then it should be "rendered harmless"—to use his own words.
I understand that the amendment which the noble Lord, Lord Dulverton, was to move, has been drafted with the aid of parliamentary draftsmen. I agree with the noble Lord, Lord Sandford, that it could be called defective as it now stands, but it is a most serious point. I hope that when he comes to reply to us and perhaps to others who may speak, the noble Earl will say that this gives us an opportunity to remove an anomaly which was serious in its inception and which is more serious now that, if the Bill passes, the Forestry Commission will not only have powers but will often be under direction from its Forestry Minister to sell land. If it can sell National Trust land, without any strings attached having first compulsorily acquired a National Trust lease, as we have heard so often on this side, we are in a very anomalous and difficult position.
Therefore I am quite sure that the Minister will consider this matter sympathetically; and owing to the fact that the noble Lords who were to move this amendment and who are deeply concerned about it—the noble Lords, Lord Gibson and Lord Dulverton—cannot be here, I hope that he will take this matter away, consider it, and that we shall not have to press it to a Division.
Lord Davies of Leek: From this side of the Committee I should like to support this amendment. Although I was present in the other place in 1946, I do not know how this provision could have slipped through that House; it makes an ass of the law. If I understand the English language, one minute we talk about inalienable rights and the next minute we are told that a Minister has the power to smash or destroy those inalienable rights. In other words, the very verbiage contradicts itself. I do not want to force a Division, but I want the Committee to agree that here there has been a complete lack of common sense. I am not qualified in law, but I know something of semantics. The whole thing does not mean anything. I think that the judge would have to do judicial acrobatics and be an intellectual gymnast to interpret this. Surely, this at least can be looked at again and straightened out so that the public know that the House of Lords is not ruled by a lot of asses. Let common sense prevail!
The Earl of Mansfield: I rather hoped that the noble Lord, Lord Davies, would have said what the Labour Government were up to when they gave the Forestry Commission power compulsorily to acquire land belonging to the National Trust. But apparently his memory fails him on that particular point. Curiously enough, this amendment is not so much defective as pointless. If I correct my noble friend, it is only for the sake of accuracy. Shortly after the Labour Government did their stuff, I am told that, in fact, there was one case where land was acquired compulsorily under these powers.
Lord Peart: Where?
The Earl of Mansfield: I do not know, and I hope that it is not Scotland.
Lord Peart: Where was it?
The Earl of Mansfield: I do not think that even then the noble Lord, Lord Ross, was in that "Gaumont British" building, Old St. Andrew's House, so we need not worry ourselves too much. The curious thing is that the amendment of my noble friend Lord Dulverton does not seek to abolish the power. What it does is to replace one rather cumbersome parliamentary procedure with another. That is why I say that the amendment is pointless. The powers are obsolete; they are not used. The commissioners regard them as obsolete, and at an appropriate occasion the commissioners will be happy to surrender them. Whether or not that happy occasion will be on Report I am not quite sure, but I will certainly take this matter away and think about it.
Lord Ross of Marnock: I am very glad indeed that the Minister has taken up this position. So far as I know, powers of compulsory purchase by the Forestry Commission have not been exercised in Scotland. I asked about that a long time ago, but it may well be that the noble Earl is better informed, although he cannot tell us at the moment where it was exercised.
However, I am interested in the statement that this is all academic. The President of the National Trust for Scotland will remember a very celebrated case when the Government—and, at that, a Tory Government—sought to get their hands on a piece of land in the North-East of Scotland at a place called Drumbuie. The noble Lord will remember what a row was caused there because they were taking one of the most beautiful parts of Scotland, which was held inalienably by the National Trust, where they wanted to erect a place for building platforms and rigs for the North Sea. That did not endear the Tory party to the people of Scotland at that time, and it was very obvious that someone was stepping over and successfully objecting to the attitude that was then taken up, probably by the Secretary of State for Scotland. I am sorry that he is not in his place, for he could have given us some inside information about what happened on that attempt. So it is not all so academic as the Minister would suggest. Admittedly, that was not Forestry Commission land, but it was National Trust land, which is one of the subjects with which we are concerned in this particular amendment. That happened in Scot-
408
land, where land holdings are very different indeed. I hope that we shall get another explanation from the Minister as to why he does not do it in this Bill.
The noble Lord who introduced this went out of his way in moving his amendment to tell us that it was defective; that it should have been a new clause; that it was out of order. It could be done without it being a new clause. It is quite right; you can make it a new section. As a matter of fact, look at what the Government are doing, in that they make changes in respect of Section 39, and then they make changes in respect of Section 41, to which we shall be coming.
I do not think that it is all that much out of order. I was interested in the reply that it was all academic. They do not use the powers. They are no good. If that is the case, why are they not got rid of here and now? They must be very sure of the parliamentary timetable and that the Government are going to give them time for another Bill fairly soon. We should get rid of these things if they are useless as quickly as possible, and Report stage is obviously the right time. If what he says is true, we should ask the Minister to promise us that he will introduce amending legislation at Report stage. There is nothing out of order in doing it in this Bill.
Lord Taylor of Gryfe: I apologise to the Committee, and to the Minister in particular, for not being in my place on the occasion of the amendment which covered the National Trust for Scotland. I know that the noble Earl, Lord Wemyss, had travelled especially from Scotland to deal with that amendment. Since Amendment No. 13A by the noble Lord, Lord Dulverton, covers the National Trust situation in England, I wondered whether the Minister felt it right to comment on the position as it affected the National Trust of Scotland in similar circumstances.
The Earl of Mansfield: Having had a moment to reconsider the position, to the best of my knowledge it does not apply to Scotland at all, so that this debate concerns only England and Wales.
The Earl of Wemyss and March: I am sure that that is correct, that the whole matter of this unfortunate contradiction of the law does not apply to the National Trust of Scotland. Therefore, I suppose that it is not in order to bring up the matter of the amendment that was not moved at this stage.
Lord Sandford: I am glad to hear that Scotland is all right so far as this goes.
Lord Ross of Marnock: No, the amendment does not apply to Scotland.
Lord Sandford: Yes. Well, may I just stick to this amendment. I suppose, having taken it on board for the noble Lord, Lord Dulverton, I am now responsible for it and all its defects. I was grateful to my noble friend Lord Mansfield for his assurance. I thought that he gave us a satisfactory assurance to the effect that he would consider the matter. It seems pretty clear that we can deal with it by just repealing subsection (4) of Section 40 of the Forestry Act 1967, and that would be much better than doing what is proposed

409
in the amendment. I think I can give an assurance that if the noble Lord does not seek that change, the House will do it for him. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 1 agreed to.
9.13 p.m.
Baroness Jeger Baroness Jeger moved Amendment No. 14:
After Clause 1, insert the following new clause:
("Right to repurchase.
. The Forestry Commission shall have the right to repurchase any land disposed of under section 1 of this Act if and when the owner decides to resell it.").
The noble Baroness said: I beg to move the amendment on the Marshalled List standing in my name and the names of my noble friends. The purpose of this amendment is to enable the Forestry Commission to have the right of buying back land which has been sold and which then comes on the market again. I am quite prepared to have the Minister nit-pick about the wording again, but I hope that he will see that the idea behind this amendment is to try to deal with the possibility of land speculation which will arise out of forestry land being put on the market.
I am encouraged in moving this amendment by certain remarks that the Minister made at an earlier stage in this debate. When it was suggested that the Forestry Commission might put some conditions of sale on to transactions, one of the noble Minister's objections was that those conditions could not be passed on to the next buyer. This seems to me to be a more than adequate reason for ensuring that the next buyer should possibly be the Forestry Commission, who should get the land back.
It seems that the letter which the Minister has placed in the Library—the one he has or has not written to himself but which is supposed to be the law of the Medes and Persians in this matter—would not apply to second buyers. In other words, all the talk about the conditions which he is suggesting the Forestry Commission should observe is meaningless. If within a couple of months of purchase the chap who has promised the Forestry Commission that he will do everything he has been asked to do—permit the public in, not shoot birds, not pick the bluebells and so on—sells that land to somebody else, every condition in the Ministers fiat, that letter, will be meaningless. I may be wrong, in which case I will listen humbly, as I always do, to the Minister's reply. However, from what he said earlier, my impression is that no conditions or restrictions will apply to the second buyer.
I fear that we are opening up a can of worms of land speculation by the Bill. After all, once we lose control over the resale of land, anything can happen to that land. It is all very well to say that people must apply for felling licences and so on. The trouble is that they may be so disinterested in forestry that they will have no need for a felling licence, being so disinterested that it would not worry them even if the trees fell down. It is therefore essential to ensure that there is some continuity of control over our precious land, because we in this country do not have much of it to spare.
The amendment would not compel land that has been sold automatically to revert to the Forestry
410
Commission; just that the commission should have the right to decide whether to buy it. There could be many reasons why land acquired from the Forestry Commission will be resold. I am old enough to be suspicious that the resale might be a matter of profit on the part of the original purchaser. On the other hand, it might be because of death or even boredom. It may be said that the commissioners already have this right under their general aquisition powers. We simply want the right written into the Bill to make it more difficult for forestry Ministers to refuse the Forestry Commission if they wish under certain conditions to purchase back land which has been sold. We want that right to be automatic and incontrovertible.
We are not playing a game of Monopoly but are dealing with one of the nation's most precious assets. We are also dealing with the possibility of Forestry Commission land being bought and sold time and again, to and from people with no interest whatever in forestry and with no interest in amenity and public welfare. Such a state of affairs is totally unacceptable to us and I am encouraged in this view by the trade union side of the Forestry Commission Whitley Council, who said:
"To prevent land speculation with what is a national asset, the Forestry Commission should be given first refusal of all land offered for resale".
That is a modest request. The same request appeared in a leader in The Times on 24th April of this year, and if one finds the trade union side of the Whitley Council and a leader in The Times agreeing—not to mention myself and my noble friends agreeing—on what seems a modest request, the Minister should have some good news for us.
Lord Davies of Leek: I, too, have no doubt that there should be a restriction on the resale of this land. It would help to prevent what I can forsee and what most of us know will go on; namely, land speculation with a great national asset. The Forestry Commission should be given first refusal—at a proper valuation, of course—on any offer for resale within a given number of years.
An important fact has, I feel, been overlooked; we are now in the European Community and there will be nothing to stop Greeks, Spaniards or anybody else coming here and buying these valuable tracts of land. Indeed, we are gradually losing the right to run our own country. That rag, tag and bobtail parliament is already passing laws about ginger beer, mustard and all sorts of other things. They will soon be moving into forestry.
I am not "anti" any nationals, really. But I say to noble Lords on the other side of the Committee, for heaven's sake please realise what you are doing when you rush through these Bills, because you are over-obsessed about public borrowing. We are selling our birthright, we are giving it away. No one in the Chamber can deny that if it is left to the free market, it would be very difficult for us to refuse any member of the European Community, any national, to come and buy land in any area of this country, if they so wished. What guarantees would we have that they would not cut down the timber right away? So I beg the Minister to look again at this matter and at

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least accept that the first refusal should be given to the Forestry Commission.
Lord Mackie of Benshie: I must say that members of the party near me are making fairly heavy weather of this question. I do not know who they imagine will go rushing into the parts of Scotland that I know to purchase land as a speculation at the present time and throw it about the market. So I think that they were juggling with a Disneyland somewhere. I should have thought that we must make quite certain that the Forestry Commission has the power to choose the land sensibly and then sell it at the best possible price. The commission should also have the power to avoid making a fool of itself. If the commission sells land to someone who the following week resells it at a profit, it will look extremely stupid.
If we impose a hedge like this we prevent the sale of any parcel of land which it might be very much in the interests of the Forestry Commission to sell. So I think that the Labour Party is tackling this question from the wrong end. I should much rather see us support very firmly a requirement for the Minister to consult the Forestry Commission and the commission to lay down the proper conditions for the sale of land.
Lord Ross of Marnock: If that were so, and if I understand correctly what the noble Lord feels, he really should have voted against clause stand part, because if you vote against clause stand part you go back to the position as it is at present. That gives the Ministers power to tell the Forestry Commission to dispose of land which is not suitable for forestry, or which could be better used in another way. What is done here is to give them overriding powers over anything at all, without any limit. The noble Lord asks, Are we seeking red revolution, are we terrified by nightmares? I can tell him that the document that I have was sent to me by the National Trust for Scotland. Is the trust's fears justified in relation to Balmacara, Inverewe, Kintail, or Brodick?
I was in Brodick last Friday, and I was shown the forestry land which has been taken over, part of which is not covered by a condition of pre-emption. The trust would like to have it over the lands that are at risk. I do not know whether the noble Lord knows Brodick—his education has been neglected. It is a virtual microcosm of Scotland, with the mountains, the glens, lush tracts of agriculture, and delightful shores and bays. The fact is that the Forestry Commission received part of the area there by way of gift. It received another part from the Treasury in the usual way. It is all inalienable. Some is in danger. They have feued out twice. I think that it was in 1970 that part of Brodick was last feued out; and they are concerned very much indeed. This is an area where it would be delightful to get rid of, to forget all about, the forestry application, and have maybe some Butlin's rural holiday camp and all that that might well mean. They are concerned about it. "All the areas in these properties are very much part of the estates concerned, and some other party than the Forestry Commission as feua who might not be sympathetic to the amenity"—whatever that means; a word which the Minister found great danger in
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defining—"and wild life in the area could be disastrous". Is the noble Lord telling us that they are suffering from nightmares; that this thing will never arise? Anything could arise in a Bill like this.
Lord Mackie of Benshie: The noble Lord asked me about something I did not say. The section which unfortunately was missed dealt with the fears of the National Trust in Scotland; and I presume it will come up again later. The amendment the noble Lord is talking about says:
"The Forestry Commission shall have the right to re-purchase any land disposed of under section 1 of this Act if and when the owner decides to resell it".
Lord Ross of Marnock: It is the right of pre-emption. They have that right. It may be that what the Government have done turned out well from the point of view of the Forestry Commission and those who have an interest indirectly through having sold to the Forestry Commission. I am sure that if that right were there and was exercised in respect of those areas, so far as the National Trust are concerned they would be delighted. It would be the Forestry Commission who would pay and not the National Trust or the National Trust for Scotland. I think this is very sensible. They cannot do it without the "say so" of the Treasury. I do not know whether people realise the extent to which the Treasury already confines every activity of the Forestry Commission through the Forestry Fund. We shall come to that in my next amendment. I am far from satisfied with the answer that the Minister has given. I do not know how my noble friend feels about this amendment, whether we should press it to a Division.
The Earl of Mansfield: May I interrupt? The noble Lord does not pay much attention to me, but I have not yet had the opportunity of answering.
Lord Ross of Marnock: I was talking about the general reaction we have had from the Minister to everything else. We have let him off with so much and got so little from him. The noble Lord, Lord Taylor of Gryfe, was so disgusted that he did not even move his amendment.
The Earl of Mansfield: I have some sympathy with the noble Baroness, Lady Jeger, but I do not see what this amendment is going to do to prevnt what she calls speculation. If a purchaser subsequently puts the parcel back on to the market there is nothing to stop the Forestry Commission from making a bid, so to speak, now if it wants to; and one would imagine that this kind of property would be advertised on the open market in order to maximise the price to be realised. If, as I think the noble Lord, Lord Davies of Leek, was hinting, there should be some sort of fetter on that subsequent sale, so that the Forestry Commission could buy back the land at the price it sold it for, I would say that that was totally unacceptable; but, at least, it would be a point of view—
Lord Davies of Leek: I did not say that.
The Earl of Mansfield: The noble Lord did not, but he hinted at it. But the amendment does not. I do

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not see that a right of pre-emption written into the Bill will go in any way to cure the mischief—if it exists (which I doubt)—which the noble Baroness is frightened of. At the moment, there is nothing to stop the Forestry Commission from writing a right of preemption into any sale if it wants to. I have no doubt if the Commissioners thought that that was desirable they would do so.
Then I turn to the more chauvinist point of the noble Lord, Lord Davies, about the Greeks. If the right of pre-emption exists, what is to happen? The original purchaser puts it on the market and has to notify the Forestry Commission. The Commission then says: "What is the nationality of your would-be purchaser?". The reply is: "It is Greek". "We will buy it ourselves", it then presumably says. I do not think that the noble Lord, Lord Davies, seriously intends this this kind of procedure should be written into the Bill.
Lord Davies of Leek: I am enjoying the joke. The noble Earl knows, seriously, that there is nothing to prevent any member of the Common Market or others to come in and buy. All we are asking for is first refusal at proper valuation. That is the phrase I used: that proper valuation be given. I know the joke about it. The Government can joke as much as they like but already they are coming in and buying.
Lord Taylor of Gryfe: May I—
The Earl of Mansfield: I was interrupted. If there is a joke it is a pretty sour one. I do not think that the Forestry Commission should go about its business on the basis purely apparently of the nationality of would-be purchasers. Whether the purchaser is British or of some other nationality, if he is able to pay the price, look after the wood properly, preserve the access and do all the things one would like such people to do, then that is as much as one could want. I hope that I have shown that while the Forestry Commission can impose a right of pre-emption, there is no practical need for it and there is no equitable need for it. If the noble Lord, Lord Ross—now he has heard my explanation—is still dissatisfied, I ask the Committee to reject it.
Lord Taylor of Gryfe: I do not want to enter extensively into this argument; but I want to say a word to my noble friend Lord Davies of Leek. Forestry is a free market. I am the chairman of a company which recently acquired on behalf of British investors 10 million dollars' worth of woodlands in Georgia, USA. By the same token, members of the EEC can buy land in this country. If they manage the land sensibly with proper respect for amenity and recreation, and proper woodland management—and they would only qualify under the dedicated scheme; they would not be permitted to clear, fell and sell—they would presumably want to attract the maximum tax advantage by the dedication scheme. To that extent they would be controlled in their management policies by the Forestry Commission. I would not pursue too far the point of Lord Davies, that a man, if he is a Greek, is necessarily evil and necessarily a bad manager of the forest estate. I believe in the Economic Community; the noble Lord, Lord Davies, does not. I do not believe that there should be—
Lord Davies of Leek: I do not know why I am getting shot at from behind. The point I made was a realistic one. I have knocked around the world, and just see the Devil's Dust Bowl in the United States or what is happening in Amazon with the speculation in the great forests of the world. All I am putting forward is a caveat that these are our treasures and we ought to be careful to whom we sell them. If they want to sell to a Greek, all well and good as long as the Greek or anybody else manages it properly. It was not put forward as a racial point. It was bringing the reality of our membership of the Community where we have no control sometimes over our own property. You can make a joke about it if you like, but you will rue the day.
Baroness Jeger: I thank the noble Earl for his reply but I must ask him another question. He says that the right of pre-emption can be written in when the Forestry Commission sells land; but I want to know whether that is to the next one or the one after that? Does that right of pre-emption get written into every sale and every subsequent sale until the third, fourth or fifth generations? I think the noble Minister is shaking his head. I do not know what he is doing with his head but I shall give way if he explains at this point.
The Earl of Mansfield: We now come to the inner mysteries of conveyancing. The answer to the noble Baroness, Lady Jeger, is, no, except possibly in Scotland. In the old days, in Scotland, a right of pre-emption did exist down through successive purchasers, but to all intents and purposes that has now all gone.
Baroness Jeger: I thank the noble Lord the Minister, because that is very helpful; it does make it absolutely clear that this amendment is essential if we are not to see the loss of forestry land arising after second sales. In moving this amendment I went out of my way to say that I accepted that theoretically the Forestry. Commission already had the right to buy this land, but I am concerned—and so are my noble friends—because of the Treasury restrictions on Forestry Commission purchases, and also because we felt that if we write this into the Bill it would make it absolutely clear beyond peradventure that the Forestry Commission was to be available at first hand.
I know that the hour is late by the standard of your Lordships' House, although to some of us veterans the night is still young. I will only say that we shall have to come back to this again. This is not a party point, but one of very genuine concern to a lot of people who love our countryside and want to see the maximum use being made of our forest land. I will beg leave to withdraw the amendment, but I cannot regard the subject as closed.
Amendment, by leave, withdrawn.
9.37 p.m.
Lord Ross of Marnock Lord Ross of Marnock moved Amendment No. 15:
Page 1, line 13, leave out from ("such") to end of line 14 and insert ("annual amount (if any) as Parliament may determine.").
The noble Lord said: Now we have a slight change, of course.
Lord Inglewood: Did we not have a debate on clause stand part?
Lord Ross of Marnock: Yes, a long time ago. There is more than one person agreed about the shortness of the dinner hour, and I am not talking about myself. I managed to get to the Bar of the House to save my amendments affer two very important amendments were swept aside. This amendment reads:
"Page 1, line 13, leave out from ("such") to end of line 14 and insert ("annual amount (if any) as Parliament may determine")".
At the present time in Section 41 of the Forestry Act we have about six subsections. The section that is to be put in states that:
"that there shall be paid out of the Forestry fund into the Consolidated fund such sums as the Ministers may determine with the approval of the Treasury direct".
I wondered why they bothered putting in "Ministers"? In fact, I wonder why they bothered making this amendment at all. I have said from the beginning this is not a Forestry Act—it is a Treasury Act. I say that because if one looks at the actual 1967 Act, one finds that it says this in Clause 41(2):
"There shall be paid into the Forestry Fund out of monies provided by Parliament such amounts as Parliament may determine."
Not a word there about Ministers. Surely it is right if Parliament is going to determine what the grant-in-aid shall be—because this is virtually what this means—then surely Parliament should determine what sums should be paid out of the Forestry Fund in respect of this disposal of land? I am sure the Minister could give us the up-to-date figures but the figures for last year showed expenditure by the Forestry Commission to be around £96 million whereas the actual grant-in-aid was £43 million.
So, at the moment, more than half of the expenses of the Forestry Commission are met by the revenues of the Forestry Commission; and I ask your Lordships to remember that what they pay out includes also grants to private forestry. It would be very tempting, indeed, for a Government who are determined to save money to make some considerable cuts there.
This is purely and simply a Treasury Bill. Why do I say that? For the first time, we are bringing the Ministers into this clause in respect of money, and I seek to leave them out. If we look at Section 41, which is entitled the Forestry Fund, subsection (6) states—and we look at what is already there and at what is going to stay there—
"Payments out of and into the Forestry Fund, and all other matters relating to the Fund and money standing to the credit of the Fund, shall be made and regulated in such manner as the Treasury"—
nothing to do with Ministers—
"may, by minute to be laid before Parliament, direct".
It is just reporting to Parliament; not asking for Parliament's approval. The grant-in-aid must be approved by Parliament and I suggest that the payments out of the Forestry Fund, too, should be subject to Parliament's approval. Then, at the beginning of a year, even as they know what their grant-in-aid is to be, they will know what they are expected to provide out of the Forestry Fund to the Consolidated Fund for the disposal of land.
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But what a confusion there is. Here in Clause 2, and the new subsection (4A) of Section 41, we have this fiction,
"such sums as the Ministers may from time to time with the approval of the Treasury direct",
when we also have it that everything going out of the Fund and into the Fund is controlled by the Treasury, and has nothing to do with the Ministers. The Government will need to change one or the other.
The Minister will note that I have down two amendments, one to change the new subsection to leave out
"such sums as the Ministers may from time to time with the approval of the Treasury direct"
and another to leave out subsection (6). So the Minister can make his choice. I certainly feel that, if he were honest about the origins of this Bill, he would choose to retain subsection (6) and forget all about the other one, because it is already there. All monies going into and out of the fund are controlled by the Treasury. I beg to move.
The Earl of Mansfield: It may help if I first explain the reasoning behind Clause 2 of the Bill. All revenues received by the commission, including those from the disposal of assets, are paid into the Forestry Fund from which the commissioners' expenditure is met. Until such time as the commission become self-financing, these revenues have to be topped up through the grant-in-aid voted by Parliament, which is transferred into the Forestry Fund as the need arises. However, once money has been paid into the Forestry Fund, there is no means by which it can be withdrawn or transferred, except to meet expenditure authorised by the Forestry Acts.
The changes which are proposed in Clause 2 will enable receipts from the disposals programme and surplus estate to be transferred to the Consolidated Fund as extra receipts. This means that the commission's expenditure programmes and cash limits will not be affected by fluctuations in receipts from disposals caused by an unpredictable market. The new power will also enable the transfer of income from the commission's trading activities to the Consolidated Fund when past public investment in the forestry enterprise begins to yield a dividend. It will be seen that this provision will be in the interests both of the Forestry Commission and eventually the public purse. It is in no way an attempt to draw off money from forestry since the revenues generated by disposals will in effect be recycled into the Forestry Fund through the grant-in-aid.
The transfer of funds in the manner proposed in Clause 2 is a perfectly normal procedure in Government accounting. This in no way implies that funds will be transferred without the knowledge or endorsement of Parliament. The extra receipts payable to the Consolidated Fund arising from the disposals programme and the sale of surplus assets will be shown as separate entries in the Expenditure White Papers and the Supply Estimates, as was done for the first time this year. This will make the position quite clear and allow Parliament to oversee the surrenders to the Consolidated Fund that are proposed.
I hope I have shown that in fact there is nothing sinister about the new provision and that there will be perfectly adequate Parliamentary control.
On Question, amendment negatived.
9.45 p.m.
Lord Taylor of Gryfe Lord Taylor of Gryfe moved Amendment No. 16:
Page 1, line 14, at end insert—
("Provided that the duty of the Commissioners as in section 1 (3) above is not limited by such direction.").
The noble Lord said: At this late hour I do not propose to argue once more the issue that the financial constraints which are involved will limit the statutory duties of the commissioners. I simply move the amendment standing in my name.
The Earl of Mansfield: The Forestry Act 1967 lays down the Forestry Commissioners' general duties, and Section 1(3) provides that those duties shall include promoting the establishment and maintenance in Great Britain of adequate reserves of growing trees. That duty was conceived during the First World War and included in the Forestry Act 1919, in order to ensure that in another emergency there were sufficient reserves of growing timber to meet immediate needs.
I would remind the Committee that in fact section 1(3) does not affect the general functions and duties of the commissioners under the rest of the section. At any rate, the concept embodied in section 1(3) has receded in importance, but I recognise that it is necessary to grow as much as wood we can at home against increasingly expensive and scarce overseas resources. So to that extent the commissioners' duty as set out in section 1(3) has lost none of its importance even if the reasons for it have changed.
But Clause 2 as drafted does not prejudice the Commissioner's duty in any way. The scope for new planting in the immediate future in terms of land use and the environment was indicated in a statement which I made to your Lordships' House on 10th December last. The commission will have a share of that planting, and adequate funds for the purpose will be made available through the usual channels in accordance with the sums authorised by Parliament. The transfer from the Forestry Fund to the Consolidated Fund of sums raised from the sale of land and plantations will not affect the scale of the commission's planting, since the whole object of clause 2 is to divorce the commission's operational activities from vagaries in the disposals programme.
With respect to the noble Lord, therefore, I hope he will see that the amendment is superfluous.
Lord Taylor of Gryfe: With the assurances which have been given by the Minister that these provisions will not affect the planting programme of the Forestry Commission and that these provisions have lost none of their statutory obligations and importance, assurances which I am delighted to have and which I am prepared to accept, I beg leave to withdraw my amendment
Amendment, by leave, withdrawn.
The Chairman of Committees (Lord Aberdare): Amendment No. 17. As the noble Lord has already indicated, if Amendment No. 17 is accepted, I cannot call Amendment No. 18.
Lord Ross of Marnock Lord Ross of Marnock moved Amendment No. 17:
Page 1, leave out lines 15 and 16.
The noble Lord said: In regard to this amendment, all I want is to be enlightened. I have tabled this amendment purely and simply to find out why and what will be the result of this proposal by the Government. I beg to move.
The Earl of Mansfield: This is a piece of tidying up, that is to say the removal of subsection (7). The powers have never been used, at least not for a considerable time and certainly not since 1967. Subsection (7) which derives from the Forestry Act 1919 was designed for quite different circumstances to those now pertaining. It was intended to cater for a situation in which the commissioners had significant funds standing to their credit for which they had no immediate need. The commissioners' present dependence on grant-in-aid voted annually by Parliament, which is drawn into the Forestry Fund as required to top up the commission's revenues from other sources, means however that the sums standing to the credit of the Forestry Fund at any given time are not large; as a measure of this, the working capital that the commission is permitted to carry over to the Forestry Fund from one financial year to another is limited to £750,000. This is not to imply that the commission will be able to keep any excess funds when it reaches a state of self-sufficiency. I am sure your Lordships will agree that, when that time comes, any excess of revenue over expenditure in the commission's amounts will, after allowing for a reasonable working balance, need to be paid into the Exchequer in the form of a dividend for the large investment of public funds in Forestry over the past 60 years or more. Clause 2 of the Bill will permit this to be done.
The powers of investment contained in Section 41(7) of the Forestry Act are therefore obsolete. This apart, they are also very restricted in that they would only permit the commissioners to make investments which, to quote the Act,
"trustees are for the time being authorised by law to make in the case of a trust fund".
They would not, for instance, allow the commission to invest sums in the wood-processing industries, even if that were considered to be desirable as a matter of policy. So, as I said at the beginning, the opportunity has been taken to tidy up this small part of the 1967 Act.
Lord Ross of Marnock: I think we are grateful for small mercies in tidying up, but it prompts the question as to why the tidying up did not go further, because I am perfectly sure that a full reading of this clause would show that there is a little more tidying up to be done, and included in that tidying up I think would be something to do with subsection (6), with which I should deal in the next amendment if I proposed to move it.
I am not terribly happy about the way in which the whole thing is being done. I believe many people would have felt justified in supporting this Bill if they felt that the monies which come from disposal would have been available to do what many people want to see done, namely, an extension of the forestry planting programme. There is no guarantee in that. I think it sticks out clearly that what the Treasury would be concerned to be doing is to take as much money as it possibly can from the Forestry Fund.

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Anyone who has been in the position of a Minister going to the Treasury and arguing for an increased planting programme knows this. Anybody who knows how the Treasury works in relation to the Forestry Commission or any other kind of business that the Government have tried to run, knows that it is impossible to do full justice to it unless one gives a greater measure of freedom—in this particular case to the Forestry Commission—to get on and do the job that they were set up to do.
The Minister should tell us quite frankly, as he has hinted in his replies to other amendments, that every department must take its share in reducing public expenditure, and if we apply that to the Forestry Commission (whether I agree with it or not) automatically it means that less forestry will be done in this country than otherwise would be done.
You would only get an equivalent amount of forestry done if you could guarantee that in regard to all the disposals of land, which could well be plantable land or more mature timber which would come to fruition and be felled, it would then be replanted as it would be by the Forestry Commission. There are no guarantees about that. So the actual result of this Bill will be a reduction, not an increase, in the planting programme, both private and public, compared to what would be the case if we allowed the Forestry Commission to use these additional sums of money for the purpose.
Lord Mackie of Benshie: I think that the answer the Minister has given is slightly sinister. He has promised to look again at the situation which the amendment put down originally provided, limiting the sales to the annual grant. The situation might well arise, if substantial and sensible sales are made, that the Commission might have a lot of money on its hands, or a certain amount of money on its hands. It would be fairly sensible, I should have thought, to leave the powers of investment so that they can get the interest that is going, instead of putting it into the Consolidated Fund and then getting it back at a later date in the form of the annual grant. Therefore I am not altogether sure that the Minister's reply was very satisfactory on this matter, unless he assures me that this is not the intention.
Lord Taylor of Gryfe: I should like to support the point made by the noble Lord, Lord Ross of Marnock. Earlier in this debate the Minister was good enough to quote the experience of other nationalised industries in respect of sales of assets. If he will examine the Transport Bill currently before the House, he will read that the disposal of British Rail Board assets are to be reinvested in British Rail and do not become the property of the Treasury when hotels and Sealink and other assets are sold off. All that is suggested here is that if you are selling off Forestry Commission land and assets, at least the results of those disposals should be reinvested in the development of forestry. That is what we are asking.
Could I simply make the point that inevitably in the disposal of land it will be the unplanted land, I suppose, that will be offered on the market, although mature and semi-mature woodlands would be more attractive to pension funds because of the immediate return that
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would come to them. But if you do this, you are eating into the reserves of planting land and into the land bank, and you are diminishing the prospects of employment for people at a time when the Manpower Services Commission and others are offering bribes to create employment for young people. At this stage what we are talking about is diminishing the prospect of healthy rural employment for people. Therefore I would suggest that if you are going to raid the Forestry Commission land bank, and realise cash as a result, you should invest that money in provision of healthy employment in the development of forestry.
The Earl of Mansfield: I think that the points which the noble Lord, Lord Taylor, has raised really go very wide of this amendment. This is not a question of tilt eventual use which is made of the money which comes from realisation of sales, whether it is planted land or bare land or whatever. This little used power in subsection (7), as I have said, has not been used since 1967, and if in the future the Forestry Commission is in a position where money comes into the Forestry Fund it will, under this Bill, then be, as it were, taken back into the Consolidated Fund and the position will go on as before. The planting rate will have nothing to do with this.
The Forestry Commission will receive its grant-in-aid, and one hopes that sales will go well and then, in fact, the amount of grant-in-aid will increase and its planting will increase and that will have all the beneficial effects which the noble Lord, Lord Taylor, wants and which the Government are also keen to support. It is really a matter of accountancy. As I have said, it is merely tidying up a power which has not been used for many years and which is now regarded as being obsolete. That, and no more and no less, is what the clause is about.
Lord Mackie of Benshie: I presume that it has not been used for many years because the grant-in-aid has always been paid out in reasonable quantities as required. It is only now that a policy of selling is going to start. This is the very time when it might be most useful to the commission to have the interest instead of the Consolidated Fund.
Lord Ross of Marnock: We are very grateful to the Minister for giving us at least something we can watch in the future to see whether he was right or wrong. He said that as disposals increase the grant-in-aid will increase. We shall watch it.
Lord Davies of Leek: I should like to ask one question. I may be completely wrong—I am often wrong, some might say, but I do not think so. Are there any restrictions on the annual amount offered for sale either by area or by value? Are there any restrictions?—not that this would happen with the Government we have now! Somebody could not go mad and offer vast amounts for sale without any restrictions. What restrictions are there, if any, on area or value of sales?
The Earl of Mansfield: The noble Lord, Lord Taylor, moved an amendment on precisely this point. We debated it for, I think, about an hour.
Lord Davies of Leek: But I was not clear at the end.
The Earl of Mansfield: The thrust of the argument as it went to and fro across the Chamber seems to have passed by the noble Lord, Lord Davies.
Lord Davies of Leek: Yes, indeed.
The Earl of Mansfield: As at present there is no fetter on the right of the Forestry Commission to sell its assets in the way which commends itself to the Forestry Commission. Noble Lords have said at considerable
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length this afternoon what they consider the proposals might be in relation to that situation.
Lord Davies of Leek: I am grateful, because I was only pretending. I knew the entire Parliament had let this go forward—all of us, the other place and this place—with no restrictions on area and no restrictions on value.
Lord Ross of Marnock: For reasons that escape me, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 18 not moved.]
10.3 p.m.
The Earl of Bessborough The Earl of Bessborough moved Amendment No. 19:
After Clause 2, insert the following new clause:
("Duty of Forestry Commissioners.
. In section 1(3) of the Forestry Act 1967 (which concerns the general duty of the Forestry Commissioners) at end insert "and that of promoting the understanding and practice of integration between forestry and other land uses".").
The noble Earl said: I beg to move Amendment No. 19. I am sorry, but I must spend just a few minutes explaining this very important amendment despite the late hour, because I have the support of the whole of your Lordships' Select Committee on Science and Technology for this amendment and I notice that some of my noble friends—and, indeed, some noble Lords on the Opposite Benches—are present. As your Lordships will see, the purpose of the amendment—a new clause—is to extend the general duty of the Forestry Commissioners so that they have to promote the understanding and practice of integration between forestry and other uses of rural land. Compared with previous discussions this afternoon, this is not, I think, really a contentious matter. Indeed, as your Lordships will see, it is supported by noble Lords from every corner of the Committee. The noble Lord, Lord Sherfield, had intended to move the amendment himself as he was chairman of our sub-committee, but unfortunately he is abroad and cannot be here this evening. Therefore, I have the pleasure of moving it, and, as I say, this was a unanimous view of our committee. The amendment gives effect to a recommendation of this committee, and, as your Lordships may remember, the committee reported last December on the scientific aspects of forestry and we had an interesting debate in February.
The recommendation in paragraph 146 of our report says that:
"Some aspects of the Forestry Commission's management objectives and statutory terms of reference are becoming out of date in the context of present decisions and the way in which forestry practice is evolving in the Forestry Commission and elsewhere."
The commission's terms of reference in the 1967 Act focused, in our view, entirely on the interests of forestry, subject to the issue, of course, of directions by Ministers. Several directions have now been issued and they change the emphasis of forestry policy so that the Forestry Commission may take account of other land use interests. In our view, it may be time formally to recognise this shift of emphasis. Therefore, the committee recommended that Ministers should consider amending both the Forestry Commission's management objectives and its terms of reference so that these reflected more explicitly the conditions under which the Forestry Commission now operates.
Today, we are not concerned with the management objectives. We are concerned only with the commission's terms of reference, and the present Bill—the purpose of which is to amend the 1967 Act—provides us with a golden opportunity. My noble friend Lord Mansfield suggested on Second Reading that this amendment might be outside the terms of the Bill. But on second thoughts I hope that he may have changed his mind. It is totally relevant to the Title of the Bill. Indeed, I greatly look forward to hearing my noble friend's reply, which will give us the first signs of the
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Government's attitude to the Select Committee's report.
It is now five months since the report was made—a unanimous report—and Members of the Select Committee are, therefore, beginning to wonder when the Government's reactions will see the light of day. I hope for a favourable response to this amendment and a sign of perhaps a favourable response to come. It is not a difficult amendment to accept. In fact, it does not seek to change either the Forestry Commission's method of operation or its policy. It merely makes its duty reflect its current practices. But it is an important amendment. Forestry simply must integrate with other land uses and there is no better place for this integration to start than in the Forestry Commission. We had considerable discussions in committee and in taking copious evidence on the matter on whether it would not be desirable to create a separate agency or a co-ordinating centre to give advice on land use in view of the fact that the Forestry Commission would tend to take the view of the foresters and the Ministry of Agriculture that of the farmers. But, on reflection, I must say that I thought there was no point in creating a new agency and that this could best be done by the Forestry Commission.
There is nothing new in the concept of integration and the report gave a number of examples of it in practice. I must say that it is more often praised in theory than put into practice. Integration is necessary; it is necessary partly for common sense reasons and for good planning reasons. It is necessary also if the forest area is going to expand, as I gather forestry Ministers hope it will. In a country which is as fully used as ours, any expansion of forestry is certain to interfere with, and probably displace, some pre-existing use of land. Through integration, therefore, we can derive the maximum benefit from our limited stock of land, and we can also prevent the build up of hostility to afforestation: hostility from public opinion representing other land users.
Perhaps I can refer towards the end to just one further short passage from our report. At paragraph 142 the committee said:
"The main development of the post-war period has been a recognition that forestry is an important land use and that its expansion increases the need to accommodate other land-use interests. The more land it absorbs the greater are the dangers of pursuing forestry without regard to those interests. If afforestation is to continue, accommodation will be a prerequisite of public agreement. The emphasis of policy, therefore, has already shifted to promote the integration of forestry first with countryside amenity and recreation and more recently with agriculture, water uses, and conservation. Integration with the last three is still in its infancy and must grow further."
I am quite certain that the green clock has gone a little wrong, and that I have not been speaking for 21 minutes. I have got only another two minutes. I think noble Lords will appreciate that I have not gone more than eight or nine minutes. I recognise that integration is a two-way traffic. We cannot expect the Forestry Commission to be alone co-operating. The other land users must follow; whether they be farmers, anglers, water users, water authorities, or conservationists. I suggest that this is not going to put too great a burden on the Forestry Commission since they would maintain that integration is their policy anyway, and better an existing body should do this rather than creating another.
There have been these shifts which have taken place under ministerial directives as provided for in the Forestry Act, but the Act itself concentrates exclusively on the interests of forestry. I suggest that we should recognise the changed emphasis and ensure that in developing and managing our forests, the interests of other land users, such as agriculture and water gathering and conservation, should be properly taken into account. I beg to move.
10.13 p.m.
Lord Lloyd of Kilgerran: I have waited until this late hour in order to add briefly my support for this amendment so ably moved by the noble Earl, Lord Bessborough. I, also, have the privilege of being a member of the House of Lords' Select Committee on Science and Technology to which the noble Earl referred. This amendment is well worth putting into the Bill. It would be of great advantage to the Forestry Commission that this kind of practice, which in many areas the Forestry Commission are undertaking, should be incorporated as one of their general duties.
I should declare an interest because in the Lake District I have the privilege of looking after an area of 250 acres which is bounded on three sides by the Forestry Commission and on the other side by three-quarters of a mile of Lake Coniston. This is an area which is devoted as a memorial to John Ruskin. It is open to the public. We are the only private enterprise in a large area of the Lake District which keeps open to the public an estate with nature trails through the land.
My managers in Brantwood on Lake Coniston have always endeavoured to co-operate with the forestry commissioners in that area. Unfortunately, things go wrong from time to time, for a variety of reasons, and when the Forestry Commission decided to have a large car-park in an area alongside our land, we thought that they should have consulted us as other land users, partly forest and partly farming, next door to them. Unhappily, that co-operation did not exist, but I make no complaint about that now. It is, in the words of the noble Earl, Lord Bessborough, essential to build up good public opinion in relation to forestry, and this aspect of integration between forestry and local land usage would be a useful provision to insert in the 1967 Act.
Baroness Jeger: The brevity of my remarks is no real measure of the sincerity and seriousness of my support for the amendment. I too had the honour to serve on the Select Committee. All of us agreed on the need for the change that has been ably proposed by the noble Earl, Lord Bessborough. We had much evidence before us, especially from Edinburgh, of the practicality of forestry and agriculture working more closely together, and it would be to the advantage of forestry, agriculture, water conservation and leisure facilities if such closer integration were to take place.
We on the Select Committee, on which many people worked hard and long, have been very modest; this is the first time we have asked for any specific legislative acknowledgement for any of our recommendations. I hope that at the end of the day the Minister will find himself able to be nice about something and accept
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the new clause. The noble Earl referred to the question of making the amendment in this part of the Bill. In my view it is a perfectly proper place to make this change, because the Long Title of the Bill is:
"An Act to amend the Forestry Act 1967",
so it seems completely in order for us to be discussing this aspect at this stage, and I hope that there will be a happy outcome to the amendment.
Baroness Elliot of Harwood: I support the amendment strongly. In the south of Scotland and the Borders, where I live, the Forestry Commission practically surrounds every farm. It is vast and we farm almost in the trees, as it were, so close are they. This state of affairs would never have existed had there been real co-operation many years ago when the Forestry Commission began, and there would never have been this vast area of forest taking up so much agricultural land, but that is done and finished with and there is no point in dwelling on that. My noble friend Lord Mansfield knows well the real problem for farming that exists and that we must have co-operation. I beg him to accept the amendment because it would do a tremendous amount of good.
Earl Waldegrave: I will delay the Committee briefly in commenting in support of the amendment. I was glad to hear the noble Baroness, Lady Jeger, quote the Long Title of the Bill—
"An Act to amend the Forestry Act 1967, and for connected purposes",
but that Long Title does not let the cat out of the bag, in that in reality it is a Bill to get a little more money for the Treasury. There can, therefore, be nothing inappropriate in amending it in a totally uncontroversial and uncommercial way, and the Minister can have no reason to resist the amendment.
I did not serve on the Select Committee. The noble Lord, Lord Sherfield, who is unable to be here tonight, did, as did my noble friend Lord Bessborough, the noble Baroness, Lady Jeger, and the noble Lord, Lord Lloyd of Kilgerran. It is clear therefore that I am not speaking merely on behalf of the committee. It would seem admirable to accept the new clause because it confirms what for many years has been forestry practice, namely, to try to work toward integration with other land users—amenity, agriculture, water and every other use including sport and nature conservation. Having been connected with a number of those things, I hope that it might be possible for the Minister to say that he will give very sympathetic consideration to the amendment.
Earl Bathurst: I would ask the noble Earl to bear in mind what the noble Baroness, Lady Jeger, has said, in particular in conjunction with the Forest of Dean. The most interesting debate that we had earlier on the Forest of Dean arose entirely from land integration carried out by the Forestry Commission. I rather suspect that there was absolutely no co-operation in the Forest of Dean—I think that the noble Baroness and her many friends there will bear me out—and therefore the Forestry Commission had to take very special measures in order to get the co-operation of the people

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in the Forest of Dean. Land integration, farming, opencast coal mining perhaps, and all the things that go on in the Forest of Dean are done in conjunction with magnificent forestry.
It would seem to me that my noble friend's amendment asks the Forestry Commission to look into how integration of land use should be carried out. What has gone on in the Forest of Dean could be taken as a very good example and written into the arrangements that would be incorporated in the Bill. I hope that the noble Earl will be so kind as to consider what is happening in the Forest of Dean. He has said that he will look into the amendment relating to that. If he can do so, there should be no reason why land integration, too, should not be incorporated in the Bill with my noble friend's amendment.
Lord Brougham and Vaux: If I may delay the Committee for only two second, I would say that, though I am not a landowner or forestry owner, unless my noble friend has very good reasons for not wanting the amendment, then, judging from what I have heard this evening, if my noble friend Lord Bessborough presses it, I shall vote for it.
Lord Drumalbyn: I wish to contribute one or two sentences merely because many years ago I was the junior Minister who dealt with agriculture in Scotland and I spent much of my time seeking to promote the need for understanding and the practice of integration between forestry and other land uses; and I have no doubt whatsoever that it is most important. My sole doubt is as to whether it is right to place the duty of promoting this only on the Forestry Commissioners. I hope that my noble friend will find a way to introduce this idea, but I hope, too, that at the next stage of the Bill he will adjust the wording.
10.22 p.m.
The Earl of Mansfield: I am very conscious of the fact that the amendment reflects the views of your Lordships' Select Committee on Science and Technology, which was so ably chaired by the noble Lord, Lord Sherfield, and I am grateful to my noble friend Lord Bessborough for moving the amendment in an attractive way. It is essential that forestry finds its proper place in the countryside, and indeed the wider consultative arrangements introduced in 1974 are designed to ensure that full regard is paid to the requirements of agriculture, the environment, and nature conservation when forestry proposals are being considered. These entail consultations with the agricultural departments, local authorities, and other bodies concerned with the management of the countryside, and the opportunity is frequently taken during this process to modify the original proposal in order to secure better overall land use. This usually calls for some compromise on the part of the various interests concerned.
I have had direct experience of these consultative arrangements in that a number of cases in which differences of view have not been resolved locally have come to me. As a result, I am of the opinion that
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the procedures which involve a large measure of give and take are working satisfactorily and I am not wholly happy, for reasons to which I shall come, to see them overlaid with a more formal statutory provision which would or could interfere with the present spirit of compromise and co-operation. There is the further point that my noble friend Lord Drumalbyn put his finger on, that is, that an amendment of this kind would create a statutory imbalance. A similar duty would not be imposed on other land use interests. There is also the question of what is meant by integration. This point has been debated in considerable detail and at great length in the context of the so-called integration of forestry and agriculture without a real consensus of view emerging. The interpretation of this term in the wider land-use context embraces such things as conservation and amenity and is fraught with even greater difficulties.
Having said that and having voiced my misgivings about the amendment, I have no reason, and still less a desire, to appear to pour cold water on this recommendation of the Select Committee. What I propose to do is to go away and think about it to see whether we could get an amendment which might overcome the difficulties which I have set out to your Lordships; or, alternatively, on reflection perhaps the difficulties may not seem as overwhelming (if that is the right word) or perhaps as cogent as they are at the moment. I hope that my noble friend will see fit to withdraw his amendment.
The Earl of Bessborough: I am grateful to my noble friend the Minister for what he has said. Before I say what I propose to do, I should like to add that I have a note from the noble Lord, Lord Adrian, telling me how much he regrets he had to catch a train back to Cambridge. Otherwise, he was going to speak on this subject from the Cross-Benches and I know he was going to do so most effectively, as well as anyone in this little debate. But I am grateful to my noble friend Lord Mansfield for his assurance. I was going to say that I hoped he could give us the assurance that he was prepared to think again and that perhaps between now and Report stage we might be able to agree to some reference to integration in the Bill. I am grateful to him for what he said about this Select Committee report and, particularly, about this particular recommendation. In those circumstances, and at this stage, I would withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 3 [Number of Forestry Commissioners]:
Lord Taylor of Gryfe Lord Taylor of Gryfe moved Amendment No. 20:
Page 1, line 20, leave out (""ten"") and insert (""eleven"")
The noble Lord said: This amendment concerns the constitution of the Forestry Commission. It is not often that we amend the Act, but this gives us an opportunity of making what I believe to be a sensible and, I hope, non-controversial amendment. There was a discussion earlier in the debate as to what kind of animal was the Forestry Commission. It was not a nationalised industry; it was not the Civil Service. What was it? By a strange accident, the members of

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the commission, the commissioners of the Forestry Commission, unlike members of the boards of nationalised industries and Government departments, happen to be Royal appointments. This was a fortunate accident in many ways for the commissioners.
They consist at the moment (or will, if the Bill is accepted) of a chairman and nine others. One of the great problems that I had as chairman of the Forestry Commission was to distribute these nine others. Obviously, you have the four full-time members of the commission, which leaves five others to be distributed. But these five others to be distributed had to cover a very wide field. Obviously, being a national organisation, we at least had to have one Welshman, probably two Englishmen and two Scotsmen, otherwise one of the nations would feel neglected. We had to build into that permutation of five people someone who was probably a trade unionist or had some connection with trade unionism. There would have to be on the commission three with special knowledge and experience of forestry, one with scientific knowledge in the field of forestry, science and research, and a representative of the timber trade.
So here you have to balance not only the national interests of the three countries involved in forestry but also the special interests of the timber trade, the scientist-research people and the specialists in forestry. Then you would also try to get a trade unionist into that picture too. It will be realised that it was extremely difficult and often caused a good deal of offence when one juggled around with these commitments within the limited numbers that were available.
The intention of the Bill which adds one other person to the commission does not resolve the situation because I understand it is the intention that the additional member shall be a businessman who will presumably be skilled in some way in the disposal of assets or in lease and lease-back arrangements. All that is being done is introducing another commissioner to take over these new and special responsibilities without dealing with the problem that I have outlined. All I would say about a businessman is that I hope the businessman appointed as a member of the Forestry Commission is going to accept the full statutory commitments of the Forestry Commission for the development and maintenance of forestry in this country—both as to state forestry and the forest authority—and will not see his prime role as being the prime agent in the disposal of the assets of the Forestry Commission. That would be quite wrong.
What we end up with after doing all these permutations is, so far as the non-executive directors are concerned, four landlords. The commission have been extremely fortunate in the people that they have attracted to the Forestry Commission and who have given their time to the service of the Forestry Commission: the noble Lord, Lord Gibson-Watt, is a member of the Forestry Commission; Captain Bowser, up in Scotland, is a member; and Sir Ralph Verney was recently a member of the Forestry Commission. With the present chairman they all have substantial interests in land owning. This does not disqualify them from membership; indeed, it enhances their ability to discharge their duties.
There is a trade unionist on the commission who happens to be the representative of the Educational
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Institute of Scotland, the teaching profession, which is not strictly forestry in this activity. He is a very good man. Before that, we had the noble Lord, Lord Donnet, of the General and Municipal Workers. If there is one element missing, it is that one does not have a chap in the field, a working forester. I know that the director-general would regard himself as a working forester in many ways; but I should like to see in the Forestry Commission a measure of worker participation on that board.
I should like to see on the board someone who is in the day-to-day practice of planting or thinning, or what-have-you in the field, because whether you like it or not, with four landlord interests on the commission, it tends to get that kind of image. I do not believe that it is good for labour relations in the commission, and I do not believe that it is good for the image of the commission if you do not have a working, day-to-day practising forester on the board. Such an appointment would do immense good in the whole area of labour relations and the general image of the commission.
We should make it possible to do this by, instead of having a chairman and nine others, as proposed in the Bill, having a chairman and 10 others. That would make 11 in all. The total cost would be £3,500 per annum, and I do not think that is a high price to pay for this gesture of participation in these days when we regard worker participation as a rather important element in good relations. I beg to move.
Lord Davies of Leek: I am without a speech because of this rather late hour. I support the views which have been put forward—the wounds in my back having healed!
Earl Bathurst: Can the noble Lord, Lord Taylor of Gryfe, say whether the proposed trade union member would have to be a member of the Forestry Commission's staff, or could he be a member of any department' of the forestry industry?
Lord Taylor of Gryfe: The trade union representative is not written into the Act as a specific commitment but is included by tradition. As chairman of the Forestry Commission, I tried not to have a specific trade union nominee as such. I remember talking to the general secretary of the TUC and he said, "Tom, you need a bloody good trade unionist", and so we got a bloody good trade unionist! But that would not meet the case that I have in mind; I want a bloody good forester instead!
10.35 p.m.
The Earl of Mansfield: As the noble Lord, Lord Taylor of Gryfe, has said, the Forestry Act provides that at least one commissioner shall have special knowledge or experience of forestry. At least one must have scientific attainments and a technical knowledge of forestry. At least one must have special knowledge and experience of the timber trade. No specific requirements are laid down in the statute, but since the Eighth Report of the Estimates Committee in 1965 the commissioners have consisted of a part-time

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chairman, four full-time executive members and five part-time members chosen for their knowledge and experience in specific fields.
Three of the four full-time commissioners are professionally qualified foresters who have spent their careers at different levels across a broad spectrum of industrial experience. They are particularly well-qualified by virtue of that experience to manage large-scale forestry projects in a way which few outside the commission can match. Moreover, as the noble Lord knows very well, senior specialists in various fields are in regular attendance at board meetings or are available to advise as required. So although I understand the cosmetic element of the noble Lord's amendment it is difficult to see what additional professional advice another professional forester could offer.
As the noble Lord has said, for many years the board has included a respected member of the trade union movement, although none has been directly involved in forestry. This may be a very good thing, because there are advantages in having someone not too closely associated with the industry, since he can then offer impartial guidance on trade union matters, but his position as such avoids the difficulties which might be encountered if he were too closely connected with one of the unions representing workers employed by the commission. The views of the industrial workers can be and are made well known. They are fully represented through their unions on the commission's Industrial and Trade Council. The unions provide members of the commission's chief statutory advisory body, the Home Grown Timber Advisory Committee, and of the 11 regional advisory committees whose deliberations are reported to the board. These offer effective and wide-ranging scope for communication between the staff and their representatives and the commissioners.
Equally, it is a possibility—and I certainly do not rule it out—that, at an appropriate time, a worker with direct practical experience of forestry inside the gate, as it were, might represent the trade union interests. But at the moment, at any rate, we do not consider it necessary to add further to the number of commissioners to bring that into effect. It is right that we propose to make one additional commissioner; somebody who has commercial experience of a rather different type than has been available before. But the Government were reluctant to increase the number by even one, and would be very reluctant to increase it by any more.
Earl Waldegrave: I should just like to add that I hope that the Committee will take note of what the noble Earl has said. It is a pity to make these commissions too big. It is also, perhaps, a pity to lay down what qualifications each person must have. The noble Lord, Lord Taylor of Gryfe, will remember that when he and I were both commissioners together we had an absolutely first-class trade unionist on the commission, who was neither a forester nor an agricultural worker. I cannot remember whether Gwyn Davies was a steel worker or a coal worker, but he certainly came from South Wales and no one could have asked for a better representative of the trade union movement there. I think that is better than laying down that you must have a statutory trade unionist, a statutory woman, a
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statutory Common Market man and so on.
Lord Taylor of Gryfe: The Act does not say that you should have a statutory trade unionist, and I have not said that we ought to have a statutory trade unionist. I have said that we ought to increase the number by two instead of one, for the reasons I have indicated, without writing into the Bill that it must be a statutory trade unionist. But it gives the opportunity for the Minister to do what I have sought. If you do not amend it now, you are stuck with the number that is in the Bill. In fact, you are adding one business man.
I looked for some support from the Liberal Benches, in view of their substantial commitment to participation. I had hoped that there would be a balancing of the one business man who is skilled in the disposal of assets and so on, with a workers' representative—not that he would give technical advice to the commission. There is a mass of technical advice at the top of the commission. There is no doubt that there is a difference between technical advice at the top and workers' participation from below and it would be a healthy element.
They have had this experience in other nationalised industries, some with success; some with less success. But it is in keeping with the times. We will not be amending the Forestry Act for some time ahead and 11 members, in addition to the chairman, would enable the Minister to have scope to do this kind of experiment. I hope that this will be regarded as non-controversial and acceptable.
On Question, amendment negatived.
Clause 3 agreed to.
Clause 4 [Short title, repeals and extent]:
Lord Ross of Marnock Lord Ross of Marnock had given notice of his intention to move Amendment No. 21:
Page 1, line 24, after ("to") insert ("Scotland or").
The noble Lord said: It would be quite wrong at this very late hour to take advantage of the waning support of the Government and to go ahead with this most important amendment, for which I have piles of papers ready. I will save it for another occasion. I do not intend to move the amendment.
[Amendment No. 21 not moved.]
Clause 4 agreed to.
Schedule agreed to.
House resumed: Bill reported without amendment.

LICENSING (ALCOHOL EDUCATION AND RESEARCH) BILL
Brought from the Commons; read 1a, and to be printed.
WESTERN ISLES ISLANDS COUNCIL (BERNERAY FERRY) ORDER CONFIRMATION BILL
Brought from the Commons; read 1a, and (pursuant to the Private Legislation (Scotland) Act 1936) deemed to have been read 2a and reported from the Committee.
PRESTON BOROUGH COUNCIL BILL [H.L.]
Reported from the Unopposed Bill Committee (on Re-commitment) with amendments.
  POLICE: WORKING PARTY ON COMPLAINTS PROCEDURE
  POLICE: WORKING PARTY ON COMPLAINTS PROCEDURE
  ASYLUM: NUMBER OF REQUESTS
  ASYLUM: NUMBER OF REQUESTS
  ISLAMIC SLAUGHTERHOUSES IN THE UNITED KINGDOM
  ISLAMIC SLAUGHTERHOUSES IN THE UNITED KINGDOM
  IRAQ AND IRAN: PROVISION OF MILITARY EQUIPMENT
  IRAQ AND IRAN: PROVISION OF MILITARY EQUIPMENT
  MR. VIKTOR RYZHOV-DAVYDOV
  MR. VIKTOR RYZHOV-DAVYDOV
  CAR PARKING: DIPLOMATIC PRIVILEGE
  CAR PARKING: DIPLOMATIC PRIVILEGE