Sitting of 19 May 1981

Preamble
The House met at half-past Two o'clock
PRAYERS
[MR. SPEAKER in the Chair]
PRAYERS
  PRIVATE BUSINESS
    BRITISH RAILWAYS (VICTORIA) BILL [Lords]
    Read the Third time and passed, without amendment.

    WHITEHAVEN HARBOUR BILL
    Order for Third Reading read.
    [Queen's consent, on behalf of the Crown, signified.]
    Read the Third time and passed.

Oral Answers to Questions
  DEFENCE

    Type 22 Frigate
    Mr. Dewarasked the Secretary of State for Defence what is the latest estimated unit cost of a type 22 frigate.
    Mr. John Nott: The latest estimated unit cost of a type 22 frigate, including fitted weapon systems and equipments, is £120 million at September 1980 prices.
    Mr. Dewar: Does the Secretary of State realise that Yarrow (Shipbuilders) Limited in my constituency will face 500 redundancies this summer unless there is an order, the first under this Government, for a type 22 frigate? Can he give some hope to an area of unacceptably high unemployment that it will be spared a further blow? Will he perhaps lay to rest the irresponsible and horrific suggestion in the Financial Times that his determination to stick with Trident at the expense of the conventional naval programme might face us with the unthinkable—the closure of Yarrows altogether?
    Mr. Nott: If the hon. Gentleman will forgive me, I shall deal with the latter point during the debate. On the former point, I am conscious of the situation at Yarrows. I realise that it needs a shipbuilding order. The matter is very much in my thoughts. During the next few weeks, I shall be looking into it.
    Mr. Henderson: Does my right hon. Friend think that the type 22 frigate is good value for money in assisting the Royal Navy to fulfil the vital task of protecting British merchant vessels wherever in the world they may be threatened?
    Mr. Nott: I think it is likely that we shall tend to move more towards the building of cheaper type frigates than the type 22. There is, I believe, a widespread view, particularly in the Admiralty Board, that this is the
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    direction in which we should go. This does not mean that we shall not have more type 22 orders. We are, however, tending to move towards cheaper frigates.
    Mr. George Robertson: I recognise that the Secretary of State has expressed some concern over the delay in ordering further type 22s. The fact is that the 1980 Defence Estimates mentioned that these orders would be placed. Is the right hon. Gentleman aware of the implications for the productive capacity of British Shipbuilders of the continuing delay by the Government over the whole shipbuilding programme and the unnecessary confusion caused to British Shipbuilders over its future shipbuilding programme?
    Mr. Nott: Yes. I am aware of the problems faced at the moment by British Shipbuilders with regard to the uncertainty that undoubtedly exists over the future warship building programme. I have talked to the chairman of British Shipbuilders, as have my senior officals, about the matter. I should like to be able to clear up that uncertainty within the next month or two. That is my aim.
    Mr. Bill Walker: Does my right hon. Friend agree that the building of type 22 or any other frigates for the Navy would be helped best if Labour Members would stop making noises about cutting back on defence expenditure?
    Mr. Nott: I have made an estimate of the approximate reduction in defence expenditure which would flow from the Opposition's amendment, which we shall be debating shortly. I estimate that it would lead to a reduction in defence expenditure of about £4½ billion. When jobs are considered against that background, I am clear that the Labour Party's defence policy, insofar as it has a defence policy—or one rather than several—would be a disaster for Britain.

    Rapid Deployment Force
    Mr. Biggs-Davisonasked the Secretary of State for Defence whether he will make a further statement about a British contribution to the rapid deployment of Western forces.
    Mr. Temple-Morrisasked the Secretary cf State for Defence what progress is being made towards the establishment of a rapid deployment force.
    The Under-Secretary of State for Defence for the Royal Air Force (Mr. Geoffrey Pattie): I refer my hon. Friends to the answers given by my right hon. Friend the Secretary of State for Defence on 17 March this year.
    Mr. Biggs-Davison: May we be sure that the review of future expenditure will take account of the Prime Minister's and the Government's support of the RDF? In noting the preparations that are being made in the United States under a marine corps general, are not the Royal Marines and the Parachute Regiment well suited to make a British contribution?
    Mr. Pattie: All these factors will be taken into account.
    Mr. Temple-Morris: Does my hon. Friend consider that the best contribution that we can make to the rapid deployment force, both historically and generally, is the Royal Marines?
    Mr. Pattie: My hon. Friend speaks correctly of the excellent contribution made by the Royal Marines in the past, and naturally we would not deny that.
    Mr. Arthur Davidson: Is not the idea of a separate British rapid deployment force becoming more and more of a delusion? Any forces earmarked for such a role are already seriously overstretched. If the reports underlying this week's events become true, they are likely to be even more so. Other European countries are, to say the least, unenthusiastic about the idea, let alone any countries to which such a force might be sent. Should not the hon. Gentleman drop the whole daft idea?
    Mr. Pattie: The only delusion is in the mind of the hon. and learned Gentleman. He seems to have forgotten that the units that have the capability rapidly to deploy outside Britain currently exist within the United Kingdom. The proposal turns on how these units may be pulled together and used at the appropriate moment.
    Mr. Jim Spicer: Does my hon. Friend agree that we should be thinking very much of a European contribution? Will he give an assurance that that will be discussed and that it will be complementary to the American rapid deployment force?
    Mr. Pattie: All developments and potential developments are considered and discussed with our NATO allies, both European and the United States.
    Mr. Frank Allaun: How can the Prime Minister talk of a British contribution to the RDF, which could land us in a war, and at the same time talk about drastic reductions in the Royal Navy? It does not make sense.
    Mr. Pattie: I was not aware that my right hon. Friend had been talking in those terms especially as regards the Royal Navy. However, if the hon. Gentleman wishes to indulge in press speculation of that sort, I would point out that my right hon. Friend offered the United Kingdom's support in any development that the United States might wish to undertake where the interests of the NATO allies are at stake. There seems to be nothing remarkable in that.

    Polaris
    Mr. Colin Shepherdasked the Secretary of State for Defence if he is satisfied with the current arrangements for the servicing of Her Majesty's Polaris submarines.
    Mr. Nott: Despite the difficulties which have been caused by the Civil Service industrial action, essential services have been—and will continue to be—maintained.
    Mr. Shepherd: Is my right hon. Friend aware that the recent rumpus at Faslane gave great cause for concern? If the credibility of our nuclear deterrent is to be maintained, surely it is essential that our Polaris submarines be at sea and on station at all times. Will he give the House and the country that assurance?
    Mr. Nott: I can assure my hon. Friend that we shall not allow the operations of the strategic nuclear deterrent to be adversely affected by the strike. We shall keep our submarines at sea even if we have to use naval personnel to do so.
    Sir William Clark: In view of the recent report that 12 sailors managed to service a submarine, thus replacing
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    some 50 civil servants, is my right hon. Friend satisfied that there is not overmanning in the civil establishment at naval dockyards?
    Mr. Nott: I should be foolish to suggest that there was not overmanning in some parts of my Department. [Laughter.] Perhaps my hon. Friend will give me support during the course of the debate. We shall ensure that the operations of our strategic nuclear submarines are kept in being with the minimum number of necessary personnel.
    Mr. Skinner: Is the Minister aware that, if the Government paid those who service the Polaris submarines the same that will be paid to those in the Armed Forces—or better still what will be paid to Members of Parliament and Ministers—following the recent announcement, they would get the job done extremely satisfactorily?
    Mr. Nott: Much depends on which rank the hon. Gentleman is talking about, the relevant circumstances and an individual's skill. The circumstances vary from person to person, whether the individual is in the Services or is part of the MoD.

    North Atlantic Treaty Organisation
    Mr. Adleyasked the Secretary of State for Defence when next he intends to meet his North Atlantic Treaty Organisation counterparts to discuss future developments in the Alliance.
    Mr. Michael McNair-Wilsonasked the Secretary of State for Defence if he will make a statement on the May meeting of the members of the North Atlantic Treaty Organisation.
    Mr. Frank Allaunasked the Secretary of State for Defence if he will make a statement on the recent North Atlantic Treaty Organisation Defence Ministers' conference held in Brussels, particularly regarding nuclear missiles.
    Mr. Nott: The NATO Defence Planning Committee met in ministerial session in Brussels on 12 and 13 May. We discussed a wide range of issues affecting Alliance security in the light of the disturbing growth in the nuclear and conventional military strength of the Soviet Union. Against this background we agreed that intensified NATO action was necessary to ensure deterrence. NATO Defence Ministers approved new guidance as the basis for Alliance defence planning for the period up to 1988 and confirmed the allied commitment to real annual increases in defence expenditure in the region of 3 per cent.
    NATO will move ahead with the planned modernisation of long-range theatre nuclear forces while making efforts to reach satisfactory arms control agreements.
    The full communique has been placed in the Library.
    Mr. Adley: Can and will my right hon. Friend confirm that the Government are not engaged in an exercise to cut levels of defence expenditure? Do the Government remain firmly committed to the NATO aim of a 3 per cent. annual increase in defence expenditure? Am I to understand from what he is saying that the Governmet are committed to that aim for not only this year but definitely through until 1988?
    Mr. Nott: The Government have already published their plans for defence spending in the Defence White

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    Paper, which we shall be discussing shortly. I can confirm that there are no plans to cut defence spending below the levels contained in the White Paper, on which a debate will follow shortly.
    Mr. McNair-Wilson: Can my right hon. Friend say whether any of the other NATO countries that said that they were willing to have cruise missiles stationed within their frontiers have yet confirmed that they are prepared to have those missiles?
    Mr. Nott: It varies from country to country. The Germans and the Italians are well advanced in their plans. The Dutch and the Belgians are indicating that they hope to come to a final decision within the next year. The programme is moving forward well. We shall be the first country to deploy, but the Germans and the Italians, especially the Italians, are well advanced with their plans.
    Mr. Allaun: If Russia has such nuclear superiority as the defence Ministers were told, why has not it attacked already?
    Mr. Nott: I do not know, but it may be something to do with the fact that we have a nuclear deterrent.
    Mr. Beith: Has the right hon. Gentleman discussed with our NATO allies which of them could possibly replace our naval contribution to Western defence if, as seems possible, he abandons much of that contribution to pay for the dubious privilege of being able to launch a nuclear response independently of those allies?
    Mr. Nott: I have not asked our allies because there will be no need to approach them on this subject.
    Mr. Robert Atkins: What discussions did my right hon. Friend have with his NATO colleagues about the chemical offensive weapon which it is known that the USSR has?
    Mr. Nott: We did not have any discussions on chemical warfare at the recent meetings. As my hon. Friend suggests, it is true that the Warsaw Pact has a substantial offensive gas warfare capability. At the moment we are totally lacking in adequate deterrence. That is a matter of grave concern to NATO. At the moment we are equipping our people with defensive kits against chemical weapons, but it is certainly a matter of concern to NATO.
    Mr. John: Did not the Ministers agree that talks should be opened between the Warsaw Pact and the NATO Ministers, particularly between the United States and the USSR? Will not the Secretary of State do everything he can to back up Chancellor Schmidt's plea to President Reagan, reported in The Times this morning, that the Americans should be serious and should undertake the talks so that they come to fruition?
    Mr. Nott: I agree with Chancellor Schmidt, but the Americans are serious and have already given the undertaking. The Rome communique of the NATO Foreign Ministers, coupled with the communique of the NATO Defence Ministers last week, confirms that negotiations will begin this year.
    Mr. Lathamasked the Secretary of State for Defence whether he is now able to announce the placing of orders with Marconi Limited for the guided weapon system 25, known as Sea Wolf; what representations he has received on this matter; and whether he will make a statement.
    Mr. Farrasked the Secretary of State for Defence whether a decision has been taken to place a firm order for the Marconi 910 Sea Wolf tracker system.
    Mr. Pattie: Marconi Radar Systems Limited is the current contractor for the programme to improve the existing tracking radar for the Sea Wolf shipborne point defence missile system. British Aerospace Dynamics has put forward proposals for an improved lighweight Sea Wolf system, incorporating the Dutch VM40 tracker. In the light of these and further proposals recently received from Marconi for an alternative lightweight design. the Navy Department is at present assessing the best way of meeting the Royal Navy's requirement for an improved Sea Wolf system.
    Mr. Latham: Is my hon. Friend aware that there is great concern amongst the employees of Marconi Radar Systems Limited in Leicestershire and elsewhere that the contract for the tracker might be given to a Dutch company at the expense of British jobs? Will he confirm that the proposal put forward by Marconi is now being seriously considered by his Department.
    Mr. Pattie: I can give that confirmation.
    Mr. Farr: Is my hon. Friend aware that about 400 jobs are at stake in Leicester? As Marconi has developed a lighter tracker system than the Dutch, there is no earthly reason why the contract should go abroad. Will my hon. Friend bear that in mind?
    Mr. Pattie: I assure my hon. Friend that that consideration is being borne centrally in mind, particularly in view of the new alternative proposal to which I referred in my original answer.
    Mr. Greville Janner: Is the Minister aware that there are two Marconi plants in my constituency and that there is vast anxiety about the proposed switch to a Dutch system? When does he expect his assessment to be completed? Will he give us the assurance that Marconi will be given as much time as it needs to come up with an alternative system, since the present system was developed for the Government according to specifications given by the Government and has been an excellent system, used by our forces?
    Mr. Pattie: As I said in my original answer, Marconi has already come forward with an alternative. It is being given all the time necessary to develop that and flesh it out. I understand that the decision will be made some time in the summer.
    Mr. Hooley: Will the Minister give a firm assurance that the system will not be made available to South Africa?
    Mr. Pattie: The same principles governing trading with South Africa will apply to this and to all other systems.

    Royal Air Force (Female Aircrew)
    Mr. Viggersasked the Secretary of State for Defence if he will seek to authorise the Royal Air Force to recruit female pilots and other aircrew.
    Mr. Pattie: I have no plans to authorise the Royal Air Force to recruit females as pilots, or to other aircrew specialisations not already open to them.
    Mr. Viggers: Following the serious rundown in aircrew training by the previous Government, what

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    thought was given to that form of recruiting as it was applied in the United States and in this country during the war?
    Mr. Pattie: There are problems in recruiting females in a combat role. My hon. Friend will be aware that the recent White Paper has allowed females to be armed. However, the first barrier which will have to be surmounted before my hon. Friend's wish could come to fruition is to allow females to be put into a direct combat role. We do not feel that that is appropriate at this time.
    Mr. Wellbeloved: In any case, would it not be premature to consider recruiting females for aircrew duties when 5,000 people are in receipt of flying pay and there are only 650 aircraft to man? Is not it time that the Minister came clean on the whole business of this myth of aircrew shortage when there is a ratio of 5,000 people who are qualified and paid to fly to 650 aircraft?
    Mr. Pattie: It is not a matter of coming clean. The hon. Gentleman will be aware that the evidence given to the Select Committee recently made available the full facts of the matter. I thought that the Select Committee's report was extremely helpful.
    Mr. Wilkinson: Why is my hon. Friend being so coy? Only recently Miss Judy Chisholm managed to fly single-handed to Australia and for a living she flies HS125s commercially. Surely aeroplanes such as the 125, which operate from RAF Northolt in my constituency in a non-combative role, would be ideal for women pilots to fly and would release trained experienced aircrew for fast jet combat duties.
    Mr. Pattie: As I did not wish to detain the House further, I did not add the second point—that we would have to change the regulations relating to the employment of women officers because many of them leave rather earlier than their male counterparts for reasons such as marriage and pregnancy.
    Mr. Heffer: Is the hon. Gentleman aware that, during the war years, there were female mechanics in the Royal Air Force? Therefore, if there could be women mechanics—[Laughter.]—I thought that women and females were the same. Is the Minister aware that, if we could have women mechanics during the war years, there is no reason why there should not be women pilots in the Royal Air Force, if they are to be in purely a non-combative role? It is about time we genuinely had equality in the forces as well as elsewhere.
    Mr. Pattie: I am sure that the hon. Gentleman's remarks will be well received in the appropriate quarter. However, he must appreciate that, with our training commitment, all pilots recruited in the Royal Air Force are recruited initially with a view to their being in the fast jet force. We recruit them not as helicopter pilots, but for the fast jet force. As people fail in the fast jet force, they go to other parts of pilot training. Therefore, the costs would be high.

    Reserve Forces (Training)
    Mr. Neil Thorneasked the Secretary of State for Defence if he is satisfied that the quota of man training days available to the reserve forces is adequate for their role within the integral national defence system.
    The Under-Secretary of State for Defence for the Army (Mr. Philip Goodhart): The number of man training days available to the reserve forces this year should be sufficient to allow them to train for their key operational roles. We do, of course, keep the standard of training and effectiveness of the Territorial Army under close review.
    Mr. Thorne: Does my hon. Friend accept that, in the past, man training days were calculated in relation to total established strengths and, more recently, as those established strengths have been reached by recruiting, there are fewer man training days to go around? For that reason, there is a great shortage of man training days, which does not allow the Territorial Army to be as efficient as it could be and to fulfil the role which it wishes to take in the defence of the realm.
    Mr. Goodhart: I shall bear my hon. Friend's point in mind. I ask him to bear it in mind that the number of man training days available has increased from 2 million in 1979 to 2½ million this year.
    Mr. Best: Will my hon. Friend acknowledge the dangers of diminution in the morale of territorial soldiers if they see the man training days progressively diminished, and the dangers of that to the overall defence of the nation?
    Mr. Goodhart: Overall, the number of man training days is increasing. The number of recruits in the Territorial Army is increasing rapidly, and retention, which my hon. Friend will recognise is of great importance, is also improving dramatically.

    Services (Priority Tasks)
    Mr. Hooleyasked the Secretary of State for Defence what is the principal priority defence task of the Royal Navy, the Army and the Royal Air Force, respectively.
    Mr. Nott: The main priority of all the United Kingdom's Armed Services is support of our defence commitment to NATO. The three Services jointly or severally contribute to the Alliance's strategic nuclear forces, provide land and air forces in the central region, maritime and air forces in the Channel and Eastern Atlantic, and the protection of the home base.
    Mr. Hooley: From even that brief catalogue, is it not obvious that the Government's defence aims are far too ambitious? Would it not be sensible to cut out the nuclear ambition and abolish the scheme for Trident?
    Mr. Nott: The aims that I read out are precisely the same as those that existed under a Labour Government. We shall be fully debating in a moment the general proposition in the hon. Gentleman's question.
    Mr. Stokes: On this very serious day, will my right hon. Friend assure us that in the next defence review there will be no reduction in the size of the Royal Navy or the number of naval ships at sea?
    Mr. Nott: I shall go into all those matters at considerable length in the debate. There may be a reduction in the number of some kinds of ships and an increase in others. The operational effectiveness of our Armed Forces is more important than pure numbers.
    Mr. Wellbeloved: Will the Secretary of State reconsider his answer to my hon. Friend the Member for

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    Sheffield, Heeley (Mr. Hooley)? Does he accept that it was not the policy of the previous Administration to scuttle the Royal Navy surface fleet, to abandon our allies on the central front of Europe and to betray the North Atlantic Treaty by abandoning our commitments?
    Mr. Nott: I am glad to hear the hon. Gentleman's assurance about the Government of which he was a distinguished member. I hope that he will be able to say the same of the loyal Opposition when they develop their policy as we come near to the next election.
    Mr. Viggers: Does my right hon. Friend agree that a principal role of the Royal Navy in time of war is to keep open the North Atlantic for reinforcement and supply, without which we could not survive?
    Mr. Nott: I entirely agree that a vital factor in any war on the central front will be the reinforcement of NATO, much of which will need to be done by sea. I certainly agree with my hon. Friend.

    Army Establishments (Cleaning)
    Mr. Foxasked the Secretary of State for Defence if he is satisfied with the rate of progress in handing over the cleaning of Army establishments to the private sector and with the level of savings so far achieved.
    Mr. Goodhart: Yes, Sir. The placing of cleaning work to contract is making a valuable contribution to our efforts to save money and manpower and furthers the Government's policy of transferring to the private sector those jobs which need not necessarily be performed by public servants.
    Mr. Fox: Is the Minister aware that on the eight contracts awarded the savings are not 25 per cent. but 52 per cent.? With defence cuts under consideration, would not this be a fruitful area for speeding up the handover to the private sector? Does he agree that only eight out of 76 contracts awarded in 18 months is a dismal record?
    Mr. Goodhart: In all, including the Army Department, decisions have been taken to change to contract cleaning at over 50 establishments, with potential savings in excess of £3 million a year and some 2,000 posts.
    Mr. George: Will the Minister guarantee that cleaners who have been displaced receive proper compensation? Does he agree that in the supposed cost advantage of private contract cleaning a number of hidden costs are involved that may not have been taken into account, such as compensation and additional security measures?
    Mr. Goodhart: An allowance for redundancy payments is taken into account. We have found that estimates for redundancies have been 50 per cent. higher than they proved to be in practice.
    Mr. Arthur Davidson: Since contract cleaning workers are among the lowest paid, according to an ACAS report which the Minister will have no doubt seen, may I ask whether he is satisfied that savings have not been at the expense of single parents, who form the major part of that labour force?
    Mr. Goodhart: Before a contract is awarded, the company and the wages that it pays are scrutinised by my Department.

    British Base (Cyprus)
    Mr. Thomas Coxasked the Secretary of State for Defence whether he has had any recent discussions on the continuance of the British bases in Cyprus.
    Mr. Pattie: My right hon. Friend has had no such discussions.
    Mr. Cox: Is the Minister aware of the growing pressure in Cyprus for discussions on the future of the bases and for a contribution to be paid to the Greek Cypriot Government for their use? As the matter is urgent and will not go away, will he discuss it with the Secretary of State and the Lord Privy Seal?
    Mr. Pattie: I am sure that the hon. Gentleman is right when he says that the matter will not go away, but this is a matter primarily for the Lord Privy Seal, who I am sure will read the reports of this exchange.
    Mr. Jim Spicer: Does my hon. Friend accept that the Turkish Minister of Defence is fully aware of the importance of the sovereign base area, not only to the United Kingdom but also to the NATO Alliance as a whole?
    Mr. Pattie: Yes, I agree with my hon. Friend.

    Cruise Missiles
    Mr. Robert Atkinsasked the Secretary of State for Defence if he remains satisfied with progress in the development of cruise missiles.
    Mr. Pattie: The development of the General Dynamics Tomahawk cruise missile which is to be deployed in Europe is the responsibility of the United States Government, but I understand that the programme is making very satisfactory progress.
    Mr. Atkins: Can my hon. Friend find time to dispel the rumours published in the much unlamented magazine Now! suggesting that cruise missiles were having trouble in tests and experiments? Is he aware that the report was based on false information obtained by the GAO in the United States, which is the subject of considerable controversy between the GAO and General Dynamics?
    Mr. Pattie: Our information is that the success rate in the tests has been in excess of 80 per cent., which at this stage in the life of a developing system is very acceptable.
    Mr. Jay: Will the Government urge the United States and Soviet Governments to fix a date for the resumption of talks in the limitation of theatre nuclear missiles?
    Mr. Pattie: I understand that conversations are in train to establish a date.

    Trident
    Mr. Cryerasked the Secretary of State for Defence if he will make a statement on the current estimate of the cost of Trident.
    Mr. Nott: As I stated in the Defence White Paper, the total capital cost of a four-boat force is broadly estimated at £5,000 million at mid-1980 prices. I cannot be more precise until various design and other studies have been completed.
    Mr. Cryer: Has not the cost increased to £6 billion, as is the widely reported and authoritative view? In the

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    Armed Services, is not such expenditure drawing money away from existing services and the maintenance of the Navy and, domestically, from such things as education?
    Mr. Nott: The figure of £6,000 million is not authoritative, nor is it true. I have given the figure. The current estimate is £5,000 million Clearly, £5,000 million spent on Trident is £5,000 million less to spend on something else. That is a statement of the obvious. We have to consider the most effective way to spend that sum in the preservation of peace. That, as I hope to state in the debate, is the argument for Trident.
    Mr. Latham: What proportion of the work on Trident will be done by British workers, and what will be the cost in the next two years?
    Mr. Nott: Approximately three-quarters of the work will be done here. The submarines will be built in Barrow and the warheads will be made here. I cannot give an estimate of likely expenditure on Trident over the next two years. We are never prepared to break down expenditure year by year in that way.
    Mr. Ioan Evans: If the £5 billion is not to be extra expenditure but to come from existing expenditure, will it come entirely from the Navy's expenditure?
    Mr. Nott: These questions have simply not been decided. Where the expenditure for Trident will fall is a matter for future decision when substantial sums become in issue. At present, we have spent virtually no money on Trident. The large items of expenditure will begin only a few years hence.
    Mr. Jessel: Is my right hon. Friend aware that £5,000 million over 15 years with a population of more than 50 million works out at less than 2p per head per day? Is not that a very modest price to keep our people safe and free?
    Mr. Nott: I congratulate my hon. Friend on making the key point. We are attempting, as the Labour Government did, to maintain peace. As my hon. Friend says, we believe that the expenditure of this sum of money is one of the most cost-effective ways to achieve that.

    North Atlantic Treaty Organisation
    Mr. Hal Millerasked the Secretary of State for Defence whether any consultations have been held with North Atlantic Treaty Organisation allies about possible changes in priorities of the United Kingdom's North Atlantic Treaty Organisation roles.
    Mr. Nott: The Alliance is aware of the current work in hand on our future defence programme. The details will be worked through in accordance with normal Alliance planning procedures.
    Mr. Miller: Will my right hon. Friend confirm that any change in our NATO commitment or role would require not only consultation with our allies but their consent?
    Mr. Nott: All changes to NATO declarations are proposed and discussed within NATO. They take place constantly. Whenever we or our allies seek to make a change, as often happens, the changes are, of course, the subject of NATO consultations.
    Mr. Marks: Has the Secretary of State discussed with our NATO allies the gross disparity between the proportion that this country pays and that which other
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    European countries pay towards NATO? Are not we taking on too many commitments? Does the Secretary of State regard it as fair that we contribute more than Germany and France, which have a higher gross national product?
    Mr. Nott: Apart from very small sums of money for items such as infrastructure, which are NATO-funded, we do not contribute anything to NATO. We contribute to our own defence, which is a quite different matter. Our defence is part of the collective defence of NATO but we do not contribute to NATO in the way that the hon. Gentleman suggests.
    Mr. Douglas Hogg: Does my right hon. Friend agree that a primarily underwater fleet would not be the best way to safeguard NATO's convoy lines?
    Mr. Nott: There are a whole host of ways of safeguarding NATO's convoy lines. I think that submarines would be one very important way, but only one.
    Mr. Leighton: Will the Minister explain whether there is any connection between these changes in priorities and the resignation of one of his principal colleagues.
    Mr. Cryer: Resignation? He was sacked.
    Mr. Nott: The hon. Gentleman must ask my hon. Friend. My hon. Friend must give his own reasons, as no doubt he may seek to do in the debate.

    Cash Limits
    Mr. Bruce-Gardyneasked the Secretary of State for Defence if he will make a statement regarding the present state of his plans to recover his Department's overspend on cash limits in 1980–81 during the current financial year.
    Mr. Nott: I have nothing to add to the reply that I gave to my hon. Friend on 14 April 1981.
    Mr. Bruce-Gardyne: Does my right hon. Friend agree in principle that to the extent that, as we are led to understand, the overspend in 1980 and in 1979 was largely attributable to the accelerated delivery of equipment and the accelerated presentation of bills for that equipment, those bills cannot be duplicated in the current year and that there is therefore an overwhelming case for cash limits in the Ministry of Defence, as in any other Department of Government, requiring a recovery in a subsequent year of overspending the previous year?
    Mr. Nott: If my hon. Friend means that if an item of equipment is delivered one year it cannot be delivered the following year, I agree with him on that. The central issue for programmes such as my own which have an extremely long time-span of 10 years or more is—and I think that this is broadly recognised everywhere—that it would be helpful to have some kind of carry-over from one year to another. Some flexibility at the end of the year would be an improvement to the system. I think that this point, however, is different from the one that my hon. Friend has asked and to which I have given an answer at least 10 times.

  PRIME MINISTER

    Engagements
    Mr. Bestasked the prime minister if she will list her official engagements for Tuesday 19 May.
    The Prime Minister (Mrs. Margaret Thatcher): This morning I had meetings with ministerial colleagues and others. In addition to my duties in this House, I shall be having further meetings later today. This evening I hope to have an audience of Her Majesty the Queen.
    Mr. Best: Is my right hon. Friend aware of the widespread welcome that will be given to the news today of the further elimination of that increasingly extinct species the quango? Will she speed up the process? Will she also say today what further progress she can make in reducing the bureaucracy of this nation?
    The Prime Minister: We were able to announce yesterday a further reduction of 140 or so in the quangos. That is very good news. On the latter part of my hon. Friend's question, the numbers in the Civil Service have been reduced by 42,000 since the Government came to office. That represents a saving of £270 million on the pay bill, so we are well on target for 630,000 in the Civil Service by the end of this Parliament.
    Mr. Foot: Talking of extinct species, will the right hon. Lady be good enough to tell us about a matter in which there is great public interest, both within and outside the House, namely, the removal or dismissal of her hon. Friend the Member for Ashford (Mr. Speed)? Was not he in fact dismissed for telling the truth? How many other Ministers does the right hon. Lady think are likely to commit the same offence?
    The Prime Minister: Ministers should fight departmental battles within the Department and not outside.
    Mr. Foot: Is the right hon. Lady suggesting that she dismissed the hon. Gentleman solely because he took his departmental battle outside? Will she tell us whether included in that battle was the question, which was much larger than the departmental matter, whether this country can afford, and whether it is right to proceed with, the £5,000 million Trident programme?
    The Prime Minister: The right hon. Gentleman raises three points. First, with regard to his earlier comments, in this Government both within Departments and in Government we believe in working as a team. [Interruption.] That is what the doctrine of collective responsibility means, alien as it may seem to Labour Members who, when they were in power, had to have special dispensation from collective responsibility. I believe in it and shall continue to do so.
    Mr. Foot: We have been hearing about all these departmental secrets and disputes. Is that the reason why the right hon. Lady, a little earlier, dismissed the previous Secretary of State for Defence? Is that the reason why he has taken up his present post? Did not he also engage in departmental disputes which he brought into the open? Was that the reason why he was removed?
    The Prime Minister: I do not think that the right hon. Gentleman has observed that my right hon. Friend the Chancellor of the Duchy of Lancaster is, indeed, one of the foremost members of this Government.
    Mr. Emery: To clear up this matter will my right hon. Friend give an absolute assurance to the House and to the country that the pledge given by the Conservative Party in the Conservative manifesto at the last general election to the effect that there would be a significant increase in defence expenditure—which was established as a 3 per cent. increase on our NATO commitment—will be held to in the present defence review?
    The Prime Minister: There has been a significant increase in defence expenditure in real terms. We have honoured the NATO commitment. We intend to continue to honour the NATO commitment of increasing, defence expenditure. Therefore, the argument is not about reductions; it is about how to spend the increases.
    Mr. David Steel: Given the Prime Minister's views on curtailing public expenditure, is not a massive cut in our conventional defences inevitable as long as the Government insist on going ahead with the Trident missile programme? Would it not show greater loyalty to NATO if we gave up the foolish pretence of being an independent nuclear power?
    The Prime Minister: I remind the right hon. Gentleman that we are talking about increases in defence expenditure in real terms—increases which have taken place and which will continue to take place. We have to decide how best to spend those sums in the defence of the people of this island and in commitment with our NATO allies. That is a commitment to which we shall continue to give considerable consideration. We must meet our commitments to our NATO allies, but there are difficult decisions on how best to spend the money. I think that the vast majority of the people would believe that the independent nuclear deterrent of Trident is extremely good value for money.
    Mr. James Callaghan: In her consideration of these issues, does the Prime Minister understand that a proposal to reduce the number of surface ships in the Royal Navy designed to fight submarines would be both an abdication of responsibility and a failure to understand the priorities for the defence of this country?
    The Prime Minister: As the right hon. Gentleman will know, bearing in mind that we have put up defence expenditure considerably over his budget, there are difficult choices to be made. The Government cannot escape those difficult choices. They have to spend the extra money, together with the underlying defence budget, in the way best suited to the defence of the people of these islands.
    Mr. Stanbrookasked the Prime Minister if she will list her official engagements for Tuesday 19 May.
    The Prime Minister: I refer my hon. Friend to the reply which I gave some moments ago.
    Mr. Stanbrook: Has my right hon. Friend seen the horrifying stories and pictures of brutality towards old people in recent cases? Taking these together with other evidence of an increase in crimes of violence, are not my right hon. Friend and the Government absolutely right to press on with bringing the police fully up to strength and providing them with proper pay and equipment for their task?
    The Prime Minister: As in the case of the increase in the defence budget, we were also committed to an increase

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    in the budget for law and order. That commitment, too, has been well and truly honoured by the Government. In England and Wales alone, the increase in the police force is in excess of 6,000, accompanied by further increases in Scotland and in the Royal Ulster Constabulary. The Government were quite right to give that priority and will continue to do so.
    Mr. Roy Hughes: Is it not time that the Prime Minister intervened to end the Civil Service dispute? Is it not time that the Government stopped their cowardly approach to industrial relations, whereby they are being tough towards the weaker sections? Would it not be better now to restore public confidence all round and to get the public services back to normal working, in addition to bringing a measure of justice to this much maligned sector of the Government apparatus?
    The Prime Minister: I very much hope that the Civil Service dispute will end, and soon. It is causing very severe disruption to some of the payments to which our citizens are entitled, such as value added tax, and grants which should regularly go to farmers. The civil servants are taking it out on their fellow citizens, not the Government. Bearing in mind that they have had a 50 per cent. increase in pay during the lifetime of the Government, and that they have also been offered a further 7 per cent. increase—which is more than some other sectors of the public service are getting, and a good deal more than many parts of the private sector are getting—they have had a very fair deal, and most of them believe that that is the case.
    Mr. Moateasked the Prime Minister if she will list her official engagements for 19 May.
    The Prime Minister: I refer my hon. Friend to the reply which I gave some moments ago.
    Mr. Moate: Will my right hon. Friend confirm that a priority of the British Presidency of the EEC will be a fundamental restructuring of the common agricultural policy? Is she aware that she will have massive national support in carrying out that task?
    The Prime Minister: We have to give priority to the restructuring of the common agricultural policy, along with the restructuring of the budget. Both are required. We cannot do one without the other.
    Mr. English: If the British Army of the Rhine were to be transferred to Britain, how many jobs currently given to German civilians would be given to British civilians?
    The Prime Minister: No decisions have yet been taken about the allocation of the increased budget. If the hon. Gentleman has very strong views to put, I am sure that he will put them to my right hon. Friend the Secretary of State for Defence.
    Sir William Clark: In view of the tragic and sad news today that five more soldiers in Northern Ireland were murdered by a land mine, is it not high time that the Government reconsidered the reintroduction of capital punishment for terrorists?
    The Prime Minister: It is the case that five more soldiers, members of the Green Jackets, were killed today by a land mine. I am sure that all hon. Members on both sides of the House offer their sympathy to the parents and families of those who were killed in the defence of law-abiding citizens in Northern Ireland.
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    My hon. Friend will know the rule of this House with regard to capital punishment. It has always been decided on a free vote. We have taken a free vote in this House in this Parliament and I do not envisage another one being taken at the instance of the Government. It is, of course, significant that south of the border, in the Republic of Ireland, the death penalty still exists.
    Mr. Ashley: Will the Prime Minister confirm that she endorses the British delegation's support for a code of marketing for baby food substitutes in the Third world, which will be discussed and debated at the World Health Assembly this afternoon or tomorrow? If she endorses that support, will she express her criticism of the United States' opposition to that code of marketing? Is she aware that if the United States destroys the code, that can damage the lives and health of millions of children in the Third world?
    The Prime Minister: I am not familiar with this code of marketing but I shall certainly look at it.
    Mr. Churchill: Will my right hon. Friend spell out the difference in perception of the Soviet threat that causes President Reagan to undertake a programme of increasing United States defence expenditure by 17 per cent. over the next two years, while her own Administration are talking in terms of cuts, not in financial terms but in the strength or capability of the Armed Forces of the Crown? Will she give an assurance that there will not be such cuts?
    The Prime Minister: We are talking about increases in expenditure in financial terms. Let that be clearly understood. It does a great disservice to indicate anything to the contrary. We shall continue to honour those increases. Of course, within those increases difficult choices have to be made. Difficult choices also have to be made between the defence programme and other programmes. We have given priority to defence and to law and order, and I believe that that was absolutely correct.
    Mr. R. C. Mitchell: When the Prime Minister has thought about those difficult choices, will she tell us whether breakfast television is more important to this country than a strong navy?
    The Prime Minister: I do not think that that question is very relevent to the future of our defence forces.
    Mr. John Townendasked the Prime Minister if she will list her official engagements for 19 May.
    The Prime Minister: I refer my hon. Friend to the reply which I gave some moments ago.
    Mr. Townend: Is my right hon. Friend aware that she has massive support for her stand on the Civil Service dispute? Will she reassure the House that the Government have no intention of getting round the cash limit by agreeing to a settlement for a period of less than 12 months?
    The Prime Minister: I saw the report in the newspaper to the effect that that was the intention. There is no such intention. The cash limit of 6 per cent. has been clearly set for the whole of the financial year. There is no intention of departing from it. The Government believe that the maximum amount that can be awarded within that 6 per cent. cash limit—in view of decreased numbers—is some 7 per cent. We shall not depart from that. I was also somewhat distressed to read, at the same time, that some members of the Civil Service—I believe only a very few

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    of those on strike—said that it was their clear intention to disrupt the Government's financial policy and to see that interest rates were thereby increased.

    NORTHERN IRELAND
    Ordered,
    That the matters of housing conditions in Northern Ireland, grants for improvement (intermediate and repair), together with proposals for a draft Housing (No. 2) (Northern Ireland) Order, being matters relating exclusively to Northern Ireland, be referred to the Northern Ireland Committee for their consideration.—[Mr. Pym.]

Dogs (Miscellaneous Provisions)
3.31 pm
Mr. Albert MeQuarrie: I beg to move,
That leave be given to bring in a Bill to make further provision for dog licence fees and for the general welfare and control of dogs; and for connected purposes.
Among other things, the Bill concerns increasing the dog licence fee. Such an increase is long overdue. The dog licence fee costs 37½p per annum and has not been increased since 1878. Taking the figure of 37½p in terms of purchasing power today, it would be equivalent to between £8·50 and £9·50 per annum. I recommend that the new licence fee be £5, which should be acceptable to most dog owners.
Last year, the cost of collecting dog licences amounted to almost £1 million, due mainly to the fact that the majority of the estimated 6 million dogs in the United Kingdom had never been licensed by their owners. Any new scheme for dog licensing must, therefore, be enforceable and must justify the need for existing legislation to be brought up to date. I shall seek to uo that if leave is given to bring in the Bill.
The Bill's other main proposals would include dog control; the responsibility of dog owners; the setting up of a national dog warden scheme, which would be self-financing; registration of all dogs after a 12-week period; and the permanent identification of a dog by means of a code number. The number could be indelibly marked on the dog by tattooing or by a similar method. The tattoo could be made on the inside thigh of the dog, because that area lacks pigmentation and would be suitable for the purpose, without causing the dog pain. The code number would be the dog's basic identification throughout its life and would be recorded on the licence.
The report of the inter-departmental working party on dog control, set up by the Labour Party in 1974, which was published in 1976, was accepted by the then Government but has never been implemented. The report, which covered licence fees, fouling and nuisance, road safety, livestock worrying and controls over breeding, dealt with many aspects of the dog problem which concern the public, including that of stray dogs.
The Royal Society for the Prevention of Cruelty to Animals is also keen to see the legislation enacted. The society has stated that hundreds of thousands of unwanted animals—the great majority of which are domestic dogs—are destroyed every year simply because homes do not exist for the number of animals that are born. The society has also suggested that, with the exception of dogs kept specifically for planned breeding, dogs should be neutered. It suggests that every encouragement should be given to owners to have their pets neutered.
The joint advisory committee on pets in society, whose member organisations are the British Small Animal Veterinary Association, the National Canine Defence League, the Petfood Manufacturers Association, the Association of Metropolitan Authorities, the National Dog Rescue Co-ordinating Committee, the British Veterinary Association, the Kennel Club, the People's Dispensary for Sick Animals, and the Royal Society for the Prevention of Cruelty to Animals, produced a comprehensive report that
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covered every aspect of the dog problem in the United Kingdom. In the introduction to the report the chairman stated:
"Governments hesitate to introduce legislation about animals because they know that any controversy arising would cut across party lines."
That is why so much legislation on animals has been left to the hazards of Private Member's Bills. It is accepted that this subject is a highly sensitive political issue, but we should not run away from it when it has reached such chaotic proportions. The health danger to human beings resulting from diseases that are obtained from dogs cannot be under-rated. People do not normally take account of the effects of dog diseases, but the consequences can do wide-ranging and permanent damage.
One of the main diseases is toxoplasmosis gondii. Recent records show that 20 to 40 per cent. of all adults are affected by that disease from dogs. The symptoms in adults are similar to those of brucellosis, with general tiredness, muscular weakness and fever. There may also be an involvement of heart, liver and lung complaints. If a female develops toxoplasmosis during pregnancy, her child will have congenital toxoplasmosis, which can lead to blindness or to a liver disease. The disease has been recognised as a human problem only in the last decade and is, of course the reason why many local authorities have banned dogs from public parks.
Other common dog diseases are well known and require urgent attention. However, I have only given illustrations of the diseases carried by dogs. I hope that those illustrations will ensure that those who are interested in this great issue will understand the problems of dog control. We are acknowledged as a nation of dog lovers, but to be true to that affection we must look after the welfare of the dog and try to engender a sense of responsibility in dog owners.
A child can give his love and care to a dog. An adult, particularly one of the 9 million pensioners, can keep a dog as a companion and watchdog. The guide dog is indispensable to the blind. The handicapped have every reason to be grateful for the affection that the dog can show during a period of loneliness. Those are examples of our caring nature.
On the other hand, having outlived their usefulness, dogs are sometimes put out on the street to wander and gather into packs. The packs will roam wildly, injuring people and fouling streets and public areas. The public are entitled to be protected from that. Clauses will be written into the Bill that will enable local authorities to control such problems in much greater depth.
Clauses will be inserted to exempt guide dogs, work dogs, dogs owned by the handicapped and the disabled and to give one free licence to every elderly person. That will remove worry from those categories of people who require dogs for essential purposes. There is an urgent need for a dog warden scheme, which need not be a burden on the public purse. As the new licence fee will cover the cost of the service, it will also create an opportunity for small private businesses. A number of local authorities already provide full-time and comprehensive dog warden services on a contract basis through private firms.
The existing enforcement powers relating to dog licences and the control of dogs are seldom implemented. In Scotland, the Scottish Canine Consultative Council brought out the Angus report in October 1978, which pledged its support to the need for legislation. The report

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suggested that the council had the support of all responsible dog owners in Scotland as well as the great majority of district councils. The failure of successive Governments to grasp this problem fully justifies this motion. I trust that it will receive the approval of the House, as it will be widely accepted in the country as a long overdue measure.
Question put and agreed to.
Bill ordered to be brought in by Mr. Albert McQuarrie, Mr. James Lamond, Mr. Teddy Taylor, Mr. Bill Walker, Mr. Tom McNally, Mr. Alex Pollock, Mr. David Myles, Mr. Greville Janner, Mr. Peter Fraser and Mr. Andrew F. Bennett.

Dogs (Miscellaneous Provisions)
  DOGS (MISCELLANEOUS PROVISIONS)
  Mr. Albert McQuarrie accordingly presented a Bill to make further provision for dog licence fees and for the general welfare and control of dogs; and for connected purposes: And the same was read the First time; and ordered to be read a Second time upon Friday 5 June and to be printed. [Bill 142]

Defence Estimates 1981
Mr. Speaker: Before we begin the debate, I warn the House that a large number of right hon. and hon. Members have told me that they hope to catch my eye. Even with the two days allowed for the debate it will be impossible to call all hon. Members unless speakers impose self-discipline. Hon. Members who have said that they wish to speak have a good claim, on constituency grounds, or because they serve on a Committee, or because they have a deeply held conviction.
I have selected the amendment in the name of the Leader of the Opposition, the right hon. Member for Ebbw Vale (Mr. Foot).
3.42 pm
The Secretary of State for Defence (Mr. John Nott): I beg to move,
That this House approves the Statement on the Defence Estimates 1981, contained in Cmnd. 8212.
I hope that I shall be forgiven for opening the debate with a quotation from the "Wealth of Nations". In 1778 Adam Smith wrote:
"arms and their ammunition are becoming more expensive. A musket is a more expensive machine than a javelin or a bow and arrows; a cannon or a mortar than a ballista or a catapulta."
Indeed, he was right. I hope that his perception of the problem, some 200 years ago, will be equally understood by the House today. It is reflected in the introduction to the White Paper that is now before us.
An explosion in defence technology has brought with it an explosion in cost. For instance, if we are to increase the flying hours of the RAF's fast jet pilots by one hour only, once per month, it will cost another £8 million a year. That is happening while the massive forces of the Soviet Union continue to grow remorselessly, and are armed with increasingly sophisticated weaponry. The position is grave.
We have a choice. Either we can continue to pretend that there is no problem, that we can wish away the threat or imagine that the United Kingdom can somehow sustain, replace and enhance its operational effectiveness without a fresh look at how we perform our tasks—what we are doing, and why—or we can continue to drift down the path that led, this year and last to cuts in ammunition, fuel, training and deployment, and will lead inevitably in the next few years to increasingly degraded operational ability.
I will not choose the latter course, although it is easiest politically, in the short-term, to take the easy course. We owe it to our countrymen, the defence of the nation, and more especially to the men and women of the Armed Services, to face these issues now and to face them bravely. No one who comes to my office can fail to be heartened by the immense contribution of our Armed Services and all who support them in a civilian role. We must not let them down by avoiding necessary decisions during the next few months.
The work of the Armed Fores is spelt out in the White Paper, and the whole House will wish me to pay tribute to it. I am sure it will not be misunderstood if I single out only one aspect of that work, namely, the contribution of the services in Northern Ireland. The defence White Paper emphasises their determination and skill in support of the RUC in the fight against pure thugs and murderers.
The versatility of our forces has been well and publicly demonstrated during recent days, as alongside their police

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colleagues they have, with coolness, discipline and restraint, maintained the rule of law while confronted with gangs of rioters armed with rocks and petrol, and nail and acid bombs capable of killing, injuring and maiming—and all the time in the glare of often unhelpful media publicity.
The House will share my outrage and revulsion about the news this morning of the murder of five soldiers in Northern Ireland while on patrol in their Saracen armoured car outside Newry. Our thoughts and prayers are with their families and friends.
I want to say one or two words about the civilian work force. I deplore the intrusion into the Civil Service of tactics in a pay negotiation more usual, sadly, in certain parts of private industry. But the action taken by small numbers of MOD civil servants highlights the immense contribution that the bulk of the work force makes, year in and year out, to the nation's defence. Well over 110,000 of our non-industrials—I want to emphasise that our 117,000 industrial staff are not involved in the dispute—are working normally. Indeed, many of them—some at places such as the Clyde submarine base and Rosyth, where industrial action has been most marked—are working extra hours and applying great ingenuity to ensure that production and repair work continue unhindered.
The vast majority of the Ministry's civil servants are not bureaucrats—they are welders, plumbers and electricians producing tanks and other armaments; they are fitters, boilermakers and blacksmiths, refitting and maintaining ships; they are scientists and engineers researching and designing our equipment; they are teachers of Service men's children overseas. They provide the foundation on which the superstructure of our fighting forces is built. The vast majority are expressing their loyalty to the Department in this present difficult period in a practical way, namely, by getting on with their jobs. The support and loyalty that any person holding my office consistently receives from the defence machine, the Chiefs of Staff and my other principal advisers is one of the most heartening and warming aspects of the job.
I began my speech by mentioning our future operational effectiveness, and how we could maintain it and enhance our front-line capabilities in spite of remorselessly rising costs. I see my task as a simple one, and no amount of special pleading from one part of our defence establishment or another will divert me from it. It is to form a defence view—not a single Service view—of how we can conduct our tasks within the Alliance in the defence of freedom and democracy.
At no time have I contemplated, sought, proposed or recommended—or been asked by my right hon. Friend the Prime Minister to contemplate, seek, propose or recommend—any cut in the published defence budget of the United Kingdom. Some of the suggestions in the press, especially—and I have never before singled out a newspaper in such a debate—the report by the naval correspondent of The Daily Telegraph, are pure invention. I emphatically deny that the Navy will be reduced to little more than a coastal defence force without carriers, with other parts of the Fleet drastically cut, and the Royal Marines disbanded after 317 years' service. If such ridiculous notions exist anywhere, we have not seen them. They may exist somewhere in the Ministry of Defence, but not in papers that I have ever seen.
Mr. Churchill: The Royal Marines have already been cut.
Mr. Nott: My hon. Friend must speak for himself if he has seen proposals to disband the Royal Marines. I have seen no such proposals.
Mr. Churchill: Will my right hon. Friend confirm that there will be no cut in the strength or capability of the Armed Forces of the Crown?
Mr. Nott: I hope that my hon. Friend will allow me to develop my speech for a few minutes more. I hope that he will then be satisfied.
Mr. Ron Brown: Would there not have been more justice if the Prime Minister had had one or two admirals in and read the Riot Act in relation to the article that the Secretary of State has quoted than in sacking the hon. Member for Ashford (Mr. Speed)?
Mr. Nott: My right hon. Friend has had no cause or reason to call in any admiral. In this exercise, about which I want to say more, the admirals, without exception, have behaved with utter loyalty. They have done all that they have been asked to do, and could not have been more helpful in the exercise that I shall describe.
I hope that my right hon. and hon. Friends will understand the issue, but what I have been trying to do in the past two months during this exercise—I have had the most loyal support from all the Chiefs of Staff in this endeavour—is to build, from the bottom up, the basic structure to which we should gear the equipment and manpower requirements of our Armed Forces for the next 10 years and beyond. The basic structure will represent for each of the Armed Services the most crucial and the most relevant elements of our defence capability. It is not itself—and was never intended to be—a defence programme as such. Its bare cost could never be a proper measure of what our defence budget provision ought to be.
In examining a range of options, in building a series of different models of the possible shape of our forces in the 1990s and beyond we are in new territory. I must not say "uncharted seas". It requires realism about the resources likely to be available in the next few years and, above all, it requires fresh thinking. To describe the results which are coining forward in this exercise as cuts or, still more, to attach alarming figures of many billions of pounds, before the structure is converted into a real-life programme based upon the increasing defence expenditure shown in the White Paper, is either deliberately to misrepresent the exercise, or totally to misunderstand what we are doing.
If I could persuade the doubters to think in terms of change—rather than always talking in terms of cuts, we could sustain the morale of our Services whilst we undertake the necessary exercise for their benefit and that of the whole country.
Mr. John Wilkinson (Ruislip-Northwood): Will my right hon. Friend reassure one doubter? In an Adjournment debate I drew attention to the fact that 1,400 defence civil servants were being moved from the South-East, where they did their job effectively, to Glasgow, where the Department admitted that they were doing the job at a greater cost and less effectively. Can my right hon. Friend reassure the House that before any cuts in equipment programmes, disbandment of units or other drastic measures of that sort are undertaken, that sort of nonsense will stop?
Mr. Nott: I believe that my hon. Friend is referring to the Hardman report. As far as I recall, that report was produced in the early 1970s and involved the dispersal of civil servants in every Department round the country, in accordance with the widespread demands of every party that that should be part of our regional policy at the time. As far as I am aware, that dispersal process has nearly ended. That should not worry my hon. Friend now, much as he might have been concerned several years ago.
Much informed opinion and discussion has surrounded two of the questions that naturally concern me, namely, reorganising the Rhine Army within the framework of our Treaty obligations, to improve its military effectiveness, and reviewing the balance between the several complementary ways of carrying out anti-submarine warfare in the East Atlantic and the Channel.
Due to security considerations, it is unfortunately not possible to debate all these issues in depth in the widest forum, but perhaps I could give the House an insight into several important issues. It is not disputed—certainly not by me, to give but one example—that the Royal Navy has a major "deterrence by presence" role in the East Atlantic and that it can perform, particularly with the new carriers such as "Invincible", a major role in out-of-area activities, particularly in support of the United States world-wide.
But in the pursuance of anti-submarine warfare in the Atlantic a whole new set of questions has arisen and must be considered in any serious study of the future. The situation here is changing. It is not simply that the new class of Soviet missile-firing submarines have great speed, range and endurance, and hence, with the Backfire bomber, pose an increasing threat to the surface fleet and reinforcement, but that sonar technology is improving and the means of countering it as well. Unfortunately, it is not possible for me to argue the merits and deficiencies of active and passive sonar, and of how it might develop in the future, but I can give the House an insight into this fascinating area
There are several means of conducting anti-submarine warfare in the Atlantic. Most of them are complementary, but not all are mutually exclusive. The hunter-killer nuclear submarine—that is nothing to do with the ballistic missile submarine, or Trident—has been described by many people, mainly in the Navy, as the battleship of the future. It is essential that we enhance the numbers, if the resources can be found to do so.
The Nimrod II conversion, the most advanced maritime patrol aircraft of its kind—with its Searchwater radar, magnetic Anomaly detector and computer-linked system for plotting and killing submarines by active and passive sonar buoys—carries a very large range of weapons, including, shortly, Sting Ray. It is recognised as a tremendously effective system for conducting area search and for localising its adversary for the kill. I refer here to the Nimrod.
The surface fleet and anti-submarine helicopters are complementary to the submarine and the maritime patrol aircraft. In anti-submarine warfare the principal devices—towed array sonar or dipping sonar, operated from helicopters—are useful systems, especially within a narrower radius than that normally operated by the maritime patrol aircraft. But it is not necessarily true that towed array needs a platform as expensive as a £120 million type 22 frigate. If we have too expensive platforms we shall have fewer resources to multiply our sonar capacity by other means.
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Hence the Royal Navy's current ambition—in which my hon. Friend the Member for Ashford (Mr. Speed) has played a major role—to design and produce the type 23 frigate at half the cost of the type 22, as a means of towing towed array. Further down the line we must also consider whether an even simpler and cheaper vessel than the type 23, with sufficiently quietened engines, can perform the function of towed array sonar. That is not as fanciful and ridiculous as some traditionalists may think.
We must consider, too, the platform from which the ASW helicopter is carried. It is not necessary, perhaps, for it always to be carried on an expensive carrier, requiring air defence destroyers as an escort and maybe even the United States strike fleet as well.
A helicopter can be borne, at least in theory, on a relatively simple, crude platform or even on one of the merchant ships that it is protecting from Soviet submarines. Thus, the argument is not solely about numbers, although, of course, numbers count. It is mainly about quality and effectiveness, and how we can best deploy our limited resources in meeting the Soviet submarine threat.
How we do so is both a technical question and a matter of judgment. I assure the House that judgment tends to vary somewhat, depending on who one is. It might be that the submariner takes one view, the frigate captain another, and the maritime aviator yet another. Sometimes judgment varies with rank, experience and background, and sometimes it varies between those who have Royal Navy establishments in their constituencies and those who do not. It has even been known to vary in emphasis between one service board and another, although I would never suggest that any such problem exists at present.
In the end, the buck stops with me. I am the Secretary of State for Defence as well as being chairman of each of the Service boards. When we have finished all our studies and completed the option exercises for carrying out the 101 operational functions that make up our total defence capability, a recommendation—and then a decision—must be made. They will be made not on the basis of sentiment but solely on a judgment of cost-effectiveness, because the country can no longer afford both to defend itself against its enemies and to be sentimental on the way.
Mr. James Wellbeloved: will the Secretary of State confirm that it remains the Government's policy that co-operation with our allies through membership of NATO is the first fundamental requirement of British defence policy? If that is still the case, will he confirm that the present understanding in NATO is that we keep about 55,000 in troops in Germany and continue to provide 80 per cent. of the readily available maritme forces for the defence of the Atlantic?
Mr. Nott: I have already said that we are considering, as one option, the reorganisation of the Rhine Army to make it more effective within our treaty commitments, I was referring to the Brussels Treaty, which mentions 55,000 men.
Our force declarations to NATO are changing year by year, just as the declarations of every other member of NATO change year by year. They are subject, in the normal way, to discussion and agreement with our allies within the NATO context. Any changes that we make will be subject to the same procedures.
Mr. Donald Dewar: I accept that the right hon. Gentleman was talking about options and emphasis, but the emphasis of his remarks suggests that the possibility of type-22 orders in the immediate future is extremely remote. Is that a fair deduction and, if so, will he inform us of the time scale in which the decisions will be made and when work will begin?
A total of 5,700 jobs in my constituency depend on naval orders. I am not ashamed of making that as a vested interest statement, and I am anxious because those jobs will start to be lost from next month. We need decisions fast in order to end the uncertainty.
Mr. Nott: The hon. Gentleman asked me that during Question Time. I answered it only an hour ago. I will not repeat the answer, because I have a lot to say.
Mr. Neville Trotter: I accept the need for simpler corvette type ships instead of frigates, but is my right hon. Friend saying that our intelligence was inadequate when ships such as the "Ark Royal" were ordered, only two or three years ago? Has the situation changed so much that they may be irrelevant?
Was not one of the roles of the three through-deck cruisers to be the carrying of the Harrier, and was not another an anti-aircraft role in shooting down Russian aircraft that would be used for guiding missiles from long range? If the "Ark Royal" and her sister ships are not to go into service, what will shoot down the guiding aircraft in the Atlantic?
Mr. Nott: I do not know who has ever said that the "Ark Royal" or the carriers are not going into service. I am not aware of having said or suggested that. I said earlier that it seems that the ASW carriers are ideal ships for out-of-area activities. I believe that.
My hon. Friend the Member for Tynemouth (Mr. Trotter) put his finger on the valid point. When the ASW carriers were ordered several years ago—the first was ordered many more than three or four years ago—the situation was not the same as it is today. Any decision that I make as a result of the review will not flow through into the new shape of the Fleet until 1990. The development of the Oscar class submarine—the missile-firing submarine with a 250 mile range—involves a breakthrough in technology. However much we may be using our ASW carriers, I do not believe that we would order them if we were making the decision today. Times have changed. However, I will be going to the launching of the "Ark Royal".
I conclude this section of my speech by saying that in considering the future allocation of resources we must arrive at the right balance between the different roles—both now and in the future—that our forces could be called upon to play—both inside and outside NATO—between manpower and equipment; between weapons, including war stocks, and the platforms that will carry them; between our Regular forces and the reserves—if I can find the money, I want to increase our reserves—and between the different layers of direct and indirect support that our fighting services require.
That study will continue for some time yet and, while it is necessary for me to keep my right hon. Friends informed of progress, I do not anticipate that I shall be seeking any decisions from them about my final proposals before July—whereupon it would be my wish, as I have already told my right hon. Friend the Leader of the House,
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that we should have a full debate on all the issues. The suggestion that I seek to avoid such a debate is only one of the more preposterous imputations that I have read recently in the pages of the press.
Mrs. Peggy Fenner: In order to alleviate the misery and apprehension of vast numbers of my constituents, will my right hon. Friend allude to the part of the front page of The Daily Telegraph today that refers to the closing of two dockyards and the fact that we shall have to wait until July for the ultimate decisions?
Mr. Nott: I cannot be drawn into commenting about the quite unbelievable things that appear in The Daily Telegraph every day. I have already referred to yesterday's edition of The Daily Telegraph. Today I read from the same correspondent that my chief scientific adviser enjoys a position that is almost unrivalled in the Ministry and has access to me in a way that is not enjoyed by the Chiefs of Staff. I simply do not understand where that comes from. I estimate that I have seen the Chiefs of Staff three or four times as often as I have seen the chief scientific adviser. Indeed, I have hardly seen him at all. I regret that, because he is an exceptional fellow, but I have just not had the time to see him.
Mr. Frederick Mulley: As a previous victim, I offer my sympathy to the Secretary of State for what happens to him in The Daily Telegraph. Not only was part of the rubbish that that paper printed when I was Secretary of State for Defence provided by some of the Secretary of State's hon. Friends—I do not think that he was involved—but it was used by Conservative Members in defence debates as though it was biblical doctrine. Perhaps what happens in The Daily Telegraph is the responsibility of some of the right hon. Gentleman's colleagues.
Mr. Nott: I share one thing with the right hon. Gentleman. I am concerned because The Daily Telegraph has a wide Tory circulation, and I am genuinely concerned that anyone should believe what is printed. [HON. MEMBERS: "Hear, hear."] I refer, of course to a particular defence correspondent.
That brings me to the amendment of the Shadow Cabinet—or part of the Shadow Cabinet, because there appear to be two rival amendments from the Shadow Cabinet, each bearing the name of a different hon. Member. It is surely unprecedented in a defence debate that two members of the Shadow Cabinet should table two different amendments. It is true—and I am sure that in due course the Opposition will make good fun of it—that my hon. Friend the Member for Ashford and I had a minor difference of view about the speech. However, Conservative Members are united in their determination to maintain the effectiveness of our defences. The Labour Members who opened, for the loyal Opposition, each day's debate in the two-day defence debate last year have now both left the Labour Party, so the defence spokesman for the Labour Party last year no longer belongs to that party. This year two members of the Shadow Cabinet table amendments that partly contradict each other.
Nevertheless, I shall attempt to find a common policy between the rival factions in the Shadow Cabinet. I refer to Trident, because Trident is the single strand that appears to unite both rival factions. Leaving aside for a moment the fact that the right hon. Member for Leeds, East (Mr.

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Healey), the Leader of the Opposition, the right hon. Gentleman the Member for Bristol, South-East (Mr. Benn) and successive Labour Governments supported Polaris, and secretly developed Chevaline, which after all, is a modernisation of the missile system—it is hard to understand why we should be criticised for continuing the modernisation process with the Trident missile system, which is the logical successor to Chevaline.
I understand that some people believe that we should run on the Polaris submarines. They should know that we need new submarines anyhow, because the present submarines are nearing the end of their life, and the new submarines for Polaris represent about three-quarters of the cost of the Polaris successor system—Trident. If it was right to preserve an independent strategic nuclear deterrent through all the years of Labour Government—and secretly to update the missile system with Chevaline—what has made Labour Members change their minds?
The Soviet Union now possesses 60,000 tanks. It can field 10,000 combat aircraft of ever-increasing sophistication, range and destructive power. Every six weeks the Soviets launch a nuclear submarine, armed with either a ballistic or a cruise missile system. They have 5½ million men under arms. More important, they are deploying each week one new SS20 MIRV-ed missile, targeted against our cities, and that is two years before the cruise missile is even due to be deployed in Europe.
If Mr. Brezhnev and the Soviet marshals read the amendment tabled by one faction of the Shadow Cabinet about nuclear-free zones in Europe and closing down our bases, they would either jump for joy or regard it with the same bemused contempt as I do.
So I come to the argument about money and the cost-effectiveness of Trident. Of course, money spent on Trident is money that is not spent on something else. However, the only real question that we have to ask is: what is most likely to achieve our sole objective in NATO—the preservation of peace? There is no other objective. Deterrence turns on what the other side thinks—not on what we think. Surely, it is not suggested that if the Soviets were asked their view—and gave an honest answer—they would sooner face an increment to BAOR's armoured strength, when they already have 17,500 tanks to our 600 on the central front—a total of 7,000 tanks for NATO—or more Tornados, when they already have a numerical superiority in modern combat aircraft. Even the expenditure of tens of billions of pounds could hardly affect that one way or the other.
Trident is not just a numerical addition to the nuclear deterrence of the United States; it involves a quite different multiplication of risk to a potential aggressor which we, alone in Europe, are qualified to possess. [HON. MEMBERS: "Oh."] In Europe we have the experience. We had an independent strategic deterrent for many years under the Labour Government. Which would the Russians choose: more tanks, or Tornados, or Trident? I suggest that one has only to ask the question to know the answer.
Finally, the estimated cost of Trident at about £5 billion, representing perhaps that part of a total estimated amount on defence equipment over 15 years of over £80 billion, and most of it spent in this country, is for a whole defence programme—missiles, boats, bases and all, the whole thing. The £10 billion—that is what it would cost at current prices—on our Tornado programme does not include the development of bases, support, and all the complex weapons systems such as JP233, defence
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suppression systems, and all the other things that go with Tornado to give a true comparison with Trident. The same is true, obviously enough, for the 24 "Invincible" class cruisers, which a speaker in another place recently implied that we could get for the Trident money. He did not compare like with like.
In the end, the comparative deterrent effectiveness is not a matter of alternative costings. It comes down to judgment and common sense. I have some sympathy, surprisingly enough, with the deep emotional abhorrence that the Leader of the Opposition feels for nuclear weapons, because I share it. However, it leads me to different conclusions about what is the safest and best way of stopping the mad nuclear arms race. I share the abhorrence of the whole awful thing. But I find it hard to understand those who argue against Trident on the utilitarian ground of deterrent cost effectiveness. If one asks which will give more pause to an adversary contemplating aggression—Trident or an increase in our conventional forces—the answer is plain.
Mr. Peter Viggers: My right hon. Friend has been helpful in dealing with speculation. Will he comment on press speculation that defence expenditure is compartmentalised and that the Trident expenditure will come out of the naval budget thus diminishing other naval expenditure?
Mr. Nott: I cannot comment on that at the moment. I cannot be drawn into answering every criticism of an internal exercise displayed in the pages of the press. Obviously I shall come to the House as soon as I am able to outline my proposals. The House will have the opportunity to debate them.
Mr. Brynmor John: Will the Secretary of State come to the House before the matters are decided, or will he merely give us the chance to debate decisions which are already firm in the Government's mind?
Mr. Nott: I shall come to the House as normal with a statement outlining Government proposals. I shall make precisely the same type of statement that any Government of any party make.
Mr. John: Will the Whip be on?
Mr. Nott: We do not normally have Whips on a statement.
I come to the question of arms control. [Interruption.] Hon. Members will have the opportunity of deciding which Shadow Cabinet amendment they wish to support if they are called. They should trouble themselves with that problem and then trouble about my statement when it is made.
Mr. Robert C. Brown: When the Secretary of State makes comparisons between Trident and other systems, that frightens people. The continual assertion that Trident is much better in terms of overall defence expenditure carries with it the inference that the Government are coming round to thinking of using the nuclear weapon, and using it quickly.
Mr. Nott: I understand that that argument is widely advertised by members of the Campaign for Nuclear Disarmament and others. the idea that any Western democratic nation could conceive of Trident or any other nuclear weapon as being required for "war fighting" is too fanciful for words. We are talking about weapons of mass

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destruction. They are required for deterrence and the prevention of war now, as they have been since the war. I must say to the hon. Gentleman, as I have said at Question Time before, that before Hiroshima and Nagasaki 50 million people died in the Second World War. That was before nuclear weapons were used. Since the two sides have had them neither side has come near to contemplating in any circumstances the use of the weapons. In some extraordinary way one must ask "Have they not become weapons of peace?" I just pose the question.
Finally, I turn to the question of arms control.
Mr. Richard Crawshaw: Not only is CND worried about the scenario of Trident. Up to now we have never been able to visualise anything but a gradual build-up. Can the Secretary of State imagine what might happen, particularly if the naval strength is reduced to any great extent, if the Eastern bloc were able to cut our supplies and yet not make war? If we bank on Trident, we must fire that or nothing. That is what is worrying people who are not members of CND.
Mr. Nott: I understand the argument about the opportunity cost of one weapon system against another. We have estimated that about £5 billion will come out of an equipment programme of £80 billion. For all the reasons that I have given, I believe that it is right to spend that money. The hon. Gentleman has a different view. I take his points about convoys and reinforcement and the ability of the Soviet Union to cut our supply line. That is why earlier in the debate I explained how important it was for the Royal Navy "deterrence by presence" role to continue and why we want an out-of-area capability in the Gulf. Surely that is one of the most likely places where the lifeline of the West might be cut by the Soviet Union if it had any aggressive intent.
Mr. Andrew Faulds: Will the right hon. Gentleman give way?
Mr. Nott: No. Many hon. Members wish to speak.
I come to the question of arms control. In doing so, I am mindful of the condemnation in the Opposition's amendment about our
"failure to pursue vigorously disarmament talks".
I must set the record straight on that accusation. We believe in arms control. I endorse, as did all NATO Ministers last week, the need for arms control negotiations. Who would not? The present arms race is utter madness. However, arms control can be successful only if we respond more effectively to the threat which faces us.
When the West enters a disarmament negotiation with the Eastern bloc from a position of military weakness, we also suffer from equally serious negotiating weakness. The weakness stems not only from the fact that the West is clearly not in a position to make good existing military disparities—and I have described them—but because there appears very often to be an in-built need on the Western side to keep up the pace of the negotiations; a need which sometimes takes scant account of the military and security risks involved.
Against this, the East appears to have no need to worry about the demands in the process of the negotiations coming from its own public opinion because it does not
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have one. The result of the differing approaches to arms control negotiations, is that, although the West may enter into the process of negotiation with laudable objectives in both military and political terms, the West has pressures on it to make progress leading to concessions in the face of intransigence and lack of compromise from the Eastern side.
I am not suggesting that the pursuit of arms control is a hopeless task. I pray that it is not, for the sake of all of us. I want negotiations to succeed, but we have to be realists as well as politicians. I am mindful of what a Conservative politician once said:
"I do see fresh opportunities of approaching this subject of disarmament opening up before us, and I believe that they are at least as hopeful today as they have been at any previous time".—[Official Report, 3 October 1938, Vol. 339, c. 50.]
That was Neville Chamberlain—in October 1938.
Mr. Churchill: At least he was rearming-300 per cent. in three years.
Mr. Michael Foot: That is an old one.
Mr. Nott: It is an old one. If the right hon. Gentleman were to say that, the country would throw him out as well.
It is not necessary for us to be in a position of military superiority. NATO, as a defensive alliance, does not seek such a position. However, we cannot hope to negotiate fair agreements from a position of substantial or growing inferiority. Arms control has a part to play in our security, but fresh initiatives can never be a substitute for necessary defence. We must be guided by our minds as well as our hearts. For that at least is a requirement of any Government, if not that of every loyal Opposition.
4.30pm
Mr. Brynmor John: I beg to move to leave out from "House" to the end of the Question and to add instead thereof:
"regrets that in the current economic climate there are no measures proposed by Her Majesty's Government to reduce the excessive and uncontrolled defence expenditure to the same proportion of gross domestic product as that of the United Kingdom's major European allies; deplores the failure of the Government to review the number and size of defence commitments and to cancel the Trident project which distorts all defence priorities; and, believing that the safety of the world depends on easing international tension and reducing nuclear and conventional alms, condemns the Government's failure to pursue vigorously disarmament talks with the major countries concerned."
The amendment encompasses the main points of criticism which we have of the Government's Defence Estimates, upon which we shall divide the House at the end of the debate.
Initially, let me join the right hon. Gentleman the Secretary of State in paying a sincere and deserved tribute to the members of our Armed Forces. Let me also join him, in a year which has seen an unprecedented amount of sneering at the civilian employees of the Ministry of Defence by hon. Members opposite, in paying a tribute to them. I think that the work that they do in supplementation of the defence forces is worthy of the highest praise. Many of them in the technical branches are retired Service personnel, which makes the jibes at their loyalty that we frequently hear totally grotesque.
If I have to single out a single section of the Armed Services for special mention it must now, as for a number of years past, be those who serve in Northern Ireland. Their courage and dedication—evidenced by the horrific

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death of five people earlier today, in pursuit of the objectives we give them in supporting the police authority—are admirable. I can neither understand nor share the view of those who lay the blame for the tragic situation in Northern Ireland upon our soldiers. They have acted at all times in support of the police and I hope that the present difficult situation will not reverse the process of handing back responsibility for law and order to the civilian authorities.
As paragraph 503 of the defence Estimates points out, for the first time since 1971 the number of garrison troops in Northern Ireland exceeds the number of those who are there under emergency powers—a fact which again directly contradicts the statements of those who talk about the United Kingdom sending more and more troops to Northern Ireland.
The debate on the defence Estimates is normally the high spot of the defence year. Even in this year, when it was to be a mere preliminary to the decisions which will be taken in July by the Secretary of State, it would have been the highlight. But as in some soccer matches, what goes on on the pitch is hard put to compete with what goes on on the Tory terraces, because the crowd is restive and the Secretary of State was given a comparatively uncomfortable time while he was talking about his own Estimates. He only treated us to a taste of his Woosterish sense of humour when he started to talk about the problems.
I enter the quarrel somewhat diffidently because it is almost like intruding on private grief——
Mr. Robert Atkins: At least he knew what he was talking about.
Mr. John: Well, I have served in the Ministry of Defence, which I doubt whether the hon. Gentleman, who interjected from a sedentary position, has ever done.
It started off in a gentlemanly enough manner with the hon. Member for Aldershot (Mr. Critchley) writing in The Daily Telegraph. I agree with the right hon. Gentleman; I have always thought Tory voters to be deluded and now I realise that the basis for their delusion is their predilection for reading The Daily Telegraph. I think he should attend forthwith to the issue of Queen's Regulations about refraining from reading such wicked lies about this country; otherwise their morale will sink to rock bottom. But the hon. Member for Aldershot had no such scruples about an attractive offer and he wrote very fairly on the possibilities facing the Secretary of State in dealing with the present defence and equipment situation.
This was followed very quickly by the hon. Member for Haltemprice (Mr. Wall), who used the time-honoured Tory formula about being sure that no Secretary of State could be contemplating such a step. That was a pretty ominous cracking of thunder, but it was quickly overtaken by the then Under-Secretary of State for the Royal Navy, the hon. Member for Ashford (Mr. Speed) and his attempt at the weekend completely to torpedo the plans of his own Secretary of State. [Interruption.] Well, he was not dismissed because he parted his hair on the wrong side of his head. He made an uncleared and critical speech on what he conceived to be the possibilities, and at midnight, the witching hour, as I understand it, the Prime Minister dismissed him. It may have been a case of acting with speed and repenting at leisure. May I express my personal
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sympathy to the hon. Gentleman? I wish him well and I hope that he will feel able to enlighten the House about the motives that led him to take the course he did.
Of course the Government are the victims of their own excesses in this matter because they talked in Opposition about there being absolutely no constraints upon defence except the threat we had to meet. That was reaffirmed by the right hon. Member for Brighton, Pavilion (Mr. Amery), who was truly bewildered when the Government of which he was such a loyal supporter suddenly changed their course and were no longer talking about matching expenditure with the threat but about economic considerations and the need to fit defence expenditure within those considerations. Indeed, he is not the only Member on the Government side to have taken the frothy rhetoric of the Conservatives in Opposition as the truth.
What we are up against, and what the Government's Lobby fodder will have to swallow, is that the Government will be planning this summer to cut public expenditure further in many other fields and that in that situation we cannot, in the present state of the economy, bear the present size of defence expenditure.
The Secretary of State this afternoon found yet another formula for disguising a defence cut. He said it was a change in expenditure, it was not a cut. On that basis the Health Service has not been cut, industry has not been cut; the expenditure has just been changed. The fact is that cuts in expenditure and the Budget finance are always understood to be cuts in planned expenditure rather than cuts in the immediate year. There have been very few such cuts, at least before this Government took account of the situation.
What was made clear in the Estimates by the printing of internal memoranda, the authorship of which was attributed—and I say this diffidently—to the Secretary of State, is that the programmes have run ahead of our ability to pay for them. He may deny that that is so, but that is the logic of the situation on which he is acting—that the present size of the projected defence expenditure for the next decade is larger than we can bear.
On this, the defence estimates are studiedly vague. They talk about the need for plans, for ensuring value for money. But the message which comes across quite clearly this afternoon is that for the next decade finance will need to be cut, and by a very substantial amount. There is no doubt about that, because of the economic record of the Conservative Party since they came to office.
This year we are spending upon defence 5·2 per cent. of our gross domestic product. Apart from the United States, that is the highest percentage of GDP of all the major NATO countries. It compares with Western Germany's 3·3 per cent. of its GDP, France's 4·4 per cent and Canada's 1·8 per cent. GDP is the fairest measure of our ability to bear any particular expenditure. Indeed, it is the very measure which the party in Government has used to support massive cuts in public expenditure, so it is hypocritical now to deny that GDP is not such a fair measure.
Mr. Wilkinson: Does not the hon. Gentleman agree that it is extremely significant that of all the European members of NATO we are the only country that does not have National Service or some form of conscripted military service? Is it not therefore entirely appropriate that we should pay a little more for the privilege of not being compelled to bear arms in defence of our country?
Mr. John: The lesson of National Service is that the defence value that we get out of National Service men is not worth the immense training effort we have to put in to get them to a state of readiness. Hon. Gentlemen may shake their heads. I did National Service, so I know at least as much about it as some of those who are shaking their heads.
Mrs. Elaine Kellett-Bowman: Will the hon. Gentleman give way?
Mr. John: No. I have no doubt that the hon. Lady will not be able to contain herself for long; perhaps I will give way later.
It is not a fair comparison to say that the Allies have National Service, and we are paying extra because we have a professional service. We have a professional service because we believe that the skill and value of our professional forces is so much better, that that is the best way to defend ourselves. I do not dissent from that. I have the greatest admiration for our professional Armed Forces and I believe that they should be kept professional. That does not explain the disparity between our 5·2 per cent of GDP and the 3·3 per cent. of GDP of West Germany.
Mrs. Kellett-Bowman rose——
Mr. John: My hon. Friends will deal in more detail with industrial matters, but my fear is that with the present rate of decline the primary manufacturing capacity of the country will be destroyed by the Government and all that we shall be capable of is the occasional sub-contracting work. That may be why Tory Members are so effusive in their welcome of whatever the United States is ready to offer us in that line.
My fear is also whether there has been the control over the defence budget that we were led to expect. In the past year we have already had a supplementary budget for £200 million; then we had an overspend of £260 million. Now the Armed Forces pay award has exceeded the cash limit and the money will have to be found from elsewhere in the defence budget. Finally, and most puzzlingly, what are we to make of the episode of the three SSN boats, which came to light not in the defence Estimates but in a Ferranti advertisement? That had not been announced, and the initial Ministry of Defence reaction seemed to be totally at sea—if I may put it that way without offence to the hon. Member for Ashford. That experience does not give me the impression of the rigid control of the budget and the value for money of which the Secretary of State boasted and which we were led to expect.
July will signal the end of that. Whatever the screams of pain, the Secretary of State will have just one attempt to rationalise defence expenditure. He must, therefore, ignore the complaints of his Back Benchers in this debate and the inevitable attempts by each Service to preserve itself intact in carrying out this defence exercise.
I shall not embarrass the Secretary of State by promising our support for him in that exercise. He could probably do without that as he could do without a hole in the head. I promise that we shall judge him fairly by two criteria. First, will the cut be a realistic cut which will achieve our acceptance in the Alliance of a fair burden? I hope that the current newspaper fuss will be neither a deterrent to him nor an indication of that oldest of dodges, certainly by the Conservative Government, in which the worst scenario is first trailed so that there are gasps of admiration when something less is done later.
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The second criterion by which we shall judge the Secretary of State is whether the exercise provides within the expenditure available to us for defence the best possible system of defence. It will be condemned if it nibbles at equipment, or if it achieves an equality of misery in the sense of keeping the Services happy by making each equally miserable.
The right hon. Gentleman on this occasion must look at the roles which we fulfil, both as to their number and their scope. Not all the roles we attempt are equally valid if expenditure is to be restricted. To stretch smaller resources more thinly over uncut commitments will mean our doing nothing well. If this role reduction is achieved, the Secretary of State can feel that he has done his task well and he can regard the loss of the Under-Secretary of State for the Royal Navy as a little local difficulty. He may complain about newspapers broadcasting the expectation of large cuts in the defence budget, but if he does not fulfil them, the conclusion will be drawn that he has lost the battle within the Cabinet and within his Ministry. Unless he comes up to scratch his position will be gravely weakened, and he will be held to be a lame duck Secretary of State.
I revert to the question of the opportunity that the House will have to consider these cuts.
Mr. Patrick Cormack: Is the hon. Gentleman's definition of a successful Secretary of State for Defence one who cuts defence massively?
Mrs. Kellett-Bowman rose——
Mr. John: If the hon. Lady would like to intervene now, it would save time.
Mrs. Kellett-Bowman: Yes, I would. Before the hon. Gentleman concludes his speech, will he give the figure per head of population which France, Germany, Italy and the United States spend on defence? In most cases the amount is considerably larger than the amount spent by the United Kingdom. What is important is not just the percentage but the amount that is spent.
Mr. John: The amounts that are spent by countries and the calculation of how much is spent per person vary according to the criteria. I was saying that with our present enfeebled economy the most valid way of making the calculation was as a percentage of GDP. I stand by that. It is certainly defensible, even against the hon. Lady's hectoring.
The hon. Member for Staffordshire, South-West (Mr. Cormack) asked whether my view of the Secretary of State was that he was a passive cutter. But no one who heard the right hon. Gentleman this afternoon would accuse him of passivity. He believed in what he said. He believed it was time, in his words, to cut through the single Service rivalries and bring about an all-round improvement in the country's defence capability at less cost. The only conclusion that can be drawn from his failure to achieve that is that he has lost the battle in Cabinet, that he has been passive with his colleagues when he has not been passive in his Ministry. [Interruption.] The state of understanding of the hon. Member for Preston, North (Mr. Atkins) is not my business. It is that of his electorate, and his puzzlement will receive its just reward in due course.
I come back to the question of the consideration which the House will be able to give to these proposals. The Secretary of State stated with a bold declaration that these

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matters would be fully debated by the House in July. At the end of his speech he said that they would be fully debated upon a statement. If I may call upon you in aid, Mr. Speaker, a statement does not enable everyone who wants to make a point to be called. It is a wholly inadequate way of discussing the matter. We do not expect in the last days of July a Government statement and half an hour of questions, followed by three months of recess in which irreversible decisions can be taken.
We demand, on behalf of the whole House, not merely on behalf of the Opposition, that these matters should be the subject of a full-scale debate and that they should be discussed fully and properly. We would consider providing a Supply day but it is the responsibility of the Leader of the House, as the custodian of the rights of the House, to force his colleagues, however unwillingly, to give the time that is proper to a subject. No one can say that this is a frivolous subject. No one can say that it does not deserve the consideration of the House. We are considering a proper allocation of the money likely to be available to us.
This leads immediately and directly to the Trident project, with which the Secretary of State has dealt and with which I shall deal, even at the risk of rehearsing our exchanges of last March. The Secretary of State, according to reports of his discussiona on the defence review he is undertaking, has talked simultaneously in terms of no sacred cows while steadfastly maintaining that there is one sacred cow—the Trident project. In our debate in March, I accepted the Secretary of State's valuation of the project cost although I expressed scepticism of it. My scepticism of the cost of the project has, I believe, been justified.
Whatever the Secretary of State may say now, newspaper reports of a unanimity that is beyond mere speculation place the cost already at £6,000 million. Even though the right hon. Gentleman relates that money to future defence equipment expenditure, it is a substantial part of the new expenditure budget that is likely to be available to the Ministry of Defence. We warned that such an escalation of costs was dangerous to the whole of the defence budget—and it has not yet finished. I understand that no final decision has yet been taken about whether the Trident missile will be the C4 or the D5. The choice will make a tremendous difference. I understand that the British choice at the moment is the C4 missile. A choice has not yet been made by the United States. If the bigger D5 version of the Trident is chosen, we shall either have to pay a further £750 million or lose the commonality of equipment with the United States which is advanced as one of the great merits of the project.
The Secretary of State was uncharacteristically petulant at the last defence Question Time when pressed about costs. Despite his behaviour, or perhaps because it was so out of character, I believe that the £5,000 million estimate that he has given of the cost of the Trident project will prove a gross underestimate when viewed historically. We have talked at the moment only about the financial cost of Trident. The Government have been extremely coy, both in the Chamber and before the Defence Select Committee, which has been examining these matters, about the opportunity costs that will arise—the other projects that will be squeezed out, deferred or cancelled to keep the Trident project in being.
I dealt with this matter in our last debate. I shall restrict myself this time to reminding the Secretary of State that
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not only The Daily Telegraph, but every newspaper has as its common theme the fact that the post-July Navy was likely to be heavily geared around the hunter-killer submarine. What the newspapers have not realised is that the Trident programme is likely substantially to interfere with this approach. In an answer given by the then Under-Secretary of State for Defence for the Royal Navy on 11 May, it was stated that there was no intention presently to open the Cammell Laird shipyard to accommodate the building of nuclear submarines. That is the only other yard in the United Kingdom capable of taking upon itself such work. All work, I understand, is to be carried out at the Vickers yard at Barrow. This was confirmed by the right hon. Gentleman today.
However, the right hon. Gentleman has failed to tell the House that every Trident submarine built at the Barrow yard displaces the hunter-killer submarine building programme on a one-for-one basis. The right hon. Gentleman is delaying a vital and essential part of his new Navy for many years through the building of the Trident submarines. I wonder how this policy accords with the Secretary of State's cogitation. Despite his remarks today, all these measures are being taken to achieve a marginal addition to the Alliance's nuclear capability. It is a national capability, in the right hon. Gentleman's view. However, no one in his right senses would contemplate its being used independently of the United States deterrent.
For that reason, the whole of the rest of our effort towards the Alliance in military terms will be severely distorted. We have only just begun to see the opportunity cost—or, rather, the opportunity detriment—of the existence and continuance of the Trident programme.
I say sincerely to the Secretary of State that not since the disastrous days of the Sandys White Paper in 1957 will we have had so many defence eggs in one basket. The right hon. Gentleman must seriously consider, and reconsider, even at this stage, the Trident programme to see whether a more balanced defence programme is not a better contribution to our allies.
Mr. Michael Mates: The hon. Gentleman argues at length against the Government's decision to go ahead with Trident. The Opposition's position is made clear in the official amendment. The hon. Gentleman has, however, failed to inform the House of the position of the official Opposition on the strategic nuclear deterrent. If he argues against the pursuance of the Trident programme, he owes it to the House to say whether the Opposition propose an alternative, what it would cost and whether it would be as effective or whether, as some of us are beginning to suspect, they want us to remain in that business at all. It is time that the Opposition officially came clean.
Mr. John: The hon. Gentleman has not read the debate of 28 March. The burden of my remarks at that time was that we should remain part of the Alliance but that we could no longer afford, due to the displacement of other defence tasks, the national nuclear deterrent. We voted against it as an Opposition last March. I hope that the position is now clear to the hon. Gentleman.
I was discussing the distortion of the other defence programmes which has not yet been appreciated by our allies, especially the new United States Defence Secretary. What the new United States Defence Secretary believes, based upon an exchange of letters that took place, is that the so-called savings on the Trident project would

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automatically be used to increase spending on force improvements. When he realises, as the Opposition now do, that the Trident project will displace other projects and other capabilities, his disillusion will be as great as that of Tory Back Benchers now and in the next five to 10 years.
There are other ways in which expenditure can be avoided. This explains why I did not initially give way to the hon. Member for Lancaster (Mrs. Kellett-Bowman), although I later did so. I wanted to return to what I regard as the lunatic flirting with a form of military national service for the unemployed. Apart from the other manifest weaknesses and objectionable features of the system, the Secretary of State will know—his chiefs of staff will tell him if he does not know—that it makes no military sense in the modern world for Britain to have National Service as a defence contribution. It is far too costly for the military improvement that it gives. I hope that we hear no more of it and that it drifts off into the amended quasi-voluntary service idea of the right hon. Member for Stafford and Stone (Sir H. Fraser).
Nor does the ill-fated rapid deployment force for Britain make any sense. The very mention of it drew horror from the proposed beneficiaries of the force and it was clear that it could not be used except with their consent, as the right hon. Gentleman acknowledged. We are in the highest degree unlikely to get that consent in the very area in which we want to use it.
Time after time in defence debates we stray almost into the realm of foreign affairs. That is because we try to forecast not only the military but the political environment in the next 10 to 15 years. Before dealing with that and before leaving defence proper, I shall say a few words about the military balance between East and West. We have set out in the tables in the Estimates the military balance between NATO and the Warsaw Pact. These are helpful in providing a general indication and I welcome them. However, the Secretary of State must recognise that the tables merely present quantitative figures.
These figures suffer from the weakness that they can be used to prove any argument that one wants to advance. They can be used to prove the argument of those who call for greater defence expenditure. They are often used as a weapon of propaganda rather than to present a realistic balance. They suggest that there is a growing and inexorable imbalance. The Secretary of State, both today and in the Estimates, at paragraphs 300 to 303, has sought to portray an imbalance that is being increased each year.
Ideally we want a balance that is neither complacent nor alarmist. To talk of numbers without attempting to make a qualitative assessment is misleading. I shall give a few examples. On page 17 we are given the balance of soldiers between NATO and the Warsaw Pact. We are told that it is 1:1·2. That ignores the poorer quality and motivation of Warsaw Pact troops. Unwilling conscripts who serve longish engagements do not compare with the professional dedicated Service men that exist in our forces. We rightly admire the members of our forces and they can be regarded as achieving more than a 1:1 ratio with their opposition in the Warsaw Pact.
If the recent "World in Action" programme is correct, there are severe problems in the Russian army with racial hostility and drug-taking. That does not take into account the restlessness of the allies within the Warsaw Pact. That must be weighed—the Secretary of State was most remiss
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in not doing so—in the military balance. If he thinks that the Polish army, the Czechoslovakian army and the Romanian army are as monolithic and allied to the Soviet Union as they were 10 years ago, he is misreading the entire situation.
Secondly, we must bear in mind equipment and roles when we seek to make a qualitative comparison. The right hon. Gentleman talked about submarine warfare. We are sometimes prone to ignore the fact that there are geographical limitations on the basing of Russian submarines, and especially on their points of entry and departure. In addition, we are much in advance of the Warsaw Pact in anti-submarine warfare, as the right hon. Gentleman acknowledged. That is put in some circles as a seven-to-10-year advantage, but in an article in the February edition of Scientific American it is said that it is unlikely to be matched in the foreseeable future. That, too, must give us an advantage that must be weighed in the balance.
It is not much good having a crude balance of equipment that ignores how much is operational and ready for service. For example, the air force balance in favour of the Warsaw Pact is at least partially offset by much better NATO serviceability rates. I refer again to the same article in Scientific American, which states that, on any normal day, only 11 per cent. of the Russian submarine ballistic missile force would be in operation, compared with 60 per cent. of the American counterpart, which makes good the disparity.
Finally, let me end by saying—[HON. MEMBERS: "Hear, hear."] Conservative Members are curious people. They profess to be interested in defence and want always to indulge in a great debate. However, when they have the opportunity for such a debate they profess universal boredom. They make the cheap, easy and simplistic points that they used to make in Opposition. They are incapable of leaving them even when they are in Government.
Mr. Dennis Skinner: This has been a very bad day all round for Conservative Members. Does my hon. Friend appreciate that there has already been one sacking—the dismissal of the hon. Member for Ashford (Mr. Speed)? However, the Prime Minister talked today about working as a team. We have had the resignation of the hon. Member for Bromsgrove and Redditch (Mr. Miller). We have recently been informed by the tape of another resignation. It appears that the hon. Member for Mid-Sussex (Mr. Renton) has packed his bags and gone. No wonder Conservative Members look downcast.
Mr. John: That is why, when it was said of the hon. Member for Preston, North that he had never been a Minister, I said that he should not despair because at the rate that the Government are using up Conservative Members as Ministers he might have an opportunity.
The central feature of the amendment is the search for peace. Although there is an imbalance in conventional terms in favour of the Warsaw Pact, it is not so wide as to disqualify us from undertaking serious and detailed discussions with the Warsaw Pact about disarmament. NATO is concerned not only with a deterrent force but with detente. We believe that we were entitled to look for far more support than the Government have given Chancellor Schmidt in his attempts to persuade the United States to negotiate seriously with the Russians. This

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morning's edition of The Times describes the plea that the German Chancellor has made to President Reagan to hold talks with the Russians seriously and urgently.
Mr. Churchill rose——
Mr. John: No, I shall not give way. I am conscious of the groans from Conservative Members. Those groans have been reinforced by some of their interjections.
Our anxiety about the sincerity of this operation has been added to by what Mr. Weinberger said on "Panorama" last night. He seemed to assume that the talks would not be serious or were bound to fail and that SALT II was dead. That latter opinion may be right, to the great regret of the United States. However, efforts to limit strategic arms must continue and so must negotiations on cruise and SS20 missiles. To suggest otherwise is to cast doubt on the sincerity of public pledges to that effect. NATO countries other than the United Kingdom will be giving close attention to current and future statements. In bringing greater pressure to bear to fulfil the accord, Chancellor Schmidt seems to have received little or no public support from the British Government. They do not appear as eager to do so as the German Chancellor.
There is anxiety in Britain about nuclear weapons. That is not confined, as the Secretary of State said, to the victims of a Soviet plot. Nor is it motivated, as Mr. Weinberger says, by a willingness to subjugate ourselves to the Soviet Union. On the contrary, we are deeply committed to liberty and freedom throughout the world but not necessarily to the sterile anti-Communism upon which Mr. Weinberger seems intent.
We believe that the world is at risk unless the nuclear arsenal is diminished, and the risk is growing year by year. We cannot ignore conventional arms. The bellicose statements of this Administration and of some foreign Administrations seem to play little or no constructive role. The contrast is stark between Government stridency on the dangers of war and their laryngitis on the possibility of negotiating peace.
The Government do not put nearly enough emphasis upon the effort to negotiate disarmament. We are all well aware of the difficulties involved, but that does not absolve the Government from trying. In neglecting that, they are neglecting—in the widest sense—the defence of this country. Even a catalogue of domestic disasters such as that of the present Government, may, in historical terms, pale into insignificance beside the charge that, despite the difficulties, they failed to be urgent enough in the search for peace and disarmament. In their timidity in that area and in their other shortcomings, they have failed to secure the defence of this country. For that we condemn the Government.
5.11 pm
Mr. Keith Speed: The hon. Member for Pontypridd (Mr. John) will not expect me to follow him down the paths along which he led the House. I disagree with much of what he said, but I thank him for his personal reference to me.
I expected to make a speech today in slightly different circumstances. However, I start by paying a sincere and genuine tribute to the men and women of the Royal Navy, the Royal Marines, the Women's Royal Naval Service, Queen Alexandra's Royal Naval Nursing Service and all their civilian support, who have given me so much
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support, friendship and kindness for the past two years. This country is well served by those people. As the outgoing Minister responsible for the Royal Navy I a m deeply grateful to them.
Last week, in Tenterden in my constituency, I made a speech which I regarded, and continue to regard, as representing the policy of my Government, of which I was proud to be a member, and the policy of my party, of which I am proud to be a member. I argued that the dangers that would ensue if there were a downgrading of the Royal Navy were such as to imperil our national security. Some have argued that if I felt that way, I should not say so in a speech but should approach the Lobby or other people behind the scenes. I believe that that is the negation of leadership. I was the Minister responsible for the Service. One should not act in a hole and corner manner if one feels that one is expressing views which I hope all my right hon. and hon. Friends will hold when looking at the world as it is today.
I accept what my right hon. Friend the Secretary of State has said, that no decisions have been taken on the difficult task on which he, my colleagues and I have been engaged during the past few weeks and months. The mixed fleet of the Royal Navy has a role in peace and in war which is fundamental to the security of this island, which depends so much for its existence on seaborne trade—in fact, to the tune of about 96 per cent. of its imports and exports.
In my speech last week I was not arguing for an uncontrolled increase either of defence expenditure or of expenditure on the Royal Navy. I was not arguing that defence expenditure should operate in a sort of economic vacuum. That makes no sense at all. However, I was not elected by my constituents, nor was I appointed by my right hon. Friend the Prime Minister, to preside over any major cutback in the surface fleet of the Royal Navy. There have been arguments in the press over recent months that that was one of the major options that would be available to my right hon. Friend in the difficult studies that he was undertaking. I reject that option now and will fight it through to the bitter end.
Commentators have remarked on Trident, which has also been mentioned by my right hon. Friend and by the hon. Member for Pontypridd. I was very much concerned with Trident on a day-to-day basis, because my right hon. Friend asked me to do that. I believe that Trident is essential for the strategic and national defence of this country. I do not resile from that for one minute. My right hon. Friend was correct in everything that he said this afternoon. However, Trident is a national, strategic: defence system and therefore should be funded in the same way as Polaris, which is national, and not at the expense of any single Service.
In sharp contrast to 25 years ago, the Soviet Union now has a huge and growing blue water fleet operating above and below the seas in all the oceans of the world. As I remarked in my speech—it is fitting to remind the country of this—the Soviet Union has two aircraft carrier in commission— and we believe that it is building more—two helicopter carriers, a new nuclear battle cruiser— with more to come—probably the most powerful surface ship the world has ever seen, with the exception of the American nuclear carriers, 380 submarines, 38 cruisers, 87 destroyers, 185 frigates, more than 370

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minesweepers, hundreds of other vessels and a massive building programme that is churning out submarines and surface ships, as my right hon. Friend said.
If one looks at Russian history and its geography, one realises that by no stretch of the imagination can that fleet be needed purely for defensive purposes. It is not. Admiral Gorshkov was appointed chief of naval staff of the Soviet Union 27 years ago. I have a personal admiration for him, because he has achieved much for the Soviet Union. He wrote:
"The Soviet Fleet is a powerful factor in creating favourable conditions for the building of Socialism and Communism".
He is practising what he preaches. He went on to say:
"In many cases a show of naval strength without taking armed action may achieve political ends merely by exerting pressures through its latent power or by threatening to take military action."
I quoted those remarks in my speech last Friday evening. On Saturday morning the Soviet fleet appeared off Lebanon, doing just what Gorshkov told us it would do. That has happened over the months and years. We have done the same ourselves to a lesser extent from time to time.
I could not tell the House on how many occasions, even since I have been the Minister responsible for the Navy, we have sent ships to different parts of the world to help our friends or to help against the natural disasters in various islands in the West Indies, and so on. That is the great advantage of maritime power. On one day one can have a high profile and the Fleet can be there on the horizon. On the next day there can be a low profile and the Fleet can draw away below the horizon, or it can move in to render first-aid or emergency services. With the greatest respect to my colleagues, that is something which, by definition, standing armies and air forces cannot do.
Much has been said about standard nuclear submarines, which are not ballistic submarines. That is the best antisubmarine weapons system. Those submarines are expensive. Currently the price is about £160 million each. Including those in operation and under construction, we have a total of only 15. Because, inevitably, some are under refit—submarine refitting is important for safety and other reasons—only 10 or 11 are likely to be operational at any one time. Alas, it is two years since we ordered the last one. With the best will in the world, a nuclear submarine cannot be used in the role of a surface ship in the Gulf of Oman, in the Belize guardship in the West Indies, in Hong Kong and in all the other areas where surface ships are used. In addition, being nuclear powered, these submarines cannot sail through the Suez Canal. We must recognise that there are substantial limitations to their use.
Again as I said in my speech, we cannot continue to have frigates costing £130 million a time, excellent though they are. With my right hon. Friend, I repudiate press reports that our modern ships are poor weapons platforms and not properly armed. They are first-class ships, but, frankly, we cannot afford them in the numbers that we need. In the Navy debate last June I advanced the case for the type 23 frigate at half the cost, for the much cheaper minehunter and for seriously considering converting tankers to helicopter carriers for anti-submarine purposes, which is a sensible dual-purpose role for them. All that makes a great deal of sense. Inevitably, the resources that
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any Secretary of State has are limited. The best being the enemy of the good has all too often been the rack upon which Secretaries of State for Defence have been laid.
My hon. Friends the Members for Rochester and Chatham (Mrs. Fenner) and for Gillingham (Sir F. Burden) and other hon. Members representing dockyard constituencies are concerned about the rumours. For a number of weeks there have been grumblings and problems about the dockyards. I feel strongly about them. I led the study into their operations and activities. I confirm what my right hon. Friend said, that no decisions have yet been made. Reports that decisions have been made are entirely speculative. The rumours were around long before the imbroglio this weekend. There is a blight because of uncertainty—and we are talking about a considerable number of jobs. I hope that as soon as possible my right hon. Friend can remove the uncertainty.
Last August I made a commitment on the Fleet as it stood and as I would wish it to continue. There is a need for United Kingdom dockyards. I ask the House to consider the employment consequences, not only for the dockyards, but for British industry generally if the Royal Navy and the other Services are degraded and run down. It is all very well for Opposition Members to talk about public expenditure on defence, but they forget the hundreds of thousands of people involved in support for defence and the defence industry—shipyards and radar and armaments factories and the spin-off to commercial firms. Hon. Members from both sides of the House have written to me to complain about lack of orders. It is proper for them to do so on behalf of their constituents. We should bear the whole defence industry in mind when we consider the economic progress that we all wish to make.
I wish to put one point to my right hon. Friend about which I feel deeply. At the very first Admiralty Board meeting that I chaired when I became Under-Secretary of State we took a decision, which was subsequently made public, to put into the reserve fleet prematurely five frigates and a cruiser. Back in June 1979 there had been such a run-out of skilled Service personnel, particularly on the electrical and engineering side—chief petty officers, petty officers and junior to middle-rank officers—that we did not have enough personnel to keep the ships at sea. The run-out was largely due to pay and other factors. I shall not make political points, but Opposition Members know that to be true. Had we not won the election, my predecessor would have taken the same decision.
I cannot speak with authority about the other Services, but if a man wishes to leave the Royal Navy he has only to give 18 months' notice. The people about whom we are talking are skilled. Even in the recession they can get a job with GEC, Marconi, Westinghouse and so on. Industry will snap up highly trained and technical people who are well disciplined and capable of high responsibility. At present they are serving the country well and are well paid, but if they feel that they may have no future because the Service is being run down, we could have an uncontrolled run-out that would make my first Admiralty Board meeting seem like a tea party. The maintenance of morale is vital. We can always acquire more ships, aeroplanes or tanks, but skilled men and women cannot be picked up or trained at the drop of a hat.
The tradition, morale, expertise and capability of the Royal Navy have been built up not overnight, but over many generations. We are an island nation. We have a specific and unique NATO contribution, which, because

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of our geography, is largely maritime. It has been said that the Royal Navy provides 70 per cent. of the NATO force in the Eastern Atlantic and Channel. My future is unimportant against that background.
I am profoundly uneasy that decisions could be taken—although they have not yet been taken—that would have a damaging and lasting effect on the surface fleet and its support. In this general debate on the Services, with the spotlight partly on the Royal Navy and the need for our maritime power and presence, at the end of the day the argument must convince the Cabinet that to degrade our maritime effort would not make sense in peace because of our geography, and in war because of our NATO commitments.
The other night when I made the speech that has aroused so much comment I concluded with the words of another famous Russian, Solzhenitsyn:
"The threat lies not so much in the capabilities of its enemies as in the indifference of the West."
Let us make sure that we do not allow that to happen here.
5.27 pm
Mr. Stanley Newens: The confirmation by the hon. Member for Ashford (Mr. Speed) and the Secretary of State that the Government, after all their boasts about increasing defence expenditure, are looking for economies comes as no surprise to those of us who have consistently argued that their proposed defence expenditure would be a crippling economic burden that we could not sustain. The right hon. Gentleman has denied that Trident, costing £5,000 million over 15 years, was more than we could afford without grave damage to our economy, but the defence statement declares:
"We must re-establish in the long-term programme the right balance between the inevitable resource constraints and our necessary defence requirements."
That is a clear admission that they are out of balance, although a vociferous band of the right hon. Gentlemen's hon. Friends does not agree. To continue to increase defence expenditure in real terms, as the Government did last year at a time when the gross domestic product is falling is a recipe for accelerating the alarming rate of economic decline and reductions in spending on education, health and welfare.
The case for much deeper cuts in defence expenditure than the present Government are ever likely to contemplate is therefore stronger than ever, particularly as, in my opinion, such cuts could undoubtedly be achieved without diminishing but rather enhancing the security interests of the British people. Therefore, on both economic and security grounds, I believe that Britain should cease to be a nuclear power in military terms.
The case for cancelling the Trident decision is not merely that it would save £5,000 million, or whatever that figure may rise to over 15 years. The possession of Trident would make Britain not less likely but more likely to be the target for a nuclear attack. As long as Britain retains nuclear weapons on her soil or they are carried by ships or aircraft operating from bases in this country, by the very logic of deterrence to which the White Paper refers nuclear weapons will be targeted against us.
The need is therefore not only to cancel Trident but to dispense with Polaris and the older systems of delivering nuclear weapons and to refuse utterly and completely to accept cruise missiles on British territory. Whatever is said in the House today, more and more people in this country
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are coming round to that point of view. The danger of a crisis escalating into a nuclear conflict is very great, even if it is not intended to exceed conventional limits. I quote from page 23 of the defence statement:
"Selective air attack with nuclear weapons against specific targets might be necessary to demonstrate political will and to induce an opponent to stop aggression."
In other words, Britain contemplates using nuclear weapons first in a case of what it regards as aggression. On the logic of deterrence, what possible reason is there to believe that the other side would not plan to retaliate with nuclear weapons in those circumstances? A chain reaction would then be likely to follow.
I accept that Britain would still be very vulnerable to the effects of nuclear weapons even if they were not directed at these islands in the case of dispensing completely with nuclear weapons but the dangers would inevitably be far less. Operation Square Leg last year envisaged a 200-megaton nuclear attack on Britain. That is the equivalent of 16,000 Hiroshimas, where a 12,500 ton TNT-equivalent bomb was dropped. Without a shadow of doubt, such an attack would be the end of Britain as we know it.
No defence system which has as a consequence of its use the destruction of the population that it is supposed to protect can possibly be regarded as effective. It is the equivalent of mining one's home to protect it against burglary. If it goes up with the occupants inside there is no defence whatever. I therefore believe, on grounds of safety as well as of cost, that Britain should now renounce nuclear weapons utterly and completely. This is not merely an attempt to opt out. Britain should use its renunciation as part of a plan designed to achieve a nuclear free Europe and nuclear free zones in other parts of the world, leading, one hopes, in the last analysis to a world in which all powers will agree to renounce nuclear weapons. Knowledge of how to manufacture nuclear weapons is likely to remain as long as the human race survives. Nevertheless, there could be agreement riot to manufacture and target such weapons. That must be our aim.
World expenditure on all arms, nuclear and conventional, was expected to rise in 1980 to 500,000 million dollars—6 per cent. of total world output. In prewar years, only half that percentage—3 per cent. of world output—was spent on arms. The increase is continuing. It is being justified in many countries by arguments similar to those which are advanced in the defence statement and which are advanced in this country repeatedly particularly by Conservative Members.
The Brandt report and many other studies underline the folly of this escalation which devotes scarce resources to the production of means of mass destruction in ever-increasing quantities. I have no brief whatever for actions which boost the arms race, wherever they may occur—in the West, in the Soviet Union, in the Third world or anywhere else. Nevertheless, I believe that the misdirection of production to the rearmament programme is one of the greatest threats not only to Britain and the British people but to humanity as a whole. Ultimately, as human beings, we are all poorer and less secure if it continues.
I do not suggest that Britain should embark forthwith on a pacifist policy of complete disarmament, or that the Soviet Union and her allies are justified in many of the things that they do. But we in Britain must face the fact

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that we cannot possibly afford nuclear retalitatory capability and at the same time make a major contribution to NATO's naval strength, commit ground troops to the Continent of Europe and maintain, as the right hon. Gentleman said today, residual world-wide aspirations. I believe that we must cut back.
This could be part of a plan to stem the arms race throughout the world. One way in which we could embark on such a course would be to renounce nuclear weapons and to become a non-nuclear power. In the long run, humanity will look back on this generation as having lived through perhaps the most dangerous period that the world has ever experienced, because more destructive power exists in the world in which we live today than at any previous time in its history.
In those circumstances, to sit here and accept glib arguments which entail a continued escalation in the growth of destructive capacity throughout the world would be a complete condemnation of us. I therefore make no apology for raising my voice today in this way as I have raised it in the past. I believe that the road ahead for this country lies in cutting back massively on our military expenditure. The same is true for mankind as a whole. The road forward for humanity certainly does not lie with the hawks, whether they speak from this House, the Soviet Union, the United States of America or anywhere else.
For that reason, although it has not been called, I entirely support the amendment in the name of my hon. Friend the Member for Vauxhall (Mr. Holland), which opposes any defence policy based on the use or threatened use of nuclear weapons.
5.39 pm
Mr. Cranley Onslow: I begin by saying how grateful I am to you, Mr. Speaker, for allowing me to catch your eye at this early stage in the debate, principally because it enables me to commend the second report of the Select Committee on Defence, dealing with these Defence Estimates, which I hope will prove helpful to the House in the Debate. I place on record the thanks that the Committee owes to its staff in drawing up the report and making it available so speedily. If I bear some responsibility for the wording of it, I do not wish to comment on that in any way. It is a report to the House, and I hope that the House will make good use of it.
I commend my hon. Friend the Member for Ashford (Mr. Speed), on behalf of the Back Benches, for a courageous speech and no doubt also for a courageous act. I know that he has fought hard for the Navy. I am sure that he will continue to fight hard for the Navy. He may find it easier to do so from the Back Benches, although I was much encouraged to hear what he said about the understanding of the position, and of the importance of the Navy as an element in our overall national defences, shown by my right hon. Friend the Secretary of State for Defence. I hope that I can add that the whole House should derive encouragement from my right hon. Friend's excellent speech today. He has helped us to see the whole question in its right perspective.
These long-term costing exercises come round with some frequency. It may be that this one is a little more fundamental than some that have gone before it. But one familiar feature is that they are accompanied by the sound of grinding axes up and down Whitehall. There has been
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in recent years a tendency for the noise to grow louder and sometimes to approach a crescendo. I am a little surprised that it has not impinged upon my right hon. Friend's normally sensitive hearing. But, if I may leave the axe grinding for a minute, I should like to quote to the House from an article written in the RUSI journal nearly two and a half years ago by a distinguished naval officer, who was then a vice-admiral and Chief of Fleet Support, and who is now Sir James Eberle, the Commander-in-Chief, Fleet.
In the article Sir James starts by saying:
"Although the proportion of the British Defence budget devoted to equipment has risen during recent years, the effect of this in increasing the size and capability of UK forces has been largely offset by a continuing rise in the procurement costs of new weapons. Indeed, over the last two decades, the steep rise in the cost of the new generation of weapon equipments has been the dominant factor affecting the size and shape of UK forces, and particularly the Royal Navy. Allowing for inflation, the cost per ton of warships has risen during this period by a factor of from 10 to 15. In the early 1960s; a Leander class frigate cost some £4 million. Her replacement today may well cost some £50 million."
There is Adam Smith brought up to date, if I may put it to my right hon. Friend. As we heard earlier, a replacement might now cost over £120 million.
Sir James goes on to say:
"This increase is not merely the result of inflation, but is also effectively a measure both of improved performance and of the increasing complexity of the operational environment in which we must operate at sea, factors which are together often described under the term `quality'. Quality in this sense is being bought at a very high price".
Sir John defines that price as follows:
"In war little can be gained if nothing can be risked. If a single unit is so large and valuable that its loss would, of itself, be a major defeat then it is clearly unsound to place it at risk … As the number of our ships reduces, we face the danger of our ships becoming too complex, too large and too valuable to be put at risk."
Part of Sir John's answer to that problem is given in the last part of the article, where he says:
"We need to harness technology, not to improve weapon performance in the traditional means of speed, range and capacity, but to retain present capabilities whilst making the systems smaller, simpler, more reliable and less costly. How successful we shall be in this depends as much upon the wisdom and perception of those officers who produce the operational requirements as upon the skill of the scientists and engineers who translate those requirements into hardware. This is a challenge that we, the military, must meet."
And, if I may so, not only the military, for ultimately the answer has to come from my right hon. Friend. But that is a clear and concise definition of the problem confronting the Navy in the 1980s.
Earlier in the same article, Sir James says something which carries me straight to my next point:
"Deterrence at the highest level rests on the twin pillars of capability and credibility. Credibility is essentially a matter of political will and is not part of our quantity/quality equation. But capability is a function of both quality and quantity. The quality in this sense is a measure of the enemy's perception of the probability, when the order to fire is given, that the warheads will get through to their target. For effective deterrence it is essential that this perception should be of a very high order. Quality therefore is paramount."
It is the quality argument that seems to me unanswerably to carry the day in favour of the Trident decision that the Government have already made. It may not carry the day with the hon. Member for Harlow (Mr. Newens), but for any who are prepared to advocate a nuclear alternative—some cruise missile system to replace Polaris—it has to be said that this is only wishful thinking. Whether it is Air Vice-Marshal Menaul, Mr. Russell

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Lewis, in today's Daily Mail, or my hon. Friend the Member for Aldershot (Mr. Critchley), I fear that their preference for a cruise missile replacement for Polaris is not one that can be home out by a serious analysis of the costs or the credibility of the deterrent that would result.
I hope that before long the House will have the advantage of seeing that argument set out at length in the report of the Select Committee on Defence on the nuclear replacement.
But meanwhile, for those of my colleagues who saw the programme last night in which Mr. Caspar Weinberger was interviewed on "Panorama," and held his own well against the usual incisive questioning of the BBC—if "incisive" is a word that the BBC would accept—it is right to remind the House that his comment on what would happen if the Opposition amendment were to become Government policy was that it would mean the beginning of the end of the Alliance. That is a diagnosis to which I subscribe and to which practically everyone in America to whom I was able to speak, when I was there six weeks ago, subscribed without reservation.
When hon. Members vote on the amendment tomorrow night they ought not to be under any illusion that they can in some magical way retain the credibility and coherence of NATO while cancelling Trident or while going further, as some Labour Members would like to do—or, indeed, as the Leader of the Opposition would like to do—by coming out of the deterrent business altogether. Many Labour Members below the Gangway are only too eager to get all the United States bases out of this country—not just the cruise missiles but all the other American nuclear bases and the American supply dumps as well.
The slippery path is there for all to see. The Opposition amendment is an open invitation to the Russians to sit back and do nothing, while the whole NATO system and the security of the Western world crumbles to their advantage. If hon. Members on the Opposition Benches do not see that, their search for popularity in the ranks of the CND is blinding them to the realities of international politics.
I should like to make one other point about Trident. The fact that the position is as I have described it seems to me to be greatly to our advantage, because the Americans are clearly very anxious that we should remain the linchpin in Europe of the Atlantic Alliance. Even though it proved impossible—for reasons that I shall not go into—to obtain offset orders for British industry as part of the Trident purchase agreement, it is open to us now to make it plain to the Americans that we have equipment that they should buy from us on its merits for their forces and that, if bought, would provide a great many jobs and so do much to strengthen the industrial base in this country. That would do much to help those whose livelihoods are bound up with the defence industry. Occasionally, Opposition Members are the subject of such pressure that they feel bound to speak up. The hon. Member for Glasgow, Garscadden (Mr. Dewar) said that he felt no shame about advancing the case for defence employment in his constituency. His voters are as intelligent as he is, and are as unlikely as anyone else to vote for a Government who will run down the entire defence complex and wreck NATO.
Viscount Cranborne: Would my hon. Friend care to consider the lack of commitment to the sale
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of Hawk trainers shown by the right hon. Member for Leeds, East (Mr. Healey) in last Thursday's foreign affairs debate?
Mr. Onslow: The lack of commitment of the right hon. Member for Leeds, East (Mr. Healey) to several things cannot escape our notice. The right hon. Gentleman's lack of commitment to this debate is fairly remarkable. Although his name appears second on the Opposition's amendment, I do not believe that he has been in the Chamber today—[Interruption.] If he was in the Chamber, he was unusually inconspicuous. However, I do not wish to dwell on the subject of the right hon. Member for Leeds, East, whose contribution to our political scene is interesting but not conclusive.
I turn to the industrial base of defence. We do not spend money on defence in order to provide jobs, but we should spend money on defence in a way that will provide the best opportunity for employment and for technological progress. We should seek to make our industry as competitive as we can. We should ensure that manufacturers are able to spread their overheads by selling their products to other nations that are willing to invest in their defences. That prompts me to remind the House that the value of our defence sales overseas in the past 12 months was over £1,000 million. When my right hon. Friend the Secretary of State selects a replacement for the distinguished industrialist who is retiring later this year from his position as head of defence sales, I hope that he will choose another distinguished industrialist and not a superannuated ambassador. I sincerely hope that no one will even suggest the latter course. One of the principal desires of civil servants in my right hon. Friend's Ministry is to keep disturbing papers from him. I am sure that there would be no disturbance if my right hon. Friend were to approve the name of a distinguished industrialist.
Mr. Anthony Nelson: Many of us were interested to see the point that his Committee's report made about subvention from the Department of Industry. We were interested in the Secretary of State's comments. The report does not state the Committee's precise view. There are obvious advantages, but there are clearly dangers as well. What was the Committee's view?
Mr. Onslow: I confess that the Committee was more anxious to get the report out than to work to decimal places. We said that we noted that the Secretary of State "would not rule out" the possibility. We might have put things more positively, but we were in a hurry to complete the report. Perhaps we did not dwell on that point, or on others, as much as we might have done. For example, we did not make as much as we might have done of the inadequacy of the present profit formula for defence contracts. That is beginning to cause serious difficulty to defence contracting firms. It should, and I hope will, receive urgent attention.
It seems to me that the way in which defence contracts are placed is designed more to defend civil servants against the inquisition of the Public Accounts Committee than to give the taxpayer the best value for the defence equipment that is bought.
Mr. Nott: I have listened to my hon. Friend's speech with great interest. He has touched on a crucial area. Since the Ferranti case, the Public Accounts Committee has helpfully—but in a difficult way—pushed our whole

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procurement process in a certain direction. I can think of nothing more helpful to the country than consideration of this issue by his Committee. Great changes are needed. I mention that, because my hon. Friend made some points in that direction. Ultimately, any change must come from the House and not from my Department. That is an important point.
Mr. Deputy Speaker (Mr. Ernest Armstrong): It would help if right hon. and hon. Members did not turn their backs to the Chair. I sometimes have difficulty in recognising the faces of Back Benchers; I certainly cannot recognise their backs.
Mr. Onslow: I am delighted to have drawn my right hon. Friend so far on that subject, though I have to be a bit cautious in my response. My colleagues will know that the Select Committee on Defence would be reluctant to pick a fight with the august and senior Public Accounts Committee. Nevertheless, we might well find some way of addressing ourselves to the problem, provided that we could do so without becoming bogged down, and provided that other Committees did not feel that we were trespassing dangerously on their territory.
Defence debates concern the availability of money to keep the peace. In this century, such debates inevitably concern the Alliance; those who belong to it and contribute to it and also those who do not belong to it or contribute to it. In a recent speech in the United States of America, Mr. Caspar Weinberger wondered how long the West could countenance a situation in which the proportion of gross national product that Japan devotes to defence remains at 0·75 per cent. Given the competition that we face from Japan's technological industries, some of us might say that it would even up the balance if the Japanese taxpayer were to pay rather more to defend himself—if the Japanese taxpayer, who depends on oil from the Gulf, were to take a larger share of the cost of ensuring that oil reaches him safely. I recognise that it is a difficult problem, but the first political question that I studied seriously was the rearmament of West Germany. Without giving anything away, I can say that that was 30 years ago.
I think that we have dodged the question of Japan's rearmament for long enough. We must now face the problem, however difficult it may be. I suggest that it is time for Japan to join other Western nations in defending, within a firm Alliance, the common interests and the peace that we will wish to maintain.
5.57 pm
Mr. Stuart Holland: The amendment that stands in my name and that of other right hon. and hon. Members has not been selected, but nevertheless my remarks will be related to it. Its substance reflects the main policy statements that were endorsed by the Labour Party at its conference last year.
Certainly, the following argument is not irrelevant to recent remarks made by Mr. Caspar Weinberger. It is only fitting that some of the central issues should be addressed by those of us who support the campaign for European nuclear disarmament and who oppose any defence policy that is based on the use, or threatened use of nuclear weapons, including Trident and cruise missiles.
One of the key factors in this debate is the alleged arms imbalance. It was a relief to find, when the Secretary of
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State introduced the debate, that he did not choose to repeat some of the arguments that he employed last year in his introduction to the statement on defence Estimates. For example, this year's statement does not contain the sort of figures on page 15 of last year's Estimates. That page contained information on longer-range land-based theatre nuclear forces to the end of 1979. It included a description of the Soviet SS20 and SS4/5 rockets, and gave the total as 530. Land-based missiles for NATO amounted to nil. That is an invalid and illegitimate comparison. The comparison is not, and should not be, between land-based missiles but between the SS20 in particular, and Poseidon or—in the context of this debate—Polaris. That is quite apart from carrier-based nuclear weapons.
This tendency to compare like with unlike, glibly spilling incomparable figures from Conservative Benches, leads to misleading conclusions.
For example, in relation to tank warfare, it was made quite plain by the Stockholm Peace Research Institute that the figures produced by the Institute of Strategic Studies were misleading because they included the reserve tanks of the Warsaw Pact. We do not have reserve tanks of the same date and vintage as the Warsaw Pact Powers. Such a comparison on a tank-for-tank basis also excludes the fact that the tactics of tank warfare employed by the two sides are essentially very different. We have a considerable number of tank recovery vehicles, with the tanks also being highly specialised. The Warsaw Pact countries have a policy of abandoning vehicles in the field if they are disabled or fall into disrepair. Therefore, a qualification should be made in the figures.
That is not the crucial argument. The argument that has been missed so far in the debate is that, against the Secretary of State's figure of 17,500 Warsaw Pact Power tanks, NATO has 200,000 anti-tank guided weapons, which is not an inconsiderable number especially if we take into account that the terms of reference in the debate about so-called conventional weapons, such as tanks, is no longer, or should no longer be, the terms of reference of the Second World War. Following the recent conflict of the Arab-Israeli war, it became clear that anti-tank weapons were, and can be, highly effective in stopping a tank onslaught or a major tank offensive. That war also made it plain that anti-aircraft guided missiles, now with highly mobile launch systems, can be extremely effective.
Those facts should be viewed in the context of our consideration of the role of Trident and other weapon systems. The background not yet stressed in the debate is that not only has the Soviet Union been building up its nuclear and non-nuclear forces—as is admitted on both sides of the House—but the United States is also building up its programmes in that area. There is not only the issue of new sea launch systems—to which the Trident, allegedly, will make a contribution—but the possibility of a new medium range bomber. There are the cruise missiles, the MX system—a massive defence expenditure programme in the United States on which, it has been alleged, more concrete is being allocated than to the whole road building programme of the federal authorities to concrete-line the missile tunnels for that weapon. Of direct relevance to the debate today is the neutron bomb and the possibility of its deployment not only by France but by the United States.
A key issue is the alleged Soviet threat. I am not a defender of the Soviet Union. It is not my aim to defend its political or social systems, which I regard as not only

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reactionary but, in many respects, repressive. But I want to introduce into the debate an analysis of the nature of the Soviet threat. We must question both whether the Soviet Union wants to go to war and under what conditions it would do so. Much of the argument that we hear, not only from the Conservative Front Bench but from the Back Benches——
Sir Frederick Burden: Does not the hon. Gentleman agree that, although the Soviet Union may not wish to go to war, it carries out annexation by military force, as in Afghanistan?
Mr. Holland: If the hon. Gentleman had waited, he would have found that I was coming to precisely that point.
It is a crucial assumption of much of the Government's defence strategy, and of defence strategy based on nuclear weapons, that there is an actual Soviet threat to Western Europe, including Britain. If we assume that, we must not do so simply by looking at the Western European frontier, or a war front between the Soviet Union and Britain alone. It has long been conventional military wisdom, part of which still remains valid, that if to fight a war on one front is difficult, to fight a war on two fronts is foolhardy. Yet envisage the number of fronts on which the Soviet Union would risk war, if it were to undertake an offensive in Western Europe. It first could be in Western Europe itself and against NATO forces; secondly, with China; thirdly, on its Islamic frontiers; fourthly, with a direct exchange between the United States and the USSR with intercontinental missiles either of current generation or MX; fifthly, with sea-launch weapons; and, sixthly, probably from now on, with a satellite weapon system—in addition to facing a possible rebellion or revolt in its Eastern European satellites.
That is a realistic scenario. It is a possibility confronting the Soviet political authorities and the Warsaw Pact Powers. If they undertook an offensive in Western Europe, it would be a matter of fighting not on one front, but on six or seven fronts.
That perspective is important in relation to the point raised by the hon. Member for Gillingham (Sir F. Burden) about Afghanistan. As the Select Committee judged, and gave as its view, the position in Afghanistan reflects not so much clear evidence of aggressive tendencies by the Soviet Union world-wide, but a failure of its diplomatic and political intervention in a country that has been recognised since the 1950s—when it rejected Western aid and support—to be essentially within the Soviet sphere of influence. I stress that I deplore the Soviet intervention in Afghanistan and what the Soviet Powers are doing there. But the possession of nuclear weapons itself, has not made it possible for the Western Powers, especially the United States, to respond to a specific act of aggression, invasion or occupation such as the Soviet Union has undertaken. America cannot easily intervene in Afghanistan, precisely because it is muscle-bound by nuclear power.
I turn to the Secretary of State's reference to the Campaign for Nuclear Disarmament, which I extend to the current Campaign for European Nuclear Disarmament. He said that the idea that any Western democratic nation would use these weapons was inconceivable. That remark has already been challenged in relation to Britain's defence policy. What has happened has been a qualitative change in the nature of nuclear weapons since the first generation
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of intercontinental ballistic missiles, which may have had, in a specific historical context, a relative deterrent capability.
The difference is that the first-generation intercontinental ballistic missiles were literally unusable unless both sides were to face mutual destruction. In the parlance of the military specialists, that is neatly described as MAD—mutually assured destruction. That is not so with the new generation of nuclear weapons, deployed in a theatre context and stressed to be tactical rather than strategic in the Government's presentation of the Defence Estimates.
The deployment of tactical nuclear weapons, especially the threatened deployment of neutron weapons, in a theatre context is a major qualitative change in nuclear warfare. Those specialists who are concerned to support the case for weapons such as the neutron bomb argue that those are limited-radius radiation bombs and not mass blast bombs. They affect an area of only a few kilometres rather than threaten the wholesale destruction of a nation. However, the United States' specialists are considering using neutron bombs not as deterrents in the old style of unusuable weapons but as weapons designed to be used. They are usuable and are designed to be used as anti-tank weapons. The argument has been made in France, where ex-President Giscard d'Estaing declared that France was considering deploying neutron bombs because they were a cheaper and more effective form of anti-tank warfare. However, if these tactical weapons are considered to be usable and, in some sense, safe, their advocates must assume that there will be no escalation in their use.
According to the United States authorities, up to 40 neutron bombs would be used per tank division of the Warsaw Pact Powers. If there is a Soviet threat in the manner assumed by the Conservative Party, the Soviet Union and the Warsaw Pact Powers would be out of their minds to invade Western Europe with one tank division. If they were serious they would use 10 tank divisions or more in the first wave.[Interruption.] I am glad to hear Conservative Members agreeing. If they were to do so and, in return, we deployed 40 neutron bombs per tank division, instead of one small, clean, limited radiation weapon, as the neutron bomb is conventionally described, more than 400 neutron bombs could and probably 'would be used across the centre of Europe in such an exchange.
That causes many Labour Members great concern. Speaking for myself, such facts on the emergence of a new generation of usable tactical weapons underlie my support for the campaign for a European nuclear-free zone.
It is in that context that former senior military officers and Lord Mountbatten in his last and, in a sense, most important speech—hardly reported in the British press or media—warned against the escalation from tactical to strategic nuclear weapons and described the escalation that I have related to the use of neutron bombs as virtually certain. Lord Zuckerman, a former chief scientific adviser to the Government, pointed out that there is an 85 per cent. probability that if tactical nuclear weapons are used there will be an escalation to an all-out nuclear holocaust in which we will all be losers.
The important element relevant to military thinking and reasoning is that in any frontier-type confrontation, the loser is always likely to escalate the scale of the engagement if he has effective weapons available. The fear that should be shared by hon. Members on both sides

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of the House is that a border incident involving tactical neutron bombs could escalate to the use of neutron and other nuclear weapons and an all-out holocaust.
Mr. Wellbeloved: Does my hon. Friend also recognise that Lord Mountbatten repeatedly made it clear that the destiny of the free world depends on Britain's remaining a member of the North Atlantic Alliance? As my hon. Friend is the distinguished theologian of the BenniteMarxist faction of the Labour Party, will he make it clear that if that faction is successful in the battle for the soul of the Labour Party his intention is to follow the diktat of Lord Mountbatten and for Britain to remain a member of NATO?
Mr. Holland: That intervention from what, by convention, I am obliged to call an hon. Friend hardly deserves a reply. It is official Labour Party policy that we shall remain a member of NATO. The Secretary of State for Defence said that NATO depends on Britain's presence and Britain's nuclear role. NATO depends on nothing of the sort. There are only two so-called independent nuclear Powers in NATO today. One is French and the other is British. Other countries in NATO do not deploy nuclear weapons.
Mr. Mates: We must have accuracy in our debates. France is not in NATO; the United States is. Where is the United States as a nuclear Power?
Mr. Holland: France is not part of the command structure of NATO. That point is well taken. The essence of the argument on deterrence that we have heard from both sides of the House was put by the Secretary of State for Defence earlier. It is claimed that deterrence works because we have had nuclear weapons. The Minister said again today that since Hiroshima and Nagasaki there had been no nuclear war. Whether the Secretary of State is familiar with the term I do not know, but he will be aware that that in itself is invalid reasoning. It is a case of post hoc ergo propter hoc, or the argument that because there has been no nuclear war in Europe, nuclear weapons deterred it.
It is arguable that deterrence may have played some role in post-war conditions. Clearly the deployment of nuclear weapons has a considerable influence on the overall environment. But the inference of a general claim from the existence of nuclear weapons is invalid, as it cannot be proved. Crucially, deterrence has been changed by the new nuclear weapons and their proliferation. In other words, tactical and usable weapons are different from the alleged mutual deterrents of MAD.
There is a further important factor in debate—the implication in deterrence theory of what one might call confrontation or the "chicken" theory. Bertrand Russell made the analogy with two vehicles or war machines that confronted and approached one another, but one swerved. Conservative Members, and perhaps some Labour Members, may have been unduly influenced by events 20 years ago and the deployment of Soviet missiles in Cuba, when Khrushchev and the Soviet authorities faced collision and swerved when the United States threatened to use nuclear force or further destabilise the situation if the missiles were not withdrawn.
But that analogy is not relevant to the deployment of tactical nuclear weapons today. The missiles in Cuba were
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strategic missiles, aimed at the heartland of a country, and not tactical field missiles of the type currently deployed. In addition, that view of the role of deterrence implies someone able to climb down, which, in turn, implies political control rather than a war machine locked into an exchange of weapons in such a way that a political climbdown is not possible.
One of the problems of the deployment of the new weapons at a local level and the feasibility of their being used in response to a conventional war is that we are proliferating a doomsday machine, not simply in the sense of a Strangelove fantasy but in the sense of an entirely new form of interlocking nuclear exchange systems, with implied escalation from tactical weapons to nuclear weapons.
I also submit that the deterrence argument favoured by the Secretary of State is wrong in the key analogy that he has chosen, namely, the use of nuclear weapons at Hiroshima and Nagasaki, and in his false analogy with Chamberlain and appeasement. A Member of another place asked whether the United States would have used the atomic bomb if the Japanese had had the weapon. That analogy is with the wrong weapon in the wrong war.
The weapons that threaten us are tactical and not strategic, in the sense of 1945 strategic weapons. They explicitly threaten the beginning of the third world war in Europe rather than the quicker ending of another war in another theatre. Whether atomic weapons would have been used by the Americans in 1945 if the Japanese had had them would have depended on a range of factors, including, first, a military evaluation of their effectiveness; secondly, the effectiveness of their delivery systems—at the time the Japanese could not have reached United States homeland targets comparable to Hiroshima and Nagasaki; Thirdly, an evaluation of the acceptable loss if the Japanese had been able to use such weapons on military targets in the Pacific, as well as the fourth and crucial question of who could use them first and inflict a potentially crippling blow.
In an era in which senior United States politicians now have admitted the possibility of a first-strike use of nuclear weapons, such issues are highly relevant. It is invalid to infer from what happened at Hiroshima and Nagasaki that nuclear weapons would not be used and deter war.
Ministers, including the Secretary of State for Defence, also neglect further implications of their arguments. If the deployment of nuclear weapons is the only defence against an aggressor, the logical consequence is that India must have nuclear weapons to defend itself against Pakistan, Southern and Central African countries must have nuclear weapons to defend themselves against South Africa and, in the Middle East, if Israel has nuclear weapons the only valid defence against them is nuclear weapons in the hands of other Powers.
It would be useful if Ministers would face those arguments and follow through the logic of their reason, for it is a prescription for nuclear proliferation world-wide as the only form of defence. But if that is not their reasoning, logic supports our case and the amendment to which I have put my name, namely, that a non-nuclear defence strategy is feasible. If that is the case we must ask why, if it is possible for other countries, it is not possible for us.
Mr. Cormack: On a point of order, Mr. Deputy Speaker. At the beginning of our debate Mr. Speaker appealed for brevity in speeches. The hon. Member for

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Vauxhall (Mr. Holland) has spoken for half an hour. The Opposition side of the House is sparsely attended but many of my hon. Friends wish to speak. Could you use your good offices to ask the hon. Member to bring his paper to an end
Mr. Deputy Speaker: The Chair can do no more than make appeals.
Mr. Holland: In fact, I have not contributed to any previous defence debate in the two years that I have been in the House.
I submit that non-nuclear defence, as implied by the amendment, is realistic rather than unrealistic. We saw in the so-called cod war that Icelandic trawlers cut through the holes of British frigates because our ships were designed for sounding on nuclear submarines rather than for coastal defence.
We have to face another important question. If an invading force did not use nuclear weapons, would the Government authorise their use as a deterrent, and, if so, in what way? Perhaps they would get Polaris submarines to deliver a death blow on Boulogne or Dover. Perhaps they would use nuclear weapons on an enemy in London. Simply posing that question raises issues that the Government have not faced.
The best defence against nuclear weapons is not to have them and to be known not to have them. It does not follow that there should be no defence against an invader, but defence against invasion by a nuclear or non-nuclear Power could, and in my view should, be based on conventional weapons and the mobilisation of resources towards defence policy in a serious sense. By that I mean not only naval coastal forces and army units but a civilian population able and ready to defend itself by direct action.
The issue is not theoretical. It has been demonstrated in Yugoslavia, which has faced Soviet aggression because it posed the threat of severe destabilisation of the hold of the Soviet regime in Eastern bloc countries. The Yugoslays have a defence force of about 200,000 men. The credibility of that force in deterring aggression by a nuclear Power is both real and a factor directly relevant to this debate. Soviet Union and Warsaw Pact forces have invaded Hungary and Czechoslovakia, but they have not invaded Yugoslavia.
A European nuclear-free zone would reduce the possibility of war, not entirely eliminate it. But it would reduce the possibility of war by accident or by incident, namely, a combination of a political or diplomatic breakdown with a misinterpreted military move.
A European nuclear-free zone also would prevent a nuclear war in Europe caused by escalation in the manner described by Zuckerman and Mountbatten. It would do so by causing the major super-Powers in the nuclear scene to withdraw land-based nuclear weapons to their own territory, thereby threatening mutually assured destruction of the old style rather than seeking tactical advantage by using nuclear weapons on the soil of other countries.
Such a European nuclear-free zone also would create the political and military space for negotiation to avoid nuclear war, rather than the far less plausible assumption of bringing in politicians and talking after an allegedly limited nuclear exchange.
For those reasons I recommend the amendment to which I have put my name. The amendment is a plea for serious consideration of the initiatives mobilised by the
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Campaign for European Nuclear Disarmament, which is supported by tens of thousands of individuals throughout Europe and by many people in dozens of trade unions and political parties. It is not simply a matter of the politics of the Left. The campaign is supported by members of Catholic, Christian Democrat, Conservative, National, Liberal, Social Democratic, Socialist and other parties throughout Western Europe.
If serious consideration of a European nuclear-free zone would give peace a chance, it would not be by total disarmament, but by a nuclear disengagement by the United Kingdom, and the feasibility, therefore—encouraged perhaps by the election of a new President of a new party in France—of major steps towards a European nuclear-free zone. European Nuclear Disarmament literally spells e, n, d—end. If we do not make a beginning towards that, it may literally be the end for all of us.
6.30 pm
Mr. Michael Mates: I suspect that the hon. Member for Vauxhall (Mr. Holland) and I have one—and only one—aspiration in common, and that is that I detest as much as he does the existence of nuclear weapons and all that they mean. However, we differ about what to do about them and how to minimise the risk of their use. I shall not follow the rest of the hon. Gentleman's speech, not least because of the opprobrium that I should merit from my hon. Friends if I were to attempt to answer all that he said. Suffice it to say that, I have as little in common with what he said as did his hon. Friend the Member for Erith and Crayford (Mr. Wellbeloved).
At least the amendment of the hon. Member for Vauxhall, though not called, is honest. It sets out what the Left wing of the Labour Party wants to do—disarrr and to hell with the consequences. I wish that the official Opposition amendment or that standing in the name of the right hon. Member for Plymouth, Devonport (Dr. Owen) were as honest. Both the Social Democratic Party and the Labour Party have put down wordy amendments which dodge the real, difficult question. They both say in words common to both, that the Trident issue is a distortion of defence priorities.
The Labour Party has struggled to find an alternative, and now, from the mouth of the right hon. Gentleman, has committed itself to unilateral United Kingdom nuclear disarmament. That we were told by an hon. Gentleman who for five years sat in the Ministry of Defence, supported solidly the Polaris programme and all that it entailed, and supported the expenditure of £1 billion on the extension of the life of Polaris and all that that entailed. He was a member of the Government—I accept that by then he had left the Ministry—who took that decision, and not one word to the contrary ever fell from his lips. Now, suddenly, have his principles changed; or is it simply expediency? If his principles have changed, it is so astounding a change of principle as to be worthy of a full explanation by him. If it is simply a question of expediency and cost, he should be honest enough to say so. He should be honest enough to say "We need to remain a nuclear strategic Power, but we cannot afford to do so". That, at least, would be honest.
Mr. John: I have never regarded the hon. Member for Petersfield (Mr. Mates), ex-Army as he is, as a Colonel

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Blimp, but, clearly, he has not read the considerable literature that has been around in defence circles over the past few months about the military value of Trident and whether it justifies its expenditure. On the whole, those who comment on these matters, apart from the hon. Member for Gillingham (Sir. F. Burden), have come down against the project. They are not being expedient. I hope that the hon. Gentleman knows me well enough to know that I am not given to expediency. If I advocate something, it is because I believe in it.
Mr. Mates: I do not gainsay that the hon. Gentleman believes that we cannot afford Trident. I questioned, and I still question, his sudden change in principle about whether it is an essential and crucial part of the British defence effort. Up to now, in his eyes and with his concurrence, it always has been. Now, suddenly, just because of cost, it is not worth it. That is a difficult position to sustain, and I do not think that I am misrepresenting what the hon. Gentleman said.
Let us take a more constructive look at what we need to do in the future. My right hon. Friend the Secretary of State today reinforced his determination and that of all Conservative Members that the primacy of defence as a priority in the Government's programme remains where it was when we came to power two years ago. I am certain that the Secretary of State's earlier words need no reinforcement, but it may be worth repeating one or two of his words for the benefit of some observers outside the House. He said on 20 January:
"The scale of the increase,"—
that is, of defence expenditure—
"fully accords with the Government's expressed determination, which I reaffirm today, of giving the highest priority to our defence in the face of the growing threat from the Warsaw Pact."
He went on:
"Let me make it plain beyond doubt that I share without qualification the objectives. ….to sustain and improve the frontline quality of our forces and of our contribution to the Alliance, which remains the cornerstone of our security".
Later that day, in reply to a question from me, he affirmed the Government's determination, from the base that he mentioned, to plan
"the 3 per cent. real growth in volume in our defence expenditure in future years".—[Official Report, 20 January 1981; Vol. 997, c. 149–56.]
My right hon. Friend has not moved from that base, and I do not believe that he intends to move from it. What the press has made of certain other statements that have been made has damaged us and the effort that we are making in this difficult area, and, more important—here I echo the remarks of my hon. Friends—has caused uncertainty among those who work in the defence industry. Yet not one word uttered by the Government has caused that uncertainty. It has been caused by words that have been uttered, leaked and conjectured by the press, which does no service to those whose livelihoods, both within and without the Armed Services, depend upon a certain security and knowledge of what faces them in the future.
Although we give priority and primacy of effort to our defence commitments, it cannot be the only priority or the only consideration in the difficult decisions that have to be taken. It therefore makes the soundest of all possible senses to look comprehensively at the whole burden that is falling on us, not of defence now, but of what is contemplated over the next 10 or 15 years—not because
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of any increased defence effort, but because of the exponential increase in the purchasing and commissioning of equipment with which to match the efforts that we are determined to make.
That is the nub of the problem that faces my right hon. Friend, and I have no doubt that he will face it with the thoroughness that he has displayed today. Provided that he does it within the terms, which he restated, of our NATO commitment, and within the resources to match that commitment, and with a determination to maintain the nuclear deterrent, he will receive no complaint from thinking Conservatives, within or without this place. The worry that has been expressed, more outside than inside the House, over the past weekend, can be laid squarely at the door of the press and those who have reported matters to the press about decisions that have yet to be taken.
I end with a quick word about Trident. I promised that I would be brief. I am a member of the Select Committee which for the past 14 months has closely considered this matter. Our report will shortly be agreed and published. Our examination of the subject has been a tremendous education for me. We have examined officials and Ministers, not only in the United Kingdom but in the United States, and we have taken a wide and philosophical look not only at the deterrent itself but at its cost in relation to other defence expenditures and, above all, its place in the list of priorities.
I am convinced that my right hon. Friend and the Government were right to give Trident priority when they made the announcement. That is not because we are entering a new generation of a different type of deterrent, as the hon. Member for Vauxhall argued, but because it is no part of our defence thinking to say "There is a task which we must discharge as part of our role within NATO and the Western Alliance but we are sorry, we cannot afford it." That is where I take issue with the hon. Member for Pontypridd (Mr. John). That is not the way that we should go. I do not want any Conservative Government to go down that path. No Labour Government went down that path when it came to the crunch.
It is crucial to ensure when phasing in the programme that Trident does not distort the defence budget. The effect that it will have on planned expenditure is not much greater than the effect of Polaris. If one adds Chevaline the effect is similar. We must not let the issue get out of proportion in the debate in the coming months. We must not regard the Trident programme as an enormous weight that will bear on the whole of the defence budget. It is part of the whole of our strategic and tactical plan to prevent war. Without that integral part deterrence will become much more difficult to sustain. If we do not have Trident, the expenditure involved in matching the other side in conventional and non-nuclear weaponry would be so great as to make the Trident programme look positively cheap.
6.42 pm
Mr. Robert C. Brown: I wish to defend some of my colleagues who have subscribed to one of the amendments. It is grossly unfair for the hon. Member for Petersfield (Mr. Mates) to suggest that the amendment implies that my right hon. and hon. Friends wish to leave Britain completely defenceless. However, I do not agree with the amendment. I wholeheartedly support the amendment in the name of the Leader of my party.

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I congratulate the Secretary of State on his speech. It is the first major speech that I have heard from him. It was thoughtful and showed that he intends to take his Department firmly by the neck. I hope that he succeeds.
The Statement on the Defence Estimates 1981 begins:
"The first obligation of any Government is the defence of the realm."
I do not dissent from that. I firmly believe that the electorate would never forgive any Government or party which departed from that obligation. It is often said that men and women of my generation are too nostalgic. I am unashamedly nostalgic about the years leading to the last war. I remember the happenings in Abyssinia, Spain and Poland. We saw the rape of Abyssinia. We talked in the League of Nations about sanctions, but there was nothing that we could do as a nation. There was nothing that we could do when the practice run for the Second World War took place in Spain. Then we gave that great pledge to Poland to protect its integrity, knowing that because we had no major forces we could do nothing. We were like neutered tomcats. Many of my generation remember that period with shame. Under no circumstances would I want to go back to it.
In the present economic circumstances we cannot afford sacred cows. It is remarkable how many hon. Members have sacred cows. The fellow who is deeply interested in education makes education his sacred cow. The same applies to hon. Members who are interested in social services, defence or any other subject. It is not possible for any Department to claim immunity. If cuts have to be made they must be across the board.
The Secretary of State has not held office long, but I am sure that he will already have learnt that, whenever defence cuts are mentioned in his building in Whitehall, he will be advised by the chiefs of staff that there must be equal misery. If £900 million has to be cut from the defence budget they will say that £300 million must be cut from each of the Navy, the Royal Air Force and the Army. Such advice will be given without consideration of the consequences for our defence.
That is not necessarily the best way to get value for money or the best defence. I compliment the Secretary of State. At least he gives the impression that he intends to try to get the best value for money. If that means saying to one or other of the Services that it must bear 50 per cent., 70 per cent. or even 100 per cent. of the cuts, so be it. We cannot afford to treat defence in the 1980s and 1990s the same as we did in the 1940s.
I do not want to hurt the feelings of the hon. Member for Ashford (Mr. Speed) because, having been a serving officer in the Navy and then a Minister, he feels strongly about the Navy. However, from my recollections of discussions in the Ministry of Defence, I have no doubt that there is a great deal of talk in the Navy about huge convoys crossing the Atlantic from the United States, protected by flotillas of cruisers, destroyers, and through-deck cruisers.
I agree with the Secretary of State that that is just not on. It will not happen that way in any case. Our ability to sail the Atlantic must be preserved at all costs for reinforcements and supplies, but we must look at the practicalities differently. We must think in terms of smaller, cheaper ships simply to provide a platform from which to kill enemy submarines.
Having said that, I certainly hope that the decisions that will have to be taken will not take too long, because the
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British shipbuilding industry cannot wait for long. At present the British shipbuilding industry—I am thinking particularly of Swan Hunter, on the Tyne—badly needs naval orders. We cannot simply sit and talk or wait for endless discussions in that main building of the Ministry of Defence while the British shipbuilding industry is slipping down the drain.
I want to stress something that is of major importance to several hundreds of my constituents who work in Swan Hunter's yard on the Tyne. If the threats of the right hon. Member for Leeds, North-East (Sir K. Joseph) are ever put into effect and the naval shipbuilding facility is sold off to private enterprise, that will sound the death knell for yards such as Swan Hunter, because without naval orders they will not survive. If the naval shipbuilding facility is sold off to private enterprise the merchant shipbuilding capacity of this country as a whole is almost doomed
Trident has been mentioned frequently and I make no apology for returning to it. I want to deal with it on cost alone. When the initial announcement was made a little over 12 months ago the cost over 10 years was said to be £5,000 million. I know that the Secretary of State has not been pleased by some of the things that have been said in the press in the last few days.
Mr. Bob Cryer: Especially in The Daily Telegraph.
Mr. Brown: Especially in The Daily Telegraph, as my hon. Friend says; it is the worst of them all and always has been. But I was going to say "by informed opinion". Certainly, leading opinion in this country seems fairly convinced that within 12 months of the announcement of this venture the cost has increased by about 20 per cent. I doubt whether anyone in this Chamber or outside, the Secretary of State or anyone else, could evaluate the final cost of this nonsense. I think a modest estimate over the 10 years must be £10,000 million as a minimum. If we get a 20 per cent. increase in one year, the increase over 10 years must work out at least £10,000 million. I do not think that that can be denied, with the tremendously escalating cost of equipment, so who can say what the final cost will be? Whatever the final cost, it will certainly be a figure that I simply cannot imagine as being affordable, if we are to have the conventional forces we need.
The thing that bugs me about the whole Trident decision is that if we carry on with this commitment to the Trident weapon the only way we shall be able to fund it is by depriving the British Army of the Rhine of the new equipment it so badly needs, particularly the battle tank. I was pleased to read in the statement that the new battle tank is to come on stream in the mid-1980s rather than in the 1990s. That is the future main battle tank, the Challenger. I am delighted to see that and that at long last our troops are to have the protection of Chobham armour, which was a superb British invention and is now protecting the troops of other countries worldwide. I am indeed pleased that, sooner than we anticipated, our troops will have that protection.
What bothers me is that if we insist on this Trident adventure we are going to have to wait longer for the type of equipment, such as the Challenger, which the British Army of the Rhine needs. I am not, like some people, so pessimistic as to believe that if, God forbid, we have a war in Europe it will be nuclear immediately. It will be a war with conventional forces, which means the British Army

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of the Rhine, which will be at the sharp end and will need the equipment. I will be bold enough to forecast that the Government in office now will not at the end of the day pursue the Trident decision because they will realise that it is just not on in terms of cost. I shall applaud them when they realise this.
I do not want anyone to accuse me of being a unilateral disarmer, because I am not. What I want to see is multilateral disarmament, where we steadily reduce the stockpiles until we get rid of them altogether. But, with the best will in the world, I see no purpose at all in saying, and I do not think that anyone here is daft enough to think, that the United Kingdom could defend itself in isolation today or take any major part in the defence of Europe. It has to operate in terms of the NATO Alliance. I am sure that when the Opposition spokesman winds up the debate tonight he will emphasise the commitment of the Labour Party to continued membership of NATO.
My final words are on the question which was raised at Question Time this afternoon on the guided weapons system for Sea Wolf which Marconi was producing. Hundreds of jobs on Tyneside are involved in this decision and I hope that the Under-Secretary will tonight give us a firm assurance that if there is any change regarding this order for the Sea Wolf delivery system, if there is any question of the order going to a Dutch firm, there will have to be compelling reasons.
The major reason, of course, would be cost, but if cost is to be a major reason, I sincerely hope that the Government will take into account the social consequences that a decision to send this order to Holland would have. It is easy to argue as a Defence Minister that social costs have nothing to do with defence, but in terms of the nation as a whole, if several hundred million pounds are involved in unemployment benefit and redundancy payments, it is reasonable to ask that this should be set against the value of a slightly lower tender from, say, a Dutch firm. I certainly hope that the Minister will be able to say something about that.
7 pm
Mr. Patrick Wall: The hon. Member for Newcastle upon Tyne, West (Mr. Brown) started his speech by reminiscing about the years before the Second World War. I, too, have memories of those years. I remember the then Opposition voting, time and again, against rearmament. I remember the activities of the Peace Pledge Union, which to some extent led to Dunkirk, and as I contemplate the activities of CND and its supporters in the House I feel that history is repeating itself.
Mr. John: The Conservative Government after the 1935 election had a majority of 150 in the House, on the basis that Stanley Baldwin promised to disarm the country. What influence did the Peace Pledge Union have on such a massive Tory majority? The hon. Gentleman should not rewrite history.
Mr. Wall: I am well aware of the history. The hon. Gentleman cannot deny that after the Stanley Baldwin period, up to the beginning of the 1939 war the then Opposition voted consistently against rearmament. The Peace Pledge Union had a considerable effect in the country as, in my view, unfortunately, does the CND today.
Sir Frederick Burden: It was not until Hitler had marched into and taken Austria that the Labour Government of the day supported rearmament. When I was a candidate in South Shields at that time, Mr. Baldwin came to South Shields and said that if the Tories went to the country on a policy of rearmament the Labour Party would go to the country on a policy of disarmament and peace——
Mr. Deputy Speaker (Mr. Bernard Weatherill): Order. We are getting deflected. We are debating our Estimates for 1981.
Mr. Wall: We are looking to the present and the future rather than the past. I shall leave that particular red herring on one side.
This is an unusual debate. We are not, as we normally are, debating the merits of the White Paper. It is an excellent White Paper, and I congratulate my right hon. Friend on preparing and producing it. We on the Conservative Benches know that it is an interim document. It is to the future that the minds of Members of the Conservative Party are being directed. We are thinking about cuts, costs and the redistribution of priorities.
While accepting the Prime Minister's assurance that we have in 1980–81 spent more on defence than our undertaking to NATO—We have spent 5¼ per cent. of the GNP instead of the 3 per cent. promised—I understand that in 1981–82 we intend to have no increase. That means, in real terms, a decrease. In two years we shall have spent 5¼ per cent., whereas we undertook to NATO and to our allies to spend 6 per cent. That will greatly annoy the Americans, who are spending more, not less. They plan to spend between 7 and 8 per cent. of their GNP on defence in the coming year.
Today, we are facing the consequences of a redistribution of our defence effort. That redistribution has been described in the press. If those descriptions are true, the result will be disastrous. In a debate like this one can only take the worst case, and I propose to base my remarks on the worst case, hoping that it will never happen.
Shall we never learn the lessons of history? Twice in my lifetime Britain has been brought to her knees, not by what happened on the central front but by the submarine. Today we face not the 60 U-boats with which the Germans started the first battle of the Atlantic but 400 Soviet submarines, about half of which are nuclear propelled.
The Secretary of State said that the only way to defeat the nuclear submarine is by team work. We need the hunter-killer submarines, the SSN, surface warships carrying helicopters, and maritime patrol aircraft such as the Nimrod II, which is unsurpassed in the world. Hunter-killer submarines on their own are not of much use, because their radius of detection of the enemy submarine is small. Team work is vital.
For year after year successive Labour Governments have cut our defences. If reports in the press are true, no Government have proposed cuts which, if The Daily Telegraph is to be believed, will mean that the Royal Navy and the Royal Marines will be emasculated and 400 years of British history starting with the defeat of the Armada will end. I am glad that my right hon. Friend advised against believing The Daily Telegraph. Any such suggestion made under a Conservative Government pledged to give top priority to defence would fill me with horror if it turned out to be true.

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That such a suggestion should be made in 1981 is extraordinary, when there is rising tension in the Middle East, in South-East Asia, in Southern Africa, in South America, in the Caribbean and in Eastern Europe. It is not the time to reduce our defences; rather is it the time to increase them.
What is the excuse? In some quarters the excuse is the state of the economy. Let us briefly examine that. The steadfastness of my right hon. Friend the Prime Minister is paying off. The economy is recovering, inflation is falling and, in due course, unemployment will also fall. Is all this improvement to be destroyed? The essence of the debate is that Britain's defence forces will have to be reduced to save the economy. That is nonsense.
Cannot the House appreciate the effect of these possible defence cuts on the North Atlantic Alliance? It will infuriate the Americans, who are increasing, not reducing, defence expenditure. It will encourage our smaller allies to cut their defences. They will say "If this is the example that Britain, America's major ally, sets, we can do the same". It will give the green light to the Kremlin when the new leaders take over, when Mr. Brezhnev, who believes in détente, finally goes, and when there is the threat of internal unrest both in the satellites and in the Soviet Union itself.
Mr. Robert C. Brown: Does the hon. Gentleman not realise that President Reagan is enjoying the experience of breast beating as did the Prime Minister two years ago on the question of defence, and in two years' time he will be faced by the harsh realities of Government, as the Prime Minister is today?
Mr. Wall: Of course there are harsh realities; I quite agree with the hon. Gentleman. The Secretary of State knows that only too well. But both President Reagan and my right hon. Friend won the election by putting the defence of their country first. They were absolutely right to do so, and they now have to find means to carry out their promise.
What should be done? If we are to save ourselves from World War Three, the only way that we can do that is by showing that we are strong, improving our defences and making it not worth anyone's while to attack. The danger area is in the next five years. If we can get through the next five years we shall probably have a reign of unparalleled peace and prosperity.
The main nuclear umbrella is maintained and paid for by the United States. The modernisation of NATO's theatre nuclear forces is to be achieved and paid for by the United States. All that we are asked to do is to contribute our share of the other forces. The army in Central Europe may come under attack by between 90 and 120 Soviet divisions, which means, as I am sure my right hon. and hon. Friends on the Front Bench will agree, that the BAOR must be equipped with better anti-armour defences, and better and more artillery equipped with precision guided weapons.
The particular danger is the second echelon of Soviet armour. We have to find a weapon to deal with that. The Royal Air Force in Germany is highly effective, but the air defence of Great Britain needs strengthening. That is in hand at last, and positive steps are now being taken. I hope that everything will be done to bring forward the air defence version of the Tornado, which is essential to the defence of these islands.
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The key to the future on the central front if World War Three ever comes are the reinforcements from the New World. Those reinforcements have been stated publicly by senior military officers to comprise over 1 million men, 100 air squadrons and 10 million tonnes of equipment, most of which must come by sea. I agree that the men could fly over in C5s and C3s from the other side of the Atlantic, but the equipment cannot be transported in that manner. Nor can it all be stockpiled in Europe.
This operation must be carried out in the face of the Soviet submarine threat. The United States Navy, the biggest in the Alliance, will have to hold the Greenland-Iceland-United Kingdom gap to prevent submarines from the Kola Peninsula reaching the deep waters of the Atlantic. The Americans will also operate the strike fleet in the North. This means that there will be nothing left of the United States Navy to deal with submarines in the Eastern Atlantic. They cannot replace our effort.
Britain provides 70 per cent. of the anti-submarine effort in the Eastlant area in terms of surface vessels, hunter-killer submarines, helicopters and military patrol aircraft, yet the press suggests that 50 to 60 per cent. of these forces may be scrapped. The Secretary of State said today that he thought that we should have much cheaper platforms. I agree. It is absurd to pay £130 million for a destroyer.
I am told that the cost of naval shipping escalates by 33⅓ per cent. a year. That is fantastic. However, we need the hulls. I agree that we should have the type 23 destroyer and cheaper frigates, provided that they carry helicopters and are properly protected. We should not, however scrap the vessels that exist today until they can be replaced one for one. I realise that my right hon. Friend's response will be to say that this is all very well but that it costs money. I shall come to that matter later.
It is essential to hold northern Norway and the Faroes. That is the main reason why the Royal Marine Commandos and the amphibious warfare ships are maintained. I do not believe press reports that the Royal Marines are to be scrapped, but amphibious warfare vessels are already being placed in reserve and may be scrapped.
I support the Trident programme. My hon. Friend the Member for Petersfield (Mr. Mates) and I have worked together on the Select Committee for over a year on this matter. We hope that our report will be published soon. I believe that the Trident is essential to the future, of this country. It is not, however, relevant to the debate. The heavy expenditure on that programme does not start until 1985–86.
I come now to the most important point that I wish to make. The argument that cuts in the BAOR will be in defiance of the Brussels Treaty is unfounded. The Treaty has already been amended on four occasions. Drastic cuts in Eastlant would, however, excite American anger. I speak advisedly, because I have close contacts with the Armed Services Committees of both Houses. I believe that the cuts would threaten Anglo-American relations, which are at present so good. They might even threaten the future of the Alliance itself. I was speaking in Phoenix, Arzona, six weeks ago. There is plenty of latent isolationism in America today. If we were to give encouragement to its development, that would be dangerous for the future of Europe and of this country.
I have been a member of the North Atlantic Assembly for 10 years. I believe that I have a special duty to warn

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the House of the effect of the cuts, if they are put into operation, on the North Atlantic Alliance. In spite of the assurances that have been given, I do not believe that the programme described in the press has yet been discussed with NATO. It could not have been discussed, because my right hon. Friend says that it is speculation. It is, however, essential that discussions take place with NATO before any decisions are announced.
Mr. Nott: Is my hon. Friend saying that he feels that we could reduce our commitment in the BAOR by a variation of the treaty? I am interested to know what my hon. Friend thinks. I thought that he was hinting at what I had described. I am sure that he appreciates that we hold 65 kilometres of the front.
Mr. Wall: It has been stated that the political difficulties of reducing the BAOR would cause a much bigger row in the Alliance than the political difficulties involved in decreasing our ASW effort in Eastlant. The Brussels Treaty applies to the BAOR but no treaty applies to Eastlant. I do not believe this to be true, but the last thing that I want to do is to play one Service off against another. The three Services should stand together. All need improvement.
Mr. Wilkinson: On the issue of the Brussels Treaty, will my hon. Friend remind the House that in the late 1960s a brigade was brought back from the BAOR? My hon. Friend would perhaps not wish to suggest that that is repeated. There are, however, other means of effective defence in the central region, such as better use of air power.
Mr. Wall: I should have thought that air power had been improved when the two tactical air forces were brought under one command. Much more can perhaps be done. I am sure that my right hon. Friend will say, however, that such proposals cost money and will ask where this money is to be obtained. I would argue that money is not everything. I believe that hon. Members on both sides of the House believe that our future depends upon the North Atlantic Alliance. That is our defence. That was our guarantee at the end of World War Two. It will continue to be our defence if it is kept sufficiently strong and deters attack because any potential enemy knows that he will be hit back if he attacks anywhere on the land front, or at sea or in the air.
Unless there are concrete discussions with NATO before a decision is made concerning any change in priorities, the integrity of the Alliance faces grave danger. Smaller countries will opt out and the Americans will become furious. I do not blame the Americans. Why should they spend blood and treasure on defending Europe—these were the remarks that I heard in the United States—when Europeans will not spend their own money? It is true that the Europeans are spending money. They are not, however, spending as much as the Americans. There is a lot to be said for the American argument. If this situation continues, there is the danger of American isolationism.
I believe that the debate could mark a turning point. If the plans appearing in the press are approved by the Cabinet we will start a process that could lead to the dissolution of the Alliance and the Finlandisation of
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Europe. This is a serious matter. I am not attacking the Secretary of State. My right hon. Friend has done a good job. I believe that he will do an even better one. However, he needs the support of the House, particularly Conservative Members, to demand more money to keep our forces properly up-to-date, to change the priorities over the years and to make certain that the deterrent in NATO remains supreme and protects us against a third world war. Unless that happens, there is a grave danger of a third world war breaking out in the next few years.
My hope now lies in the Prime Minister, whose courage and steadfastness will, I am sure, save the country economically if she continues on her present path. The excuse of the civil servants is that to save our economy we must virtually destroy our defence forces. That is nonsense, and I believe the Prime Minister will refute it. British history, from the time of Queen Boadicea to Elizabeth and to Victoria, has shown the strength and the patriotism of women in high places. The "Iron Lady" will surely not wish to go down in history as the leader who saved the economy of the country but endangered its defences. I appeal to her—at this stage one can only appeal to her—to ensure that the forecasts appearing in the press do not become reality. The credibility of the Conservative Party and even the future of the country are at stake.
7.18 pm
Mr. Bob Cryer: I should like to weave a path between reality and the myth generated by NATO, the Government and most Conservative Members about the balance of forces between NATO and Russia. According to the myth, Russia is powerful and expanding her forces, not least her nuclear forces, at an alarming rate, and we have to catch up. The vice-chairman of the Conservative parliamentary defence group, the hon. Member for Plymouth, Sutton (Mr. Clark) said on 3 March:
"However, I ask the House to consider the proposition that the Soviet Union in central Europe, measured in terms of policy, achievement, territorial aggrandisement or adventures, has been consistently on the retreat since 1948.
If one measures the extent by which the strength of the Soviet Union has been eroded in central Europe by defections of one kind or another since that high point at the time of the Berlin airlift, one sees that effectively, it has lost Austria, half of which it occupied, and Finland, over which it exercised almost total dominance. It has lost, irreparably, Yugoslavia. It has lost Rumania in all but name. In Hungary the regime has become more relaxed and more inimical to Soviet influence. Finally, there are threatening developments for the Soviet Union in Poland. Seen from the Soviet side, this shows a steady pattern of retreat and disintegration."—[Official Report, 3 March 1981; Vol. 1,000, c. 193.]
The SALT II treaty gives 11,894 strategic warheads to the United States and 6,005 to the USSR. Those are not my figures any more than the quotation was my quotation. Those are the figures that are given in the SALT II treaty. That is not exactly a picture of NATO with catapults and the Soviet Union moving rapidly ahead.
According to the Institute of Strategic Studies, the USSR's theatre nuclear delivery capability is 819 while NATO's is 555. However, NATO has about 7,000 tactical nuclear weapons and the Warsaw Pact has 3,550. That is the balace according to the Stockholm International Peace Research Institute.
In 1978 the Pentagon admitted and accepted that the Soviet inventory of tactical nuclear weapons was "probable far smaller". The Institute of Strategic Studies

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observes in the current issue of The Military Balance in page 4, for example, that the Russians will expect to have a total of strategic nuclear delivery vehicles of about 6,000 by about 1985. That total will reflect an increase. However, page 3 of the same volume states that the United States total is 7,301. The picture to be drawn from that information is rather different from the manic picture to be drawn from the information supplied by the NATO Alliance, the British Conservative Government and Conservative Back Benchers.
Page 111 of the Institute of Strategic Studies' current document says:
"Apart from having greater economic resources, Alliance countries, including France, maintain rather more men under arms than the Warsaw Pact."
The figures are supplied. It adds:
"the Soviet Union has a large number of her divisions and men on the Chinese border."
Those are not my figures. I do not have any figures. I gain my figures from official documents. It is worth saying that the figures produced by the Institute of Strategic Studies are provided not by an organisation hostile to NATO and the West but by one that supports NATO. The information that it receives is filtered by NATO Governments. Therefore, it is likely to be exaggerated in favour of NATO rather than against.
When I tabled a question about the Estimates in the Defence White Paper of 1980—the relevant words are repeated in the current document that the House is debating—I was told by the Minister that, as the Soviet figures were so unreliable we had to make our own estimates of its expenditure. Apparently this is done in great detail every year by assessing the cost to the Soviet Union of all known items of spending and aggregating them for the purpose of comparison according to the NATO definition of defence expenditure.
In other words, the Ministry of Defence guesses what the Russians are spending and says, "It is an enormous amount and we must catch up." However, it is merely a guess. In answer to my question the Ministry of Defence said, in effect, "This must be right because the Pentagon has made the same guess and it, too, says that the Russians are spending more than they claim that they are spending." I cannot think of two less objective sources of information about "the other side."
Conservative Members may not share my view of the exaggeration of Russian expenditure. However, there is another source. In the magazine Sanity that is published by the Campaign for Nuclear Disarmament, of which I am a member and supporter and always have been, Senator Nino Pasti of Italy, a former member of the NATO military committee and former Deputy Supreme Allied Commander for NATO Nuclear Affairs, wrote as follows:
"The truth is that NATO forces, both conventional and nuclear are stronger than those of the Warsaw pact countries. During the last ten years the Soviet Military budget has remained stable. My colleagues were unhappy about this situation, because they could not justify increases in their own expenditure. So they invented a 'pricing' system. It is easy to see how the figures were inflated to show higher Soviet expenditure."
I am sure that Conservative Members will not pay much heed to that opinion, but it is a different view. They cannot deny that it is an authoritative source for a different view. It means that there is a large question mark hanging over the assumptions on which our massive defence expenditure is based, which is increasing by 3 per cent. I say that that defence expenditure is too high and that it can and should be reduced.
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It is true that the Trident programme is only to be embarked upon. We hope that there will be a general election before the programme gets under way. We hope that a Labour Government will be returned with a massive majority, committed to stopping the programme. We shall have to bring forward public expenditure to create and provide jobs for peaceful purposes. That is part of our policy and it is one of our most important and abiding tasks.
The Trident programme is slated to cost £5 billion. When that figure is mentioned, hardly an eyebrow is raised on the Tory Benches with the exception of those of the hon. Member for Aldershot (Mr. Critchley), who is on record as saying that Trident will reduce expenditure on conventional forces. That seems to be exactly right.
Of course, we shall preserve our conventional forces. Of course, we shall preserve defence facilities in Britain. We shall do so so that we may use those conventional forces if and when the need arises. We shall be prepared to make a contribution to United Nations action if we are called upon to do so. The notion that Britain can afford £5 billion or £6 billion at current prices on the Trident programme is nonsense at a time when every aspect of our nation is being eroded.
For example, teachers are being sacked and facilities are being cut back. Children are now sharing books. Parent-teacher associations are being encouraged by the Secretary of State for Education and Science to raise money so that it may be spent on text books. However, we are prepared to spend £5 billion to £6 billion on Trident. What sort of priority is that?
Last week we discussed a Bill that included the proposal to cut back 1 per cent. of the over-provision that the Government claim that they have made for pensioners, widows' allowances and invalidity benefits. Every area of welfare is being cut back. No one can deny that the National Health Service is being forced by financial restrictions to examine every area of its expenditure.
Against that background Trident is the one area that is producing a massive commitment from the Government of £5 billion to £6 billion at current prices. My right hon. and hon. Friends say "No" to Trident. It is not necessary even in terms of the limited thought processes of those on the Conservative Benches.
If Polaris is a deterrent, why do we need a version of Trident that is twice as powerful? Why do we need to up the nuclear stakes? If one Polaris boat carries more firepower than was expended by both sides throughout the 1939–45 war, which is true, why do we need a boat that carries twice the amount of firepower that was expended. during the Second World War? Is not a boat with perhaps ten, 12, 14 or 16 2-megaton weapons sufficient? Why does the nuclear rate have to be increased? Yet that is what we are doing.
The people who support the notion of mutual assured destruction had their wish in 1963 when there was enough fire power for both sides to blow each other off the face of the planet Earth if they put a foot wrong. Since 1963, while people have uttered platitude after platitude about multilateral disarmament, which means waiting for the other side to do something, every country which has had nuclear weapons has been spending more on them and has been increasing month by month and year by year the number of nuclear weapons on the planet Earth. If deterrent worked in 1963 why do we need to do that? It does not add up.

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Year by year we are moving towards the abyss. As more nuclear weapons exist, the greater is the danger of one going off. The arguments used by Conservatives are that that increase is absolutely necessary in order to deter and that we have to be a nuclear power. Over 100 countries are not nuclear powers. If they follow our argument, they have every justification for obtaining nuclear weapons. Therefore, let us get rid of nuclear weapons and set an example to those hundred nations, many of which signed the non-proliferation treaty. When those countries signed that treaty, they said that they would sign it on the basis that the nuclear powers made some effort to get rid of the nuclear weapons and power. What has happened since the non-proliferation treaty was signed?
Year by year the nuclear powers have increased their dependence on nuclear weapons. Therefore, some of those countries are saying, as they did last year, that they are having second thoughts about the non-proliferation treaty because no effort has been made to reduce nuclear weapons. By saying "No" to Trident and "No" to cruise, the United Kingdom would demonstrate to those non-nuclear nations that moves were being made towards a reduction of the reliance on nuclear weapons. That would enhance peace.
It is true that the Caspar Weinbergers and anti-Communist fanatics of this world, who can only see a little red dot in front of their eyes and who cannot see the world on a wider basis, may be disappointed, but millions of people in the United States will say that they want their Government also to recognise that the expenditure on nuclear weapons proposed by the Reagan Administration is madness and totally unnecessary and that it exists only to provide some fat and lucrative contracts for the defence lobby which helped to put Reagan into power in the first place.
Mr. Cormack: I intervene in order to put it on record that the former Leader of the Labour party, the right hon. Member for Cardiff, South-East (Mr. Callaghan), and the present shadow Foreign Secretary both subscribed in broad terms to what the hon. Gentleman castigates as the Weinberger doctrine. He should admit that most experienced people on the Opposition Benches, who have had real dealings with the Soviets and experience in defence and foreign affairs, also subscribe to that philosophy.
Mr. Cryer: I do not speak for my right hon. Friend the Member for Cardiff, South-East (Mr. Callaghan). If the former leader of the Labour Party wishes to speak, I have no doubt that he will do so.
The Labour Party has its internal arguments. In some areas, I am in a minority and in some areas my right hon. Friend is in a minority, but policy is decided democratically. It is decided democratically at the annual conference and there is not a more democratic organisation in a political party in this country. However, I object to people like Caspar Weinberger telling this nation on a BBC television programme how it should organise itself and telling our political parties how they should make decisions. We are friends of the American nation not on the basis of subjugation, but on the basis of equality. That equality does not invite American statesmen to comment on our internal matters and internal policy decisions.
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While I am talking about the American position, I shall remind the House that in the defence Estimates about £25 million is our contribution to the installation of cruise missiles. I make it clear that there is a massive and growing body of opinion outside the House against the stationing of cruise missiles in this country. The supporters of the Government's defence policies cannot make 100,000 people demonstrate in Trafalgar Square in support of the massive expenditure on Trident, cruise and the rest.
The reason for such deep and abiding opposition to cruise missiles is that they represent a dangerous escalation in the nuclear arms race. They are not retrievable. There is an argument that the F111s are here already with American nuclear bombs on board. I do not endorse that, but at least one can signal a pilot to turn back. One cannot turn back cruise once the key is inserted. Cruise is sent on its way by American personnel, not by joint United Kingdom and American personnel. There is no right of veto over the use of cruise missiles.
The formula for the use of cruise missiles was adopted in 1951 by the then Labour Prime Minister, Clement Attlee, with President Truman—when Parliament was not sitting because an election was being held. The formula was designed not for nuclear weapons, but for the use of American personnel in bases built for their use here, or handed over for their use. Those are entirely different and dissimilar areas, yet the same formula is trotted out, that, in the light of the circumstances at the time, there will be consultation over use. We know that a nuclear war can start in a matter of minutes, so consultations in those circumstances are purely academic. The fact is that cruise is subject to the control and discipline of the Americans and is not subject to any veto by the United Kingdom Government.
Since I have embarked on an analysis of the respective positions of both sides, I must add that it is common consent that both sides mutually distrust each other and look at each other's actions with a certain suspicion and caution. In those circumstances, if there is to be a reduction in the nuclear arms race, there must be verification. It is a crucial element of arms control that each side, being suspicious of the other, can look at the other side and say, for example, that it does not believe that the Russians are telling the truth about expenditure. I have no doubt that the Russians say precisely the same, that the imperialist West is building up arms. Under those circumstances there must be some means of verification. Cruise is a weapon which is least open to easy verification. In our international systems of satellite photography, cruise is one of the weapons most unlikely to be detected.
The Government have put forward the advantages of cruise. They have said that it can be shoved on the back of a lorry, taken down a road, put in a garage, in a wood, on a hillside and the rest. That is put forward as an advantage, but it is a crucial disadvantage to arms control and limitation. That must be taken into consideration.
For those reasons, people outside led by the Labour Party, are saying "No" to cruise. Therefore, the £20 million to £25 million for expenditure on cruise is a waste of money. We hope that there will be an election before cruise arrives here. We shall tell the Americans to take back the cruise missiles.
It has been suggested that we should somehow dictate to Japan—that was the implication, although the word "dictate" was not used—that the Japanese should spend more on defence. They spend less than 1 per cent. of gross

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national product on defence. They are to be persuaded that that is wrong. Why should the Japanese, who are the only nation who have had nuclear weapons used against them, change a policy that seems to be highly successful? They have spent money and devoted ability to produce things that people want, and have been enormously successful at it. That is the example that we should follow. We should reduce the enormous sums that we spend on defence and channel the money to goods and services that are needed throughout the world.
The House has debated the Brandt report. Many people have said kind things about it, although some Tory Right-wing extremists thought that it was nonsense. The report emphasises that the West is wealthy but that many nations are poor and do not have enough to eat and do not have sufficient clothing and adequate shelter. On page 14 it states:
"The military expenditure of only half a day would suffice to finance the whole malaria eradication programme of the World Health Organisation, and less would be needed to conquer river blindness, which is still the scourge of millions … One-half of one per cent. of one year's world military expenditure would pay for all the farm equipment needed to increase food production and approach self-sufficiency in food-deficit low-income countries by 1990."
However, the Conservative Government continue on the treadmill. They are proud of the 3 per cent. increase in real terms in defence expenditure.
A Minister has been sacked because he appeared to raise his voice against the minor cuts contemplated by the Government, but the majority of the world's people do not have enough to eat, and even by reducing military expenditure by a small proportion we could have enough money to bring enormous relief to the suffering. We have the moral choice. we should opt for people and against the massive arms race.
Finally, the Conservative Party believes in freedom of choice, but a small elite group— perhaps half a dozen or a dozen—may, if the unhappy day comes, initiate action that will lead to mass extermination. An image may appear on the radar screen, and the observation tower may confirm that a missile or something that looks like one is on its way, and the Prime Minister, depending on the circumstances that she and her advisers choose, may initiate nuclear action. I asked in a Parliamentary question whether she would do so, and she confirmed that if the circumstances were right she would make the decision.
Mr. Trotter: Will we have a referendum?
Mr. Cryer: Someone jovially asks, "Will we have a referendum?" It is a jest when half a dozen people can initiate action that irretrievably and inexorably will bring about mass extermination, certainly wiping out virtually the whole of Europe.
I would give people a choice, which is more than the Conservatives are doing. They would press a button, believing that they were right, and the minority or majority of dissenters would be committed to a radioactive cinder heap. They may be wrong. They may make a misjudgment. I do not allow any Government of whatever political persuasion to have that right over my life and the lives of my family, community and nation. If we are to have a real freedom of choice, we must get rid of nuclear weapons. they are far too costly, and they deny freedom of choice, so are anti-democratic. We should use the money to save people and not to threaten to exterminate
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the world. It is a moral and political choice. The only proper decision is to get rid of the nuclear weapons and form an initiative for peace.
Several hon. Members rose——
Mr. Deputy Speaker: Order. A great many hon. Members wish to take part in the debate. Speeches in excess of 20 minutes will make it difficult for them to do so.
7.44 pm
Mr. Victor Goodhew (Sir Albans): I shall not go at length into the arguments that can be put against the standard CND speech, but I should like to ask the hon. Member for Keighley (Mr. Cryer) one question: does he believe that the United States would have dropped its atomic bombs on Japan had it known that the Japanese could deliver one back to Washington the next day?
I wish that the hon. Gentleman had been with me last autumn, when I spent a month at the United Nations as a delegate at the first committee on disarmament. He made the sort of speech that representatives of all Warsaw Pact countries make in propagandist efforts to destroy the will of the West. He would also have found that there is such a lack of mutual trust that the only basis for disarmament or arms control is verification, and that is where we come unstuck with the Russians, which is not surprising. Their cynicism, is shown by the fact that when they were fighting in Afghanistan and killing Afghans, many of them unarmed, they put down a resolution in the committee entitled:
"Urgent measures for the prevention of war".
One cannot be much more cynical than that. Those who echo the cries of the Russians and their allies should remember that.
In his absence, which I absolutely understand, I congratulate my right hon. Friend the Secretary of State on his speech and the Statement on the Defence Estimates, which were presented extremely well. I am disturbed that he has to say that a review is under way. We have had defence reviews in the past. They always create uncertainty, which is damaging to Service morale. Every time we have a review the Services say that they have been here before, and their anxiety about the future becomes very great. At present they are probably trapped by unemployment. One only hopes that their morale will not be as shattered as in the past. To that end, speed is essential in getting on with the review. We cannot have it hanging about for months on end.
Mr. Cryer: The hon. Gentleman says that "Speed" is essential, but it is clear that he is not.
Mr Goodhew: Speed is essential in announcing the results of the review. I want to see the announcement made in the shortest possible time, instead of having to wait through the Summer Recess, which I fear may happen.
It is sad that a Government who have restored morale greatly in the Armed Forces by tackling pay find once more that the career prospects in the Services seem to be at risk and that the morale that has been built up will again be damaged. I repeat that it is essential to get on with the review as soon as possible. My right hon. Friend said that we should have a full debate in July, and I hope that: he has that sorted out with the Leader of the House. I hope that an announcement will be made then.
I am disturbed by the rumours, and wonder what their source may be. It is indicative of where it might be when

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one considers the action of my hon. Friend the Member for Ashford (Mr. Speed), who has for the time being sacrificed his career because he feels so strongly about the rumours. He is in a better position than the rest of us to know where they come from and whether there is truth in them. I have much sympathy with what he said in his speech, as I am sure many hon. Members have.
One problem is that the rumours have had such wide circulation and we have not had much to refute them. My right hon. Friend attacked one journalist, but there was not much enlightenment in what he said. There was one gleam of light, or rather a flashing red bulb. He said that the hunter-killer nuclear submarines were the battleships of the future. That would merely cause me to think that my hon. Friend was quite right to say what he did, whereas he is supposed to be wrong. I am therefore rather confused about that.
I remember the discussion about going from manned aircraft to missiles some years ago, when we suddenly found that we had it wrong and had to go into reverse. If we are talking about going all-submarine, I ask myself what is the point of saying that we must have a Royal Air Force strong enough to defend the home base if the Navy is to be denied the ships with which to protect the merchant shipping bringing food and supplies without which we cannot exist. That seems somewhat incongruous if we are thinking along those lines.
I accept entirely the need to be cost-effective, but this again causes me anxiety. I remember when cost-effectiveness in the Armed Forces was first discussed the TSR 2 was cancelled. Thereafter, we had the most terrible time. We had to do without and to make do for a long time until, quite recently, we obtained a replacement aircraft, which is now doing a very good job. That was the result of that attempt at cost-effectiveness. I hope that we shall not get it wrong this time.
I wish to impress upon my right hon. Friend and his colleagues the need to purchase British wherever possible, whether it be aircraft, ships, missiles or whatever. One never really gets down to the real cost to the taxpayer of weapons systems bought from abroad as compared with those purchased at home. The cost to the Ministry of Defence shows up as a very large figure in the White Paper, but we are not told how much of that comes back to the Exchequer in the form of taxation on the salaries and wages of those employed in the armaments industries, avionics, electronics, and so on. We should not fall too easily for tempting offers from the United States or anywhere else if we can produce what we need here. I should like to see an attempt made to put down the comparative cost of missiles or aircraft available abroad, comparing not the cost to the Ministry of Defence but the cost to the taxpayer, because that is the true cost.
I emphasise that when I talk about public expenditure cuts across the board, I do not accept that defence comes into the same category as other Departments. I have said this before, and I say it again. If an individual feels that he must cut his standard of living when the going gets rough, he may cut down on various items. The one thing that no sensible person does is to cut down on insurance policies, because that is the one way to disaster. I regard our defence expenditure as an insurance policy on which we depend for the security of our country.
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You have appealed for brevity, Mr. Deputy Speaker. So much has been said already that I feel disinclined to go into great detail about the weapons systems, missiles, and so on, in which I am interested. I simply say to my right hon. Friend once again that I hope that he will consider very carefully the effect of all this on the morale of the Armed Forces. We depend so much upon their good will and dedication. I therefore close by thanking them, through him, for all that they do, because every hon. Member knows that we owe them a great debt.
7.53 pm
Mr. R. Bonner Pink: I associate myself with the view of my hon. Friend the Member for St. Albans (Mr. Goodhew) that the one thing that we cannot cut down is the cost of defence.
The debate has centred largely on the question of Trident. There have been two angles in the argument against Trident. The first comes from the anti-nuclear lobby. The second is the argument about cost. I wonder how many people, when they think of the cost, think of the other side of the coin, in terms of employment and the money that will be spent in this country in the production of Trident. I also agree that Trident is a national commitment, not an individual Service commitment, and that the cost must not be borne by the Navy or any other Service alone.
On the subject of cost, I go further. I ask that instead of four nuclear submarines we should have five. The mistake was made with Polaris in having only four. Annex C of the White Paper shows that of the four, one is currently undergoing a long refit. Instead of the four Polaris submarines, we have effectively three. Those submarines take time to get to the patrol area and to come back. It takes time for them to be rearmed and refuelled. For much of the time, therefore, there are not three or even two Polaris submarines on patrol. Often, there is only one. If there were five instead of four, this would double the effective force at sea at any one time.
The Minister referred to the disturbing press reports over the past few days to the effect that the whole future of the Navy is at stake and that it will no longer be an effective force. In many ways, the Minister has answered that point. Nevertheless, in my constituency there is grave concern about the future of the Navy and of the dockyard. In the Portsmouth area, 80,000 jobs with the Navy and the dockyard are at stake. People are rightly asking why, if millions of pounds can go to bolster up British Leyland and to save jobs there, defence costs should be cut and those 80,000 jobs put at risk.
I therefore ask for a categorical assurance from the Minister—I am sure that my hon. Friend the Member for Rochester and Chatham (Mrs. Fenner) feels the same way—that Portsmouth dockyard will not be closed. It is not merely a question of the effect on employment and morale in Portsmouth. There are more naval training establishments in the Portsmouth area than anywhere else in the country. Those establishments depend entirely upon Portsmouth dockyard for the maintenance of their very sophisticated equipment.
I wish to follow what has already been said about the protection of convoys. It has been suggested that submarines can do the job, but there is no doubt that in any future war, as in all past wars, the bulk of our supplies of raw materials, food and manufactured goods of all kinds will come by sea. Those supplies will have to come in

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convoys, and the convoys must be protected. Nimrod aircraft give outer cover and outer detection of submarines, but there are far too few. The convoys will need close protection of the frigate type, as in the last war.
As was also shown in the last war, there is a need for hunter-killer groups. There is no doubt at all that the only effective hunter-killer today is the nuclear fleet submarine—the hunter-killer submarine armed with conventional torpedoes. They are the only vessels fast enough to keep pace with and to catch other nuclear submarines. In bad weather, certainly, no surface vessel could do that. As the last war showed, we need the complete team—the long-distance reconnaissance aircraft, the close escort and the hunter-killer. I believe that in the last war about 60 convoys were at sea at any given time. We do not now have the ships or the aircraft to provide sufficient protection.
The Minister also did not say anything about the protection of our North Sea oil supplies. This is a matter of grave concern. I should be grateful if we could have more information on what the Minister has in mind about the way in which those oil rigs can be protected.
We have heard a great deal today about the cost. I am sure that economies could be made in the ships of the Navy. We could have simpler ships—ships built on a modular pattern, with less specialised requirements. The American navy uses a far greater proportion of ordinary commercial bits and pieces. We should have fewer changes in specifications, especially when there is a refit or when a ship is being built, because the cost escalates every time a change is made. There could well be the acceptance of the built standard throughout the life of a ship, instead of having very long and very expensive refits. Such refits mean fewer ships available, and that escalates the cost.
There is a further point with regard to the fitting up of merchant ships. We could do what was done even before the First World War, so that fittings are installed to take armaments or helicopters. Those modifications and strengthenings should be built into the ships when they are being constructed. But whatever is done, nothing can replace a balanced Fleet, including major units and a major surface fleet. Trident cannot replace it; submarines cannot replace it. Whatever the result of the review that the Minister is carrying out, I hope that he will bear in mind that we must have a strong surface Navy as well as submarines.
8.3 pm
Mr. Kenneth Warren: I wish to declare an interest, in that I have been engaged in the defence industries for much of my industrial life.
In this valuable debate we have to address ourselves to the nature of the threat that we face and how we can meet it at the minimum sensible cost in terms of money and of our resources. I should like to deploy the argument that by using the best of our technology we can offset the sheer weight of Russian armaments, which we cannot meet man for man, tank for tank or aeroplane for aeroplane. In his gallant speech, my hon. Friend the Member for Ashford (Mr. Speed) referred to the threat that is towering ever higher over these islands. He paid a professional tribute to the work of Admiral Gorshkov in the last 20 years in achieving the supremacy of the Russian Navy.
It is interesting to consider the way in which, in the last 15 to 20 years, the threat has grown against us. Two
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distinct components are involved. First, the size of the threat has varied slowly and often imperceptibly with time. Over the 15 years in which measurements have been taken with a fair amount of accuracy it can be seen that the percentage of gross national product that the Russians now devote to their armed forces is 13 per cent. That is an enormous proportion, which cannot be compared with that of any other nation in the world. As the figure has grown to the 13 per cent. level, they have deployed increased fighting capability right across the spectrum of their war machine.
The second component of the threat to which we should pay attention is the style of the threat. This also varies very slowly because of the time that it takes to develop weapon systems. As my right hon. Friend the Secretary of State said this afternoon, we have seen a tremendous increase in the numbers of Soviet tactical aircraft. They are now deployed with three times the range and twice the payload of 10 years ago. Whereas in 1970 there were no Soviet army attack helicopters, today the Russians have three times as many as has NATO.
Perhaps my right hon. Friend felt that he could nor refer this afternoon to the style of the threat undersea, but I am told that the latest class of Soviet Typhoon submarine has a speed capability under water more than double that of the type 22 or type 23 frigates about which we have been arguing. In other words, if one tows the sonar across, one just watches them go by. I am not surprised, therefore, that a radical re-thinking has to take place of the way in which, within our resources, we can meet these threats.
From my knowledge of technology, I should like to extrapolate how I see the threat developing in the next 10 years in relation to what the Russians can do and what we can do to meet it.
At the end of those 10 years the Trident will be on station. In those 10 years, however, there will be two more generations of technology in Russia, and certainly one more generation of politicians. We are starting from a position, in relation to the Russians and their anti-ballistic missile defences, where they have done the courtesy to the United Kingdom nuclear deterrent of putting their one and only anti-ballistic missile defence system across the path. that the Polaris missiles would take into Moscow.
We are starting from that level. There is also the tremendous amount of work that the Russians are carrying on at their research establishments at Sharagyn and Semipalatinsk on laser and charged particle weapons, to a point where the Ministry of Defence has to face the question: with the Tridents on station, how many Trident missiles will get through, and will this weight in the balance be sufficient to act as a real deterrent to Russia?
I think that we can achieve an out of balance position, in order to make the Russians pay attention to us, if we can have access to the American work that is continuing in this area. Perhaps in his reply, my right hon. Friend the Minister will be able to say whether in the Trident agreements the Government have rights to the United States counter-work which will enhance the Trident programme over the next 10 years. I commend to his attention the Defence Advanced Projects Research Agency, the "White Horse" project in the United States on defence against missiles outside the atmosphere, and the Livermore research laboratory's defence against missiles inside the atmosphere.
It is important to make sure that we have the balance in our favour. When we look at the way in which the SALT

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negotiations can develop inside and outside SALT II, we find that under SALT II over the next 10 years the Russians will legally be allowed to advance from about 6,500 nuclear warheads to over 12,000. In other words, within SALT II they are allowed to double, but outside SALT II, taking account of the fact that they are developing five new inter-continental ballistic missiles and medium-range ballistic missile systems at present, they would then advance from 6,000 warheads to 21,000.
Those are numbers quite beyond comprehension in terms of devastation that they could bring. Those who have said in the debate today that Trident is so much the ultimate deterrent that it will never be used should face the fact that it is not only Admiral Gorshkov but President Brezhnev, in his own writings about the Soviet Army, who has said that they regard atomic weapons as part of the inventory of weapons that they will use in any conflict. There is no question about that. It is not the ultimate for them as it has to be for us.
We have to be aware of the fact that in the capability that the Russians have demonstrated in firing existing weapons they ought with their accuracy to be able—these are United States' estimates—to be able to take out 90 per cent. of the Minuteman missiles on a first strike into the United States. So the balance is difficult, but it must come down in our favour if the investment in Trident is to be the deterrent that we want it to be.
My next point concerns the other battles that will have to be faced in the 1990s. The technologies that we deploy in our computers and on our drawing boards will have to rival those that are being deployed in other NATO nations—in competitive and weapon terms—in order to outstrip work undertaken in Russia. It takes 10 years for the concept of a modern weapon—stretching across those two generations of technology, which can change the concepts in mid development—to reach the point at which it can be put into practice. That time scale automatically implies that we should pay more attention to the resources and brains available in Britain.
Even if we were able to look through the diplomatic mists to 10 years hence, we would not see a happier or calmer world. Therefore, we must make preparations not only for Trident but for the other types of warfare that we might have to face if the Russians chose to deploy their forces against us. If we do that, we can still maintain the right to have a strong voice in the councils of Western defence.
I shall put forward four ideas which I hope will commend themselves to my hon. Friends and to my right hon. Friend the Secretary of State. I hope that they are worth examining in terms of trying to review the defence equipment procurement and methodology of the Ministry of Defence.
The first idea is easier to put forward than to practise. In the American vernacular it is called "zero budgeting". An examination, at least, should be undertaken. When we are so tight on the resources that can be deployed, we should have a team which in parallel with existing work, will justify every type of defence in terms of its relevance, its dating and obsolescence, as well as the total cost of ownership. It is not so much a question of buying a weapon in the first instance as of how much it will cost over the 10 to 15 years in which it will be kept in commission. It
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should ask the question, and report to the Ministry of Defence on whether we can afford each and every commitment that we have.
The second idea concerns technical specifications. Are they relevant to the operational needs that will be faced in 10 years' time? Fifteen years ago I was responsible for producing a photo processor. It was a monster device with whirring wheels, which were supposed to take the nice films from Victor bombers that came back from reconnaissance flights. It was supposed to turn them out at high speed. It was a huge machine. We had a contract from the Ministry of Defence to produce 10 of them. Under the terms of the contract we were required to conduct a test, which consisted of dropping the equipment off the back of a lorry to see what would happen. It was called "the drop test". It broke in half.
If it is thought that such things cannot happen today, I must tell you that there is today an extremely good and expensive weapons system, which requires excellent test equipment to accompany it. This contains commercial standard components. No military components can match these commercial components. They are excluded from all the drop and vibration tests, but the rest of the equipment has to go through those tests although it is part of the same package. An item can be dropped, when it is known that it will break. The commercial part is not required to be of military standard. That is ridiculous. I am told that the development expense involved is colossal.
Who is questioning the relevance of technical specifications in such expensive equipment? That equipment must work properly if our defence system is to work. Those specifications should be examined, not to get rid of commercial equipment, but to bring a bit more in. Usually, military specifications cost five to 10 times more than items that could be bought off the shelf if a commercial standard were sought.
The Ministry of Defence rightly wants to save money. I hear that there is an edict around to the effect that no vehicle or weapons system should be built with an out-of area capability. My hon. Friend the Under-Secretary of State for Defence for the Royal Air Force made a wise speech and said that we should have a deployment force that is able to operate in the Persian Gulf. However, if the equipment is not to have an out-of-area capability at the design stage, it must be remembered that something that works in Britain will not work in the sun and sand of the Persian Gulf. Should we acknowledge that the style of the threat changes with time and reflect that in our specifications?
My hon. Friend the Member for Portsmouth, South (Mr. Pink) raised the subject of warship needs. I am sure that he appreciates that the specifications put out for the Royal Navy are often not in sympathy with those required in most parts of the world. It must be to the chagrin of British warship builders that they see the Italians walking away with contracts that they used to win in South America. Indeed, only this evening a naval architect told me that when one worries about the type 22 and type 23, it should be borne in mind that if the Navy were to cut down on what it wanted to carry in its vessels and got more armaments in, the price could be reduced to a quarter or one-fifth of what is now paid.
I should like to impress on the Secretary of State and his colleagues that we should look at design in terms of the total sale of the end product, instead of in terms of what the Navy wants. To evaluate the result of all our efforts

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to standardise and reduce costs, one should look at what is on the frontier of the Iron Curtain. The British Army's First Armoured Division faces the Soviet Union's Third Shock Army. There are equal numbers of men, but the Soviets have twice as many tanks. What is the specification of a Russion division, when it means that it has twice as many tanks for the same number of men?
At times we have questioned the memorandum of understanding on which so much of our armaments trade with the United States of America is based. I have looked through it. I hope that my right hon. Friend will have one more look at it. I can find nothing that would preclude the United Kingdom from having an offset agreement under the Trident agreement with the United States of America. If 30 per cent. of Trident is built in the United States of America, it will be equivalent to 75,000 jobs for a year in Britain.
We must erode the duplication of expertise that is practised at two levels on the same contracts in the Ministry of Defence and in industry. We must try to shorten contract times. It is time that costs money, rather than men or materials. I commend the American practice, whereby the American Department of Defence delegates the job of running the contracts to prime contractors. We must give industry a power that is not used often enough in the Ministry of Defence. I refer to the power of management to say "No" to change. Above all, I should like to see the deployment of brains of British industry, because that will give us the technology to win the peace of the 1990s.
8.17 pm
Mr. John Ryman: I shall make a short speech. I wish to raise the subject of the Admiralty's shipyards on Tyneside, as a result of the rumours that have appeared in newspapers in the past few days and as a result of the resignation of the hon. Member for Ashford (Mr. Speed).
As a result of the recession in the merchant shipbuilding industry, a large proportion of the work done on Tyneside is shipbuilding for the Admiralty. Indeed, the new "Ark Royal" is being built on Tyneside. Thousands of jobs are involved. Many of my constituents work in the shipbuilding industry on Tyneside carrying out Admiralty work. Since the reports appeared in the newspapers during the past few days there has been a great deal of rumour and worry about the Government's plans for local employment for thousands of workers on Tyneside. We want to know the position. Governments have played cat-and-mouse with Tyneside for years. I am glad to see the hon. Member for Tynemouth (Mr. Trotter) in the Chamber. If he catches your eye, Mr. Deputy Speaker, he will no doubt support my remarks.
Because of the recession in merchant shipbuilding on Tyneside, a large proportion—about 70 per cent.—of work is for the Admiralty. As the Government appreciate, the fundamental difference between merchant shipbuilding and Admiralty work is that Admiralty work takes much longer. I am told that it takes between 12 and 18 months to build a merchant ship but that to build the cruisers currently being built on Tyneside takes anything up to five years. The strong rumour on Tyneside last weekend was that the construction of the new "Ark Royal" would cease, thereby jeopardising about 4,000 jobs in an area of existing high unemployment. The workers on Tyneside are entitled
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to know the position. They have a long and honourable record for hard work, good industrial relations and great skill in merchant and Admiralty shipbuilding.
I declare an interest because Blyth was a submarine base during the war and has a long and honourable tradition with submarines. Large numbers of Navy personnel live in my constituency and many of the best regiments in Britain recruit in Northumberland. We need to know the position on Tyneside. Unless the air is cleared and the Government's intentions stated unequivocally and precisely, the present worry will escalate, much hardship will be caused and greater uncertainty will be created in an area of existing high unemployment.
If the jobs go—and thousands of jobs are involved—no other jobs will be available, thanks to the Government's asinine policy of abolishing special development areas in the North-East of England. If the Government now cause the loss of further jobs in the North-East, especially on Tyneside, with its Admiralty contracts, thousands of men will be thrown out of work without any prospects of alternative employment. There are no jobs in the North-East, as a direct result of the Government's policies—deliberate policies to smash regional aid, knowing full well that there are no alternative jobs.
I do not for one moment subscribe to the blimpish speeches that have been delivered from the Conservative Benches tonight. However—and this should be said—I passionately believe in the defence of Britain. I find the defence policy of the Labour Party confusing, to say the least. The cheap blasts from the Conservative Benches do not help when we are discussing a serious matter. The Labour Party takes the defence of Britain seriously. I ask the Government to be sensible and to have regard to the rumours widely circulated both in the press and in the House during the past few days.
What are the Government's plans for cutbacks for the Navy? They will inevitably involve a cutback in Admiralty shipyards on Tyneside and in the North-East of England generally, at a time when merchant shipbuilding is in, deep recession with no real prospect of improvement in the foreseeable future. The cutback in Admiralty shipbuilding on Tyneside will mean the diminution of the large number of works currently being carried out—quite apart from the "Ark Royal"—and thousands of men will be thrown out of work. The Government must clear up that uncertainty.
I am not interested in the internal machinations of the Tory Party. I am not interested in the disputes currently taking place within the Government. I am interested in jobs for my constituents. The Government's behaviour during the past few days has created enormous uncertainty. I ask the Minister to explain the position and to allay the fears of workers on Tyneside.
8.25 pm
Mr. Robert Hicks: I find it somewhat disconcerting that we are holding our annual debate on the Defence Estimates against a background of profound uncertainty about the future distribution of expenditure within the overall defence budget. It has been suggested by the press that the Royal Navy would have to bear the brunt of any such redistribution of resources. A figure a 75 per cent. of savings in the Royal Navy budget within the overall defence budget has been mentioned. I find that difficult to comprehend.
It is recognised that in recent years the Soviet bloc has established parity in strategic nuclear weapons and a

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substantial superiority in conventional weapons. In the West, we have seen a considerable Soviet maritime buildup with a world-wide naval deployment. The Royal Navy has a role to play in combating that threat and a specific function in anti-submarine warfare. It is important that the quality and effectiveness of its anti-submarine strategy should be maximised.
Many Conservative Members feel that the Royal Navy has a unique and vital contribution to make, not only to NATO but to the defence of our national interests, both in peacetime and in war. It would be wrong for the Government to make a decision to downgrade that function.
I want to mention two related aspects—the morale of the manpower serving in the Royal Navy and the effect that any such downgrading will have on both the regional and the local economies of parts of the United Kingdom. I make no apology for mentioning that the part of the United Kingdom that I serve has a strong defence tradition. The importance of the Royal Navy and its associated activities to the Plymouth region and the South-West and to my constituency in south-east Cornwall cannot be over-emphasised.
Over 20 per cent. of the work force in Her Majesty's dockyard at Devonport lives in my constituency. Furthermore, all the non-officer intake into the Royal Navy undertakes its initial training in the Bodmin constituency, at the two shore bases of HMS "Fisgard", where the artificers train, and HMS "Raleigh" where the ratings train. Those two shore bases at Torpoint, together with the dockyard, have a major impact on the economic activity in my part of the country, where unemployment is currently 14 per cent. At present, 590 artificers are undertaking their part I and part II training at "Fisgard", where 134 service personnel and 110 civilians are employed. A major investment programme is planned for the future. Across the road at HMS "Raleigh" a £14 million capital works project has just been completed.
I ask the Under-Secretary who is to reply to consider the effect of all the uncertainty on the morale of those who have just joined the Royal Navy and those who are already embarked on a Service career.
My right hon. Friend the Secretary of State asked the House to look at the decisions that he has to make as changes rather than savings. That may be a fair request, but in return I ask him to appreciate the anxieties of those already serving in the Royal Navy and those who have just joined. We all recall the traumatic experiences suffered by many of their predecessors as a consequence of political change. That is why I always worry when Ministers, of whatever Government, talk about fundamental reviews.
I recognise the complexity of the problem facing the Government. Money is short and it is important that we get the emphasis right, but I ask the Government to recognise the role and functions of the Royal Navy. My right hon. Friend the Secretary of State represents a constituency in Cornwall and will acknowledge that once a force such as the Royal Navy is relegated in status it is enormously difficult to restore its position if it is subsequently realised that a mistake has been made. I earnestly hope that my right hon. Friend will not fall into that trap.
8.32 pm
Mr. Neville Trotter: I start by reminding the hon. Member for Blyth (Mr. Ryman) that by concentrating aid to the regions on smaller areas the Government are ensuring that areas such as Tyneside have a better relative position for the future than they had under the aid scheme of the Labour Government.
I echo what the hon. Gentleman said about the uncertainty that has been caused on Tyneside by speculation in the press over the past few days, especially about the fate of "Ark Royal". I was delighted to hear that my right hon. Friend the Secretary of State will be attending the launch of that ship in two weeks' time and I am sure that he will see the good sense of putting such a valuable asset into service. I remind him that there are many other roles envisaged for "Ark Royal" apart from anti-submarine warfare, to which he alluded.
My right hon. Friend has a painful and difficult task in his review, and it is bound to cause concern and upset. However, we should emphasise that, unlike previous reviews, this one is not based on cuts in spending. It is instead seeking a better way of spending the greater sum that will be available in real terms. More than £12,000 million is to be spent this year, and that is the highest figure in real terms for 12 years. In addition, it is envisaged that the figures, high as they are, will in the future rise by 3 per cent. a year, after allowing for inflation. It is not the Secretary of State's fault that these increases are not enough to pay for the ever-increasing cost of new technology.
Defence Ministers in all Western countries face the same problem. Unfortunately for us, Marshal Ustinov, the Defence Minister of the Soviet Union, does not operate under the same financial constraints. As a result, Soviet forces are being re-equipped with high-quality equipment and we can no longer rely on the quality of our equipment to make up for our numerical inferiority.
The problem of ever-rising equipment costs is certainly not new. The Defence Estimates for 1939 stated:
"One factor which has led to increased expenditure is the ever increasing complexity of modern armaments … The ingenuity of the inventor is for ever resulting in new devices and improvements which, while they add to the effectiveness of the weapons in question, also add appreciably to the cost."
That was the situation in 1939. I should add that the cost of the whole Air Force in that year was £200 million. We have come a long way since then.
Our debate today takes place in something of a vacuum, while we await what may be major changes at the end of the review. It is rather like discussing a company's annual accounts when we know that the accountants have been specially called in to review the workings of every Department.
Leaks were inevitable, because details of parts of the review were widely known throughout the Services. The rumours have undoubtedly been harmful. It is a pity that the excellent statement made by my right hon. Friend to the Procurement Executive a few days ago was not published a little earlier, as it made clear the background to the review and would probably have dispelled many of the most alarming and scaring of the headlines. The Royal Marines must have choked over their breakfast toast when they read that the whole of that magnificant corps was to be disbanded, according to the front page of one newspaper. I was very glad when my right hon. Friend denied that suggestion today. However, some concern

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must remain in the corps on the ground that there is no smoke without fire. I am sure that everyone, whether on Tyneside, in the Royal Marines, in Portsmouth, Devonport or Chatham, will want the general uncertainty to be cleared up as soon as possible.
Mr. George Robertson: I listened carefully to the Secretary of State's statement, and he did not deny the story on the front page of The Daily Telegraph. He seemed to suggest that it was purely speculation and therefore must presumably be one of the elements taken into account in the review that is to be announced in July.
Mr. Trotter: As I understood my right hon. Friend, he certainly denied that the scale of the cuts suggested in that newspaper was in any way accurate. To my memory, he specifically denied that the Royal Marines were to be disbanded. My hon. Friend the Under-Secretary of State is nodding to confirm what I say. So the Royal Marines can eat their toast with some relief tomorrow morning.
Difficult balances need to be struck by the Ministry. A balance needs to be struck between the different missions of the Services, and again between buying new equipment and running costs. Above all, we should cut out the harmful cuts that have often been made in fuel, spares and training, which are all bad for morale and efficiency, but which take place because there is no other way of balancing the books at the end of the year. There also needs to be a balance between the near-term and long-term objectives. It can take 10 years to introduce a new weapons system. If our judgment is wrong, we may deter a war today but find that we are too weak in 10 years' time. Then there is the difficult balance to be made between the numbers and the quality of the equipment. Of course, numbers count, but so, against the sophisticated navy and other forces of our opponents, does sophisticated equipment. However, if we have a highly sophisticated system, we have a high cost.
Beyond that, there is the main question, which is one of economics for the Government as a whole, rather than for Ministers in the Ministry of Defence. If the Soviets keep on increasing their military spending by 4 per cent. or 5 per cent. a year, and we in the West increase ours by only 3 per cent., can we, by any degree of skilful allocation of funds, prevent the adverse balance tilting too far against us so that our safety is at risk? I suggest that there is nothing sacrosant about a 3 per cent. annual increase. In fact, in the mid 1960s' when as a country we were poorer, we spent more in real terms than we are spending this year.
It is right that my right hon. Friend should consider all options, and I support what he is doing. I wish to make a few suggestions. First, it is important that the Ministry of Defence itself—the organisation and, if I may use the word, its bureaucracy—should be subjected to exactly the same review as are the Royal Marines, HMS "Ark Royal" and all the other fighting units. There is room for considerable economy in the Ministry of Defence, and it is important that those who serve in units can see that the headquarters, too are affected by the changes that affect them.
More could be done to bring down the cost of equipment for the Forces by spreading overheads over larger runs if we pursued the possibility of exporting more equipment. Mention has been made in this debate about
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the difficulties of exporting warships. I have found from my own travels abroad that we have lost out on a generation of submarines. One now finds German-built U-boats in many navies in the Third world.
That is mainly because we have not put into production a new conventional submarine for our Navy. It might be a good use of funds to bring forward production of a few of such submarines. We shall need them eventually, for training if for no other reason, because nuclear submarines are too expensive for that role. If we brought production forward to the near-term we might be able to obtain submarine exports and work for our shipyards which are in such desperate need.
More international co-operation is required in production. The two-way street across the Atlantic must be made into a road with both carriageways of equal widths. Too often in the past, it seems to be a motorway in one direction and a country lane in the other. There are now hopes of major exports to America with the Hawk, the Harrier and perhaps the JP233 and Stingray.
Whatever else my right hon. Friend may do when reallocating funds, there should not be a reduction in the number of people serving in the Forces, even if that requires us to keep on old equipment that we would rather have replaced by new. The quality of our men and women is first class, but their numbers are not excessive. We have only two-thirds the number in the Services that Germany and France have. With old equipment they can still give a good account of themselves, and certainly a better account than if they did not exist.
I hope that we shall consult NATO before the reallocaton takes place. It must surely have views about our commitments and the changes that we make. Above all, the House and the country should be informed. of the principal options that were available and why the decisions are taken. There should be no secrecy. Defence is a unique subject, but it is important that we are given the details of the alternatives and why the choices are made by the Government.
Normally, there are no detailed discussions of defence proposals in this House. We treat defence unlike any other subject. For instance, if there are changes in social service provisions we expect to have a debate and a vote on the details of each change. The position here is unlike that in America, where, each year, every item of the Defence Estimates is subject to scrutiny and vote by the well-informed congressmen and senators who specialise in the subject.
There must certainly be a further debate in the House as soon as the review is completed, and there should be debates on each of the three Services as soon as possible, so that the role of each Service can be discussed by the House in a way that is not possible in a general debate.
There has been much speculation about the future role and size of the Navy. Changes could have serious implications both for the safety of our Mechant Navy and for the future of our shipbuilding industry. I remind the Secretary of State that 60 per cent. of the shipbuilding industry in Britain today is engaged on Royal Navy work and only 40 per cent. on merchant building because of the rundown in orders for merchant ships.
We should not build £100 million ships just to provide work. However, many people believe that the money is better spent on them than on subsidies poured down the

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drain for such businesses as British Leyland. I accept the need for simpler ships, and my right hon. Friend hinted at that. It is one way of maintaining the necessary numbers.
The number of surface ships in the Navy has already fallen by nearly one-third in the last few years. I cannot believe that the 1,500 merchant ships which the White Paper reveals would have to cross the Atlantic in a month during a war to bring reinforcements and supplies from America could be escorted adequately by submarines and aircraft alone. Surely there must be surface ships, who can shoot down long-range missiles fired from Soviet submarines, aircraft and surface ships. Only a surface ship can deal with such an attack. A submarine certainly cannot.
Some would say that a war in Europe would be so short that convoys would be irrelevant. We cannot be sure of that. The Germans have a strong Army and a small Navy. We have the opposite. That is not just because of our history, but also because of our geography. Our back door is the Atlantic. If we do not defend it, there is nobody else to do so. If the Atlantic sea lanes are not kept open, we face defeat in Europe by strangulation. That might be slow, but it would be just as certain as defeat by direct assault. It is something that we cannot allow.
8.45 pm
Mr. Ernie Ross: We are holding this debate in a crucial period for working people in this country and for people throughout the world. The year 1980–81 will no doubt be remembered as a period of bizarre economic dogma sponsored by a bizarre and economically illiterate Government who wreaked havoc on the people and the economy of Great Britain. Members of the Opposition take no great pleasure in reminding the people of Britain generally that all our warnings without exception have become a terrible reality; billions of pounds of cuts in the vital social services, bankruptcies by the thousand, industrial production reduced to the level of the 1929 depression and 2½ million officially unemployed, with even the Government admitting that predictions of 3 million or more unemployed are likely to be fulfilled in 1981.
The year 1980–81 will surely also be remembered as a period that ushered in an even more unfriendly, unwholesome and dangerous situation in the shape of seriously deteriorating international relations. Certainly 1980 was the first year since the 1930s that an economic slump, mass unemployment and a growing Right-wing authoritarianism were locked in a ludicrous embrace with a dangerously accelerating arms race. These Defence Estimates are part of all that.
No one should be complacent because, as my right hon. Friend the Member for Bristol, South-East (Mr. Benn) said at the miners' gala in Scotland last year, no arms race in history has ended without war. I would argue that anybody with eyes to see knows that the threat to our schools, housing, health, employment, living standards and, indeed, life itself comes not from some mythical Soviet menace to which we have to respond in these Defence Estimates but from the International Monetary Fund cuts, the EEC, the investment and pricing policies of the multinationals and the United States-inspired arms race.
Hon. Members should ask themselves whether it is the Soviet Union or the Prime Minister that is responsible for
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the massive deflation being imposed on this country, the decline in industrial production, reminiscent of the 1930s, the slashing of public spending, the mass unemployment affecting the country, the flight of capital, the chronic under-investment in British industry and the fuelling of the arms race. Those are the real dangers facing working people in this country.
It is encouraging that the British people not only have begun to get wise to the Government's domestic programme but also are beginning to see through their foreign adventures as well. We have to call them adventures because they certainly do not resemble anything that could be considered a policy. This opposition was expressed most recently in the local government elections and also in the opinion polls and the people's demand for withdrawal from the Common Market. More important for this debate are the growing movement against war, against United States bases in Britain and against the deployment of nuclear weapons on British territory, the shrinking support for Trident and cruise missiles and the absolute lack of support for the neutron bomb and post-colonial dream of President Reagan or our own Prime Minister, the rapid deployment force.
The whole basis of our foreign policy, which is really a slavish obedience to the United States, and bellicose military adventurism, is in the process of being rejected by the British people. Even anti-Soviet hysteria, which has been a true and trusted ally of reactionary politicians in the past, is beginning to be questioned by peoples and Governments all over the world. Certainly we on this side would argue that, from the end of the Second World War and throughout the cold war, the Soviet threat was usually posed in terms of a Russian arms build-up and numerical or technical superiority. We have heard this again today. Both the bomber gap scare of the 1950s and the missile gap scare of the 1960s, were subsequently exposed for the lies that they were, but not before a new twist had been given to the arms spiral by the United States and the arms producers in the name of catching up, which we have heard again today, and not before the arms manufacturers had pocketed appropriately large profits.
Today we see a new generation of nuclear warheads and missiles which the Americans argue are capable of being used in a first-strike capacity and as part of the so-called theatre of limited nuclear war. They have been perfected and churned out—the cruise missile, the MX missile, Tridents, neutron bombs, planes that fly through radar and a new long-range bomber. This is at a time when the Stockholm International Peace Research Institute estimates that the United States superiority of strategic warheads over the Soviet Union is 10,000 to 5,000.
It has been said that this is merely a response to the events of Afghanistan. That is a lie which should be nailed immediately. These projects do not appear out of thin air, as has been said from the Government side today. They take years to research, design, cost and prepare. The West German Defence Minister admitted recently that the preliminary decision to deploy cruise missiles in Europe was taken in 1975. We know, too, that a decision was taken in 1977 to increase the NATO arms budget by 3 per cent. each year in real terms. That was the year in which the go-ahead was given to Trident.
An $80 billion procurement programme was agreed to in May 1978 in Washington at the same time as the United Nations was holding its special disarmament session in

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New York. We now know that as Carter was almost literally boarding the plane to take him to Vienna to sign the SALT II treaty, he gave the green light for the MX mobile underground strategic system which we saw in the "Panorama" programme last night.
The Brussels decision to deploy 572 cruise and Pershing missiles in the territories of Western Europe, like all the other insane decisions, was taken before, and not in response to, events in Afghanistan.
While we are talking of hypocrisy, it is sickening that the Americans should use the Soviet military contingent in Afghanistan as the hypocritical excuse for breaking off the arms limitation talks and for a military build-up. Are memories in the House so short? Have we forgotten that, at the height of the bombing in Vietnam, the SALT I treaty was prepared, and while the Americans were still fighting in Indo-China the first stage of the Helsinki agreement was begun.
The arms race of which these Estimates are a part has its origin in a number of objective conditions which we do not have time to consider in detail tonight. One that must be mentioned in the context of the renewal of the Soviet scare campaign is the growing influence of the military industrial complex in the West.
The current arms build-up began when SALT II was refused ratification by the United States Congress, not because of a military fear by America of the Soviet Union but because of the fear for profits if detente and the peace process went any further. It was not Marx or Lenin who warned of the military-industrial complex; it was Dwight D. Eisenhower in his farewell address as President of the United States in 1961. He said:
"We have created a permanent armaments industry of vast proportions. The total influence is felt in every city, every State house, every office of the federal Government. We must not fail to comprehend its grave implications. In Government we must guard against unwarranted influence by the military industrial complex."
Mr. Wilkinson: Will the hon. Genteman kindly inform the House who wrote or prepared this speech? Surely it is not the product of even his own perverted logic.
Mr. Ross: If the hon. Gentleman wishes to participate in the debate, I am sure he will make every effort to catch your eye, Mr. Deputy Speaker. If he wishes to disagree, it would be helpful for him to make a useful contribution.
There is no doubt that detente is bad for business. Between 1970 and 1975 world military spending grew by only 1·1 per cent. a year. The 1977 NATO decision was for a 3 per cent. annual increase. President Reagan, encouraged by the Soviet scare, projects an even bigger increase. We are not debating United States spending, but we are part of it. The United States will be spending $1 trillion in the five years up to 1985. Military and industrial complexes clearly recognise the problems involved if SALT II negotiations had come to fruition. The mouthpiece of American capitalism, the Wall Street Journal headed its front page on the concluding day of the Senate hearings by saying "Reject Salt now". Even the prestigious American stockbrokers, Drexel, Burnham and Lambert expect defence issues to out-perform the market. While the profits of many other industries are likely to shrink, they say, defence producers will show rises of 10 to 20 per cent. this year and next.
Mr. Robert Atkins rose——
Mr. Ross: Hon. Members on the Opposition Benches have many disagreements with the contents of the Defence Estimates. I should like to see the money put into other areas much more concerned with working people. I should like to see the Government extending diplomatic, cultural and trade contacts between countries with different social systems. It is not all one way. These contacts help to break down barriers. They lead to relaxation of tension and the building of mutual trust and confidence. They also hold out the prospect of material and economic benefits for the populations of the countries concerned. I am sure that the hon. Member for Preston, North (Mr. Atkins), who keeps trying to intervene, will be pleased to learn that, last year, West Germany's trade with the Soviet Union amounted to 16 million deutschemarks, for which I am sure the people of West Germany were grateful.
We should also like to see the Government take a greater interest in the elimination of racialism and Fascism and give support to the world's national liberation movements. I would prefer to see the Government supporting the sort of attitude taken by Socialist countries in their economic boycott of South Africa. I do not agree with the adventurism of the United States in supporting the Fascist countries of South America and its apparent decision to establish some contact with South Africa and Argentina. That cannot benefit people in this country.
We should also like to see support for the developing countries, the newly independent countries and those in the non-aligned movement. We should support their efforts to achieve a new international economic order and to help to free them of the new colonialism of the multinational corporations. It is not the Soviet Union, a country more or less self-sufficient in raw materials and natural resources, but the Western countries, especially the United States, which are seeking to use military might to maintain political and economic conditions favourable to the big business enterprises of the West. The United States maintains 500,000 Service men in 2,500 overseas bases to prop up and insure the world-wide profit interests of Western capital. Overseas earnings are now the major feature in big business balance sheets.
Whereas, in 1964, 38 per cent. of Western multinational corporation profits were earned abroad, the figure in 1971 had jumped to 69 per cent. Clearly, the Western multinational corporations do not seek to help the developing countries in the manner that we would wish to see.
Mr. Wilkinson: On a point of order, Mr. Deputy Speaker. I should like to draw your attention to the fact that the hon. Gentleman—I have to call him such—is reading. He is clearly reading from a prepared script that I suspect was not prepared in the House. It is surely the custom of this place that hon. Members should have occasional recourse to notes and that right hon. Members, on the Front Benches may have recourse to more copious, notes owing to their special responsibilities. I suggest to you, Mr. Deputy Speaker, that the hon. Gentleman is reading. I suspect that his text was not prepared in this place.
Mr. Deputy Speaker (Mr. Bryant Godman Irvine): It was the principle a few years ago that if an hon. Member was reading from what were evidently more than copious notes, he was interrupted. That practice seems to have

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slipped a little. If the hon. Gentleman can adopt what was our previous practice, no one would be more happy than I.
Mr. Cryer: Further to that point of order, Mr. Deputy Speaker. If hon. Members are not allowed to read from notes verbatim, that means that no Minister will make a speech at the Dispatch box and half of the Conservative Members will never make a speech in the House.
Mr. Deputy Speaker: The hon. Member for Keighley (Mr. Cryer) is wrong. Ministers have alway been allowed to read from their notes. It used to be the practice that Back Benchers used notes only occasionally.
Mr. Ross: I apologise to the hon. Member for Ruislip-Northwood (Mr. Wilkinson) if he finds my contribution distasteful. I am sorry if he does not like it. However, what I am saying is true. If the hon. Gentleman wished to disagree with the content of my speech, I could understand his intervention. I accept that he does not agree with me but hon. Members do have the right to make a contribution to debates in the House.
Mr. John Biggs-Davison: But not to read.
Mr. Ross: I am always much concerned about what I say in the House. I recognise the importance of this place. This debate is especially important. I shall continue to use extensive notes because I think it is important that what I say goes on to the record in exactly the way in which I would wish it to go on the record.
I was alluding to the role that we would like to see the Government play in preference to the Trident nuclear submarine. I shall give the House one further example. Last year our televison screens brought us news and pictures of the cruise missile, a missile that can travel 4,000 miles at 300 miles a minute. We were given the guarantee that it could land on an area no larger than a football pitch. That was supposed to the achievement of science in the 1980s.
During the same year the same television screens brought us different news and different pictures. That news and those pictures came from the Ogaden, India, Uganda, Africa, Asia and Latin America. We were shown appalling scenes of children in their millions starving to death. We are told by the United Nations that one out of every 10 babies born in the Third world last year is already dead and that 300 million are stricken by malnutrition. This is at a time when the world has spent $450 billion on its arms bill. During every hour of every day the world spends $50 million in preparation for its own destruction. One and a half days of world military spending would provide adequate food for 60 million undernourished expectant mothers, reducing if not eliminating infant mortality. A fortnight's military spending would provide adequate food for the 300 million starving children for 40 years, and 1 per cent. of all military spending would pay for the farm equipment that is needed to help poor countries to achive food self-sufficiency by 1990.
If Western politicians, including Conservative Members, are looking for breaches of human rights, they should turn their attention to the daily criminal violation of human rights of hundreds of millions. There are families without shelter, disease-ridden cities and children needing food and going hungry.
Mr. Robert Atkins: On a point of order, Mr. Deputy Speaker. What has this to do with the debate on Defence Estimates?
Mr. Deputy Speaker: I am hoping that very soon that will become apparent.
Mr. Ross: Such comments bring the House into disrepute. We are talking about Estimates that involve many thousands of millions of pounds. Labour Members would like to see that money spent rather differently. Many of the constituents of the hon. Member for Preston, North (Mr. Atkins) agree with me that the money should be spent differently.
Mr. Atkins: I advise the hon. Gentleman to go to Preston to tell them so.
Mr. William Hamilton: The hon. Member for Preston, North (Mr. Atkins) will find out at the next general election.
Mr. Ross: I am certain that the comments that are being made by the hon. Gentleman will be remembered by the people of Preston. I am sure that they will give him his reward.
Mr. William Hamilton: He will be out on his neck.
Mr. Ross: The hon. Gentleman will be given his reward when the Government are forced to go to the country to ask for its support for Defence Estimates of this sort.
All the world-wide problems are problems which we could begin to resolve if we were not wasting the money in the Defence Estimates. There are many areas in our own country where that money could be used rather than being wasted on armaments which could never be fired without being the end of us all.
Last night, on the valuable "Panorama" programme, some leading politicians from the United States disagreed with some of the thinking which has gone into the Defence Estimates and the defence spending in the West. Congressman Les Aspin even said that
"the system in the United States could not absorb the total amount of money which was being thrown at it."
Those are not my words, but the words of Les Aspin. Admiral Gene La Roque said that
"the emphasis was on winning rather than limiting a war."
All those comments lead me to suggest that this debate would make much more sense if we were talking about real jobs and real prosperity for working people. However, we are talking about producing weapons which cannot and could never be used. If those weapons were used, they could lead to the end of the civilised world as we know it.
I am one of those who has tabled an amendment which Mr. Speaker saw fit not to call. I shall join my right hon. and hon. Friends in voting against the Defence Estimates because they do nothing for the ordinary people in this country or for the needy people of the Third world. They do nothing to bring down tension and to build confidence between countries. All they do is seek to escalate an arms race which can have no other ending than the end of a world in which people could talk to each other and have mutual exchanges of confidence-building measures. In the Defence Estimates there are no peace proposals. The people of Great Britain cannot say that their children can look forward to many years of peace with other countries.
9.7 pm
Mr. Jim Spicer: The hon. Member for Dundee, West (Mr. Ross) has made free of the words "we on this side of the House". It is a tragedy that the Liberal Bench and that occupied by the new Social Democratic Party are empty, because that phrase will reinforce the members of the Social Democratic Party in their decision to leave a party that talks nonsense of a kind that I have seldom heard in the House.
The debate is meant to be devoted to a discussion of the Defence Estimates, but naturally we have spilled over into new territory because decisions will be made over the next few months. We await those decisions with interest. My right hon. Friend the Secretary of State for Defence has made it clear that those decisions will be harsh and that they are necessary. My hon. Friends who have spoken in the debate have made it clear that they accept that the central point in those decisions has been the decision on Trident, and most of us accept the need for it.
I know from my Service career that there can be no question of our spreading our capability across every area. I repeat that the decisions that we have to make will be harsh, but they cannot be made in isolation from our NATO Allies. The most important thing that we have to remember is that we are no longer independent. We are interdependent within the Alliance. Changes made unilaterally are bound to affect the Alliance and our capability to work closely with our Allies.
In opening the debate the Secretary of State made it clear that there had been and would be discussions with NATO. I hope that in winding up the debate my hon. Friend will repeat the assurance that decisions made as a result of our defence review will be made in concert with our NATO Allies and that no decisions will be taken without their full consent and approval.
There is a need for a total rethink. To take one example, we all know that the old concept of the NATO operational area is well and truly dead. The whole of the NATO strategy must be realigned as a consequence.
Russia has a total global strategy, although some Opposition Members do not accept that. At present we do not have one. In particular, the Soviet Union has developed a massive intervention force. It is estimated that within 48 hours it could move no less than 50,000 men and their equipment into the Gulf by air alone.
We talk of a rapid deployment force, but we are entitled to ask the Government: how rapid, and how much force? Equally, we must all question the fact that at present almost the total component part of the rapid deployment force is American. I felt for the Secretary of State when he was interviewed on "Weekend World" the other day and was questioned hard by that tough interrogator Brian Walden, who asked what we should be providing towards the rapid deployment force—would it be a battalion, a company or what? At that point it seemed that we were hovering between a company and a battalion, which is not good enough for those of us who believe in the concept of such a force.
We cannot accept only an American rapid deployment force. Middle East oil is vital to our survival. It is more vital to us than it is to the United States. It is therefore essential to create as soon as possible a European rapid deployment force, complementary to its United States counterpart. Some say that that is impossible and that our European allies have no interest in such a force, but I
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disagree. There would be interest in Turkey and in France, particularly if it was a separate European force to be deployed alongside a United States force in the Gulf. I add one point. Such a force must not be the present ACE mobile force. It must be additional to it.
If we consider where such a force might be based, it is not by coincidence that there is a sudden upsurge of interest in the sovereign base areas in Cyprus. Hon. Members on the Opposition Benches question whether we should hold the bases or whether they should be renegotiated. That is a measure of the importance of the bases. They are the key to our strategy in the Eastern Mediterranean.
The most important point is that, if we are to have such a force, quality must be the key to its effectiveness. We have made a good start in the United Kingdom in restoring a genuine parachute capability, but it is only a start. I hope that at some point the Government will say that we have dropped a battalion group from aircraft flying in formation and not in stream. I know that that is their wish, too, and I hope that the announcement will be made sooner rather than later. We should aim at a minimum of a battalion group, with all arms and services included in it. From that, we should build up to a maximum of the re-establishment of a parachute brigade group.
In that context I ask my hon. Friend the Under-Secretary of State for Defence for the Army whether it is not rather strange to have an elite parachute batallion carrying out guard duties in Edinburgh at this time. 'We all know that there is a need for some Army force to be deployed in an anti-tank role with helicopters. To have an elite batallion of that kind stuck up in Edinburgh at this time seems a waste of undoubted ability.
Whatever force we form, excellence and quality must be our aim. As a former parachute soldier, I know only too well the priceless asset that this country has, not only in our parachute forces, but in our Royal Marines. I know that Conservative Members and many Opposition Members deplore any talk of a cutback. Indeed, we believe that there should be expansion.
I come next to a much narrower point, which is nevertheless important. For any expansion, we require manpower. I think that my hon. Friend will accept that the Army, particularly, is often working on a very low establishment figure. That is a drawback to the efficiency of many forces.
I could understand it if the volunteers did not exist, but they do. In my constituency alone, I know of seven youngsters who, having been trained in the cadet force with the aim of going into a Service career, have hooked into their careers office with a good background, only to be told at the last minute that there is a ceiling on recruiting and the Service cannot take them, but that it' wishes them well in their civilian careers.
In this context, I make one suggestion. The budget of the Ministry of Defence may well have reached its ceiling, but could not some small part of the massive funding of the Manpower Services Commission be set aside specifically for the basic Service training of these youngsters? Of course, there would be an interdepartmental battle, but I am sure that the Ministers could hold their corner. If they could grab £10 million or £20 million from the Manpower Services Commission, they could do a great deal of good. Indeed, if that support could be obtained from the Manpower Services Commission, far more good would be done in the training of those

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youngsters than will be done by some of the job opportunity schemes in action today. Even if at the end of six months those youngsters could not be called forward for regular service—and one would hope that from such a pool they would be called forward—at least they would come out with some basic training, they could go into the Territorial Army and in my view they would be better equipped to carry a job in civilian life.
I know that we are looking anxiously at the clock. I applaud the statement of the Secretary of State today that adequate time will be given for a debate after the review has been carried out. I think that all Conservative Members expect that and hope that it will come about. We have backed our Prime Minister in her forthright support for adequate defence forces both for this country and for the Western Alliance. We shall continue to do that, and we shall give our support to our Ministers as well.
9.18 pm
Mr. George Robertson: The debate has been rather 'different from the one that we should have expected, had not the furore at the weekend directed the attention of the House to some of the serious issues being considered within the Ministery of Defence. In that respect, we owe a considerable debt of gratitude to the hon. Member for Ashford (Mr. Speed) who, in the normal course of events, would have followed me in winding up the debate. Although he is absent from the Chamber at this moment I pay tribute to his sincerity and courage in blowing the whistle on what he clearly knows to be a major and massive exercise going on behind the closed doors of the Ministry of Defence, which would otherwise have continued undiscovered behind the debate taking place in the House today and tomorrow and would have been produced in what we now know to be a brief and inadequate statement placed before the House in the dying days before the Summer Recess.
I should like to remind the hon. Member for Dorset, West (Mr. Spicer) that the Secretary of State did not promise, as we wanted him to promise, a full debate on the enormously important review that is taking place. The Secretary of State changed the phraseology, even within his own speech, to say that all that we could expect was a statement. Labour Members—and, I am sure the hon. Gentleman and his colleagues—would be completely dissatisfied if the Secretary of State chose to announce the outcome of this major and fundamental review of Britain's defence by that inadequate and inappropriate method in this Parliament.
We know know that the implications of the review go far beyond the thinking that has been published in the Defence Estimates for 1981 that we are debating today and tomorrow. Some of the thinking that was elaborated upon within these documents is now being seriously questioned by the Secretary of State, with his devotion to the cause of monetarism that has wreaked so much havoc on the economy of the country, and now promises to have the same effect on the nation's defences.
Despite the Secretary of State's diversions on the iniquities of the defence correspondent of The Daily Telegraph, one point that he failed to mention was that all the editorial comment of Sunday, Monday and Tuesday of this week, in all the newspapers of this land, was unanimous on one point—if only on that one point. That
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feeling is shared by the Financial Times, The Daily Telegraph, The Guardian and all those newspapers that have chosen to comment on the matter. It is that the defence of this country is to be seriously compromised by the Government's decision to exempt the Trident missile system from any kind of review of its expenditure. They are unanimous that the Government must consider Trident as part and parcel of their defence review. I hope that the Secretary of State will consider that point this evening, and that when he has the outcome of the review he will bear in mind the views and apprehensions of people inside and outside this House.
One of the impacts of this debate—whether in the Chamber or within the Ministry of Defence—will be on Service morale. During their period in Opposition, the Conservatives often made great play of the morale of the Services. It has to be remembered by Conservative Members that pay is only one factor in building the morale of the Armed Forces of this country. If our Armed Forces are to be starved of ammunition and fuel, and of the training that is desperately needed, morale will be affected, irrespective of what we pay them.
The hon. Member for Ashford made the point clearly and tellingly when he referred to the dilemma with which he was faced when he chaired his first Board of Admiralty meeting. That dilemma could again face the incoming Under-Secretary of State for Defence if the apprehensions that are being caused by the prospect of the review are allowed to drain morale further. That is irrespective of the pay that the Government are giving to the Armed Forces. There is also the matter of resources available to them in the discharge of their duties.
I should like to refer to what was said by the right hon.Member for Chesham and Amersham (Sir I. Gilmour) in the last defence debate under the Labour Government. The right hon. Gentleman is now the Lord Privy Seal and, according to the press, he has been holding the fort for the Foreign Secretary in Europe while the Foreign Secretary has been dragged into the post mortem of last night over the dismissal of the hon. Member for Ashford. On the occasion of that last defence debate, the right hon. Member for Chesham and Amersham was the principal defence spokesman for the Conservative Party. He said:
"The Conservative Government will pay our Service men properly. They will restore their status. They will foster their morale. They will see that Service men have enough good equipment, fuel, ammunition and spares with which to fight and train".—[Official Report, 13 March 1978; Vol. 946, c. 79.]
Only two years into the Conservative Government that the Lord Privy Seal foresaw, the Secretary of State has stated in the Defence Estimates that
"The economic pressures… have also led to deep cuts in procurement of ammunition, fuel and oil, and essential spares, so that activity—training and certain deployments—has been held back too severely."
The Sunday Times described morale in the Armed Forces as brittle. That is a serious underestimation of morale in certain parts of the Armed Services. Tanks cannot move, soldiers cannot fire, ships cannot go to sea—when they do they cannot sail at full speed—men cannot get adequate training at sea or on land, weapons cannot be effectively tried out, and troops are sent home for long periods at Christmas in order to satisfy the Treasury's cash limits. Countless numbers of ships are mothballed. At such a time, morale in the Services is undoubtedly affected.
Sir Frederick Burden: I am grateful to the hon. Gentleman for saying that the morale of the Armed Forces

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is somewhat brittle under this Government. However, we have increased expenditure on the Armed Forces. Opposition Members below the Gangway demand far more extensive cuts. If they were carried out the morale of the Armed Forces would not only be brittle; it would be in pieces.
Mr. Robertson: The hon. Gentleman ignores the fact that the Conservative Party came to power defending the defence budget and promising to improve it and to strengthen basic equipment in the Armed Forces. By and large, as a result of decisions to pre-empt large amounts of resources—which have been agreed by both sides of the House—our Forces are being starved of the basic elements that are needed if they are to do the job.
Many Conservative Members have spoken about the state of morale after the weekend's coverage of the cuts that are clearly envisaged, at least in some parts of the Ministry of Defence. At the core of the issue lies the Government's decision to pre-empt at least £5,000 million on Trident. Indeed, the figure is likely to be considerably higher than that. That will place enormous and increasing strain on our resources.
Hon. Members have clearly been influenced by what the Secretary of State described as "speculation" in the press. Uncharacteristically, the right hon. Gentleman chose to pick one journalist for special treatment for his projections of what the Ministry of Defence is considering. Mr. Desmond Wettem, the naval correspondent of The Daily Telegraph, cannot, presumably, count himself in any honours list that the right hon. Gentleman may suggest.
I fail to see why Mr. Wettem should be singled out for approbrium. Indeed, the Secretary of State was apparently rebuked for daring to question the authority of The Daily Telegraph on anything other than naval matters when he chose to extend his criticism beyond the narrow issue of the The Daily Telegraph's front page. Although The Daily Telegraph gave more detail than other newspapers, it told the same tale as most of the other heavyweight newspapers on that day.
On its front page, The Times carried the headline:
"Threat of Tory revolt on £1,000 million cuts in defence."
The article continued:
"Mr. John Nott, Secretary of State for Defence, is due to see Mrs. Margaret Thatcher today to disclose plans to cut £1,000 million from defence spending over the next 10 years, three quarters from the naval budget".
The article outlined several programmes that would be cut as a result of the plan. The article stated—even The Daily Telegraph did not mention it—that the cuts included the planned successor to the Tigerfish heavyweight torpedo. The newspaper articles contain a catalogue of proposals that cannot have come solely from the minds of their naval correspondents. The Secretary of State did not say that it came from the fertile imaginations of Fleet Street. He assumed that it came from within the Ministry of Defence. The only detail that we can expect must come from those with a vested interest. The indirect criticism deployed by the Secretary of State showed that he suspected that the leak came from the subterranean depths of his Department.
It is worth reminding the House about the catalogue of proposed cuts that appear to have been leaked by someone with a vested interest within the MOD—for example, 29 of the 63 surface ships of the Royal Navy; 30,000 Service men and women employed by the Royal Navy; two Royal dockyards specified as Chatham and Portsmouth—the
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hon. Members for Portsmouth, South (Mr. Pink) and Bodmin (Mr. Hicks) mentioned the apprehensions raised by the speculative stories that have caused grave discontent in the areas that will probably be affected—"Ark Royal" and "Invincible" will not be put into active service; the abolition of the Royal Marines;, the abolition of the Sea Harrier force; the mothballing of 60 Sea Kings, the abandonment of the type 23s and the abandonment of the heavyweight torpedo.
We need from the Minister not a denunciation of the Naval correspondent of The Daily Telegraph, but a firm assurance that those poposals are not being considered. The Secretary of State said that he had not seen any such proposals, but he was careful not to say that they were not being considered as part of any package that might come about through the fundamental review now taking place.
When the Under-Secretary of State for Defence for the Royal Navy chose publicly to say "Hands off the Royal Navy" there as not a denial by the Prime Minister that the Navy would not be protected; what happened was that the Under-Secretary was dismissed. That is hardly likely to be reassuring to anybody in any part of the country that might be affected either by military cuts as a result of the proposals or the huge civilian effects that would be felt almost instantaneously in the shipyards and the helicopter, torpedo, electronics and dockyard-related industries.
In the right hon. Gentleman's denial of the stories he embarked upon a theory that in some ways contradicted the Defence Estimates for the role of the Royal Navy. Paragraph 329 of the Defence Estimates states:
"The conventional defence of Central Europe depends crucially on transatlantic reinforcement and resupply."
Conservative Members said how important that is. I do not know how long they see a possible war continuing, or how long it can continue before reinforcements and supplies are needed from the other side of the Atlantic.
Paragraph 332 of the Defence Estimates, in an apparent contradiction, states:
"Our maritime forces are primarily designed for antisubmarine warfare, as the most dangerous threat is from Soviet submarines."
That appeared to be the track down which the Secretary of State went when he expanded his arguments this afternoon. We must know—the House and the country have a right to know—precisely what the Government envisage as the role of the Royal Navy, and whether they see a duplication, even a needless duplication, of some of its future roles.
All those working in industries either directly or indirectly related to the proposals—alarmist though they may be—which have been put forward as coming authoritatively from within the MOD, have a right to know whether their jobs and futures will be endangered by a change in the Government's view about the way in which to conduct the defence of Britain. Both defence and defence-related industries have a right to know about future ordering.
The Lord Privy Seal, when in Opposition in 1978, said:
"The House will be aware that cuts in defence expenditure are measured by cuts in planned expenditure and not by cuts in what was actually spent the year before. "—[Official Report, 13 March 1978; Vol. 946, c. 69.]
What the Secretary of State is proposing to cut now will affect the Royal Navy not tomorrow, next week or next year, but in five or 10 years' time. We are talking not only about the Royal Navy, but about the warship ordering programme. Hon. Members from both sides of the House,

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including my hon. Friends the Members for Newcastle upon Tyne, West (Mr. Brown) and Blyth (Mr. Ryman) and the hon. Member for Tynemouth (Mr. Trotter), have all expressed the same concern about the impact of the Government's indecision on the warship building programme.
There will be changes in the warship building programme irrespective of the Government in power or what view they take of it, but it is unforgiveable that the Government, who came to power committed to building more and defending the country, dither around on the outskirts placing no orders. The Financial Times said about two weeks ago that in naval matters urgent decisions are needed, or skilled staff will leave the shipbuilding industry.
The remarkable thing is that the indecision led Vice-Admiral Sir Gerard Mansfield to say in The Times yesterday:
"the message is clear."—
in relation to the shipbuilding programme—
"The Conservative's fine words in support of deterrence have not yet been matched by their actions."
This dithering and indecision is likely to prejudice large numbers of jobs in the industry, irrespective of what comes out of the defence review.
In his opening speech, my hon. Friend the Member for Pontypridd (Mr. John) referred to the sudden mysterious, surprising appearance in an advert in the magazine Defence of the names of three new submarines that had not previously been known by the public. The announcement of the names of HMS "Torbay", HMS "Tireless" and HMS "Tactician" were announced for the first time to an amazed world in an advertisement placed by Ferranti Limited in the magazine Defence.
When I tabled a question to the former Under-Secretary of State for Defence for the Royal Navy I was told that there was no information with regard to that indiscretion by Ferranti Limited but only that no inquiry was necessary. If the Government go ahead with their unquantifiable programme for Trident submarines, the size, nature and location of which have still not been announced, it will have an effect on the capacity of Messrs. Vickers and Yarrow to build the SSN programme that the Secretary of State said would be the centre-point of our new maritime defences.
The evidence presented to the defence Select Committee last year clearly laid out that in the words of the Ministry of Defence official that
"unless there was extra capacity which was made available, the advent of a successor to Polaris would cause some delay in the building-up of the SSN programme".
That has not been satisfactorily explained either by the Defence Estimates or by anything that the Secretary of State said. It can only cause increasing confusion.
As my hon. Friend the Member for Glasgow, Garscadden (Mr. Dewar) said, the future of the type 22 frigate has pointed to the indecision and confusion that has been caused at Yarrows, in Glasgow. My hon. Friend the Member for Newcastle upon Tyne, West and the hon. Member for Tynemouth have said that in the shipyards in their area—the Swan Hunter yards—the indecision is now a major factor in the minds of those who live and work there. It is incumbent on the Government as soon as possible—certainly sooner than July—to say how the shipbuilding ordering programme will go, to allow the
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shipbuilding industry to make the necessary plans if they are to be capable of delivering the present generation of warships, never mind the next generation.
The Tory Party came to power two years ago as the party, supposedly, of defence, of firm words and fine, even if unquantified, promises. The Government promised increased and more effective spending on the nation's defence and they have delivered neither. Instead, with their obsession for the Trident extravaganza, they are debilitating our forces, they are emasculating our defence efforts, and they will squeeze the effectiveness of our Services, whose morale and usefulness has been needlessly prejudiced.
Instead of a rational look at how our defence needs match our national resources, we are seeing a series of chaotic panic measures, conceived in haste, compromising the effectiveness of our defence effort, damaging our shipbuilding and high technology industrial capacity and making a laughing stock of our Armed Forces.
Overnight, those measures have produced an overheated war of words on the front pages of the press which will do enormous damage to the morale in all our Armed Forces and the industries associated with them. It is a fact underlined by the events of the past 24 hours that the effect on morale of this botched, leaked inter-Service battle, will be considerable.
The effect on our continuing undisputed defence capacity and our participation in NATO, to which the Labour Party is still emphatically committed, of clinging to an outrageously expensive nuclear fig leaf, will be traumatic. We have to thank the hon. Member for Ashford and the leaks in the national press for bringing the issue before the people and their Parliament—the people who should know and should decide. It is clear that the Government still have much to answer for.
9.41 pm
The Under-Secretary of State for Defence for the Army (Mr. Philip Goodhart): The hon. Member for Hamilton (Mr. Robertson), whom we welcome to defence debates, said at the start of his vigorous speech that my right hon. Friend the Secretary of State was not serious when he said that he wanted to have a full day's debate when the Government's defence proposals were published. I assure the hon. Gentleman that, although it is not within the power of my right hon. Friend to ensure that a debate will take place, it is our intention to seek a full debate.
So far, this has been a debate of notable speeches—not least by my right hon. Friend the Secretary of State—rather than a notable debate. The House listened with attention and respect to my hon. Friend the Member for Ashford (Mr. Speed) who made a distinguished speech in every way. I regret that he was speaking from below the Gangway. He was the first person to welcome me to the Ministry of Defence and, on personal grounds, I deeply regret his departure.
My hon. Friend, my right hon. Friend the Secretary of State and my hon. Friends the Members for Woking (Mr. Onslow) and Haltemprice (Mr. Wall) shared an enthusiasm for cheaper and simpler vessels. My hon. Friend the Member for Petersfield (Mr. Mates) vigorously reminded us that the cost of Trident was not out of line with other defence costs.
I regretted that more hon. Members were not present to hear the speech of the hon. Member for Vauxhall (Mr.

239
Holland), who added his name to an amendment signed by one of the two candidates for the deputy leadership of the Labour Party.
We were told by the hon. Member for Erith and Crayford (Mr. Wellbeloved) that the hon. Member for Vauxhall represented the new wave in the Labour Party. I thought that I heard the hon. Gentleman say that the United States could not intervene in Afghanistan because it was muscle-bound by nuclear power. I found that remark riveting. I shall contemplate it at leisure in the months to come.
My hon. Friend the Member for St. Albans (Mr. Goodhew) asked that in considering purchases of foreign equipment we should bear in mind the real social cost. I can assure him that that is done. However, surely one of the principal messages that flows from this debate is that we must seek cost effectiveness at almost all costs. I assure the hon. Member for Newcastle upon Tyne, West (Mr. Brown) that that will be taken into account in looking at the Sea Wolf improvement programme, although it is too early to say when it will be possible to reach a decision on the matter.
My hon. Friend the Member for Hastings (Mr. Warren), in another notable speech, mentioned the cooperation between the United States and the United Kingdom on the potential improvements to Trident which may be developed by the United States. As he knows, we have had a long and successful history of Anglo-American co-operation and information exchange on nuclear matters. I am confident that that will continue.
Mr. Michael Colvin: I am grateful to my hon. Friend for giving way. My hon. Friend the Member for Hastings (Mr. Warren) referred to offsets for Trident. I wonder why no such offsets have been arranged? Is my hon. Friend aware that if reciprocal sales of defence equipment from the United Kingdom to the United States were made to offset this £1,500 million bill, it would in effect double our total sales of defence equipment from the United Kingdom in the year in question.
Mr. Goodhart: My hon. Friend the Member for Hastings referred to the memorandum of understanding on this point. It has been signed and cannot be renegotiated at this stage.
The hon. Member for Pontypridd (Mr. John) and others asked about the effect of the Trident programme on plans for building nuclear powered hunter-killer submarines. The sixth and last Swiftsure submarine is about to enter service and HMS "Trafalgar", the first of the next class, will be launched later this year. Two further vessels in this class are already on order, and further orders are planned. The precise timing of the further orders will depend on the results of the wide-ranging review described by my right hon. Friend.
The hon. Member for Pontypridd began his speech with an attack on the Government for the proportion of the gross national product and gross domestic product that was being devoted to defence. I was somewhat surprised at the terms of his argument and by the terms of the Opposition amendment, because in the past the hon. Member for Salford, East (Mr. Allaun) has deployed precisely the same argument against Labour Secretaries of State and Ministers of State at the Ministry of Defence and the argument has been shot down successively by the right
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hon. Members for Barnsley (Mr. Mason), Sheffield, Park (Mr. Mulley) and Stockton (Mr. Rogers). I was therefore somewhat surprised to hear the argument advanced by the principal Opposition spokesman.
Mr. John: The Minister's memory must have lapsed because the 1974 defence review reduced our spending as a proportion of GDP.
Mr. Goodhart: Since the middle of the 1960s, through the long years when the Labour Party was in charge of our defences, in terms of the proportion of GDP Britain was constantly near the top of the NATO league. I prefer other measures when it comes to judging the size of our defence effort.
When I last spoke in a defence debate before the general election I reminded the Government that in defence expenditure per head of population we had sunk below the level of Belgium, Holland and Norway. Our pe:7 capita contribution to the Alliance was comparable with that of Denmark. As my hon. Friend the Member for Tynemouth (Mr. Trotter) reminded us, things have changed dramatically since then. Now our per capita contribution to the Alliance has surged ahead of Norway, Holland and Belgium and we are third in the league, just behind France and just ahead of Germany. All that extra expenditure has helped to pay for a substantial increase in our defence capacity.
In an avowedly nostalgic speech the hon. Member for Newcastle upon Tyne, West looked for an improvement in BAOR. On the central front the hitting power of the 1 British Corps has increased significantly and will continue to increase in the coming year, if only because the plans which the hon. Member for Newcastle upon Tyne, West helped to draw up have come to fruition faster than expected.
In the past year the number of manned tanks increased from 475 to just under 600 while the introduction of the TOW anti-tank missile on our Lynx helicopters is giving an enormous boost to our anti-tank helicopter capability.
My hon. Friend the Member for Haltemprice (Mt. Hall) wanted more artillery for BAOR. An additional purchase of M109s is a powerful boost for the Royal Artillery. It is difficult to over-emphasise the importance of the virtual completion of the re-equipping of BAOR with Clansmen wireless sets. For the first time we have wireless sets with the right range, which are reliable, robust and easy to operate. Equipment, however good, is of little value if we do not have the men to operate it.
My hon. Friend the Member for Ashford reminded us that when he came to office he had to put into mothballs five frigates and one cruiser because the men were riot there to man them. They were not there because of the dramatic outflow of Service men and officers from the Armed Forces in the last two years of the Labour Government, because of the mistreatment of our Armed Forces over pay.
In the last two years the position has been reversed dramatically. Far from worrying about people flowing out we are worried about the number of people who are anxious to stay in. The Opposition will undoubtedly say that that is due in part to the level of unemployment. However, it is also partly due to the splendid way in which the Government have honoured their pledge on pay and maintained comparability.
Just before Easter I spent a couple of days in Northern Ireland and on my return I remarked to a senior general

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that, among all the troops that I had visited there, no one had mentioned the Armed Forces pay review which was then under consideration in the Ministry of Defence and at the Treasury. "Well," he said, "they have every confidence that you will honour your commitment." That commitment was indeed fully honoured.
The hon. Member for Hamilton suggested that morale had been severely affected by the necessary cutbacks on ammunition and petrol for training. I wonder how he thinks he would improve the morale of the Armed Forces or the training of the Armed Forces if, by some chance, the amendment put down by the Opposition were to be adopted tonight, for it would at a stroke remove £4· billion from the Defence Estimates. Does he think that there will be more training as a result of that cut? If the hon. Gentleman doubts that figure perhaps he would like to tell us exactly how much he believes would be removed from the Defence Estimates. I have given him the figure; it is, on our estimation some £4· billion.
Meanwhile, the explosion of the landmine near Newry this morning has provided a tragic background to the first day of our debate. As the hon. Member for Pontypridd and the Secretary of State said, this reminds us of the debt that we all owe to our Armed Forces in Northern Ireland.
During the past year, the work of the Armed Forces has drawn praise from the widest cross section of the community. One tribute to part of our Army even came from our former colleague Mrs. Bernadette McAliskey, who had the good grace to say, "We will both be eternally grateful" to the soldiers who saved her life when she and her husband were shot at their home outside Coal Island.
In the circumstances it was not surprising, therefore, that the suggestion by the right hon. Member for Bristol,
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South-East (Mr. Benn) that British troops should be replaced by United Nations forces has not gone down too well. Even the New Statesman, which can hardly be called a friend of the Northern Ireland policy of successive Governments, was moved to use the words "implausible" and "preposterous" when referring to this idea.
In part, the general derision with which this idea has been greeted owes something to the knowledge that, while United Nations forces may be good at monitoring the activities of other conventional armies, they are wholly unsuited to coping with the mixture of hooliganism and terrorism that sometimes seems endemic to parts of Northern Ireland.
In part this derision stems from a recognition that the British Army has shown exceptional, indeed unique, restraint in the past decade in protecting innocent civilians from murder and mayhem. We are all well aware that this task is often turbulent and sometimes dangerous. So far this year the main brunt of casualties has been borne by the UDR, whose skill and devotion to duty is too rarely acknowledged. But now, with this tragic incident, the balance is redressed.
I am sure that the whole House is united in sending our condolences to the relatives and comrades of those who have been killed. This tragedy is a short, sharp reminder of the duty we in the House owe to the Armed Forces.
Debate adjourned. —[Mr. Cope.]
Debate to be resumed tomorrow.

Defence Estimates 1981

  BUSINESS OF THE HOUSE
  Ordered,
  That, at this day's sitting, the Armed Forces Bill may be proceeded with, though opposed, until any hour. —[Mr. Cope.]

Orders of the Day

  Armed Forces (Re-committed) Bill
  Considered in Committee (Bill amended in the Select Committee).
  [MR. BRYANT GODMAN IRVINE in the Chair.]
  Clauses 1 to 29 ordered to stand part of the Bill.

  Armed Forces (Re-committed) Bill
    New Clause 1

      ABOLITION OF THE DEATH PENALTY FOR REMAINING OFFENCES
      No person shall be liable to suffer death for having committed the offences under the following provisions:

      Section 24 of the Army and Air Force Acts 1955,

      Section 2 of the Navy Discipline Act 1957,

      Section 25 of the Army and Air Force Acts 1955,

      Section 3 of the Navy Discipline Act 1957,

      Section 26 of the Army and Air Force Acts 1955,

      Section 4 of the Navy Discipline Act 1957,

      Section 31 of the Army and Air Force Acts 1955,

      Section 9 of the Navy Discipline Act 1957,

      Section 32 of the Army and Air Force Acts 1955,

      Section 10 of the Navy Discipline Act 1957,

      Section 209 of the Army and Air Force Acts 1955, or

      Section 118 of the Navy Discipline Act 1957. —[Mr. Arthur Davidson.]

      Brought up, and read the First time.
      10.1 pm
      Mr. Arthur Davidson: I beg to move, That the clause be read a Second time.
      The purpose of the clause is to abolish the remaining offences under the various Acts dealing with the Armed Services which still carry capital punishment. It may come as a surprise to many people to learn that there are several offences, 12 of which are listed in the clause, for which the sentence of death is still the penalty. The offences are set out in the memorandum printed on page 59 of the report of the Select Committee on the Armed Forces Bill, and I shall not weary the House by retailing them on this occasion.
      It is not my purpose to initiate a major debate on capital punishment. There was one more offence which carried capital punishment. That was spying for an enemy on board one of Her Majesty's ships when committed by a civilian, but the Government got rid of this offence in clause 17 as a response to the 1971 Select Committee recommendation that the Minister of Defence should review the need for the retention of the death penalty, particularly with a view to reducing the categories of offences for which it may still be awarded.
      I am moving the clause because I believe that the response of the Ministry of Defence, although clause 17 is welcome, should have been considerably bolder. The justification for the retention of the death penalty is set out concisely in the evidence on page 75 of the Select Committee's report:
      "Retention of the death penalty is considered necessary as a deterrent given that a potential offender on the battle field who may well be killed at any time as a result of obeying orders is unlikely to be deterred from assisting the enemy by the possibility of no more than imprisonment. That is the basis of the Service need for the retention of the death penalty."
      246
      That is a matter of opinion. There is no way in which it can be tested. No Service man is likely to come along and say "I would have failed to make known information received from the enemy but for capital punishment". There are no figures on which to base the honest assertion made by the witness because, fortunately, offences that carry capital punishment are extremely rare. Capital punishment for these offences is not mandatory. Most Service men, in the unlikely event that they wished to assist the enemy, would know that the capital punishment offence was most unlikely to be carried out.
      Two other countries in NATO—Germany and Portugal—have done away entirely with capital punishment without, it seems, any increase in attempts by their Service men to "assist the enemy". It is true that some NATO countries have capital punishment for more offences for Service men than the United Kingdom. No doubt their arguments for retaining offences for capital punishment that do not carry capital punishment in this country will be the same as those used by the Ministry of Defence to justify offences that carry capital punishment here.
      The Soviet Union has capital punishment for the most obscure offences. I would not, however, regard the legal system in the USSR as one that we would necessarily wish to follow. I feel sure that the basic patriotism, training, discipline, and high standards of our Service men make it unlikely that Service men would contemplate assisting the enemy and so putting the lives of their colleagues at risk. The time has come to get rid of these anomalies. I hope that the very act of my drawing attention to them will make that day come somewhat nearer.
      Mr. Bruce George: I support my hon. and learned Friend the Member for Accrington (Mr. Davidson). The question of the death penalty will not go away. Only today, at Question Time, the Prime Minister was obliged to comment on the death penalty. She said that no initiative would come from her Government to introduce legislation to restore the death penalty. As my hon. and learned Friend says, it probably comes as a surprise to many people, not least to some who served on the Committee, to see the range of offences for which both civilians and military personnel can be subject to execution.
      The death penalty, as we have been told, can still be exacted for serious misconduct in action when committed with intent to assist the enemy and for failure to suppress a mutiny with intent to assist the enemy. Although there are many instances where the death penalty can be legally exacted, there have been few occasions when the ultimate sanction of the State has been applied. It is easy in debates of this kind, if one has fixed views for or against the death penalty, to come to a swift response. If one believes in capital punishment, one will have few dilemmas in looking at military law in connection with the death penalty.
      There will be those who, on ethical grounds, oppose the death penalty in all circumstances in civil and in military affairs. I confess that I approach the question of the death penalty in military law with some apprehension. The arguments are not at all simple when applied to a nonmilitary sphere. Those who may reach the same conclusion as myself will probably do so following a great deal of internal debate, soul-searching and agonising.
      Persuasive arguments were presented in favour of exacting the ultimate sanction in times of conflict. It was

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      pointed out to hon. Members that the ultimate sanction could be exacted even in what was not a war-time situation but a situation such as Northern Ireland where a state of war does not legally exist.
      May a soldier, for example, find himself in a situation that is different from that experienced by those in civilian life? If one believes that that is so, one reaches certain conclusions. Despite the strength of the argument presented by the Ministry, by the documentation and by witnesses from the Ministry of Defence, I am not persuaded that the existing law should be retained. I am pleased that one category has been eliminated and I hope that further categories will likewise be eliminated. I do not understand the reason for excluding one category while not excluding other categories.
      I am not persuaded by the arguments of the Ministry of Defence, although it was a near-run thing, as I shall outline in not too great detail. I do not want to jeopardise the lives of sailors, soldiers or airmen in a conflict that in many instances could lead to death. However, in the Federal Republic of Germany and in Portugal the death penalty has been abolished for military offences. As my hon. and learned Friend the Member for Accrington said, there are some strange reasons in other countries why a person may be executed. I understand that in the United States and in France striking the flag without authority can lead to one's demise and departure to "another place". That seems a severe penalty for something that does not strike me as being a capital offence.
      My main reason for favouring the new clause is that the death penalty has been implemented on few occasions over the past 40 years. In 1942 three soldiers in the Ceylon garrison were convicted of and executed for armed mutiny. In 1942 a soldier was executed for treachery after having been taken prisoner. I understand that 45 men were convicted of murder outside the United Kingdom before the abolition of the death penalty. I am not saying that the law has become completely in abeyance, but the fact that the ultimate sanction has been applied so infrequently gives me good reason to support the view that it is an unnecessary deterrent even during a conflict.
      I add to that my objection on ethical grounds. During a military conflict there is the risk of a miscarriage of justice in the heat of the moment. I confess that the Ministry advanced strong arguments why the process would not be telescoped. Nevertheless, in the heat of battle one cannot be certain of its eventual outcome. The arguments are not crystal clear. A military situation is different from a civil situation. The arguments are finely balanced. Despite the Ministry's persuasive arguments I am of the opinion that the deterrent argument has not been overwhelming when set against ethical considerations.
      Finally, the fear of summary justice during a time of conflict persuades me that on balance I should oppose the Ministry's argument and support the new clause.
      10.15 pm
      Mr. Bob Cryer: I support my hon. and learned Friend the Member for Accrington (Mr. Davidson). It is an anachronism that we should be considering the death penalty for certain offences in the Armed Forces while it has been largely abolished for civilians, as the Select Committee's report observes. As my hon. and learned Friend has said, both West Germany and Portugal have abolished the death penalty for a similar range of offences.
      Mr. Robert Atkins: It has not been abolished in Russia.
      Mr. Cryer: The Minister said in evidence to the Select Committee that the Warsaw Pact countries were not taken as a model. Presumably that is not an argument that weighed with the Ministry of Defence.
      My hon. and learned Friend the Member for Accrington specifically asked Mr. Dromgoole, who was giving evidence to the Committee:
      "As far as you know have they had a problem in peacetime?"
      The reply was:
      "We are not aware of any predicament which the Germans might have experienced under this heading."
      We have troops stationed in Germany, which is one of our NATO Allies, with which we work closely, and the death penalty has been abolished there. The question was put to a representative of the Ministry of Defence whether any problem had arisen and the answer was that it had not.
      The penalty is clearly otiose. The last occasion when it was put into effect was nearly 30 years ago. It is absurd that we should carry on this fiction, which requires that if people are to give of their best and not aid the enemy they have to have the threat of the death penalty. Surely any army of efficiency and effectiveness, as has been said again and again in the previous debate, does not need such a deterrent, which has not been used. If we have reasonable Armed Services, they do not need the threat of what appears to be something that is not even well known.
      The members of the Select Committee had to be assured that the members of the Armed Forces were aware of that deterrent. Some of the witnesses said that they were reasonably sure that the people were informed—at least the officers knew about the deterrent. However, presumably it would apply to the other ranks as well. If they do not know about it, it can hardly be an effective deterrent.
      Therefore, the general conclusion is that the penalty is otiose and out of date, but thankfully it has been largely abandoned in this country. It should be abandoned for the Armed Forces.
      The Under-Secretary of State for Defence for the Army (Mr. Philip Goodhart): As the Committee will be aware, the 1976 Select Committee on the Armed Forces Bill recommended in its report that the Ministry of Defence should review the need for the retention of the death penalty, particularly with a view to reducing the categories of offence for which it may be awarded.
      The review has been carried out. Under clause 17, the scope of the death penalty is reduced by the abolition of the death penalty as the maximum sentence under section 93 of the Naval Discipline Act 1957 for spying for the enemy on board one of Her Majesty's ships or within a naval establishment outside the United Kingdom and Colonies.
      There are now five classes of offences in each of the Service Discipline Acts which apply to Service men which carry the death penalty. These include such offences as communicating with the enemy, obstructing operations, mutiny or incitement to mutiny, and surrender of a place to an enemy without lawful excuse. The sentence of death can apply only where the offence was committed with deliberate intent to assist the enemy or, in the case of mutiny, to avoid or impede operations against the enemy.
      The offences which I have described are of the utmost seriousness because they can put in danger the force to

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      which the accused belongs and might threaten the outcome of a battle or campaign. It is worth remembering, as the hon. and learned Member for Accrington (Mr. Davidson) reminded us, that there are parallels in other NATO countries, with the exception of the Federal Republic of Germany and Portugal, for all of the United Kingdom offences attracting the death penalty. At least four NATO countries—Belgium, France, Norway and the United States of America—have a greater number of offences attracting the death penalty in wartime than we do. It is worth noting that they are all countries where the death penalty in civilian life is used exceptionally sparingly, if at all.
      In contrast with NATO practice, in the Soviet Union in war some 16 criminal offences are punishable by death. They range from insubordination through desertion to abandonment of a sinking warship.
      The Armed Forces are convinced that the death penalty is a deterrent at time of war, and I ask the hon. and learned Member for Accrington to seek to withdraw his new clause. Alternatively, I ask the Committee to reject it.
      Question put and negatived.

    New Clause 2

      HOMOSEXUAL OFFENCES
      '—(1) Section (1) of the Sexual Offences Act 1967 shall prevent an act from being an offence (other than a civil offence) under any provision of the Army Act 1955, the Air Force Act 1955 or the Naval Discipline Act 1957 unless the conduct can be shown to be prejudicial to good order and discipline.
      (2) Section 1(5) of the Sexual Offences Act 1967 is repealed.'—[Mr. Arthur Davidson.]
      Brought up, and read the First time.
      Mr. Arthur Davidson: I beg to move, That the clause be read a Second time.
      The purpose here is to ensure that homosexual acts in the Armed Forces are not offences under the various Armed Forces Acts unless the conduct can be shown to be prejudicial to good order and discipline. The arguments why the Armed Forces should be excluded from the provisions of the Sexual Offences Act are set out in the memorandum from the Campaign for Homosexual Equality, presented to the Committee. The most commonly cited are, first, prevention of coercion of junior personnel by senior members of the Forces; secondly, the disruptive influences of homosexual practices; and, thirdly, the risk that those who engage in homosexual acts may be open to blackmail. I do not dismiss them as trivial or unpersuasive.
      Again, I do not wish to initiate a major debate on homosexuality. I certainly do not want to go into the argument whether legalising homosexual acts makes those who indulge in them more or less vulnerable to blackmail. Neither do I seek to bring Armed Forces lawfully into line with the law in general. I seek merely to cure a massive injustice and a blatant act of discrimination.
      I am concerned with the Service man who may have served his country loyally and patriotically for many years and who has a good military record. There is no suggestion in that case of coercion, or of having committed homosexual acts with other Service men, but for some reason—perhaps because he admits to it—it is discovered that he is a homosexual. In such circumstances he would
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      be automatically dismissed from the Services, whether his conduct has prejudiced military discipline or not. That is unfair and discriminatory. His career and prospects would be catastrophically damaged. I hope that, as I have drawn attention to such consequences, the Ministry of Defence will look again at the question of homosexuality in the Armed Forces and perhaps seek to cure an injustice.
      Mr. Douglas Hogg: I take the opportunity to make two points. First, the arguments against the substance of the new clause are succinctly summarised in Mr. Dromgoole's evidence on 25 March 1981, set out on page 32 of the Select Committee's report. Suffice it to say that I find those arguments wholly compelling and I am against the new clause.
      I am, however, sympathetic to one aspect of the argument advanced by the hon. and learned Member for Accrington (Mr. Davidson), which I became aware of as a constituency problem. It relates to the way in which Service personnel are dealt with following the discovery of this kind of offence. Under military law a homosexual relationship is an offence that may give rise to a prosecution that, if successful, will almost certainly lead to a discharge from the Service, the fact of the discharge being marked on the ex-Service man's papers.
      This leads to a number of disadvantages. Clearly, prospective employers are anxious to see the ex-Service man's papers whenever possible. The ex-Service man finds either that he has to conceal the circumstances, which leads to embarrassment, or that his prospects of employment are impaired.
      Fortunately, there is another way of resolving difficulties of this kind. That is by way of administrative action. In a number of cases the Armed Services do not prosecute, but discharge by way of administrative action. In those circumstances the discharged Service man's papers are marked with something to the effect that his services are no longer required. Clearly, that is not a glowing testimonial, but it is a great deal less prejudicial than a statement to the effect that he has been discharged from the Service.
      I suggest that although there may be cases in which prosecutions must be mounted, because of abuse of trust, a degree of coercion or gross lewdness, for instance, the majority of cases could perhaps be dealt with by administrative action. I know that this is done in certain circumstances. It was done in the case of my constituent, for which I am grateful. I should be very pleased to hear my hon. Friend the Under-Secretary of State say that in the great majority of cases it would be the practice of the Armed Services to deal with matters of this kind by administrative action rather than by prosecution leading to conviction.
      Mr. George: I rise briefly to support my hon. and learned Friend the Member for Accrington (Mr. Davidson). The Sexual Offences Act did not apply to the Armed Forces. One way to prevent the emergence of a military caste in any society is to make the military subject to as many of the laws of the land as is practicable, unless strong reasons can be shown as to why it should be excluded from ordinary legislation.
      Arguments were advanced by Ministry of Defence witnesses as to why the Sexual Offences Act should not apply to the Armed Forces. All sorts of reasons were given about morale, likelihood of blackmail, and so on. One

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      may appreciate why a soldier should be drummed out of the Armed Services if he commits a homosexual offence, but the arguments for saying that he should be thrown out simply because he is a homosexual are less persuasive. He may not have committed a homosexual act. He may have committed such an act in the privacy of his home. But if he were found out, this would still result in his dismissal.
      In my view, there is no strong argument for a person to be thrown out of the Army simply because he is a homosexual. I therefore believe that the legislation should be amended, so that only those offences that are committed perhaps in public should be punished by law and the soldiers removed from the service. Simply to deny a person who in every other respect may be a very competent soldier is not justified.
      Without spending too much time on military history, may I say that it was perhaps fortunate for Greece, and indeed for civilisation as a whole, that Alexander the Great was not subject to British forces discipline, or he would have been slung out of his army.
      10.30 pm
      The same could be said of Frederick the Great and Julius Caesar. I could turn to more modern times, except that I refuse to be drawn into making any comments that would result in the descendants of various generals, field marshals and admirals writing abusive letters to The Times.
      I do not think that a person's sexuality would have any impact upon his ability within the Armed Forces. Therefore, I hope that the next time an Armed Forces Bill is considered the five years will have transpired, and that perhaps attitudes will have changed slightly so as to bring a degree of liberalism into the law relating to the Armed Forces, just as we have in civil society, based on the Sexual Offences Act 1967.
      Mr. Goodhart: I am glad that we have got the drafting of the new clause right at last. At least it was a mistake in the right direction, for I am sure that we would all have been appalled if, through some error in drafting, we had made homosexuality compulsory in the Forces.
      The House will be aware that the position regarding homosexual acts under Service law is different from that under civil law. Service men who engage in homosexual acts, irrespective of consent, both parties being over the civil age of consent, 21, or where the act takes place in private, may be prosecuted under all three Service discipline Acts for disgraceful conduct of an indecent kind. The position was specifically allowed for by section 1(5) of the Sexual Offences Act 1967.
      The disparity between Service and civil law reflects the difference in conditions between Service and civil life. Members of the Armed Forces are often required to serve in conditions where, both off and on duty, they are unavoidably living in closed communities, sometimes under stress. Such conditions, and the need for absolute trust and confidence both within and between all ranks, require that the potentially disruptive influence of homosexual practices should be excluded. It is, above all, necessary to ensure that those in authority over younger or junior men do not use their position to coerce or persuade those in their charge to perform acts in which they would not otherwise engage.
      If the hon. and learned Member does not seek leave to withdraw the motion, I must ask the Committee to negative it.
      Question put and negatived.
      Schedules 1 to 5 agreed to.
      Bill reported, without amendment.
      10.34 pm
      Mr. Goodhart: I beg to move, That the Bill be now read the Third time.
      The Bill before the House is, by comparison with the two most recent Armed Forces Bills, a rather modest measure. Nevertheless, I am sure that hon. Members will agree with me that it contains a number of very worthwhile proposals, with regard both to the discipline of the Armed Forces and to the general regulation of Service communities overseas. In the latter connection, I single out the proposed powers in clauses 13 and 14, regarding the temporary care of those suffering from mental disorder and children at risk overseas, which constitute a major innovation of the Bill and which have been welcomed by the Select Committee in its report.
      I pay tribute to my hon. Friend the Member for Bexleyheath (Mr. Townsend), who chaired the Select Committee through the highways and byways of Service discipline with great skill and courtesy, and to those hon. Members who served on it. I also share the view expressed in the Select Committee's report that the procedures under which Armed Forces Bills are introduced every five years and referred to Select Committees are the right procedures to allow the House to evaluate the workings of the Service discipline Acts and to ensure that, as far as the exigencies of Service life allow, they are kept broadly in line with practice in civil life.
      As has already been demonstrated in the previous debate, the House takes a close interest in defence matters, and rightly so. I am pleased to move the Third reading of the Bill in the knowledge that its general principles find very wide support within the House.
      10.35 pm
      Mr. Arthur Davidson: I briefly endorse the remarks made by the Minister. I also pay tribute to the Chairman of the Select Committee, the hon. Member for Bexleyheath (Mr. Townsend). In addition, I should like to pay tribute to the Minister for the excellent memorandum and for the assistance and expertise provided.
      I welcome the Bill.
      10.36 pm
      Mr. George: Like my colleague, my hon. and learned Friend the Member for Accrington (Mr. Davidson), I pay tribute to the Chairman of the Select Committee. I also pay tribute to the Minister for having attended the Committee most diligently. In addition, I pay tribute to the hordes of Ministry of Defence witnesses who regularly poured into the Committee to offer their advice.
      Those who read Hansard years from now many see that this stage of the proceedings has not been punctuated by regular interruptions and by mass contributions. They may wrongly reach the conclusion that Parliament takes little interest in matters of Service discipline. However, in this case the Select Committee did a competent job on behalf of the House. The experience that we gained in Committee is valid for other Committees. The Committee performed the functions of scrutiny, investigation and legislation. Although there is experimentation in other spheres, I hope that what is happening will be replicated elsewhere. Standing Committees often deal perfunctorily with legislation, because they are not able to interview

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      witnesses and to elicit information. The function of Standing Committees is usually to ratify what has been drafted by civil servants and Ministers.
      Some hon. Members may have felt that the Committee would be boring, but it was not. I have sat through many boring Committees, but within the space of a few weeks this Committee dealt with race relations, drug and alcohol abuse, homosexuality, discrimination against women, capital punishment and what I shall call the Captain Queeg phenomenon, namely, how to deal with commanding officers who go bananas on duty. It was by no means a boring experience. Five years from now, I hope that other hon. Members will not have to be dragooned into serving as some of us might have been. My great regret is that it was not the Defence Committee that took responsibility for dealing with this subject.
      It is vital for Parliament regularly to review military law, and particularly this branch of Service discipline. We can be exceedingly proud of the fact that the military is subordinate to the political. We can take nothing for granted. In many countries mass unemployment, hyperinflation, disaffection and other major catastrophes have imperilled civilian Government. In Britain we control the military. Few nations are so fortunate. Parliament must always exercise vigilance over the military to ensure that proper democratic and constitutional procedures are maintained in times of considerable stress. Military law is not separate law; it is part of ordinary civil law. I hope that we shall continue to exercise vigilance.
      I wish to make two brief points about matters that have not yet been raised but to which we devoted a great deal of time and energy in Committee, namely, the role of social work and social workers in the Armed Forces. That role should be considerably expanded. Social workers are obvious targets for criticism and abuse, but competent, trained social workers could play a more important part in the Armed Services. There are many stresses, tensions and strains in Service life which although they do not distinguish the military from the remainder of society, are perhaps exacerbated by the peculiarities of Service life. The strains may take the form of marital breakdowns, teenage delinquency in the children of Service men, child abuse, abandoned wives, people suffering from mental disorders, drug abuse or alcoholism.
      I am not criticising the Armed Forces or saying that they are different from the remainder of society. As a result of our investigations we found, to our amazement, that the incidence of such deficiencies or strains was much less than we had imagined. Mr. Dromgoole said in evidence that drug abuse was not a significant problem in the Armed Services. However, there is an incidence of strain, and employing qualified social workers could be a means not only to cut down what is seen by some as a too rapid exodus from the Services but to perform a significant role on behalf of our Service personnel.
      The Army Board turned down the recommendations of the Spence committee in 1976 to establish an Army social work service using civilian social workers. The Navy responded differently, and established the Seebohm committee on naval welfare. I asked how many social workers were in the Army. The answer was only three. I ask the Minister seriously to consider whether we could supplement the role of the SSAFA and the small, considerably diminished role of social workers. The
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      emotional, psychological and personal difficulties attendant upon serving in any organisation, not least in the Armed Forces, could be dealt with more successfully by qualified personnel. However, I am not criticising those currently operating in that area.
      In clause 20 and schedule 3 we considered the assimilation of the women's Services. Should we conclude from the legislation that we now have equality not only in law but in practice between the sexes? Both in the House and outside there are those who feel that women play a greater role in the Armed Forces than is desirable, although probably few go as far as an MOD witness who told the Defence Committee last year that he had rather old-fashioned views about the subject and would rather they were doing a more useful job at home.
      I hope that the limited progress that has been made so far by the military in incorporating more women into the Armed Forces is accentuated. I am disturbed by a parliamentary answer from the Under-Secretary of State for Defence for the Army that the numbers of women will not increase. The Minister said that although there is likely to be a small increase in the number of women recruited over the next five years, that will not significantly change the overall percentage of women in the Armed Forces of the United Kingdom.
      In military law, we find some elements of discrimination, the so-called "X" factor, which is designed to compensate military personnel for the rigours of military life. In reality, it serves to perpetuate an unequal pay structure. Women are not allowed to serve on board ship overnight. That is not conducive to the modern spirit of egalitarianism that should exist outside and inside the Armed Forces.
      Experiments have been made on American ships which concluded that there was no serious problem of discipline, that the ship continued to float and that there were no tasks on board ship that could not have been done adequately by the female personnel. One often finds, not just here but elsewhere, an outdated and chauvinistic attitude to women in the Armed Forces. One sees from the smiles of Conservative Members that they do not share my views.
      Two or three weeks ago I read the views of General Westmoreland, who argued vehemently against women in the Armed Forces, particularly in combat. He said that if a man and a woman soldier were in a trench they would be far more concerned with making love and not war. I presume that the general is not aware that most troops would be fighting in anti-chemical warfare suits; thus, the logistical problems would be considerable. I would have thought that a Russian tank bearing down on one at 50 yards would be more likely to diminish any urges that might creep up on one—at least among some serving soldiers. There is discrimination and some mirth at the prospects of women having a role in the Armed. Forces over and above the role that most of them presently enjoy—working in hospitals or as cleaners, or in tasks traditionally regarded as being essentially female.
      So many more roles could be carried out by women. I do not think that in future one should exclude even a combat role. I hope that the Department will consider the report of the Brookings Institute for 1977, entitled "Women and the Military" and the proceedings of a conference organised by RUSI, published in its journal, and that it will consider legislation relating to equality and the role of women in the Armed Forces, so that at some stage we shall see a considerable expansion in the role of

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      women. Surely the military reflects the society that it derives from and it must reflect the values that it is dedicated to preserve.
      Not even the military can be immune from a movement that is occurring in this and in many other countries—often more significantly— for women to play a more significant role. I hope that that will happen and that the Department will keep under review the issue that I have raised, which was also raised in the White Paper.
      Question put and agreed to.
      Bill accordingly read the Third time and passed.

  Northern Ireland (Employment)
  10.49 pm
  The Minister of State, Northern Ireland Office (Mr. Adam Butler): I beg to move,
  That the draft Employment (Miscellaneous Provisions) (Northern Ireland) Order 1981, which was laid before this House on 12th May, be approved.
  As the title suggests, the draft order deals with various matters relating to employment in Northern Ireland. The main provisions are contained in parts II and III. Part II makes provision for the control, through licensing, of private employment agencies and employment businesses in Northern Ireland and brings the law on that subject generally into line with the law in the United Kingdom.
  The order differs from the Great Britain Act in one material respect. It does not accord rights of entry in relation to the inspection of premises, records or documents. Rights of entry have been carefully considered, but the Government are reluctant to see any extension of such powers and it is felt that adequate control can be exercised through the licensing procedure. Article 6 provides for the making of regulations in relation to the keeping of records, the furnishing of information to the Department and other matters.
  Part III repeals the Safeguarding of Employment Act (Northern Ireland) 1947 and provides for the abolition of the central advisory council on the employment of the disabled, the Northern Ireland training council and the youth careers guidance committee. I shall explain more about that in a moment. Part al also contains an article to raise the limit of the borrowing powers of the Northern Ireland redundancy fund and is a parity measure following the recent increases in the borrowing powers of the Great Britain fund.
  I shall follow precedent and deal with the order in a little more detail. The House may remember that on Second Reading of the Employment Agencies Bill my hon. Friend the Member for Rutland and Stamford (Mr. Lewis) outlined why it was considered necessary to regulate the operation of private employment agencies in Great Britain. He stated that, although the agencies were widely used, there was a wide variation in the quality of services being offered. The majority of agencies conducted their business in a proper manner, but a sufficient number of complaints had been received for it to be concluded that a number of agencies should be prevented from operating and that some form of regulation was necessary. He gave some examples of matters about which complaints had been received.
  The House accepted the arguments for the necessity of controlling and regulating the operations of employment agencies in Great Britain and, following the normal parliamentary procedure, the Employment Agencies Act 1973, as amended, became operative in 1976.
  Employment agencies have not been a particular problem in Northern Ireland. The exact number currently active is not known but is thought to be between 30 and 40. As they do not play a major part in the labour market; and, apart from representations from Equity and a recent resolution of the conference of the Northern Ireland committee of the Irish Congress of Trade Unions to extend the provisions of the Great Britain Act to Northern Ireland, there is no evidence of abuses arising because of their activities and there has been no urgency in seeking to regulate or control their operations.

  257
  However, it is desirable that the law in Northern Ireland should be brought into line with that in Great Britain in order to avoid difficulties and abuses that may arise from the present situation in which agencies are uniformly licensed throughout Great Britain while left free of all control in Northern Ireland. Following the making of the order, Great Britain agencies will no longer escape controls by operating out of Northern Ireland and providing services throughout the United Kingdom.
  The order does not aim to curb the activities of respectable and responsible agencies but sets out to ensure that firms active in this sphere do not fall below the standards that the public, including employees and employers, are entitled to expect. Its main provisions will follow closely those of the Employment Agencies Act 1973.
  Articles 3 to 11 make provisions for Northern Ireland comparable to those made by the Great Britain Act. One difference between the two measures is that the order does not accord right of entry to officers of the licensing authority. We considered the question carefully and I am satisfied that adequate control can be exercised through the licensing procedures.
  Articles 3 to 5 provide that no one shall operate an employment agency or an employment business without holding a current licence from the Department of Manpower Services. The application procedure is described as well as the criteria which the Department shall use in deciding whether to grant, refuse or revoke a licence. Provision is also made for representation to be made by persons whose licence has been refused or revoked.
  Article 6 lists the regulations that the Department may make to secure the proper conduct of employment agencies or employment businesses.
  Article 7 prohibits an employment agency or employment business from receiving a fee from any person for finding or seeking to find him employment.
  Article 8 requires the holder to display his licence and a copy of the regulations applying to the agency or business in the premises to which the licence relates.
  Article 9 provides penalties for making fraudulent applications or furnishing false documents.
  Article 10 provides for the making of regulations under the order.
  Article 11 provides interpretations and defines inter alia "employment agency" and "employment business", and lists exemptions from the order.
  Article 12 deals with a separate point. It repeals the Safeguarding of Employment Act (Northern Ireland) 1947, which was a measure designed to protect the jobs of Northern Ireland workers from being taken up by people outside Northern Ireland. When the United Kingdom Government acceded to the Treaty of Rome in 1973, it was granted a period of derogation from the requirements of the Treaty regarding the free movement of labour throughout the Community countries. The United Kingdom Government undertook not to extend that period beyond the end of 1977, and from 1 January 1978, the Act ceased to have effect. Workers from the European Community countries are now free to take up employment in Northern Ireland, and accordingly the requirement in the 1947 Act no longer exists. Of course, nationals from countries outside the European Community are still
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  subject to the more stringent requirements of the Immigration Act 1971, and need work permits before taking up jobs in Northern Ireland, as in the rest of the United Kingdom.
  The thinking behind articles 13, 14 and 15 is that the steps by which the Government carry out their consultation with the appropriate bodies should be simplified and improved. These articles provide for the abolition of the Northern Ireland Training Council, the Youth Careers Guidance Committee and the Central Advisory Council for the Employment of Disabled People. We have proposals to replace those bodies in any case. For instance, the Central Advisory Council for the Employment of Disabled People has not met since 1969. On the other hand, the seven district advisory committees have provided excellent service and they will continue.
  Instead of these three bodies, I intend to set up a single non-statutory forum, entitled the manpower advisory council. This will have places for representatives of the interests of the young, the disabled and disadvantaged, education, employers and employees. It will be an important body which I intend to chair myself as frequently as possible, and it will provide opportunity for a thorough exchange of views and for advice to be forthcoming on a wide range of training, careers guidance and employment matters.
  Article 16 provides for the raising of the limits set by section 45 of the Contracts of Employment and Redundancy Payments Act (Northern Ireland) 1965, as amended, on the amount which can be borrowed by the Northern Ireland redundancy fund from the consolidated fund from £2 million to £7· million. This increase is necessary, first, to meet expected claims on the redundancy fund which, as in Great Britain, have grown rapidly during the past year and are expected to continue at a high level during 1981, and, secondly, to maintain existing parity with Great Britain.
  The employment Agencies Act, which regulated the conduct of private employment agencies in Great Britain, was welcomed by all sides when it was considered by the House in 1973. However, it did not extend to Northern Ireland. I have referred to the fact that the present Bill follows very closely the 1973 Act, as amended, and it will bring Northern Ireland generally into line with Great Britain.
  Perhaps the second most important body to come out of the Bill is the manpower advisory council, although it is not enshrined in it. It is a non-statutory body. That forum will bring together representatives from a variety of bodies interested in the many aspects of employment and training. It will give my Department and myself the opportunity to consult on a broad front on matters which affect our responsibilities.
  Finally, the third most significant item in the order is the proposed increase in the Northern Ireland redundancy fund borrowing limits. It will do no more than ensure that the Northern Ireland fund has borrowing rights in parity with its Great Britain counterpart.
  11 pm
  Mr. J. D. Concannon: As a preface to my remarks on the main provisions in the order I shall repeat an assertion. The Government's economic policy in Northern Ireland has failed and will fail in the future so long as the current monetary and fiscal policies are applied in such a drastic and unrelenting fashion.

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  The Government have been unable to maintain normal economic life in the Province. The 33 per cent. increase in unemployment in the past 12 months is full evidence of that. Further, we have only to look around at the closed factories, the boarded-up workshops and the industrial wastelands across Northern Ireland to know that decay is the watchword of Tory rule in that most poor and deprived region of the United Kingdom. Whatever distant notes of optimism the Minister might care to hear, there is no disguising their underlying presumptions about the future of the Northern Ireland economy.
  The recent Expenditure White Paper predicted that unemployment would reach 128,000 by the middle of 1982—a further increase of 33 per cent. That will mean that well over one-fifth of the work force will be without a job.
  One of the provisions in the order increases threefold the borrowing reserve for the Northern Ireland redundancy fund so that the increase in demand for redundancy payment can be met. If the Minister's words are optimistic about the ending of the recession in Northern Ireland, his actions are nothing short of pessimistic. Plans for disaster go ahead, while absolutely nothing of note is done to avert the rising tide of unemployment. This negative resolution is testimony of the Government's unwillingness to take positive action to contain or even reduce the numbers out of work.
  The Opposition regard it as a most wasteful provision, because it will lead to a waste of manpower and resources. Instead of providing money to save and create jobs the Government are opting out of their responsibilities.
  At the most critical moment in Northern Ireland's recent history, the Opposition find it distressing in the extreme that the Government are planning for more redundancies in this way. The greater the unemployment problems in the Province the more serious the security problems are likely to be. I shall not dwell further on the redundancy fund except to say that there must be immediate and determined efforts to stave off the impending increase in the numbers out of work in Northern Ireland. Otherwise, the consequences for all the people in the Province will be very serious indeed. The time for complacency has passed, and action is demanded.
  I turn to the provisions for the licensing of employment and business agencies. I understand that the number of such agencies in Northern Ireland has increased considerably in the last two years. The move towards some form of control is welcome. However, I view with great apprehension the decision by the Minister to withdraw an article that was originally in the draft order and that would have empowered inspectors to enter agencies and to check books, records and documents to ensure that regulations are complied with. Since we have an inspectorate for such agencies in Great Britain I am pleased that the Minister dwelt on it. The Minister must explain why he has suddenly decided, after all the deliberations, to do away with it.
  In paragraph 4(11) of the part of the order relating to employment agencies it states that licenceholders must inform the Department of any change in the manner or running of the agency on pain of a fine of £400. The Minister should tell the House exactly how he plans to persuade those disobeying the regulations to own up. Furthermore, how will his Department know when an
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  agency fails to keep proper records? How will his Department prove to a court that an agency has broken the law? In short, who is going to check these agencies?
  These questions need full and comprehensive answers. Not only do the people who get the jobs through agencies have a right to know that they are protected under an enforceable law; the agencies need to know exactly where they stand in terms of the licensing regulations. Unless there is effective enforcement, the licensing procedure will be seemingly no more than a head count.
  I ask the Minister to reconsider seriously his decision about an inspectorate. Unless he does, the legislation on this issue that we are debating tonight will be worth no more than the paper that it is written on. Indeed, I would have thought that the need for inspectors was even greater in Northern Ireland than in the rest of the United Kingdom. It is vital that in Northern Ireland strenuous efforts should be made to ensure that the Fair Employment (Northern Ireland) Act is being instituted at every point of employment. As the provisions of the order stand, the Act may well be a dead letter in terms of employment agencies, for we cannot effectively check that they are obeying the law.
  If the Minister plans to rely on the vigilance of the public in this matter I ask him to think again. People may well not be aware of their rights when dealing with such agencies, and anyway they are less likely to speak out against misdemeanours when they depend on such agencies for their livelihood. If the law breakers are allowed to go undetected, as they will be if the order goes through in its current form, the real losers will be the workers who use the agencies.
  Finally, I should like to express my disquiet at the abolition of the Northern Ireland Training Council, the Youth Careers Guidance Committee and the Central Advisory Council for the Employment of the Disabled. The abolition of the last, in particular, is disturbing, since in this International Year of Disabled People we should be doing all we can to see that the distinctive needs of disabled people are fully recognised.
  I understand that the Minister now intends to set up a manpower advisory council. I think that he should tell the House a bit more about this council and who he intends should serve on it. I understand that he is finding certain difficulties at the moment with certain people or organisations that have refused to serve on this advisory council because, as it has been put to me, they see it as nothing more than a window-dressing exercise. Unless it has a clearly defined role and place in the decision-making process it will not be of positive help to the community. If this is the Minister's attempt to show that he is doing something to help the unemployed, it is a poor effort indeed. He would have done much better to improve the existing advisory and guidance committees.
  I do not wish to detain the House any longer. I hope that the Minister will give full and clear answers to the questions that I have raised. I am not expecting him to do this tonight, but I shall be expecting a letter in due course, in the usual manner on Northern Ireland topics.
  11.04 pm
  Mr. J. Enoch Powell: Owing perhaps in part to certain electoral events which are imminent in the Province, it falls to me on this occasion to represent not only the party to which I belong but the Province as a whole in which I have the honour to represent a

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  constituency. It may be some consolation and gratification to the Minister to learn that my colleagues and I at any rate see no reason to take so acidulated a view of the order which he has placed before the House as did the right hon. Member for Mansfield (Mr. Concannon).
  Perhaps, as the right hon. Member for Mansfield sailed a little near the wind in the earlier part of his speech, I may be permitted to say how pleased I was that the Minister found time to visit the southern part of my constituency only yesterday and to examine for himself the important but under-used port of Warrenpoint. This is as relevant as any of the remarks of the right hon. Member for Mansfield. It is by the development of communications that this port could provide and the infrastructure generally that the Government will do much more to subserve the interests of employment and the reduction of unemployment than by the mere expenditure of sums of public money. I was surprised that the right hon. Member for Mansfield queried the desirability of article 16 of the order. I would have thought that there could be no possible justification for allowing the fund, given the statutory claims that fall upon it, to come too near to the point of exhaustion.
  While mentioning that provision, I might perhaps invert the order of the order and put to the Minister a query arising out the letter he sent to, among others, Northern Ireland Members on the subject of article 16. The hon. Gentleman said that it would be wise to ensure that the Northern Ireland redundancy fund has a borrowing limit in parity with the revised limit proposed for the Great Britain fund. The point is small, but I was puzzled about how there can be parity if the fund is raised from £2 million to £7 million in Northern Ireland and from £40 million to £300 million in Great Britain.
  I am aware, of course, of the general concept of parity in this context but I cannot see that the particular figures proposed owe anything to the principle of parity. The Minister can perhaps clear up the significance, if any, that lies behind that part of his letter. Apart from that, I do not see how any objection could be taken to using the opportunity of the order to increase the limit on the fund by article 16.
  I appreciate that article 16 did not appear in the original order. The Minister was rightly sensitive to the anxiety of Northern Ireland Members that a draft order issued in proposal form shall not normally be extended to subjects with which, in its proposal form, it did not deal. I do not think that the most captious could complain of the Minister having taken the opportunity, even between the proposal stage and the laying of the draft, to make this necessary alteration in the financial limit.
  I wish now to revert to the natural order of the order and to begin at the beginning. My hon. Friends and I welcome the fact that it is proposed to apply to Northern Ireland by this order the provisions of the Employment Agencies Act 1973 which came into force in Great Britain four years ago. In general, we believe that, wherever there is not clear reason to the contrary, the law should be uniform between Great Britain and Northern Ireland. This is a case where the law in Great Britain was made initially by Private Member's legislation, though that legislation was passed with the support of all parties in the House.
  I quite understand that a private Bill will often be introduced in relation to Great Britain. I believe, however,
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  that from now on vigilance is the order of the day to ensure that, where private legislation is introduced in a Great Britain form, which ought to be applied to Northern Ireland, the opportunity is taken before such legislation, with a fair wind, reaches the statute book, to extend it to Northern Ireland in one way or another before the completion of proceedings.
  The Minister, in applying the provisions of the 1973 Act to Northern Ireland, has made one alteration that I regard as an improvement. I differ here from the view of the right hon. Member for Mansfield. Too often, in recent years, we have got into the mere habit, whenever any licensing or control procedure is enacted, of assuming that the whole panoply of powers of entry has to be introduced into the legislation. I do not believe that because there is to be licensing and control as set out in part II of the order it is necessary to arm inspectors with these standard powers to enter the premises. I have not the slightest doubt that there would be complaints by those who had reason to know of, and arguably to suffer from, malpractices in future by employment agencies, and there would be no difficulty in establishing for the purposes of the law that the control provisions had been infringed. I hope that what the Minister has done, which gives Northern Ireland a slight edge over Great Britain in this respect, is a sign that the Government are considering seriously in all legislation the necessity or otherwise for these powers of entry. That is a sort of vigilance that could usefully be exerted during the preparation of legislation.
  I am aware, as the right hon. Member for Mansfield (Mr. Concannon) said, that the Irish Congress of Trade Unions on the Northern Ireland Committee has become excited about this issue. I do not believe that there is any justification for its excitement or anxiety. In fairness to the Department, I should say that the congress alleged in its letter of 13 May that the Minister, his successor and the Department had never mentioned that the order included the provisions that it now claims are the main provisions of the order. I read that part of the letter several times, as all the documents that accompanied the proposal stage made it quite clear, even if the order did not, that these were the principal provisions. It is curious that so misleading a communication should have been sent to Northern Ireland Members of Parliament. I encourage the Minister to take heart that he is doing right in part II both by what he has included and the provision that he has decided to exclude.
  I turn to the repeal of the 1947 Act for the safeguarding of employment. It is an Act that has always had less practical effect than those who introduced it imagined. We have no full statistics of the number of citizens of the Irish Republic not being also United Kingdom citizens who have entered Northern Ireland from the Republic to obtain employment. If the electoral register in which such persons when of voting age are designated, since they do not have the local government franchise, is any guide to go by, the numbers are about 5,000 to 7,000. As those electoral numbers include a number of women who are not employed, that indicates that the amount of employment, or potential employment, in Northern Ireland attributable to citizens of the Irish Republic who have entered it in recent years is not of great importance.
  I believe that I am right in saying that in recent years there has been a counter-flow in emigration from the Irish Republic and that the tendency has been for Irish citizens to return to the Republic rather than to leave it. There has

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  been a reversal in the economic and population experience of the Republic in the past 20 years. There would not be any great reason anyhow to lament the demise of the 1947 Act. It is, as the Minister said, untenable in the face of our obligations under the law of the European Community.
  Perhaps I might be permitted a piece of not wholly unimportant pedantry. In the Explanatory Note that accompanied the proposals it was stated in relation to article 13 that
  "under the requirements of the Treaty of Rome there has been free movement of labour from EEC countries into and out of Northern Ireland since 1 January 1978."
  That is not so. The law of the EEC does not control movement into Northern Ireland, except from outside the United Kingdom. It is movement into the United Kingdom which has in all respects been free, since the beginning of 1978, to nationals of the EEC countries.
  That point is worth making since the fact that the EEC does not interest itself in internal movement either of goods or persons inside the United Kingdom creates some extremely tiresome difficulties and anomalies, notably between Northern Ireland, the Isle of Man and the Irish Republic in the matter of the export or movement of meat. Therefore, it is just as well—one takes the opportunity of getting those things right—to point out that it is as part of the United Kingdom that Northern Ireland is subject to the provisions of free movement of labour of the EEC.
  That leaves me with the abolition of the—the word has not been mentioned yet in the debate and I do not know how that has been achieved—three quangos which are dealt with by articles 13, 14 and 15. Here again, the tide has turned against a set of fashion. There was a period, now happily ended, when it was fashionable in every context where a legislative or statutory obligation was undertaken to set up a statutory advisory council. It is not difficult to guess that the fact that that body was statutory resulted in a much greater degree of elaboration and expenditure and no greater degree of efficiency than if the consultation had been perfectly informal.
  I am prepared to accept that the Minister will be better served by the informal committee which he will set up, especially if he chairs it and especially if it sits fairly regularly. For all the enthusiasm of the right hon. Member for Mansfield (Mr. Concannon), I cannot believe that the central advisory committee on the employment of the disabled, which has not sat for the last 12 years and whose members have apparently not agitated to sit for the last 12 years, has done a great deal towards the employment of the disabled in Northern Ireland.
  Much has been done in those 12 years towards the employment of the disabled. I shall take the occasion of the provision to pay a tribute to the work of the resettlement officers in the context of disablement, blindness and other disabilities to whom I am sure that I am not the only Member for a Northern Ireland seat who has recourse and who has come to appreciate the extreme care and pertinacity with which they deal with the attempts them are of disabled persons to obtain employment. I have two or three examples in mind as I say that. All of them happen to be from Newry, where the most attentive assistance has been given by the disablement resettlement officer to the placing of people who, by reason of their disabilities, would otherwise have had great difficulty in finding employment.
  The removal of the three statutory bodies is a clearing up operation which could be imitated in other areas. I hope
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  that what has happened is that the vacuum cleaner is being passed by the Government over the floor of legislation and that this is a little bit of the corner of the carpet which happened to be Northern Ireland, where the vacuum cleaner has worked to some effect.
  Therefore, I give this modest order a welcome which I hope will outweigh the rather sour reception which it received from the Opposition Front Bench. However, I hope that the Minister will be able to deal with one or two of the niggling points which I have mentioned.
  11.24 pm
  Mr. Adam Butler: I understand why it has not been possible for hon. Members representing Northern Ireland seats to be with us. We are grateful that the right hon. Member for Down, South (Mr. Powell) has made a contribution. I am particularly grateful, as the right hon. Gentleman welcomed the order almost in its entirety and made helpful and constructive remarks.
  The opening remarks of the Opposition spokesman, the right hon. Member for Mansfield (Mr. Concannon), were predictable. I shall not reply, except to refute utterly the suggestion that the Government have done nothing of note to tackle unemployment. The right hon. Gentleman is well aware of our actions to promote industrial development and in the realm of job creation, through the schemes that operate through the Department of Manpower Services.
  Without unduly delaying the House I shall try to answer some of the points made. In the absence of comment to the contrary, it seems that the employment agencies provisions are welcome, although the right hon. Gentlemen disagree about rights of entry. It will not surprise the House to know that I find myself in accord with the right hon. Member for Down, South.
  The Government are concerned with the powers of entry available in legislation in so many different areas of our lives, and we have considered whether such powers are necessary. New legislation is being examined for that purpose. We have experience of the 1973 Act as it has operated in Great Britain, which tells us that the powers of entry are not essential to the Act's operation.
  Under the order, the licensing authority will have to satisfy itself about the suitability of applicants and on various other points, including the suitability of accommodation. Unless the authority is satisfied, an application for a licence will not be granted. To assist the licensing authority an applicant may wish to invite its representative on to the premises.
  Further, the order provides for annual renewal of licences for a maximum of five years, so again, apart from the opportunity to revoke licences, applicants will have to come forward periodically and satisfy the authority.
  We are dealing with private bodies that generally are in competition. If anyone is to police them, surely it should be the user of the services. I do not believe that an individual looking for a job is not capable of making up his mind whether he is getting good service from an agency. Once the licensing procedures are operating we shall monitor the order. If there is reason to alter the position over rights of entry we shall consider it, but I hope that it will not be necessary.
  I turn to the removal of what the right hon. Member for Down, South referred to as quangos. The right hon. Gentleman is right, for two reasons. First, there are certainly too many quango-type bodies in the United Kingdom. Secondly, and perhaps more important in

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  relation to Northern Ireland, we are a relatively small community. there is no point in proliferating quangos all treading on one another's toes.
  I am afraid that the Opposition spokesman chased the wrong fox, as the central advisory council for the employment of the disabled has not met for a very long time. The services for the disabled will, however, be properly looked after, primarily through the continued existence of the district committees.
  These three bodies will therefore be removed by statute and in their place will be the new manpower advisory council. It is correct that the Northern Ireland Committee has declined to serve on this body, possibly due to a misappreciation of what it is about. I believe that it will not be doing its members a good service in refusing to take the opportunity to discuss with a group of representative people interested in the same things in which its members are interested on a council that generally will be chaired by me, as Minister.
  I believe that we should be able to sit down together in this way, and that individuals should not have to reach a unanimous verdict on any particular subject, as other organisations might be required to do, but should be able openly to put to the Minister their views and to give him advice—that is why it is called an advisory council—and for him then to go away and reach his conclusions about whatever subjects have been discussed.
  I have therefore replied to the trade unions' committee that the places allocated to them on the council will remain open and I very much hope that they will reconsider the matter in the very near future and join us in our deliberations.
  Briefly, the council will include four representatives of employers, places for four representatives of employed persons, three representatives of educational interests covering higher, further and secondary sectors, two representatives of what one might call the providers of
  266
  training, that is, training boards and management and related services organisations, and one representative of the disabled. We would expect to meet four times a year.
  In that regard, I very much appreciated the right hon. Gentleman's reference to the work of the resettlement officers. It is admirable that, even in an empty Chamber such as we have now, one who has experienced it in his constituency should make that very worthy statement about the excellence of their work. From what I have seen during the few months that I have been in the Department of Manpower Services, I entirely agree with the right hon. Gentleman.
  The right hon. Gentleman also asked about parity in the redundancy fund increases. It is perhaps misleading to look at the increases. Certainly there is no mathematical relationship that I can divine between the amounts of the increases. The parity relationship is between the figures to which the two funds have been increased. We have used the relationship of 1 to 40, and we find that 7½ million is to 300 million as 1 is to 40. That is the mathematical parity for which the right hon. Gentleman was searching.
  Mr. J. Enoch Powell: I take it that that means that parity did not previously exist.
  Mr. Butler: I think that it must correctly follow that the parity did not previously exist, but we have rectified that in the order.
  I think that I have covered all the points. I commend the order to the House.
  Question put and agreed to.
  Resolved,
  That the draft Employment (Miscellaneous Provisions) (Northern Ireland) Order 1981, which was laid before this House on 12th May, be approved.

  Northern Ireland (Employment)

    ADJOURNMENT
    Resolved, That this House do now adjourn. —[Mr. Thompson.]
    Adjourned accordingly at twenty-six minutes to Twelve o'clock.

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

Lord Jenkins of Putney
Hugh Gater Jenkins, Esquire, having been created Baron Jenkins of Putney, of Wandsworth in Greater London, for life—Was, in his robes, introduced between the Lord Strabolgi and the Lord Brockway, and made the solemn Affirmation.
Lord John-Mackie
John John-Mackie, Esquire, having been created Baron John-Mackie, of Nazeing in the County of Essex, for life—Was, in his robes, introduced between the Lord Elwyn-Jones and the Lord Cledwyn of Penrhos, and made the solemn Affirmation.

Airline Tickets: Wholesaling
2.42 p.m.
Baroness Burton of Coventry: 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 propose to take any action on the availability of discounted airline tickets following the discussion held with organisations on the suggestion that wholesaling of these tickets should be considered.
The Parliamentary Under-Secretary of State, Department of Trade (Lord Trefgarne): My Lords, as I said in answer to a Question by the noble Baroness on 26th March, it is for the agents to discuss with the airlines matters relating to methods of sale of airline tickets. There is no action for the Government to take until such time as the airlines are persuaded to favour a system of wholesaling of unsold tickets, and there is an IATA recommendation to this effect for Governments to consider.
Baroness Burton of Coventry: My Lords, I have become so weary of this type of Answer. I wonder whether the Minister realises that stonewalling consistently is not only boring but an affront to the House when every piece of evidence is treated in that manner. May I ask Lord Trefgarne whether he is aware that in the current recession more and more airlines are using bucket shops for their surplus tickets and that among the most recent ones are reputable airlines such as KLM, Air France and Swissair? Finally, does the noble Lord recall that yesterday he told the House that it was not always wise to postpone decisions indefinitely? May I ask him whether he has now reached a decision to do nothing at all about this
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matter or whether they are still in an indefinite situation?
Lord Trefgarne: My Lords, I am sorry that the noble Baroness finds my Answers on this matter wearisome. I suppose I should be out of order if I were to say that I find the Questions much the same.
Several noble Lords: Yes.
Lord Trefgarne: As for the substance of the supplementary question asked by the noble Baroness, the problem, as she has described it, of the bucket shops is not precisely the Question on the Order Paper and is, indeed, rather a different matter. The question whether or not bucket shops should be authorised by the airlines to sell their tickets is a matter for the airlines, not for me.
Baroness Elliot of Harwood: My Lords, we have listened to these replies from Her Majesty's Government. Surely it is time for Her Majesty's Government to take a lead. Everybody knows what is happening. All the airlines are perfectly aware of what is going on. Why do not the Government say straight away either that this is illegal or that it is legal? If it is legal, then everybody will benefit from it.
Lord Trefgarne: My Lords, as I have explained to my noble friend on several occasions, and also to the noble Baroness, Lady Burton of Coventry, and to a number of people who have been to see me privately, including Members of the other place with various delegations, the question of legality in this context is a difficult one to solve. It is not immediately clear upon what basis the illegality could be founded, although I am certain that there is an illegality of some sort. The difficulty is to find evidence which will stand up in court. As for taking a lead, as my noble friend suggests I should do, we do indeed take the lead in the bilateral negotiations in which we are involved from time to time for securing a régime of lower air fares, which is certainly the long-term answer to the problem.
Lord Young of Dartington: My Lords, even if the Minister is unable to announce any action, would he at least be prepared to accept that all consumers would be behind Lady Burton in the kind of stance she has taken on so many occasions in this House? If the Minister accepts that, can he give us any assurance at all that at some point in the future, in response to what is a very general consumer opinion, the Government might awake from their torpor on this issue?
Lord Trefgarne: My Lords, those who produce that sort of line of reasoning are, with respect, oversimplifying the problem. As I have said many times before, the air fares which are charged by individual airlines are a matter in the first place for the airlines themselves and subsequently for approval in this country, first by the Civil Aviation Authority and then by the Government. It is not open to me unilaterally to abrogate the agreements which we have entered into with other Governments.
Lord Boyd-Carpenter: My Lords, while accepting what my noble friend has said as to the position of the Government, can he indicate that as a matter of policy the Government favour getting rid of most of the restrictive apparatus of IATA and allowing air fares to be fixed, like many other commodities, by the law of supply and demand?
Lord Trefgarne: My Lords, as my noble friend will know, IATA is an association of airlines and it is for the airlines themselves to decide how they want to order their affairs. If they think fit to join IATA, they have to follow the procedures which it lays down. My noble friend is quite right to suggest and, indeed, to invite me to assure both him and the House, that the Government do favour a régime of generally lower air fares. We should also favour the removal of some of the restrictions on the sale of air fares generally.
Lord Bruce of Donington: My Lords, the noble Lord has indicated to the House that he is in some legal difficulty and that he needs evidence. Can the noble Lord give to the House some indication of the type of evidence which he requires in order that his legal difficulties may be resolved?
Lord Trefgarne: My Lords, the sort of difficulties to which I have referred include, for example, the difficulty of ascertaining who has committed the offence of selling or using an air fare other than the one which is part of the authorised agreement. I can assure the noble Lord and the House that the difficulties are formidable.
Lord Renton: My Lords, is my noble friend aware that in at least one of these cases the jury failed, or refused, to convict, that it seems to be very difficult to establish guilt in such cases and that this situation is bringing the law into wide contempt and should be brought to an end as soon as may be?
Lord Trefgarne: My Lords, certainly I agree that the present situation is unsatisfactory but I am persuaded—indeed I am quite satisfied—that the right answer is to find a régime of lower air fares which can be sold without many of the awkward restrictions which apply at present.
Baroness Burton of Coventry: My Lords, I wonder whether the Minister is prepared to accept an unorthodox suggestion. Does he recall that when I asked him before about the wholesaling system he did not tell us that he had seen the organisations concerned until I asked him about that in a supplementary question? When he meets these organisations for the representations, would he allow those of us who are particularly interested in this from the point of view of consumer affairs, such as the noble Baroness, Lady Elliot of Harwood, the noble Lord, Lord Young of Dartington, or myself to sit in and see whether we can bring some common sense to bear on this matter?
Lord Trefgarne: My Lords, I am not short of advice on these matters and I am always pleased to receive
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the noble Baroness when she wants to come and see me. Of course some people who come to see me do not always see precisely eye to eye with the noble Baroness, Lady Burton, and may not necessarily wish her to be present at meetings which they have with me, but, in principle, of course I have no objection to receiving the noble Baroness whenever she wishes to see me.
Lord Morris: My Lords, in his previous answer my noble friend referred to illegalities of some sort. Can he be a little more precise about that?
Lord Trefgarne: My Lords, I fear I cannot. If I had had a better legal framework under which to operate on this matter, I think the problem would have been solved.

Maternity Allowance Payments
2.51 p.m.
Baroness Phillips: 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 review the method of paying maternity allowance so that working mothers receive their full entitlement.
Lord Cullen of Ashbourne: My Lords, my right honourable friend is obliged to make payment in accordance with the legal entitlement determined by the independent statutory authorities. If the noble Baroness knows of any claimants who have been paid less than their legal entitlement their cases will be investigated.
Baroness Phillips: My Lords, while thanking the noble Lord for that reply, I should perhaps say that I have no personal interest to declare in this matter, but I wonder whether the noble Lord is aware that a working mother who ceases to work can receive maternity allowance for 11 weeks before the birth and 4 weeks after—or even a little longer—whereas if she continues to work she forfeits the money that she would have had before the birth. Since the money must be set aside for 18 weeks, would the Minister not agree that it would be more sensible and fair that all mothers should have the 18-week maternity allowance?
Lord Cullen of Ashbourne: My Lords, the noble Baroness probably knows that my right honourable friend sent out a consultation paper about this last October in order to try to tidy up what is rather a patchwork arrangement where there is a grant, an allowance and maternity pay. No consensus was reached on this, and we are now considering waiting until the new sick pay scheme comes into operation before reviewing the whole question of maternity benefits.
Lord Davies of Leek: My Lords when the noble Lord is reviewing these questions of social security

831
allowances in many fields, please will he see that legislation is brought forward to help the people who are not learned in the law or in the ways and means of obtaining help, in order to help them to get what they are entitled to, particularly in view of the fact that there are millions of pounds of unclaimed social security owing to people who do not have the know-how?
Lord Cullen of Ashbourne: My Lords, it was with that idea in mind that a complete review of supplementary benefits was undertaken recently, and now I think the noble Lord will find that it is very much simpler, both for claimants and for those who are administering the scheme.
Baroness Phillips: My Lords, sensing that the noble Lord is sympathetic, may I express the hope that the review will come out with a fair scheme? Contributions have been made by all and it seems reasonable that all should collect.
Lord Cullen of Ashbourne: Yes, indeed, my Lords.
Lord Young of Dartington: My Lords, may I ask the noble Lord whether he is able to make a statement about when the Government will be able to say that they will upgrade the level of maternity grant in line with inflation, instead of keeping it at its ridiculously low level of £25, which as the noble Lord knows, was set as long ago as 1969?
Lord Cullen of Ashbourne: My Lords, this is the crux of the matter. Certainly the sum of £25 was fixed in 1969 and has never been altered. One of the options for a review of the system is to abolish both the maternity allowance and the maternity pay and hugely increase the maternity grant. There are several other options, but it is fairly complicated and I doubt whether the House would want me to go into it.

The House of Lords and the Constitution
2.55 p.m.
Lord Alport: 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, in view of the Lord President of the Council's undertaking on 8th December 1980 that they would "give urgent consideration to the strategic purpose" of the Constitutional Referendum Bill, now before this House, any statement of past progress and future intentions can now be made.
The Lord President of the Council, Lord Soames: Yes, my Lords. Since the debate in your Lordships' House last December the Government have carefully considered the matter to which my noble friend refers. The Government are entirely committed to a Second Chamber as an essential part of the constitution. They have, however, decided not to come forward
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at this time with proposals to afford some form of statutory protection to the House of Lords without reference to the broader issues of the composition and powers of your Lordships' House. The Government are considering the many different proposals which have been put forward for reform.
Lord Alport: My Lords, may I ask my noble friend whether I should be right in interpreting his Answer as meaning that in fact there is unlikely to be any action in this field for a very considerable time? Since the programme of legislation ahead of us is now so great in this Session and it would be wrong therefore to ask your Lordships to give consideration to the further stages of the present Constitutional Referendum Bill in this Session, would the Government perhaps consider giving some support to a revised Bill, taking into account the criticisms made at Second Reading, and for it to be introduced at the beginning of the next Session so that some progress may be made on this matter while they are making up their minds about the future form and powers of the House of Lords?
Lord Soames: My Lords, my noble friend is really asking whether the Government would consider giving support to some measure of the character of the Bill which he introduced, giving us a valuable opportunity, as I think the whole House will agree, to debate this matter at the beginning of this Session. He is asking whether the Government would give support to a similar measure to be introduced next Session, again without consideration of the composition and powers of your Lordships' House. What I tried to say in my original Answer was that we think the two should be linked together and that it would be wrong to proceed with one without giving due and proper consideration to the important question of composition and powers at the same time.
Lord Paget of Northampton: My Lords, does not the noble Lord agree that so long as we have a sovereign Parliament both this and any other similar Bill is a necessary futility because it can be repealed by the next Parliament just as easily as it can be passed by this one?
Lord Soames: My Lords, I do not think it is quite as simple as that. As I have said, my noble friend did a service to the House in introducing this Bill. Many views were expressed in the debate on the Second Reading of the Bill, but since that debate the Government have weighed all the pros and cons and, in particular, what was said during the course of that debate and, although there seem to be advantages and disadvantages on both sides, we felt that what I have put to the House today was the right answer.
Lord Shinwell: My Lords, is the noble Lord the Leader of the House aware that the Labour Party has decided to abolish the House of Lords when it is returned after the next election, which is by no means unlikely, and therefore what is the use of a constitutional referendum?
Lord Soames: My Lords, there are many reasons why I think it unlikely that such an eventuality will

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come to pass. One of them is that I do not think the country would like to see single chamber government.
Viscount Gage: My Lords, is it not extremely unlikely that there would be any general agreement about comprehensive reform? Would not the Government be well advised to consider a modest measure of this sort, and by doing so might not the Queen be relieved of having to take some very difficult decisions?
Lord Soames: My Lords, all this was taken into account. There was a balance of arguments, but I do not think that Question Time is a proper time for a further debate on the advantages and disadvantages, such as took place on the Second Reading. All I can say is that the Government have considered every aspect of this question and have come down on the side of what I have suggested to the House.
Lord Orr-Ewing: My Lords, are there not constitutional dangers in the fact that this country has no written constitution? We have no Bill of Rights. It is certainly unlikely that in the short term we shall have any electoral reform. Does my noble friend recall that the Lord Chancellor delivered an exceptional Dimbleby TV lecture drawing attention to the danger of an elective dictatorship and wherein it was shown that a minority Government of extreme views could be a considerable danger to our whole constitution? Would he therefore remember that there are considerable dangers, that it may be later than the genuine democrats in both Houses think, and that it therefore is necessary to take some steps to protect our parliamentary system? So the suggestion he made in his first reply, that the Government are examining this matter, is welcome. Would he say that there is some sense of urgency about this examination?
Lord Soames: My Lords, we are indeed examining it, and we realise that this is a matter that cannot be allowed to trail too long.
Lord Lee of Newton: My Lords, would the noble Lord agree that by far the most sensible propositions yet put on this issue were those contained in the report of the Labour Party Peers, which I tried to outline some months ago? If a Bill such as that proposed was put forward, would the Government support it?
Lord Soames: My Lords, that is a hypothetical question.

Tate Gallery Extensions
3.2 p.m.
Lord Segal: My Lords, I beg leave to ask the Question which stands in my name on the Order Paper.
The Question was as follows:
To ask Her Majesty's Government what extensions to the Tate Gallery are planned on the site of the former Millbank Hospital, when they are likely to be completed, and what is their estimated cost.
The Parliamentary Under-Secretary of State, Department of the Environment (Lord Bellwin): My Lords, a new museum to house a large part of the Turner Bequest is to be built on part of the Millbank Hospital site. Work is expected to start at the beginning of 1982 and take two years to complete. The estimated cost of the building, which will be linked to the Tate Gallery, is £5½ million: funds have been donated by the Clore Foundation.
Lord Segal: My Lords, while thanking the Minister for that reply and paying tribute to the generosity and public spirit of the trustees of the Clore Foundation for their magnificent bequest, may I ask whether the noble Lord is aware that his reply will give great relief that this unique collection will at last be found a worthy permanant home? May I ask the noble Lord two supplementary questions? Is it proposed that there will be direct access to the extension from the existing Tate Gallery building, either underground or above ground? And will there be an opportunity for a wider examination to be made of the proposed plans for this building?
Lord Bellwin: My Lords, I am glad that the noble Lord is pleased at the Answer, and I am inclined to agree with him that this would be the feeling of most Members of your Lordships' House. With regard to the access point, perhaps it would be helpful if I were to say that two of the four ward blocks will shortly be demolished to make way for the new Turner Museum, and the remaining two will be used to provide much needed storage space for the Tate Gallery. Other buildings which will be retained as part of the overall redevelopment will be used as offices, including a new home for the National Art Collections Fund. Quite what the effect of that will be on the access I am not too sure.
Perhaps it would be helpful if I were to say—also covering the second point the noble Lord made—as regards an opportunity for there to be public comment on the proposed redevelopment, the Westminster City Council are presently considering a notice to propose development and they have invited representations. Drawings and a model are being displayed at City Hall and later they will also be displayed at the Tate Gallery. I would have thought that that was the time for people to have their say on this matter.
Lord Hutchinson of Lullington: My Lords, as chairman of the trustees of the Tate Gallery, may I ask the Minister whether he is aware that a very distinguished architect, Mr. James Stirling, has been engaged by the trustees to design this building, and that access to the building will indeed be from the Gallery itself and from the outside? May I ask the Minister, enlarging perhaps the sense of the Question, whether he is aware that the Tate Gallery now has become one of the greatest museums of modern art in the world, and that the rate of expansion of the Gallery must, therefore, exceed the rate of any other museum of fine arts in the country? In those circumstances, would the Minister urge the Government to give the development of the rest of the site urgent priority so that the public are able, as the Minister agrees they are entitled to be able, to see the works which we acquire, which we are at the moment quite unable to put on show?
Lord Bellwin: My Lords, I am very grateful to the noble Lord for his obviously very informed response to the point of access and the other matters. I do not think anyone would quarrel with any of the observations he has made. As to the point about the rest of the site which it is planned to redevelop, I would only say that there are plans, of which I am sure the noble Lord is aware, and it is hoped to provide for the future expansion of the Tate Gallery on this site, possibly, or should I say, hopefully, by means of further donations of private funds.
Lord Strabolgi: My Lords, arising out of what my noble friend Lord Hutchinson said, would the Government bear in mind that there are many important 19th century paintings, particularly Victorian paintings, in which there is an increasing interest which it is Impossible to accommodate in the present accommodation of the Tate Gallery? Will it be possible for this to be borne in mind in any extensions, either for Turner or for other works?
Lord Bellwin: My Lords, I unhesitatingly bow to the greater knowledge of the noble Lord on this subject. I will read with interest what he has said and assure him that we will consider it carefully.
Lord Davies of Leek: My Lords, is the noble Lord aware that my supplementary question is a complete non sequitur, but, if he would like to enjoy seeing future exhibitors at the Tate, there is a marvellous exhibition of children's paintings upstairs in this House at the present moment.
Lord Bellwin: My Lords, I hear what the noble Lord says.

Business
Lord Sandys: My Lords, it may be for the convenience of the House if I announce that dinner will be available this evening at the usual time. The House will adjourn at approximately seven o'clock for approximately one hour. During this adjournment the European Communities (Accession of the Republic of Zimbabwe) Order, the Sheriff Courts (Scotland) Order and the Committee stage of the Licensing (Amendment) Bill will be taken.

Transport Bill
Lord Bellwin: My Lords, I beg to move the Motion standing in my name on the Order Paper.
Moved, That it be an Instruction to the Committee of the Whole House to whom the Transport Bill has been committed that they consider the Bill in the following order:—

Clauses 1 to 4,

Schedule 1,

Clauses 5 to 7,

Schedule 2,

Clause 8,

Schedule 3,

Clauses 9 to 14,

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Schedule 4,

Clauses 15 to 17,

Schedule 5,

Clause 18,

Schedule 6,

Clause 19,

Schedule 7,

Clauses 20 to 25,

Schedule 8,

Clauses 26 to 28,

Schedule 9,

Clauses 29 and 30,

Schedule 10,

Clause 31,

Schedule 11,

Clauses 32 to 37,

Schedule 12.

—(Lord Bellwin.)

On Question, Motion agreed to.

Judicial Pensions Bill [H.L.]
3.8 p.m.
The Lord Chancellor (Lord Hailsham of Saint Marylebone): I beg to move that the Commons amendments be now considered.
Moved, that the Commons amendments be now considered.—(The Lord Chancellor.)
On Question, Motion agreed to.

COMMONS AMENDMENTS
[References are to Bill (70) as first printed for the Commons]
1 Schedule 2, page 32, line 10, leave out ("1st January 1957") and insert ("16th July 1956")
2 Schedule 2, page 32, line 16, leave out ("1st January 1957") and insert ("16th July 1956")
3 Schedule 2, page 34, line 17, leave out ("14(1 )(a)") and insert ("10(4)(a)").
The Lord Chancellor: My Lords, on Amendment No. 1, perhaps I can say, in moving that the House do now agree with the Commons in their said amendment, that as all the amendments are Government amendments, it is not surprising that I shall move the same Motion in regard to all of them. There are four amendments, of which three relate to Schedule 2, and if the House agrees, I will move the first three and then the last.
If the House will look at Schedule 2, the three amendments with regard to that schedule all correct errors to which I have to admit that an annotator to Messrs. Butterworths first drew our attention. The first two amendments correct a wrong date. Paragraph 9 of Schedule 2, to which the amendments relate, reproduces Section 25(4) of the Administration of Justice Act 1956. That section refers to the date on which that subsection came into force. But, by virtue of the Administration of Justice Act (Commencement) Order 1956, Section 25 came into force on 16th July 1956 and not on 1st January 1957.
The third of the Schedule 2 amendments corrects another drafting error because it refers to Section 14(1)(a) of the Administration of Justice Act 1973. There is no Section 14(1)(a) in the Administration of Justice Act 1973. The derivation table correctly shows

837
that the right subsection is Section 10(4)(a) of the Administration of Justice Act 1973. I beg to move.
Moved, That this House doth agree with the Commons in the said amendments.—[The Lord Chancellor.]
Lord Elwyn-Jones: My Lords, the House will be grateful to the noble and learned Lord for explaining these lucid amendments to us all, and to the annotator of Butterworths. We are happy to take help from any source in respect of these technical measures that come before the House.
Lord Renton: My Lords, I was merely going to say before the noble and learned Lord, Lord Elwyn-Jones, rose to his feet, how much both Houses of Parliament owe to those assiduous people who annotate our statutes for us.
Lord Foot: My Lords, while that may be all very well, is it not a little humiliating to this House that, whereas we have used as one of the excuses for our existence the fact that we are a revising Chamber, that lot has now fallen upon the other place?
The Lord Chancellor: My Lords, the other place must serve some useful purpose after all!
On Question, Motion agreed to.

COMMONS AMENDMENT
4 Schedule 3, page 37, line 44, after ("or") insert ("a pension").
The Lord Chancellor: My Lords, I beg to move that this House doth agree with the Commons in their Amendment No. 4. For this again we are indebted to an outside source, but on this occasion no less than Sir Godfray Le Quesne, the chairman of the Monopolies Commission. It is simply a clarificatory amendment. Paragraph 7(3) of Schedule 3 to the Bill, to which the amendment is made, re-enacts paragraph 6 of Schedule 2 to the Pensions (Increase) Act 1971 as amended by Schedule 12 to the Fair Trading Act 1973. It is plain that paragraph 6 applied the Pensions (Increase) Act 1971 to the pensions of the chairmen and deputy chairmen of the Monopolies Commission, and accordingly the amendment reflects the existing law. Paragraph 7(3) of Schedule 3 simplifies the wording. I beg to move.
Moved, That this House doth agree with the Commons in the said amendment.—[The Lord Chancellor.]
Lord Elwyn-Jones: My Lords, the House will note the value of the circulation of Bills on this occasion yet again. It is very helpful indeed.
On Question, Motion agreed to.

British Telecommunications Bill
3.13 p.m.
The Minister of State, Department of Employment (The Earl of Gowrie): My Lords, I beg to move that the House do now again resolve itself into Committee on this Bill.
Moved, That the House do now again resolve itself into Committee.—(The Earl of Gowrie.)
On Question, Motion agreed to.
House in Committee accordingly.
[THE LORD ABERDARE in the Chair.]
Clause 33 [Power of the Secretary of State to make orders about pensions]:
Lord Ponsonby of Shulbrede Lord Ponsonby of Shulbrede moved Amendment No. 120:
Page 33, line 1, after ("may") insert ("with the consent of the Trustees of the Post Office Staff Superannuation Fund").
The noble Lord said: I beg to move Amendment No. 120 and I should like also to speak to Amendment No. 121. The purpose of these two amendments is to get an agreement from the Government that they will not split the Post Office Staff Superannuation Fund without the consent of the trustees of the fund. As the Government know, there is considerable concern among the employees of the Post Office about this particular matter. Indeed, that was acknowledged by Mr. Baker the Minister of State in the House of Commons on 1st April when he said at column 524:
"this is one of the issues that has caused the greatest anxiety and concern among postal and telephone workers … That is entirely understandable. Apart from one's own house, a pension is probably the most valuable asset, or the right to an asset, that will be acquired during one's lifetime".
Later during the Third Reading debate he went on to say:
"the pension entitlement cannot be removed or reduced by any action by me or any other Minister under the Bill. That is the basic assurance … that no pension entitlement can be removed or reduced by any order under the Bill''.
The Post Office Staff Superannuation Fund is one of the largest and most powerful financial institutions in the country giving security and protection to employees and former employees which no other pension fund can rival. The fund has assets of something over £3 billion. About 400,000 staff are employed by the Post Office and British Telecom and rather under half of those are in the Post Office section and rather over half in the Telecom section. There is no logical reason why if the Post Office divides into two corporations the fund must do the same. The criterion to be used for the judging of what is best for the future of the fund is surely the interests of its members. It is the nature of the fund and its purpose which distinguishes this issue from the others which will result from separation.
So far as the future of the fund is concerned, it is not primarily a question of the philosophy of separation or of the tidiness of organisation or of the management prerogative, although the interests of the two corporations are clearly matters to be taken into account. The major issue is surely the interests of the members of the fund.
Given the surrounding circumstances of the widespread changes which will arise from separation, the unions believe that the right course of action at present is to retain the fund as it exists and to make as little change as possible. That would clearly be a valuable contribution towards stability in a period when the separation of the telecommunications and the Post

839
Office from each other is having a profoundly unsettling effect on the staff.
I think that one should say that there is no point in change for its own sake and that is how this proposal appears to the staff. The Government have already agreed to consult with interested parties about the splitting of the fund, but so far they have not given any assurance that they will act in accord with the spirit of that consultation. Therefore, in this amendment we are proposing a safeguard to ensure that they get the agreement of the trustees before they decide on any splitting of the fund. So far as the trustees are concerned, their view, I understand, is that they see absolutely no reason why there should be a division of the fund into two. They believe that the fund has been well organised and managed and that, I understand, is also the view of the members of the fund and their trade union representatives.
One should further consider the reasons why the trustees believe that it would be disadvantageous for the biggest pension fund in England to be split into two funds which would make them the third and fourth largest funds. I understand that the trustees believe that they would no longer be the automatic first port of call for anyone with a large proposition be it in property or in the placing of new shares or a sale for distress reasons of a large line of existing shares. Not only does this give the trustees the advantage of first refusal, but it also gives them the chance of being involved with other partners and of negotiating terms which are weighted towards them.
I understand that the trustees have also come up with the figure of £1 million as the extra cost per year that would be incurred by various charges in various ways if the management of the fund had to be split into two. I think that the noble Earl who is to reply should be very much aware that at the end of the day the Secretary of State will have to justify to the members of the fund why it is worthwhile spending an extra £1 million in expenses in order to split the fund. As I have said, the trustees cannot see the merit in incurring these additional costs for the splitting of the fund.
At the heart of this is the point that the members of the fund believe, in effect, that there will be better pensions for the employees of the Post Office and of British Telecom if, in fact, the fund remains as one. This is a fairly straightforward amendment and I hope that the Government will agree to accept the fact that, until after they have had their consultations, they should not take any action on this other than with the agreement of the trustees of the fund. I beg to move.
Lord Morris: The noble Lord, Lord Ponsonby, has just said that the members of the fund believe that the fund should not be split. What evidence does he have for saying that? Will the members of the fund be consulted?
Lord Ponsonby of Shulbrede: I have not personally consulted the members of the fund or, indeed, each and every one. But I am informed that the members of the fund believe, because of the views of the trustees, that if additional expenses were incurred, that would
840
have the effect of reducing the amount of pensions available.
The other concern is that if we split the fund—and, of course, the fund has investments in property and other things—obviously we must take a view as to into which particular side of the fund particular assets go. We could well have a situation where one part of the fund grows faster than the other part of the fund. This would inevitably mean that those belonging to the part of the fund that was not growing as fast as the other part would feel aggrieved.
Lord Hawke: I think that some of the arguments put forward by the noble Lord are probably special pleading on behalf of the Post Office people rather than the telecommunications people. In the long run, if you consider the future of this industry, the telecommunications people will be on to a winner and the others will be on to a loser. It stands to reason that those who are on to a winner stand to receive better pensions than those who are on to a loser.
I do not think that the argument about the largest fund getting the pick of the propositions is very valid, because a large proposition can always be split between the two. There is no earthly reason why the two funds should not be run from the same office. There would be no need to have two entirely different offices, different staffs and things like that. Nowadays in financial matters it has been found that size is very often a handicap. People who have smaller amounts of assets and can change their assets more easily, are often in a very much better position than those with immense sums which they cannot change. For example, if a fund has £1 million of value in some important company and another fund has, perhaps, £50,000, the people with £50,000 can sell on the market tomorrow, but the £1 million might be much more difficult to place. There is no virtue in size.
I quite agree that it will be difficult to split the fund, particularly if it owns property. For all I know, it may own works of art and things of that sort, and I do not quite know how, for instance, you split up a Gauguin. However, I think that it must be done because, as I say, as time goes by telecommunications will be on to a winner and the others will be on to a loser.
Baroness Phillips: In reply to the noble Lord, Lord Hawke, surely there are many classic examples illustrating that the moment we divide things, they cost far more. We are all saddled with the redistribution of local government. Let me cite what has happened in my local government area. Whereas once we had two town clerks, we were told that one would be very much cheaper; in fact, we now have five, because we have administrative officers. We know exactly what will happen if we divide up the pension fund.
The Post Office had cheaper stamps, better service and certainly cheaper telephone communication when it was under the Government. One of the worst things that we ever did was to make it a separate corporation. If, once again, we are to split this up, not only will more manpower be involved, but it will certainly be a much more costly operation. I know what the Minister will say: that it was a Labour

841
Government that did it. That still does not make it inviolate.
3.26 p.m.
The Earl of Gowrie: I think that the contribution of the noble Baroness, Lady Phillips, was extremely pertinent in relation to the corporation. But the fact is that we are debating the pension fund, which is run by a tightly-knit body of financially-motivated men, and is not an issue in this part of the debate. I find this a very interesting subject and I congratulate the noble Lord, Lord Ponsonby, on the pithy and coherent way in which he moved the amendment; indeed, I congratulate my noble friend Lord Hawke for talking, if I may respectfully say so, very sound financial sense, that size is not always a virtue.
It is true that the pension fund of the Post Office is probably the biggest single concentration of capital in this country, and this debate will be useful if only to underline what we, on this side, are so often saying, that it really is grotesque to continue to talk about the rival merits of socialism and capitalism as if, in the traditional sense, they still existed; as if concentrations of capital are now corporate and social, not necessarily in their direction but in their ownership.
The largest concentration of capital in the United Kingdom is, in fact, the pensions of all the relatively small employees of a very large state corporation. It is, indeed, a very big fund and I hope that, whatever happens to it structurally, the fund will use the liberalisation that this Bill offers to put a small portion of its £3 billion into new British information technology enterprises. That more than anything would get the show on the road. We must hope that the fund managers, who I passionately agree should be entirely free from any direction in this matter, will take the opportunities that they are being given.
Of course, the future of the fund is of great importance to all the employees of both the Post Office and British Telecom, as well as to the very many existing pensioners. Therefore, the Government have a great responsibility to get this right; we are very conscious of the concern, and we attach very great priority to achieving a solution which has the widest possible support. To that degree we are altogether in line with the sentiments expressed by the noble Lord, Lord Ponsonby.
My honourable friend the Minister of State for Industry and Information Technology has met the unions involved as well as the trustees, to allow them to put their views to him. The Post Office board has also submitted its recommendation, which, as the noble Lord, Lord Ponsonby of Shulbrede indicated, is to separate the existing fund and make it into two funds; one for the pension arrangements of each corporation. The Government have made it clear that no quick decision will be taken and that we do want to achieve the widest degree of consent. The present round of consultations will be completed soon and we shall then need time to reflect on the issues involved and to weigh up the advantages and disadvantages of the various solutions which have been proposed. I can again assure the noble Lord that no final decision will be taken without full consultation.
Whatever is decided, I do have to point out that it will not be possible to maintain the status quo absolutely.
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Some changes have to be made to the present trust, if only to allow employees of British Telecom to continue to be members of the fund at all and to allow British Telecom employees to be allowed to appoint trustees, and so on. In the same way, the Inland Revenue will necessarily require separate accounting from the previous arrangements of the two corporations and thus sharing out may also lead to changes in the deed. It is for this reason that the powers being taken by the Secretary of State in Clause 33 are needed.
While we would naturally wish to achieve the greatest degree of support for the eventual solution, it must be accepted that, inevitably, there may be some disagreement, if not on the major principles then on the detail of their implementation. There has to be some means of resolving any such disagreement, and in a big public sector corporation this must ultimately devolve on the accountable Secretary of State. I can sympathise with the intention behind the amendment and I am trying carefully to tailor my words in the direction of the noble Lords' sentiments—but I am afraid that the amendment as against the sentiments which the noble Lord has expressed would not deal with any position that might occur should there be a disagreement among the trustees. If that were to happen—and in the range of human life disagreement can always happen-then the effect of this amendment would be to prevent the Secretary of State from taking any action. He would be stymied in the possibilities open to him. I am sure the Committee would agree that it would be wrong to allow this to happen. It would also have the effect of giving the trustees of the Post Office fund effective control over Ministerial amendments to a British Telecom trust deed. I think the Committee would also agree that that might be undesirable.
The rights of invididuals are protected by the very major safeguard contained in Clause 33(3), which provides that no order can be made which removes or reduces anyone's existing pension entitlement; nothing decided here or in another place can interfere with that. In the light of this explanation, together with the commitment that I have made for very full consultations and the sympathy and consideration which I have shown towards the viewpoint which the noble Lord Lord Ponsonby of Shulbrede represented, I hope that the noble Lord will not press what in effect would be an amendment to stymie the Secretary of State.
Lord Morris: In response to my noble friend Lord Ponsonby of Shulbrede the noble Earl the Minister quite rightly replied that Her Majesty's Government have a considerable duty of care in regard to this matter and that in those circumstances no quick decision should be taken. May I just ask the noble Earl the Minister if he will do everything in his power to expedite agreement, because I believe that time is of the essence with regard to this matter and that delay will only hinder the implementation of the solutions which might be defined as being satisfactory to all concerned?
The Earl of Gowrie: I recognise that it is important to get this matter settled and I share the view that has been expressed by my noble friend. We must go carefully but we cannot use that as a pretext for delay.
Lord Ponsonby of Shulbrede: I thank the noble Earl the Minister for his sympathetic response to this amendment. I accept his point that there must be some solution to this particular problem, but when he referred to the problem of disagreement among the trustees I believe he really meant that there could be problems if there were a disagreement between the Secretary of State and the trustees, rather than it being a case of the trustees disagreeing among themselves. The noble Earl the Minister repeated the assurance which was given by the Minister of State in another place that no member of the fund would lose any entitlement or suffer any decrease in his pension as a result of a splitting of the fund. My concern is that if one effect of the splitting of the fund is that there will be additional costs placed upon the fund, then at some time or another that is bound to have some effect on those who are members of the fund. While accepting the noble Earl the Minister's major thesis, this other point still remains. However, I shall look very carefully at what the noble Earl the Minister has said in response to this amendment and shall possibly come back to it at Report stage.
Amendment, by leave, withdrawn.
[Amendment No. 121 not moved.]
Clause 33 agreed to.
Clauses 34 to 49 agreed to.
Clause 50 [Obligation of Secrecy]:
3.38 p.m.
Lord Young of Dartington Lord Young of Dartington moved Amendment No. 122:
Page 43, line 2, at end insert—
("(3) In the provision of data processing services and services connected therewith, the Corporation shall adhere to the terms of Resolution 74(29) of the Committee of Ministers of the Council of Europe.").
The noble Lord said: I should like to begin by making it clear that the resolution of the Committee of Ministers of the Council of Europe to which the amendment refers has, as the noble Earl the Minister will know, been superseded by the European convention for the protection of individuals with regard to automatic processing of personal data—which I can only think is a literal translation from the French.
I fully accept that it might have been better if my amendment had referred to that convention rather than to the previous resolution. I should like to say to the noble Earl the Minister that I should be perfectly well satisfied if the Government felt able to insert into the Bill at a later stage an amendment to the effect that, in the provision of data processing services, et cetera, the corporation shall adhere to the terms of the European convention which I have just mentioned.
I hope—not in vain I trust—that this will not be too difficult for the noble Earl the Minister to accept, because, as was mentioned earlier in the debate, the Government have already announced that they will adhere to this convention, and to recognise it in this Bill would be the first consequential step in giving legal effect to the convention. The convention certainly goes a lot further than Clause 50 to reinforce the obligation of secrecy, as I hope to make clear in a
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minute. However, it will not have effect until there is consequential legislation.
I must say a word about the nature of the problem, although the problem is well-known. Computers are more and more extensively used for the storage of information about citizens of this country, as of other advanced countries, and this information can be combined and recombined in all sorts of mysterious ways. Information about bank balances, creditworthiness, social security payments and benefits, our health records, businesses started and liquidated, our families and many other matters can be put together at ever reducing cost on a computer without the individual concerned knowing anything about it.
Just yesterday in this House a question was raised about the extent to which information about car owners which is stored on the Ministry of Transport's computer at Swansea is being freely transferred over the telephone line to the computer, at Newcastle, of the Department of Health and Social Security. This kind of talking to each other on the part of computers via the telephone system is clearly going to become more and more common.
The European Convention deals with the problem of privacy, given the trend of which I have just spoken, in a comprehensive way. The purpose of the convention, as is stated in it, is
"to secure in the territory of each party for every individual, whatever his nationality or residence, respect for his rights and fundamental freedoms and in particular his right to privacy with regard to automatic processing of personal data relating to him".
In broad terms the convention gives individuals the right, at reasonable cost, to find out what is stored about them both in public and private computers. It gives the individual citizen the right to examine the data and to correct it if it is inaccurate, and also to have the data taken out of the store if it concerns racial origin, political opinions or religious beliefs, or data about health or sexual matters unless this is specifically authorised by law.
It seems to me, as I hope it will seem to the noble Minister, that the European Convention is very much on the right track in giving this additional protection that the citizen does not at present have in law. The debate on this matter has had a sadly long history in Britain, which on data protection has lagged behind almost every advanced country in the world. There was such strong feeling about it in the early 1970s that the Labour Government of that time set up the Younger Committee, which reported in 1972. Nothing was done. After a change of Government the matter was looked at again, and Mr. Roy Jenkins, who was an outstanding liberal and reforming Home Secretary, who has since become better known as a member of the Gang of Four, appointed the Lindop Committee in July 1976.
That committee reported in 1978 on the ways in which the data protection authority, which it was given the function of examining, would work out in practice. If its recommendations were accepted it would finally clear up the difficult issue in law of who owns information about individuals and what rights the person has in respect of whom the information is stored. The Lindop Report, like the Younger Report before it, was warmly welcomed but, as happens with

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so many Government reports, the rest has been silence—largely so. One Government after another have unfortunately stonewalled. I only hope that we are not going to have another example of it from my noble friend opposite in a few minutes.
Despite growing pressure from the British computer industry and British business, so far nothing has happened. France, Germany, Sweden, Norway, Denmark, Luxembourg, Spain and Portugal are just some of the countries which have data protection laws on their various statute books. Unless we take similar action, computer operators outside this country will be prevented from passing information into the United Kingdom. We could, like Panama in another field, become a computer haven for shady operators and lose the respectable international trade in information and, as one of the directors of Lucas said the other day, prevent British firms from getting business involving the transfer of information by computer across borders.
Medical interests have been as keen as business interests on data protection which would preserve confidentiality of information about patients. Perhaps there is at last to be some movement because the Government have recognised the European Convention, and this is certainly a most welcome step. The Home Secretary has said that he has decided '"in principle", though only in principle, to introduce legislation on the subject. He did not exactly speak with firmness. On the question of when there was to be legislation, he said, "When opportunity offers", which goes back to very much the same form of words used by a previous Home Secretary as long ago as 1975.
We have the opportunity—I do not think that can be denied—to do something about it today if the Committee so wishes. It certainly cannot be claimed that we do not have the parliamentary time today to take at least a first step along the road indicated to us as desirable by the Lindop Report and the Younger Report before that. I have to say that I fear we shall not get truly liberal and comprehensive legislation on this matter until there is a change of Government, and I imagine that I look forward to that more eagerly than the noble Minister opposite. But one should always be ready for surprises, and I end by begging the noble Minister to surprise me today. I beg to move.
Lord Lloyd of Kilgerran: I should like to support the noble Lord, Lord Young of Dartington, in this amendment. As your Lordships have no doubt heard from other sources, industry in this country has been worried at the absence of data protection in the laws of the United Kingdom. Indeed, when the all-party group on information technology was set up over 18 months ago one of the first matters brought to the notice of this all-party group was the absence of these laws and how it was affecting seriously the business of this country.
As the noble Lord, Lord Young, has said, computer operators abroad are reluctant, so I am told, to pass communications through this country because of the absence of any protection of data processes. The Lindop Report has now been warmly welcomed but so far no efforts have been initiated, apart from Lord Young's amendment in this Bill. There may be some
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procedural difficulties about endorsing the terms of a Council of Europe convention in a Bill of this kind, but in my submission this Committee should take the opportunity of supporting this amendment of the noble Lord.
Lord Trefgarne: I am sure that we are all grateful to the noble Lord, Lord Young of Dartington, for raising this important subject on the rights of the individual in relation to data banks and for the measured way in which he moved his amendment. However, although I can understand the noble Lord's concern, and indeed the concern of the noble Lord, Lord Lloyd of Kilgerran, I do not believe that this amendment is the best way to deal with the problem.
First, I am advised that it is highly unusual for a statute to incorporate part of an extraneous document in this way, as it is preferable for statutes, so far as possible, to be self-contained. The noble Lord, Lord Lloyd of Kilgerran, foreshadowed that point. But that is not the only reason why I feel unable to accept the amendment. As the Committee may know, Resolution 74(29) has now been superseded by the Council of Europe convention on the protection of individuals with regard to the automatic processing of personal data. I am sure your Lordships will have welcomed the signature of that convention by the United Kingdom as recently as 14th May. As the noble Lord, Lord Young, said, the Home Secretary announced to Parliament on 19th March that the Government had decided in principle to introduce legislation, when a opportunity offers, designed to provide statutory protection for personal information handled automatically, and when enacted, the proposed legislation will enable the United Kingdom to ratify the convention. I believe that general legislation is the proper place to deal with this problem and that the course I have outlined is the best approach.
Meanwhile, this clause continues for BT the present statutory provision whereby the unauthorised disclosure—except as required by law—of information obtained in the course of the provision by the Post Office of data processing services is an offence. BT will therefore already be governed by one of the principles contained in the convention. But it would be premature and unfair to single out BT for further statutory duties which would involve it in extra costs but which would not have to be met by its competitors. I am sure my right honourable friend the Home Secretary will pay careful attention to what has been said today and will take it into account in the preparation of the legislation.
I do not think there is very much between the noble Lord, Lord Young, and the Government on this matter; we both agree that the provisions of the convention to which I have referred should, as soon as may be, be applied to British Telecom, as indeed to the rest of the appropriate bodies which will be covered by the convention. It is simply a question of how best to bring that into legislative shape. I hope the noble Lord will agree that the Government's approach is the right one and will not seek to press the amendment.
Lord Byers: I wish to take this opportunity to thank the noble Lord, Lord Young, for raising this matter.

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I was a member of the Younger Committee which spent nearly two years going into all aspects of privacy and I do not think we could have done a more thorough job. We have, however, for nearly 10 years, with the support of noble Lords like the noble and learned Lord, Lord Gardiner been pressing for action along the lines of the report. If the Government would give an assurance that the appropriate moment will come some time in the next Session of Parliament, many of us would feel a great deal happier because we are lagging too far behind other countries which have already adopted a form of protection for data processing. I have a feeling that we are storing up real trouble for ourselves if we keep putting off action as we have been doing over the last decade.
Lord Trefgarne: I fear I cannot give the assurance the noble Lord seeks. My right honourable friend announced his intention in this matter only last March and, as I say, the convention was signed just a week ago, so I doubt that it will be possible, although I should be happy to be proved wrong, to bring the legislation forward as soon as the noble Lord asks me to assure him we shall. However, I assure him that there will be no unnecessary delay.
Lord Morris: My noble friend said legislation would be forthcoming "as soon as may be". Is that another way of saying "as soon as possible"?
Lord Trefgarne: It depends what one means by "as soon as possible".
Lord Byers: I suggest to the Minister that this is about the right time, in this parliamentary Session, to put down a marker for the next parliamentary Session, and then, with any luck, we shall get the priority we have been demanding for so long.
Lord Trefgarne: I am afraid I am not in a position to foreshadow the contents of the next Queen's Speech.
Lord Young of Dartington: I thank the Minister for his remarks but naturally, like other noble Lords, I was sorry because there were no surprises in his answer. All noble Lords who have spoken share the same views, and of course some of us know a great deal more about the issue than others. I fear that the Minister's remarks, when he spoke about "as soon as may be", represented very little advance on what we heard earlier from the Home Secretary, when he used the phrase "as soon as possible". Although the Minister was not able to say anything more firm today, I hope he will convey to his colleagues the reasonable strength of feeling there is on this question and express the hope that there will be legislation next Session. That would be welcome by the British business community, by the medical profession and by all those concerned with civil liberties in this country. I greatly hope it will be possible for the Government to act on the matter, not just as soon as may be but with a particular timetable attached. Meanwhile, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 50 agreed to.
3.57 p.m.
Lord Elwyn-Jones Lord Elwyn-Jones moved Amendment No. 123:
After Clause 50, insert the following new clause:
("Interception of messages
.—(1) A person who—

(a) intentionally intercepts any message or other matter carried by means of a public telecommunication system (including any such system provided, under a licence, otherwise than by the Corporation);

(b) instigates any person engaged in the business of the Corporation to intercept such a message or other matter; or

(c) discloses the contents of any message or other matter intercepted under paragraph (a) or (b) above.

unless acting in obedience to a warrant issued pursuant to the following provisions of this section, shall be guilty of an offence and liable on conviction on indictment to a fine not exceeding £5,000 or to imprisonment for a term not exceeding three years or to both.
(2) Proceedings for an offence under subsection (1) above shall not be instituted in England or Wales except by or with the consent of the Attorney General, or in Northern Ireland except by or with the consent of the Attorney General for Northern Ireland.
(3) No person shall be guilty of an offence under subsection (1) above as respects any act done by him whilst engaged in the business of the Corporation.
(4) The Secretary of State may, on the application of a chief officer of police or the Commissioners of Customs and Excise, issue a warrant for the interception and disclosure of telecommunications if he is satisfied that—

(a) it would assist in the detection of a serious offence;

(b) normal methods of investigation have been tried and have failed or from the nature of things are unlikely to succeed if tried; and

(c) there is good reason to think that the interception would result in a conviction for that offence.

In this subsection "serious offence" means—

(i) an offence for which a person not previously convicted could reasonably be expected to be sentenced to imprisonment for a term of three years; or

(ii) an offence in which either a large number of people is involved or there is good reason to apprehend the use of violence.

(5) The Secretary of State may, on the application of a chief officer of police or the Director-General of the Security Service issue a warrant for the interception and disclosure of telecommunications if he is satisfied that—

(a) it would assist in the detection of a major subversive, terrorist or espionage activity giving rise to external or internal danger to the defence of the Realm; and

(b) normal methods of investigation have been tried and have failed or from the nature of things are unlikely to succeed if tried.

(6) An application for a warrant under this section shall be made in writing and shall specify—

(a) the person whose telecommunications it is sought to intercept and the telecommunications in question; and

(b) the facts and circumstances in support of the application, but the Secretary of State may allow any information required under paragraph (b) above to be provided orally and not in writing in respect of an application for a warrant under subsection (5) above.

(7) Except in a case of emergency, any warrant under this section shall be issued only under the hand of the Secretary of State; and, in any such case, shall be confirmed under his hand as soon as reasonably practicable after issue.
(8) In this section "intercept" includes the doing of any act designed to enable an interception to take place, and intercepts", "intercepted" and "interception" shall be construed accordingly.").
The noble and learned Lord said: This new clause relates to the important question of interception of communications taking place between private citizens

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either by the exercise by the state through the Home Secretary of a power to do so or by persons or bodies with no such power. It seeks to give statutory authority and form to the actions that are taken in this field by the Secretary of State and to prevent, so far as the law can, and to punish by suitable sanctions, unauthorised interceptions of communications on the publicly-operated systems.
A great deal of public concern has been widely expressed in the press and elsewhere that the unauthorised private tapping of telephones and the bugging of premises and phone lines are believed to be more extensive now than ever before. Micro-electronic technology has made the available devices smaller, cheaper and much easier to acquire and install, and the potential for abuse is now so great that we believe further action is needed to protect the privacy of the citizen.
On the first main purpose of the clause—namely, the problem of authorised intercepts on behalf of the Crown-the Committee will, I believe, find itself in agreement with a statement made by the noble and learned Lord, Lord Diplock, earlier this year in his report on the interception of communications in Great Britain:
"That the exercise by the State of any power to read or listen to communications taking place between private citizens involves an invasion of their privacy which has always been looked on by the public with suspicion and distaste".
That, I believe, applies equally to interceptions of communications through the telecommunications system, with which Amendment No. 123 deals, and to No. 145, which deals with interceptions of the contents of mail carried by the Post Office.
I think that there will also be common ground on the other side of the coin; namely, that properly authorised and carefully controlled telephone tapping and interception of mail are both necessary to combat crime and espionage. Serious crime, not only domestic crime, but in particular terrorist crime, planned and carried out across the frontiers of states by criminal gangs, is on the increase. The sinister and profitable traffic in drugs continues unabated, and in this dangerous nuclear age espionage unhappily shows no sign of diminution.
The Committee will note that we bear in mind the importance of those considerations in the amendment. We do not wish to deprive, nor seek to deprive, the police, the security service, or Customs and Excise, operating under warrants issued by the Secretary of State—and I emphasise the point about the warrants being issued by the Secretary of State—of a useful weapon in their efforts to protect the community from the dangers that I have mentioned. However, in a democracy invasions of the privacy of phone calls, and of letters passing through the post, must be authorised clearly by the law before they can be justified and sustained; and that is the first proposition that the clause seeks to establish, by giving what is done a statutory basis. The second purpose of the clause in general terms is that all unauthorised tapping outside the legal framework provided by the clause should be dealt with by, and should be liable to, strong penalty.
As to my first proposition, unhappily the state of the law in this country on telephone tapping is, to say the
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least, unsatisfactory. The origin of the power is obscure. There is no statutory or express legal authority for telephone tapping. While I am not suggesting that the tapping of the telephone by police is unlawful, unhappily it lacks full and express legal authority. This is a particularly serious defect in our law when we bear in mind that the Government of the United Kingdom have assumed an obligation under Article 8 of the European Convention for the Protection of Human Rights and Fundamental Freedoms to secure for everyone the right to respect for his private and family life, his home and, I stress, his correspondence.
This matter was considered by Vice-Chancellor Megarry, in the Chancery Division, in his judgment in the case of Malone v. the Commissioner of Police of the Metropolis, with which I am sure the noble and learned Lord is very familiar. The Vice-Chancellor expressed his view of the matter in this way:
"It is, I suppose, possible to contend that the de facto practice in this country sufficiently secures these rights and freedoms",—
under the convention—
"without legislation for the purpose being needed".
Then he added:
"It is also plainly possible"—
and note the contrast—
"to contend that, among other things, the existing safeguards against unbridled telephone tapping being merely administrative in nature and not by law, fall far short of making any rights and freedoms secure to anyone".
That is a view with which, with great respect, I find myself in full agreement, and it is against that defect that the proposed new clause is directed.
In a later passage the Vice-Chancellor made clear his view when he stated that in our law
"any adequate and effective safeugards against abuse are wanting".
He added:
"In this respect, the English law compares most unfavourably with West German law: this is not a subject on which it is possible to feel any pride in English law".
That is indeed a serious ststement to be made by a Vice-Chancellor. Later in the judgment he stated:
"I would only add that, even if it was not clear before, this case"—
the Malone case—
"seems to me to make it plain that telephone tapping is a subject which cries out for legislation".
The continuation of his judgment is highly relevant. He went on to say:
"However much the protection of the public against crime demands that in proper cases the police should have the assistance of telephone tapping, I would have thought that in any civilised system of law the claims of liberty and justice would require that telephone users should have effective and independent safeguards against possible abuses. The fact that a telephone user is suspected of crime increases rather than diminishes this requirement: suspicions, however reasonably held, may sometimes prove to be wholly unfounded. If there were effective and independent safeguards, these would not only exclude some cases of excessive zeal"—
as he put it—
"but also, by their mere existence, provide some degree of reassurance for those who are resentful of the police or believe themselves to be persecuted".
I apologise for taking up so much time on that quotation, but I believe that it goes to the heart of the matter,

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and I point out that it emanates from a judicial source of high authority.
The new clause is an attempt to respond in regard to what the Vice-Chancellor called,
"a subject which cries out for legislation".
The Vice-Chancellor added in his judgment that:
"…the difficulties in legislating on telephone tapping ought not to prove insuperable; and the requirements of the Convention should provide a spur to action, even if belated".
I wonder whether they will. I very much hope that the Government will respond to the judgment and to the amendment by accepting the clause as it is or with such amendment as they may think proper to introduce.
Other democratic countries have shown themselves quite capable of having a statutory basis for telephone tapping and for appropriate political and legal safeguards against abuse in these invasions of the privacy of the subject. No doubt it was the absence of an identifiable legal or statutory basis for the Home Secretary's powers that led the Royal Commission on Criminal Procedure recently to propose that the use of all surveillance devices, including those for the interception of letters and telephone communications, should be regulated by statute, and that is what the new clause tries to do.
With regard to the second purpose of the clause, would point out that ill subsection (1) it makes a clear and unequivocal statement of the illegality of unauthorised telephone tapping and it imposes an appropriately serious penalty on those who perpetrate it. The Committee will see that subsection (1) creates three criminal offences. It refers, first, to a person who,
"intentionally intercepts any message or other matter carried by means of a public telecommunication system (including any such system provided, under a licence, otherwise than by the Corporation)".
So that, first of all, deals with intentionally intercepting. The subsection refers, secondly, to a person who,
"instigates any person engaged in the business of the Corporation to intercept…".
That deals with instigation. Thirdly, the subsection refers to a person who
"discloses the contents of any message … unless acting in obedience to a warrant issued pursuant to the … provisions"
of the clause that refer to the powers of the Secretary of State to issue warrants for interception.
The subsection also provides, I believe for the first time in regard to this kind of intolerable misconduct, appropriate sanctions. The penalties proposed are, on indictment, a fine not exceeding £5,000 or imprisonment for a term not exceeding three years, or both. At the present time the penalties for unauthorised interceptions are quite trivial; they are farcical. Yet this is a time when the fact that unauthorised interceptions and bugging are on the increase is widely reported in the press and they are seriously feared to be taking place. As the report of the Post Office Engineering Union on tapping the telephone points out, private bugging and efforts at debugging are now big business. Equipment is easily available, and last year an American company, Communications Control Systems, actually opened a London shop selling a wide variety of specialised devices. The shop is called "Counter Spy", oddly enough, and is located in Park Street in Mayfair.
The use of these deices for the purposes of, for instance, industrial espionage is now thought to be considerable. They can be used for the purposes of the commission and furtherance of the crime of blackmail, quite apart, of course, from the deep offence and affront that tapping one's telephone causes to those who are made the victims of it, whether they be of high estate or low. This is why we now think it proper, for the first time, to attach real, effective penalties to deal with this mischief.
Subsection (2) provides that proceedings for an offence under this clause should be brought by the Attorney General. Clearly, telephone tapping is a serious offence in the field of a good deal of political sensitivity, and we think it is necessary that prosecutions should be brought by the Attorney General. This would provide consistency and would enable him to balance all the considerations of public interest that are involved, and, of course, the prospects as to whether a prosecution would be likely to succeed. So that is a valuable safeguard.
Subsection (3) of the clause exempts the staff of the British Telecommunications Corporation from the provisions of the clause. The staff are already liable to a series of specific offences contained in earlier statutes going back as far as the Telegraph Act 1873. Obviously, the staff of British Telecommunications, in the day-to-day course of their duties, may have to listen to telephone calls in order to help the customer in connecting his call, to check the quality of service or in ways of that kind. But outside such proper interceptions or activities, the staff would already fall foul of strict disciplinary procedures, which include provision for dismissal.
Subsections (4) and (5) of the clause are very important parts of it. They set out the criteria which the Secretary of State is now obliged to follow in issuing warrants for interception to the police, Customs and Excise and the security service respectively. I should like to emphasise that these criteria which are included in the clause are exactly the criteria which the Home Secretary states he currently operates and which are, indeed, set out in the White Paper, The Interception of Communications in Great Britain, which was issued in April of last year.
If your Lordships will be good enough to look at the subsection, it says:
"The Secretary of State may, on the application of a chief officer of police or the Commissioners of Customs and Excise, issue a warrant for the interception and disclosure of telecommunications if he is satisfied that—

(a) it would assist in the detection of a serious offence;

(b) normal methods of investigation have been tried and have failed or from the nature of things are unlikely to succeed if tried"—

so it is very much a last resort power—
"and
(c) there is good reason to think that the interception would result in a conviction for that offence".
Then, in that subsection the words "serious offence" are defined, as they are defined in paragraph 4 of the Home Secretary's White Paper; namely,

"(i) an offence for which a person not previously convicted could reasonably be expected to be sentended to imprisonment for a term of three years; or

(ii) an offence in which either a large number of people is involved or there is good reason to apprehend the use of violence".

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I recollect that the noble Lord, Lord Hooson, commented critically upon that definition of "serious offence" in an earlier debate, but we have been so anxious to secure the full co-operation of the Home Office in giving approval to this new clause that we have jealously followed the very language which the Home Secretary has used and within which he regards himself as confined.
Then subsection (5) says:
"The Secretary of State may, on the application of a chief officer of police or the Director-General of the Security Service issue a warrant for the interception and disclosure of telecommunications if he is satisfied that—

(a) it would assist in the detection of a major subversive, terrorist or espionage activity giving rise to external or internal danger to the defence of the Realm; and

(b) normal methods of investigation have been tried and have failed or from the nature of things are unlikely to succeed if tried.".

Those criteria are the Home Secretary's own criteria for applying these powers, and I submit they create reasonable and responsible limits within which these powers should be exercised.
Subsection (6) provides that applications for warrants will normally be in writing, but permits information to be provided orally. That reflects what is in fact existing practice, as indicated in the report of the noble and learned Lord, Lord Diplock, of March of this year, and is a useful provision to safeguard security.
Subsection (7) provides that except in a case of emergency a warrant shall be signed by the Secretary of State himself. In a case of emergency a fellow Secretary of State could presumably be made available to do so. This again reflects what is said to be—and as the Home Secretary says so, it presumably is—the practice operating at this present time, and it is so described in the Secretary of State's White Paper. Finally, subsection (8) simply concerns the scope of the term "intercept".
I have taken the Committee through the subsections of the clause. As will be seen, its overall intent, as I have said, is to give statutory force to the very procedures which the Home Secretary says already operate, and to the precise criteria which he says already apply. In my view, and in the view of my noble friends, the enactment of this clause would clarify and place beyond doubt—and there is a good deal of room for legal doubt about it now—the legal authority of the Home Secretary to issue warrants. It would also introduce new and stronger penalties against unauthorised tapping, and I believe that it would greatly strengthen the position of the United Kingdom in relation to its compliance with the European Convention on Human Rights and put it beyond doubt. I believe this clause, if implemented, would provide a welcome measure of reassurance to a very concerned public. I beg to move.
4.20 p.m.
The Earl of Gowrie: If I rise at this point it is not for any purpose of trying to discourage debate hut simply because I think it might be convenient for the Committee on this very important issue if I put the Governments' position quite clearly, if I am able to do so, at the beginning. The amendment is concerned with the integrity of the public telephone service, and that is a matter of great importance to all of us who use
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it. It affects not only the minority who are involved in crime, but the great majority of us who are not involved in crime. They, too, the majority, have an interest in interception both because they want criminals brought to book, on the one hand, and because, on the other, they also want to be assured that their own telephones will not be subject to arbitrary interception.
The postal and telephone services provide a universal means of communication for the whole nation and the telephone system in particular is the most convenient and quickest system of communications available. It also provides the ideal means, unfortunately, of communication for the criminal and the spy who wishes to communicate quickly with his associates. I do not think it can be disputed that it is as necessary today as ever it was for the agents of the Crown to exercise a proper, but a strictly controlled, surveillance in relation to these services. As the Birkett Report put it in 1957:
"the criminal and the wrongdoer should not be allowed to use services provided by the state for wrongful purposes quite unimpeded".
Since then, the growth of terrorism and drug smuggling have served only to strengthen the case. On this there is no disagreement between the Government and the supporters of this amendment and if a similar amendment on the interception of mail, because they, too, accept that interception is a weapon which should be available to the Crown.
What is at issue is not the need for interception as a weapon in the fight against crime, but rather the way in which the weapon is controlled to ensure that the power to intercept communications is exercised only in clearly justifiable cases and the use made of it limited to what is strictly necessary. A balance has to be struck between the needs of the community in the prevention and detection of crime and the rights of the individual whose privacy may be infringed. The question we have to debate today is whether, for that balance to be properly struck, the arrangements for the control of interception must be enshrined in legislation. The Government's case rests on two simple but vitally important propositions. The first proposition is that if interception is to be effective it must be carried out in secret. The second is that the judicial process is by its very nature an open process. It is the conflict between these two propositions which, in the Government's view, makes it impossible for interception to be regulated by an Act of Parliament, and thus made subject to litigation, without necessarily destroying its effectiveness.
Clearly a suspected bank robber, drug smuggler or spy should not know that his mail or telephone is being intercepted at the time. Otherwise he will modify his behaviour accordingly. But it is equally important that the information which forms the case for interception should be kept secret, both then and subsequently. It would clearly help the criminal to discover how much the police know about his activities—and who is telling them. And yet this is exactly what would happen if the criteria for interception were laid down in an Act of Parliament; for it is an essential feature of our constitutional system in this country that what is laid down in an Act of Parliament can be tested and enforced in the courts at the suit of any interested person. Cases in which an individual

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thought that his telephone was being improperly intercepted could be brought before the courts and the courts would be obliged to adjudicate.
To enable the court to determine the matter fairly, all the relevant information would have to be exposed in evidence. This would include all the information available to the Home Secretary, some of it of a most sensitive nature derived from those on whom the police and the security service depend; people in some cases whose very lives would be endangered if their part were known, or even suspected, by the dangerous men against whom interception is sometimes employed.
Before the Home Secretary signs a warrant—and this is a responsibility which the Home Secretary cannot delegate—he has to be satisfied that interception is justified in accordance with the criteria set out in the White Paper which the Government published a year ago. That means that the Home Secretary must be fully and frankly informed of the basis of suspicion against the individual concerned, including information which should on no account be revealed, and, least of all, revealed to that individual. And if the Home Secretary is to be frankly informed about such secret matters he must himself be in a position to keep the secrets entrusted to him. How then could he permit such information—which he would not reveal to the other place—to become a matter of evidence in a court of law?
And yet, if interception were regulated by statute, this is what must happen. For it is the very essence of the judicial process that the judge must determine the matter exclusively on the basis of the law and of the evidence adduced—the evidence adduced, that is, by the parties, publicly and in the presence of each other. It would no longer be possible to keep secret the sort of sensitive information, often given at great personal risk, to which I have referred. It is no answer to say that secret matters could be kept secret by claims of Crown privilege. If secrecy precludes the Home Secretary from saying whether there has been an interception or, if there has, from demonstrating to the court that the conditions laid down in the statute for the issue of a warrant were in fact met in a particular case, then the judgment of the court must go against him. From that, unfortunately, there is no escape.
But important safeguards already exist which avoid the unacceptable consequences of legislation. This Government have appointed one of our most respected judges, the noble and learned Lord, Lord Diplock, to scrutinise the existing arrangements and undertake a continuing, independent check that the procedures and safeguards set out in the White Paper on 1st April 1980 are, in fact, being observed. He has complete access to all the secret material which is submitted to the Home Secretary and he has complete freedom to look at any case he wants in whatever way he chooses. Individual cases are thus independently tested against the published criteria while still preserving the essential secrecy. The public are protected against unjustified interception and the informant against the revenge of his associates. No one, I believe, who has read Lord Diplock's first report can doubt the care and penetration with which he has carried out his task. He gave the system a clean bill of health; and his continuing checks on individual
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cases provide a valuable new safeguard against any departure from the published principles.
First, there is the position of the Post Office and, after the coming into force of this Bill, the British Telecommunications Corporation, which is independent of the Government. They need the confidence of their customers and would not put it at risk by allowing widespread and unjustified snooping on their customers' communications. In fact, they will undertake interception only where the law requires them to do so. Their employees would be committing a criminal offence if they undertook interception except in accordance with a warrant. Similarly, as regards the police it was plainly stated on oath in a recent court case—and again I am quoting—that:
"The Commissioner of Police of the Metropolis would not in any circumstances authorise, or be party to, the tapping of any telephone otherwise than in pursuance of a warrant of the Secretary of State".
The same applies to other chief officers of police. And for the individual police officer to undertake unauthorised interception would be a very serious disciplinary offence indeed.
These arrangements provide a strong safeguard against unauthorised tampering with Post Office equipment. If Post Office employees engage in unauthorised interception, they are breaking the law. While generalised allegations of unauthorised tapping have been made, my right honourable friend the Home Secretary made it clear in another place that if he were given specific evidence of unauthorised interception he would of course immediately take firm steps to deal with it.
It is sometimes argued that to introduce legislation into this area cannot be all that damaging because a number of other countries have done it, and the noble and learned Lord has rehearsed that argument along those lines this afternoon. With the greatest respect to him, this seems to us to be a misleading argument which does not pay sufficient regard to the different legal, constitutional and historical traditions of the countries concerned which make it, in our view, inappropriate to draw parallels. In the Federal Republic of Germany, for example—which is often quoted in this connection—there is a statutory provision which provides in terms that,
"there shall be no legal remedy before the courts in respect of the ordering and implementation of restrictive practices"—
which in this context means surveillance measures.
In exceptional cases the constitutional court would have a function; but the Committee will be well aware that in this country we have no constitution in the German sense and no constitutional court. It we were to follow the German model we should find ourselves with a statutory provision which was not within the cognisance of the courts of the land—those very courts whose constitutional function it is to interpret and enforce the statutes in individual cases. I cannot believe that the House would wish to adopt so extraordinary a provision.
In a number of countries the practice is for interception warrants in criminal cases to be issued by a magistrate or some other judicial officer, acting in an administrative rather than a judical capacity. In this country that would mean giving the responsibility to all magistrates or all judges—or at least to some class

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of judges—with a consequent loss of consistency, control and democratic responsibility. I believe it is far better that this responsibility should rest with a single Minister responsible to Parliament. However, from the information available the Government have formed the view that in those countries which provide for the regulation of interception by statute, usually including such provisions as retrospective notification, the effectiveness and value of interception has, when you get down to it, been reduced. The Government see no reason to follow that example.
May I now very briefly sum up the Government's case against these provisions. It is that interception to be effective must be secret. That in turn means keeping secret both the fact of interception and the information which led to it. If arrangements for interception were laid down by Act of Parliament it would be impossible, under our judicial system, to preserve the secrecy and yet, if challenged, to satisfy the court that the Act had been complied with. Secrecy and litigation cannot be reconciled. That is why we oppose these provisions. They are unworkable. In our view they are also unnecessary.
The public have a right to know that interception is properly controlled. But we believe that the present system of administrative controls and safeguards, which has stood the test of time—we are not in new territory here—provides the necessary assurance. The position of the Post Office, the key rôle of the Secretary of State's warrant, the procedural arrangements described in last year's White Paper, and behind them all the monitoring eye of the noble and learned Lord, Lord Diplock, are, I believe, sufficient to reassure the public that our arrangements are such as both to protect the public interest and to safeguard the rights of the private individual.
4.35 p.m
Lord Gardiner: I do not often trouble your Lordships in these days. We are discussing two things: telephone tapping and a proposed piece of law reform, and I have had some experience of both. I shall be interested to know whether there is any Member of your Lordships' House whose telephone has been tapped or threatened to be tapped more often than mine. A long time ago I went—partly at the request of the Bar Council and partly at the request of Christian Action—to observe the opening of the treason trial in Johannesburg. The first thing that leading counsel for the defence said was, "Whatever you do, do not use the telephone because it is tapped by the police".
I went, in the days of Salazar's Portugal, to the so-called treason trials in Portugal. One of the first things that the defence lawyers said was, "We at once tell you that any telephone call you make will be tapped". In the days of "the Colonels" I went to Athens to deliver a lecture on human rights. This was merely a definition of what human rights were and their history, and contained no criticism of the then Government. The manager of the hotel—not only kindly but I think bravely—told me that the police had already been round and seen all his telephonists, who were all to keep a complete record of any telephone conversation I had.
When I went with the Commonwealth Secretary to Rhodesia, I was of course aware from Sir Roy Welen-
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sky's memoirs that when Mr. Dingle Foot went to defend a black African in Rhodesia his private and confidential talk with him on the case had been tapped by the police. I asked Mr. Smith whether if we saw any of the African detainees we were to assume that the conversation would be tapped. He said that he did not know but he would find out from the police and let us know. He never did let us know. When we saw Mr. Nkomo and other Africans in detention, we did so in the middle of a very large field.
We stayed at Government House with Sir Humphrey Gibbs. He told us that the room that we were to use as a sitting-room was swept every morning for "bugs" but he could not guarantee it and that when we discussed things we should sit close together, not talk too loudly, and must have the radio on.
When I became Lord Chancellor I realised how essential it was for me to be able to have strictly private conversations with the Attorney General, who is the Lord Chancellor's alter ego in the other place. Particularly in my case, having had so little parliamentary experience, I was, as your Lordships know, immensely fortunate in having my noble and learned friend as Attorney General with his great parliamentary experience. Being a pacifist and having appeared for Sir Oswald Mosley and Mr. Harry Pollitt, I thought it more likely than not that MI5 were "bugging" the telephones in my office.
When I had to speak to the Attorney General in confidence I took him out on one or more occasion in the car because I knew the driver and I knew that she would never have allowed the car to be "bugged" without my knowledge. So I have had experiences in this field, and I am still not certain whether my telephone was "bugged" by MI5 or not but I think it probable.
I have also had some experience in law reform. I started trying to reform some of our laws in 1924—which is rather a long time ago—and was for 40 years working outside Parliament in various societies, during 16 of which successive Lord Chancellors appointed me to the Law Reform Committee.
I am delighted to see the noble and learned Lord the Lord Chancellor here and I should like to ask him two or three questions, if he feels inclined to reply to them, the answers to which I hope will be in the affirmative. They are all things I think I have heard him express in the past. The first is, does he agree that on the matter of law reform English people, including lawyers, are unduly conservative, with a small "c"? So often I have been told that some law which works perfectly well in other European countries could not possibly work rightly here, or that some law which works perfectly well in Commonwealth countries could not work rightly here; and then, when the law is enacted, it works as well here as anywhere else. I find it very difficult to understand why, most other European countries having such a law, we could not. It seems to me that the European Convention is perfectly clear because, apart from providing for a right of privacy concerning correspondence, which includes telephones, it then goes on to say:
"There shall be no interference by a public authority with the exercise of this right, except such as in accordance with the law and which is necessary in a democratic society in the interests of national security, public safety or the economic well-being of the country, for the prevention of disorder or crime, for the protection

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of health or morals or for the protection of the rights and freedoms of others".
That gives an enormous discretion to each country to make their own law. All it says is that there ought to be a law about it.
Secondly, I would ask whether he agrees that, as long as we are parties to an international treaty, although that treaty may form no part of our domestic law, it is out bounden duty to carry out its terms; and does it not follow from that that we ought, if we are to comply with the European Convention, to make a law in this field?
For those reasons, broadly speaking, I support this amendment which goes some way in that direction. There are also one or two questions I should like to ask and if the noble Earl the Minister cannot reply now perhaps he would be good enough to write to me about them. I do not think that any ordinary person minds—I certainly do not mind—200, 300 or 400 cases a year in which the Home Secretary authorises a senior police officer to tap somebody's telephone either to prevent crime or, when a crime has been committed, to find out who has committed it and so on. It is the other cases that I think people are worried about.
The first question I should like to ask is: Am I right in thinking that if one uses the words "Secretary of State" we are not just talking about the Home Secretary but about any Secretary of State, so that in practice now other Secretaries of State besides the Home Secretary have the power to issue such warrants and do in fact issue such warrants? Then, much has been said of the most valuable report of the noble and learned Lord, Lord Diplock. I should like to know whether or not MI6 was within his powers of reference. Next, I should like to know whether—I think the answer is probably in the negative—I am right in thinking that the organisation known as "Government Communication Headquarters" was outside the noble and learned Lord's terms of reference. Lastly, I should like to know whether I am right in thinking that telephone-tapping by American security forces in England was wholly and deliberately outside the noble and learned Lord's terms of reference. May I make it plain that I can well believe that in the world in which we live it is very desirable that the English and American security services should work together: that is a separate point. All I am submitting is that the time has come when this should be part of our law and legal system so that the public know who are the people who are entitled to give authority for telephones to be tapped.
I see no difficulty about the framing of such a law. This particular clause is adapted to this particular Bill, of course, but behind it all lies the serious question raised by the noble Lord, Lord Byers. It is 12 years since the Younger Committee's Report. It is not simply a question of telephone-tapping. They recommended, as your Lordships may remember, making illegal electronic devices for eavesdropping, and in a wider context than we can pursue in relation to this Rill, there lie behind it all questions of the new electronic devices. It is not just a question of putting your telephone out of order, which can be done by the Post Office, and then calling to put it in order and
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slipping in a "bug". There are many other devices. I think that the whole subject of electronic surveillance demands consideration in a wider field.
4.46 p.m.
Lord Rawlinson of Ewell: I would apologise to your Lordships for not being here at the start of this debate, and particularly to the noble and learned Lord who moved the amendment, but I am provoked to speak by what has just fallen from the lips of the noble and learned Lord, Lord Gardiner. He talked about his association with what he described as his "alter ego", the Attorney General, the noble and learned Lord, Lord Elwyn-Jones, and he talked about the remarkable story of having to get into a motorcar to be able to discuss with him private matters and apparently sensitive matters of Government.
I was the "alter ego" of my Lord Chancellor, the present Lord Chancellor. He is not, if I may say so, a person who usually speak sotto race and, as far as I recollect, any conference that we had either in his room—sometimes in rooms, sometimes in corridors, sometimes in a smoking room—or wherever it may be, was spoken at the top of his voice so that I could understand and learn exactly what he wanted. I find it absolutely extraordinary to believe that there were these two distinguished Law Officers of the Labour Government sneaking into a motorcar, getting under a rug, passing to each other what was going to happen about the emergency regulations and whether they were to be amended or whether the law of contract should be adapted or adopted. It seems to be a most extraordinary situation. Nevertheless—other Governments, other manners, other behaviour.
All I should like to say is that after the experience of nearly 20 years of government—I was a Law Officer even before the noble and learned Lord, Lord Elwyn-Jones—I have never found that this law as it is, as practised—because it is no law: practice rather—is in any way, shape or form a threat to the liberty of the individual. I beg your Lordships to retain and maintain the present practice and the present position. It is sensible, it is pragmatic, it has a safeguard in the form of one of the most distinguished judges and a Member of your Lordships' House, to supervise and to see that it is being properly carried out. It would be a bad day, I submit, if we tried to enact this into law. The practice works: let us keep it.
Lord Inglewood: I think it is a pity that this debate should be continued entirely by distinguished lawyers, because this is a subject which does have an interest for a great many people who have not held high judicial office and who have not known the inner workings of the system. Nobody in this Chamber could say that I am not on the side of law and order, considering the number of speeches I have made over the years, but I must say I am not entirely happy about the speech of the Minister. I did not find myself convinced that this was a subject which should be begun and ended as an administrative matter.
Furthermore, we must appreciate that there is widespread uncertainty and unhappiness in the country today about exactly how this power is used. I do not want to make a long speech but I do want just to make two points, and first to ask the Minister, when he

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replies, if he could say anything about the timing of these operations. Anyone who knows anything about the prevention of crime knows that speed is often the most important aspects. How long does it take, from the moment a chief officer of police or his junior gets the first idea that it may be a case where he has to ask the Secretary of State for a warrant to enable telephones to be tapped? If it is going to take any length of time, it may be too late and, therefore, half useless.
My second point is this. Once this information is obtained, who will control how it is used, compared with information from the central criminal records? It may be said that only certain people will have special authority to obtain information from those records. Once it is obtained we should be more certain as to how it is used. We are going to infringe the liberty of the subject by tapping telephones and here I must say that I did not find the noble and learned Lord, Lord Rawlinson, so convincing, when he said that this was no threat to the liberty of the individual. It seems to me that what we are now doing is admitting that it is a threat, and saying that, in special circumstances, it is something which we should accept. But what I want to know is: once this information is obtained, by these means, what checks are there on its use?
Lord Lloyd of Kilgerran: I am encouraged by the realistic and practical approach of the noble Lord, Lord Inglewood, in this interesting debate. As a lawyer who has practised only in the exotic field of intellectual property, and who has not had the advantage, so far as I am aware, of experiencing bugging in technological matters, I should like to congratulate the noble and learned Lord, Lord Elwyn-Jones, on moving this important amendment.
I do so on two main grounds. First, I congratulate him on his eloquent, careful and comprehensive manner in moving the amendment. But, more importantly, I congratulate him on taking the initiative in moving this important amendment as a lawyer of such distinction, and as a former Lord Chancellor. That fact, in itself, is of importance, particularly as the noble and learned Lord the Lord Chancellor has throughout been in his place on the Government Front Bench. This will, perhaps, do something to alleviate the disquiet and anxiety which prevails outside the House, and will show that, at least, your Lordships' Committee is taking very seriously and urgently this matter which is raising such disquiet.
Your Lordships will be well aware, as the noble and learned Lord, Lord Elwyn-Jones, pointed out, of the vast variety of gadgetry which is now available on the open market: first, for bugging, then for anti-bugging, for telephone tapping and for serious invasion of personal privacy as well as vast schemes for industrial espionage and piracy. But, of course, invasion of privacy is justified when one is dealing with bank robbers and terrorists, and in combating crime.
The noble and learned Lord, Lord Elwyn-Jones, has spoken at length about the Malone case, where the court pointed out that there were few legal safeguards against the invasion of privacy. There is the case of Dr. Klass v. Federal Republic of Germany, which appears to indicate that this country may be in serious breach of our international obligations in this field, particularly under Article 8 of the European Convention
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on Human Rights. The public at large know that an innocent person who has had his conversations recorded in the United Kingdom, then circulated and put in storage, appears to have no redress at the present time and cannot successfully sue for damages.
I, also, am unhappy about the answer given to us by the noble Earl, Lord Gowrie, on behalf of the Government. It does not seem to me, in view of the inadequacy of United Kingdom domestic remedies dealing with the violation of fundamental rights, that this is a matter which should merely be left in an administrative way. Privacy must be safeguarded and I support this amendment as a substantial move in the direction of law reform, as advocated by the noble and learned Lord, Lord Gardiner, which is the main content and the main theme of the amendment which is before your Lordships.
Lord Ritchie-Calder: I should have thought that the noble Lord, Lord Lloyd of Kilgerran, with all his knowledge, would know that he is probably not immune from this tapping. If he deals in intellectual property, then he is one of the people most likely to be exposed to industrial espionage. I assure my noble and learned friends Lord Gardiner and Lord Elwyn-Jones that they would no longer be able to go out in their car and talk to each other with immunity, because we now have telescopic bugs which pick up from a distance. We are in a most extraordinary situation where practically anybody at any time, unless we provide safeguards, will be able to bug anybody else.
I have had the distinction of being warned by people as distinguished as my noble and learned friend Lord Gardiner. I am one of your Lordships who has been pretty systematically bugged. I know, because I read the transcripts and when I read them I said: "What an extraordinary, sinister and devious character this fellow Ritchie-Calder must have been. I wish I had known him". The conversations were almost on the level of the kind of thing we have been hearing lately, about the non-existent tapping of Prince Charles.
But the point is that it is all there. It is positive, it is growing and we must take the necessary precautions to curtail it. Like everybody else, I see no reason why, on positive serious knowledge, the protectors against crime should not be allowed to take ample precautions about the necessary information. But this has now become world-wide traffic and it is growing. I can bring any bugs I like into this country. I hope that other people will not follow my non-existent example. But this is something which we really must deal with very emphatically indeed.
Lord Young of Dartington: I should like to support this amendment, having been persuaded to do so by the speeches made by my noble and learned friends Lord Elwyn-Jones and Lord Gardiner. It seems that the Government are seriously under-rating the extent of public anxiety on this very important subject and I hope that, even at this late hour, there may be some sign that there will be some reconsideration.
In supporting the amendment, I want to make only one point. I should like to stress again what my noble friend Lord Lloyd of Kilgerran said about technological factors and their importance. I think it is generally accepted that the cost of telephone tapping and mail

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interference has fallen drastically. What used to take hundreds of hours of human labour can now take the time of only a never-sleeping computer and, as computer intelligence—which is what it is often called—increases, costs will go down still further as computers are trained to recognise voices and other indicators of sensitive material. So that the time, the trouble and the cost of going through what used to be a very clumsy exercise in the past are all going to diminish.
As for the post, advances in technology already allow mail to be read unopened; and, of course, not just by public servants, by any means, as is the case with phone tapping as well. It seems to me that these technological developments underline the need—although I accept that they are only one of the reasons—for additional safeguards against phone and mail tapping, and I hope that this Committee will, for this reason as well as for others that have been given, support the amendment.
Lord Lloyd of Hampstead: I should like, very briefly, to add a word in support of this amendment. I confess that I have never been a person of sufficient importance for anybody to wish to tap my telephone. Nevertheless, I share the tremendous public concern that is felt over this matter, a concern which was reflected recently in the judgment of the Vice-Chancellor in a case which came before him in which he made it clear that he thought our law was most inefficient.
The one matter to which I should like to refer is that to which the noble and learned Lord, Lord Gardiner, has already referred; namely, the European Convention. It seems to me that the Government have overlooked the fact that it was laid down in the well-known Klass case, which was considered by the Court of Human Rights, that there needs to be some sort of appeal procedure on the part of an aggrieved citizen. The court there held, so far as I remember, that it was not necessary for this appeal to be to the ordinary courts of law. There could be some kind of special appeal procedure—say, to an independent tribunal.
The noble and learned Lord, Lord Elwyn-Jones, has suggested in his amendment that the appeal should be to the High Court and the Government have indicated that they see great objection to that procedure. What they have not indicated is that they would be prepared to contemplate some alternative by way of an independent tribunal.
It is perfectly true that we have the benefit of the services of that most distinguished judge, the noble and learned Lord, Lord Diplock, but his services are related, as I understand it, purely to the general operation of the security arrangements. He is not in a position, and it is not within his terms of reference, to consider individual appeals.
There therefore remains this very important lacuna in our law. In view of the fact that the Government are apparently not prepared to contemplate any kind of judicial or quasi-judicial regulation of this issue, which it seems is of burning importance to so many people, my view is that one has no alternative but to give one's warm support to the amendment so ably and lucidly advanced by the noble and learned Lord, Lord Elwyn-Jones.
Lord Mottistone: Before the debate ends, I wonder whether the noble and learned Lord who moved the amendment can explain why there appears to be no reference to Scotland in subsection (2). Are the Scots to be freed from this special provision for a special reason?
5.2 p.m.
Lord Elwyn-Jones: As the noble Lord's question is specifically addressed to a limited point, may I say that we have the presence, happily, of the noble and learned Lord the Lord Advocate. I understand that the provisions and arrangements in Scotland differ so fundamentally from those in the rest of Great Britain that it was not thought appropriate to bring Scotland within the purview of this proposed clause.
I am grateful to those noble Lords who have taken part in the debate. I am sorry that the noble and learned Lord, Lord Rawlinson of Ewell, was not here when I spoke, though perhaps he lost little. On the other hand, had he been here he would perhaps have had a better balance of the case for the clause than he has.
My noble friend Lord Gardiner indulged in fascinating reminiscence about personal experience of interception of telecommunications. Perhaps I may also be permitted a little anecdotage—speaking for myself, of course. I recollect an occasion when I had a brief in Libya on a case which contained certain political implications. As is often the custom when going abroad for cases of civil liberty, the moment I arrived there to appear for the defence, every possible difficulty in the way of visiting counsel was created. I was informed that the case had been adjourned for a week. I was a little worried about the situation which resulted, because I was due to appear for the defence in a murder trial at Cardiff Assizes, the date of which I was not sure about. So I sent a signal to my clerk in The Temple, Eric Cooper, asking him to let me know the date of the murder trial. I received a frantic call from our diplomatic representative in Tripoli the next morning. He said, "What on earth is going on? A cable to you has been intercepted, reading, 'Cable received; murder fixed for Wednesday' and signed by an obviously suspect person, Eric". Happily, however, our diplomatic representative was able to redeem the situation with a few well-chosen words.
If I may turn from the frivolous to the serious, I confess that I was very disappointed with the speech of the noble Earl, Lord Gowrie. What surprised me was that he omitted completely to deal with the provisions in the Bill which provide sanctions for unauthorised intercepts as though he is perfectly happy about what has been said in the Committee about the widely extensive range of unauthorised intercepts. (I shall come back in a moment to cases of intercepts on the authority of the warrant of the Secretary of State.) The noble Earl maintained a total silence about those intercepts. That is where we believe the main mischief lies. It lies in the field of what I might call private bugging, private intercepts, using all the devices which it is notorious are now used in all sorts of fields, like industrial espionage.
Can the Home Office really be content with a situation in which the most that is capable of happening to those who do this is that they can be penalised for

865
stealing the Post Office electricity which is involved when interfering with the Post Office's telephone communications? It is a nonsense. This interception which is undoubtedly causing grave concern to the public—my noble friends have indicated that—can now be carried out more or less with impunity. I do hope we shall receive an answer to that part of the story.
As to the other side; namely, the authorised intercepts by the Secretary of State, the gravamen of the Home Office case is that if you put his powers into statutory form, every time you enact a power by statute there is the possibility of civil proceedings being brought by those who are affected by the use of that power. In my submission, the Home Office should not be so frightened of judicial review as they appear to be.
The courts are not inexperienced in handling matters of the gravest importance to the security of the country. The noble and learned Lord, Lord Rawlinson, and I have appeared in many an official secrets case at the Old Bailey where there were confided to those who were allowed to attend the proceedings in camera matters of enormous importance to the security of the country. I have never known of any leakage from that process, either on the judicial side or on the side of advocacy or those concerned. Judges are perfectly capable of protecting the public interest in any proceedings for a declaration, or whatever it may be, either by the procedure of sitting in camera or by the aid of Crown privilege, if need be.
In my experience, the Home Office has always over-reacted to fears of what may happen if greater controls over executive power are introduced. I remember that when I appeared for the Crown, without success, in the leading case on Crown privilege, I was told, "This is a disaster. All the secrets of the State will now be opened. Terrible things are going to happen". Nothing of the kind has happened, despite my eloquent warnings to their Lordships in Appellate Committee that they would.
Then there was the Dorset yacht case, where the Home Office was deeply worried about the fact that when a borstal boy being treated in an open borstal escaped and got on a yacht where the yacht owner had foolishly left some liquor behind, there was consequential damage caused in subsequent collisions and the yacht company sought to make the Home Office responsible for failing properly to supervise the control of the absconder. Terrible fears were uttered from the Home Office that it would put an end to the licensing system, to probation, to licence on leave, to suspended sentences and that terrible things would happen. Nothing of the kind has happened. I think that authority, if I may say so with great respect-and I hope I am not speaking irresponsibly in this field—does get over-frightened about extensions of protections of the liberty of the subject on the one hand and, on the other hand, the duty of the Executive when things go wrong to face the consequences if the citizen is injured.
I do not want to take up much more time. Nothing that I have said in any way diminishes my admiration and the value of the work done by the noble and learned Lord, Lord Diplock, but of course that is in an extremely limited field. His terms of reference were to examine the working of the system whereby the Home Secretary
866
issues warrants for intercepts. He has examined that and I confess I was not surprised to learn that within that limited field there is apparently not a great deal to worry about. But it is in the unauthorised fields, where intercepts are made other than through that established machinery that most of the mischief lies. I am bound to say that in our view what the clause proposes, so far from diminishing the authority of the Home Secretary, would give it statutory shape and statutory form and statutory support, So far as concerns the other end of the scale of the threats to the privacy of the subject in this country, which in my view are now very great, this clause will provide further protection and at least will at last provide sanctions against the improper interceptor of our private affairs.
The Earl of Gowrie: I tried to make the Government's case as fully and carefully as I was able to do and I do not wish to detain the Committee by going over it again. I listened with great interest to the speech of the noble and learned Lord, Lord Gardiner, and indeed I could not help, as it were, mentally commissioning a painting for your Lordships' House about the rare deliberations between the noble and learned Lord, Lord Elwyn-Jones, and the noble and learned Lord, Lord Gardiner, when they were in high office, but I think the point he made was well answered by my noble friend Lord Rawlinson. He asked me some specific questions and, as he kindly suggested, I will write to him on those.
I must take exception on one point in the speech made by my noble friend Lord Inglewood. I do not think it is sufficient to try to write off the rather solemn provisions that I was outlining as being the desire of the Government to keep this an administrative matter. I made it clear in my speech, if he will be so kind as to read it tomorrow, that the warrant of the Home Secretary himself was needed in the vast bulk of these cases, and that it was a solemn affair and not, as it were, as his phrase rather suggested, on the whim of some minor official in a large department of state.
The noble and learned Lord, Lord Elwyn-Jones, towards the end of his speech appeared rather to concede that the Government might have a case where issues of state security might be concerned and where our system and the present system, and the system which obtained when the noble and learned Lord was in Government, operate in the need for authorisation by the Home Secretary. He said that what he was worried about and what the public were worried about was unauthorised interception and that I had not dealt sufficiently with that. Indeed, it is a fair charge, I think, that the bulk of my speech depended on a defence of the existing system where state security was concerned and where interception for the purposes of crime detection by the police was concerned.
On unauthorised interception, it is not true that these are minor offences or that we can all, as it were, "bug" our neighbours without let or hindrance. It is a serious offence for anyone wilfully and maliciously, or without authority, to open someone else's mail, or to use a radio receiver or transmitter for the purpose of intercepting a message. It is also an offence dishonestly to use or divert electricity. Although I agree that there is a slightly farcical element in the

867
concept of electrical theft, and although I also concede that that concept is based on a civilisation with a rather narrower view of the potential of electricity than obtains, nevertheless the fact remains that the diversion and dishonest use of electricity is a serious crime and is therefore covered under existing legislation. I believe that these provisions adequately cover the areas where unauthorised interception might occur in practice. I have consulted my right honourable friend the Home Secretary and I am advised that there is absolutely no reliable evidence of unauthorised interception, whether of mail or telecommunications, but I will bear the point very much in mind.
Lastly, I want to bring the attention of the Committee back to the fact that our system has to strike a balance between the desire of the public not to be snooped upon and the equally strong desire of the public to be secure from crime or from enemies of the state. Our judgment is that there is a long-standing procedure, with no evidence that it is not working or not proving satisfactory, with parliamentary accountability of the very senior Minister of the Crown who is, in the overwhelming majority of cases, responsible; that no evidence has been produced that this system is not working and that we should stay with it, so long as from time to time we devise ways of monitoring whether in fact it is working reasonably well; and I would turn back to the device which we are currently using and in which most of those who have spoken in the Committee expressed confidence, namely, the work of the noble and learned Lord, Lord Diplock.
With those considerations in mind and with the case which I tried to put at considerable length and in some detail earlier, I hope your Lordships will not seek to move this amendment into our law.
Lord Elwyn-Jones: In view of the support which the amendment has received from, I think, all parts of the Committee except the far distant right-hand corner and the Front Bench opposite, I think it is appropriate that we should test the feelings of the Committee on the amendment.
5.20 p.m.
On Question, Whether the said amendment (No. 123) shall be agreed to?
Their Lordships divided: Contents, 82; Not-Contents, 118.

CONTENTS

Airedale, L.

Davies of Penrhys, L.

Amherst, E.

Elwyn-Jones, L.

Aylestone, L.

Evans of Claughton, L.

Balogh, L.

Gaitskell, B.

Blyton, L.

Gardiner, L.

Boston of Faversham, L.

George-Brown, L.

Bowden, L.

Gladwyn, L.

Brockway, L.

Glenamara, L.

Bruce of Donington, L.

Goronwy-Roberts, L.

Chitnis, L.

Gosford, E.

Cledwyn of Penrhos, L.

Hale, L.

Clifford of Chudleigh, L.

Hampton, L.

Collison, L.

Houghton of Sowerby, L.

Crowther-Hunt, L.

Howie of Troon, L.

Darling of Hillsborough, L.

Hunt, L.

David, B.

Ilchester, E.

Davies of Leek, L.

Inglewood, L.

868

Jacques, L.

Pitt of Hampstead, L.

James of Rusholme, L.

Ponsonby of Shulbrede, L. [Teller.]

Janner, L.

Jeger, B.

Ritchie-Calder, L.

Jenkins of Putney, L.

Rochester, L.

John-Mackie, L.

Sainsbury, L.

Kennet, L.

Segal, L.

Kilbracken, L.

Shackleton, L.

Kilmarnock, L.

Shinwell, L.

Lawrence, L.

Somers, L.

Lee of Newton, L.

Spens, L.

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

Stamp, L.

Stedman, B.

Llewelyn-Davies, L.

Stewart of Alvechurch, B.

Lloyd of Hampstead, L.

Stewart of Fulham, L.

Lloyd of Kilgerran, L.

Stone, L.

Longford, E.

Strabolgi, L.

Loudoun, C.

Taylor of Mansfield, L.

McNair, L.

Underhill, L.

Maelor, L.

Walston, L.

Mais, L.

Wells-Pestell, L.

Milverton, L.

Whaddon, L.

Molloy, L.

White, B.

Oram, L.

Winstanley, L.

Phillips, B.

Young of Dartington, L.

NOT-CONTENTS

Abercorn, D.

Glenkinglas, L.

Abinger, L.

Gowrie, E.

Ailesbury, M.

Gridley, L.

Airey of Abingdon, B.

Grimston of Westbury, L.

Alexander of Tunis, E.

Hailsham of Saint Marylebone, L.

Allen of Abbeydale, L.

Alport, L.

Halsbury, E.

Auckland, L.

Hanworth, V.

Avon, E.

Hatherton, L.

Balfour of Inchrye, L.

Hawke, L.

Bellwin, L.

Henley, L.

Belstead, L.

Hill of Luton, L.

Bessborough, E.

Holderness, L.

Bridgeman, V.

Hylton-Foster, B.

Brookes, L.

Kemsley, V.

Burton, L.

Killearn, L.

Cairns, E.

Kimberley, E.

Camoys, L.

Lauderdale, E.

Cathcart, E.

Long, V.

Chalfont, L.

Lyell, L. [Teller.]

Chelwood, L.

Mackay of Clashfern, L.

Chesham, L.

Macleod of Borve, B.

Cockfield, L.

Mancroft, L.

Colwyn, L.

Margadale, L.

Cork and Orrery, E.

Marley, L.

Cottesloe, L.

Massereene and Ferrard, V.

Cranbrook, E.

Mills, V.

Cullen of Ashbourne, L.

Monckton of Brenchley, V.

Daventry, V.

Monk Bretton, L.

Davidson, V.

Morris, L.

de Clifford, L.

Mottistone, L.

De L'Isle, V.

Murton of Lindisfarne, L.

Digby, L.

Newall, L.

Dilhorne, V.

Northchurch, B.

Donegall, M.

Nugent of Guildford, L.

Dormer, L.

O'Hagan, L.

Ebbisham, L.

Orkney, E.

Eccles, V.

Orr-Ewing, L.

Elibank, L.

Pender, L.

Ellenborough, L.

Portland, D.

Elles, B.

Rankeillour, L.

Elliot of Harwood, B.

Rawlinson of Ewell, L.

Exeter, M.

Renton, L.

Faithfull, B.

St. Aldwyn, E.

Falkland, V.

Sandford, L.

Ferrers, E.

Sandys, L. [Teller.]

Fortescue, E.

Savile, L.

Fraser of Kilmorack, L.

Sempill, Ly.

Gainford, L.

Sharples, B.

Garner, L.

Skelmersdale, L.

Geoffrey-Lloyd, L.

Slim, V.

Gibson-Watt, L.

Soames, L.

Gisborough, L.

Stradbroke, E.

869

Strathcarron, L.

Trumpington, B.

Sudeley, L.

Vaizey, L.

Swinfen, L.

Vickers, B.

Swinton, E.

Vivian, L.

Thorneycroft, L.

Westbury, L.

Trefgarne, L.

Young, B.

Trenchard, V.

Resolved in the negative, and amendment disagreed to accordingly.
Clause 51 [Offences by bodies corporate etc.]:
5.28 p.m.
Lord Lyell Lord Lyell moved Amendment No. 123A:
Page 43, line 4, leave out ("Act") and insert ("Part").
The noble Lord said: I hope I can move this small amendment very briefly. It corrects a small drafting error in the Bill. As the Committee will see, Clause 51 should apply only to the telecommunications part of the Bill and this is what the amendment seeks to achieve. I beg to move.
On Question, amendment agreed to.
Clause 51, as amended, agreed to.
Clause 52 agreed to.
Clause 53 [Documentary evidence as to sums due for services]:
The Deputy Chairman of Committees (Lord Jacques)The Deputy Chairman of Committees (Lord Jacques): The next amendment is Amendment No. 124. If this amendment is agreed to, I shall not be able to call Amendments Nos. 125, 126 or 127.
Lord Mottistone Lord Mottistone moved Amendment No. 124:
Page 43, line 19, leave out subsections (1) and (2).
The noble Lord said: I beg to move Amendment No. 124 and I should also like to speak to Amendment No. 128. I shall explain to your Lordships in due course why I have tabled these amendments separately. These amendments are similar in principle to my Amendments Nos. 96, 98A and 99A which we dealt with last night. Indeed, my remarks in cols. 800 and 801 are wholly relevant. Their object is to put British Telecom under the same obligations to customers as other businesses.
Clause 53 of the Bill, unamended, will confer on the corporation the same exemption from justifying a bill for services which it provides as that which the Post Office now has. It is considered that such an exemption is unjustified and that the clause should therefore be omitted from the Bill. The argument of my noble friend Lord Trefgarne in col. 802, in relation to the earlier amendments to which I referred, that in that case Clause 22(1) was tightly drafted and, indeed, was supplemented by Clause 21, does not seem to apply, in this case. There is not, if I may put it this way, the equivalent of Clause 21. It seems that the phraseology is imported from the Post Office Act 1969, about which I spoke on more than one occasion yesterday in warning the Government that they should not, without very careful thought, transfer these sorts
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of provision into this Bill where we are dealing once again with a new creature in the shape of British Telecom which will be, as far as possible, competitive. It is in this area that it is competitive.
I should like to make one other point and that is that in the debate on the last amendment, which was taken to a Division, your Lordships may remember that the noble and learned Lord, Lord Elwyn-Jones, made a point of the fact that persons in authority become over-sensitive if their status quo in relation to privilege is threatened. I would suggest that the remarks that the noble and learned Lord made about the Home Office might, in this case, be seen by the Government to apply equally to the Post Office and that they are probably fighting for this very special privilege unreasonably and uncompetitively. I think that in this case perhaps the Government might see their way at least to accepting Amendment No. 124. I have separately tabled Amendment No. 128 because it seems to me that, on the whole, Clauses 53(1) and (2) are more anti-competitive, in a British sense at any rate, than Clause 53(3) which, of course, deals with overseas matters. I would be grateful if the Government could at least give thought to considering Amendment No. 124, even if they turn down Amendment No. 128. I beg to move.
Lord Trefgarne: As my noble friend has pointed out, Clauses 53(1) and (2) repeat Section 69 of the 1969 Act and provide that a certificate from BT stating that a specified sum is due to it from a specified person with respect to telecommunications services is to be evidence of that fact in legal proceedings. The effect of this is that the court would accept the certificate as correct in the absence of any evidence to the contrary. I should like to stress that the court would have to weigh carefully any other evidence brought before it and that a subscriber is quite free to challenge British Telecom's certificate. It is in no sense conclusive.
The need for this provision stems from the special and complex nature of the telephone charges. Unlike gas and electricity, telephone charges are not based on a single measure of consumption, but a range of factors such as the destination of the call and the time of day it is made. It is not sufficient merely to check the subscriber's meter, since a fault elsewhere in the system, such as equipment sending out the wrong pulses, may cause an error if the meter itself is accurate. It is, therefore, more difficult to verify a telephone bill, and the first two subsections merely provide a basis which the court can accept without elaborate proceedings. As I have said, a subscriber is perfectly free to challenge British Telecom's certificate.
The noble Lord will also be aware that the advent of itemised billing with System X will go some way towards dealing with this problem: meanwhile the Telecom Code of Practice provides for arbitration on telephone bills and British Telecom have agreed that the results of this arbitration are to be binding upon them. I had intended to deal also with the amendments of my noble friend Lord Morris, if that should be his wish, but he may prefer to leave them until a later moment. I hope that my noble friend Lord Mottistone will see that the present arrangements are appropriate and will not wish to take the matter further.
Lord Mottistone: I think that I shall have to read with care what my noble friend has said. Fortunately there will be later stages of this Bill and it may be that I shall return to the charge when I have had time to examine what my noble friend has said. In the meantime, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
5.38 p.m.
Lord Morris Lord Morris moved Amendment No. 125:
Page 43, line 21, after ("20") insert ("or otherwise (subject to any term of the agreement to the contrary)").
The noble Lord said: I beg to move Amendment No. 125. This is merely a drafting amendment the purpose of which is not to change the substance of Clauses 53(1) and (2), but merely to delete subsection (2), thus saving net some 53 words in the Bill. Whether my drafting meets the approval of the Government is, of course, another matter, but I have tabled this amendment with considerable care and I believe that it is a minor improvement in the clarity and brevity of the Bill. I beg to move.
Lord Trefgarne: I must confess that I was not quite certain what lay in the mind of my noble friend when he tabled his amendments. However, I think that I am right in saying that the mere drafting improvement which my noble friend seeks to achieve is, in fact, not quite so. As I understand it, the effect of his amendments would, indeed, go wider than that. For example, I understand that any agreements made by British Telecom for the provision of telecommunication services are confined to its own services, but schemes also cover international calls. It is not possible, therefore, to confine Clause 53(1) to services provided solely by British Telecom as, for example, Amendment No. 126 seeks to do. I hope that my noble friend will find that explanation satisfactory.
Lord Morris: That was not what I intended the effect of the amendment to be. I shall look at it again and see whether I can achieve my objective at a later stage of the Bill. In the meanwhile I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendments Nos. 126 to 129 not moved.]
Clause 53 agreed to.
Clause 54 agreed to.
Clause 55 [Power of local authorities to contribute towards new offices or facilities]:
5.41 p.m.
Lord Lyell Lord Lyell moved Amendment No. 129A:
Page 44, line 8, leave out ("their area or any part of it") and insert ("the whole or any part of their area").
The noble Lord said: I hope that I shall not offend my noble friend Lord Morris, but perhaps he will accept that the Government have tabled this particular amendment, No. 129A, in the name of my noble friend Lord Gowrie, as a result of Amendments Nos. 130 and 131 in the name of my noble friend Lord Morris. I understand that, among other things, my noble
872
friend's amendments would be an attempt to improve the drafting. I apologise to my noble friend for pre-empting him in this way, but we are certainly grateful to him for having drawn attention to a slight inaccuracy in the wording of the Bill.
The purpose of Clause 55, which we are now discussing, which repeals in a modernised form the relevant provisions of Section 51 of the Post Office Act 1953, is to empower local authorities to indemnify British Telecom against any losses which it may sustain as a result of establishing or, indeed, maintaining a telecommunications office or facilities, where the local authority considers that the office or facilities would benefit its area or, as we put it, any part of it. The local authority may do so whether or not the office or facility in question is inside or outside the area that will benefit. We hope that the Government amendment makes this point quite clear and we certainly think that it meets the spirit of the amendments of my noble friend Lord Morris. With that, I beg to move.
On Question, amendment agreed to.
Lord Morris Lord Morris had given notice of his intention to move Amendment No. 130:
Page 44, line 12, after second ("the") insert ("said").
The noble Lord said: In the sense that a starving man is grateful for a crumb, I am very grateful that this amendment at least managed to alert Her Majesty's Government. I am delighted that it had precisely that effect.
[Amendments Nos. 130 and 131 not moved.]
5.44 p.m.
Lord Young of Dartington Lord Young of Dartington moved Amendment No. 132:
Page 44, line 21, at end insert—
("(4) Where the local authority does not consider that it would be for the benefit of its area that the Corporation should provide telecommunication facilities in its area, the local authority shall have power to do so itself.").
The noble Lord said: In moving this amendment I should like to say by way of introduction that, as one of the supporters of the previous amendment on which we voted a few minutes ago, how very welcome is the fact that at present local authorities—and we are dealing with local authorities in this clause—are considering a code of practice based on the recommendations of the Lindop Report which would protect the privacy of information which nestles in local authority computers and which derives from social service departments, housing departments and other departments. In this way, if local authorities adopt the proposed code of practice, they will be showing the way to central Government in a very important particular.
I move this amendment in order to achieve two purposes. The first is to make it clear beyond doubt that local authorities have power to establish their own telephone services in their own areas. This might seem rather a strange proposition. British Telecom talks a great deal about economies of scale and very little about "diseconomies" of scale. Is there not living proof to the contrary in one English city, the City of Hull in Yorkshire? As many of my noble

873
friends will know, Hull City Council set up its own phone service under the power given to it by the Telegraph Act 1899. At that time Glasgow, Brighton Portsmouth, Swansea and, of all places, Tunbridge Wells also had their own telephone services. Unfortunately from my point of view, the Post Office of the day browbeat them all into giving up their telephone services, but fortunately failed to browbeat the tough Yorkshiremen of Hull into doing so, and from that day to this the service has continued to prosper.
I regard it as a model of the municipal socialism which will, I hope, be cherished by my fellow Social Democrats and would, in happier days for the Conservative Party, have been cherished by the Conservative Party as well; for instance, by Joseph Chamberlain and, for all I know—and if I had been able to do the research I might have been able to show this—he actually approved what happened in Hull and these other distinguished English cities and towns, as well as Scottish ones.
The service in Hull has become so successful that, despite the fact that it has no share of the lucrative trunk revenue, which is the lifeblood of Telecom, local calls in that city are untimed, the connection charge is still only £25, and there is a standard of personal service which is probably such that only a small operator like Hull would be able to provide. I had experience of that myself when the city council allowed me to conduct an experiment there, which showed the immense value of subsidised telephones to elderly, housebound people living on their own who could not afford the phones out of their own resources, even the 'phones with the very low connection charges that there are in Hull.
Where Hull goes today my hope is that other municipalities will be prepared to follow in the future. Glasgow could turn back the clock and recover the municipal service that it once had; Manchester or Liverpool, Leeds or Birmingham could do the same. I do not pretend to be an expert on the legalities of this, but I understand that the Telegraph Act, which gave Hull municipality the power to run this excellent municipal telephone service, has not been repealed and that nothing in law except a licence exists to stop other local authorities doing what Hull has done. The powers given under the Telegraph Act are supplemented by the more general powers available to councils given, for example, in Section 111 of the Local Government Act 1972, Section 137 of the Local Government Act 1972 and the Local Authorities (Goods and Services) Act 1970.
I have already apologised verbally to the noble Lord the Minister for not having given him notice by letter of the question I am now going to put to him. I hope that he will accept my apology and is prepared to respond, even though I did not give him notice. Could the noble Lord the Minister confirm that my reading of the law is right: that local authorities are legally entitled to start their own telephone services by way of competition with British Telecom? If the noble Lord is not able to confirm that this afternoon, perhaps he would be prepared to write to me on the subject, because I believe the matter is of interest within a number of local authority circles.
I also wish to draw your Lordships' attention to a matter which is just as important: the add-on services
874
to the first telephone which have been frequently discussed on previous occasions. As we all know, the Bill gives the right to compete with British Telecom in the provision of these add-on services, and we now know more than we did from the Beesley Report what sort of add-on services are being contemplated. It is not expressly provided in the Bill that non-profit-making local authorities shall have the same right to compete as private enterprise. This is not a theoretical matter by any means. For instance, many local authorities already own computers and some have substantial installations. I hope that the noble Lord the Minister will be able to say that there is no reason in law nor in practice why, in the retailing of British Telecom capacity, local authorities should not be able to sell their own computer services to private business. I hope the noble Lord the Minister will make it clear that this further competition to both British Telecom and private enterprise will be welcomed in the mixed economy which has received some favourable mention from the Government's Front Bench today.
My amendment was put down in order to try to clarify these two questions. I would be delighted if the noble Lord the Minister is able to accept my amendment, but if he is not able to accept the amendment I hope that he will be able to say something reassuring about both these important matters, which concern almost every major local authority throughout the country. I beg to move.
Lord Trefgarne: Although I understand the noble Lord's concern to give local authorities a statutory power to act in accordance with any licence granted under the powers of this Bill, I do not believe it would be right to do this. In saying that, I want to make it clear that the Government fully support the city council of Kingston upon Hull, to which the noble Lord referred, in its continuing wish to run a local telephone system for as long as the electorate of that city wishes it so to do. However, the amendment would give all local authorities—from the smallest parish council to the Greater London Council—the power to act in accordance with any licence under this Bill that might apply to them. That would include all the general strategic licences which we envisage will be granted to all persons, covering key areas of liberalisation.
The amendment could have the effect of enabling any local authority to offer value added network services to the public in so far as the Government decide to liberalise such services and do so by means of general licences. The different tiers of local government could set up in competition with one another as well as in competition with British Telecom. It is not the Government's aim to see public money used to create such competition between public bodies; in the end it would be the taxpayer and the ratepayer who would have to pay, because the ultimate discipline of becoming bankrupt would not be imposed upon these competitors. It is through the pressures of the market place that the interests of the consumer can best make themselves felt. That would not happen fully when the competitor was in the public sector—least of all if one or more of the competitors was inexperienced and had moved outside the functions for which it exists to challenge a large, professional corporation.

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There is nothing wrong in challenge. Challenge is something we want, but challenge should come from businessmen who know how to calculate risk and how to assess market demand. Should there ever be any special case where it was justifiable for a local authority to enter the telecommunications business, then special statutory provisions could be made were they needed.
The noble Lord asked me some particular questions about local authorities, and as he foreshadowed it is not possible for me to give a considered reply at this time. I undertake to inquire into the matters which he has raised and will write to him with the answers. However, I believe that I can deal with one particular matter this afternoon. Section 2 of the Telegraph Act 1899, to which the noble Lord referred and which, if my memory serves me right, was the Act which originally authorised the establishment of local telephone services and of which, as the noble Lord also pointed out, only one remains, authorises local authorities to provide public telecommunications services but only under licence from the Post Office—which will in future be British Telecom. I believe that that is the position with regard to the present service run by Hull Corporation. I hope this explanation of the difficulties which might flow from the adoption of the noble Lord's amendment will persuade him not to take the matter further.
5.57 p.m.
Lord Young of Dartington: The noble Lord the Minister would not expect me to be convinced by his arguments—nor am I. His first argument was that if my amendment was accepted a local authority of whatever size would be able to run a telephone service, and this seemed to the noble Lord the Minister to be self-evidently ridiculous. However, it does not seem ridiculous to me, and neither does it seem ridiculous to the drafter of the clause we are considering, No limitation on the size of the local authority is referred to in Clause 55, and if there is no limitation on the size of the local authority in the main part of the clause, why should it be ridiculous to have no limitation on the size of the local authority in the proposed amendment?
The noble Lord the Minister went on to say that some local authorities are so small that they would not want to run any telephone services, or that it would make no sense at all for them to do so. But on other occasions the noble Lord has not applied the same reasoning to private enterprise. There has been no suggestion that just because a firm is small it will not be able to compete with large firms and with British Telecom with the provision of add-on services.
Lord Trefgarne: If the noble Lord will allow me to interrupt, the point I was endeavouring to make, and I am sorry if did not make it clearly, was that there was a real difference between small firms and small local authorities. The difference is that small firms can go bankrupt whereas local authorities cannot.
Lord Young of Dartington: Yes, I was just coming to that point. The noble Lord the Minister said that the disadvantage of a municipal service—and he has just repeated it—is that it is the ratepayers who would
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pay. That is not the case in Hull. In Hull the ratepayers are not paying for Hull's telephone service. On the contrary, Hull's telephone service is making a surplus which helps to keep rates lower than they would otherwise be. No local authority with any sense whatsoever would think of establishing its own telephone service did it not expect to do so at a profit which would be a relief to hard-pressed ratepayers. Indeed, it could be provided in any licence that might be given to a local authority in the future that there should be no subvention from the rates for any such municipal commercial service as this would be.
The noble Lord the Minister will therefore understand that the arguments do not convince me. However, I cannot pretend that there is a great ground swell of support in the Committee this afternoon for the point of view I am endeavouring to put before your Lordships.
Lord Mottistone: Before the noble Lord sits down, may I say that I too am not in the least convinced by my noble friend on the Front Bench? I was most disappointed in what he had to say as a reflection on the principle of liberalising the whole area of telecommunications. I think it would be much more in accord with the general thinking of my noble friend and those of us who sit on these Benches if he would find his way to being more flexible in considering this point. It is ridiculous to write off small local authorities as not being people who are perfectly capable of running particular services at a profit, which is what we are talking about, or at least under profitable circumstances. Without wishing to offend the noble Lords on the nearer Benches opposite, I feel that it is an area which is worthy of proper consideration and could usefully be expanded, although perhaps not at this stage of the Bill. I thoroughly support the noble Lord in the general principle of what he is trying to do.
Lord Lloyd of Kilgerran: I was also halfway to my feet when the noble Lord, Lord Young, started what was intended to be his final speech. Like the noble Lord, Lord Mottistone, I am unhappy about the reply by the noble Lord, Lord Trefgarne, in this matter, particularly when we consider the terms of Clause 15(8). Clause 15 empowers British Telecom to give licences, and under subsection (8) it says:
"For the purposes of a licence granted under subsection (1), the definition of a class of persons may be framed by reference to any circumstances whatever".
It would seem prima facie that a local authority could be said to be a "class of persons" and therefore possibly entitled to the grant of a licence. I may be wrong in my interpretation of this clause, but I should like to support the noble Lord, Lord Young, in the general theme that he has put to your Lordships today.
Lord Trefgarne: Before the noble Lord, Lord Young, decides what to do with his amendment, there are two points that perhaps I may put before your Lordships in this matter. First, your Lordships seem to imagine that what Hull is doing today, any other local authority could do tomorrow. The difficulty is of course that Hull has been at it for some considerable time and has acquired a good deal of skill and expertise over the

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years. There is no other local authority in that position.
I venture to suggest that however expert they were and however many experts they hired to help them, any other local authority that ventured into this highly complex field—vastly more complex than when Hull entered it so many years ago—would inevitably, in the early years anyway, be making substantial losses which would, I fear, fall upon the ratepayers. In any event, if noble Lords are seeking only to provide for other local authorities to act as Hull has acted for so long, those local authorities could still seek a licence under the 1899 Act, which remains in force, and under which Hull has been operating for all these years.
Lord Brookes: I had not intended to intervene, but there might be others on the Benches on which I sit who can scarce forbear to cheer at hearing our Front Bench in such unqualified terms condemn municipal and public trading as something which could be an irresponsible use, or misuse, of public funds. I hope that that conviction, which I heartily applaud, is going to be a consistent factor in Government policy in dealing with the British Steel Corporation, British Rail, the Coal Board, and all the other ailments from which we have suffered for so long. I merely ask that we be consistent.
Lord Young of Dartington: The noble Minister's last remarks seemed to me to be on the same lines as the remarks we heard from him earlier. It seems that the noble Minister is unable to see the close parallel there is between the arguments that could be advanced about private firms and the arguments that could be advanced about local authorities. The noble Minister said that no local authority would be able to get into this business because they have so much to learn. Could not the same thing be said of a private company which may come into existence precisely because of the operation of this Bill: "No, it cannot be done, because there will be so much to learn and so much expertise to gather"?
This argument, taken further than it has been, would mean that one completely distrusted all new entrepreneurs whether they were private or municipal. That surely would be taking the argument to a ridiculous absurdity. If private firms are going to be allowed to compete—and that is something that many in this House welcome—then local authorities should be able to compete under the same terms, perhaps with a proper restriction about no support from rate funds. Otherwise, there is no rationale that has been presented so far from the Government Front Bench.
I am delighted that I was interrupted, just before I was going to do what I am now going to do, by noble Lords who have expressed their support. I hope that this support will weigh with the noble Minister and his colleagues when they consider what to do at later stages of the Bill and when they consider what to do after this Bill has become an Act. In the meantime, and wishing them rational and happy thinking on the subject, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 55, as amended, agreed to.
Clause 56 agreed to.
Clause 57 [Interpretation and extent of Part I]:
Lord Trefgarne Lord Trefgarne moved Amendment No. 133:
Page 45, leave out lines 1 and 2.
The noble Lord said: On behalf of my noble friend, I beg to move this amendment.
Lord Ponsonby of Shulbrede: No doubt the noble Lord will explain to us the purpose of this amendment.
Lord Mottistone: Perhaps I may be able to assist my noble friends. At the time when we were discussing Clause 25 stand part it was said that this would be one of the consequential amendments if Clause 25 was left out, which it was.
Lord Lyell: I have an apology to make to the Committee. It is indeed one of a plethora of amendments that I spoke to. I am grateful to the observant watchdog who goes by the name of my noble friend Lord Mottistone for pointing this out. I apologise to the Committee. Indeed, this was one of eight amendments.
On Question, amendment agreed to.
[Amendment No. 134 not moved.]
Lord Lyell Lord Lyell moved Amendment No. 134A:
Page 45, line 44, leave out ("12(2)") and insert ("12, 17, 18").
The noble Lord said: This is a consequential amendment which takes account of the fact that the Isle of Man authorities have agreed that Clauses 17 to 19, which give the Secretary of State power to make marking orders concerning telecommunications equipment and apparatus, should extend to the Isle of Man.
On Question, amendment agreed to.
Lord Lyell Lord Lyell moved Amendment No. 135:
Page 46, line 1, leave out ("16, 20 to").
The noble Lord said: With the permission of the Committee, I will speak at the same time to Amendment No. 136. These are two more consequential amendments which take account of the fact that Clauses 17 to 19 and Clause 51 do not extend to the Channel Islands. I am advised that the Channel Islands, contrary to what goes on in the Isle of Man, run their own telecommunications system, and on their behalf I hope your Lordships will agree to these amendments.
On Question, amendment agreed to.
Lord Lyell Lord Lyell moved Amendment No. 136:
Page 46, line 2, leave out ("50, 52").
The noble Lord said: I spoke to this with the last amendment. I beg to move.
On Question, amendment agreed to.
Clause 57, as amended, agreed to.
Clause 58 [Powers of the Post Office]:
6.12 p.m.
Lord Ponsonby of Shulbrede Lord Ponsonby of Shulbrede moved Amendment No. 137:

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Page 47, line 12, leave out from ("members") to end of line 16.
The noble Lord said: With the permission of the Committee, I will speak at the same time to Amendment No. 138. These amendments are aimed at further liberalising the type of business that can be handled over the post office counter. The theme of the amendment is that the Post Office should be allowed to expand its work across its counters in whatever way it considers appropriate, free from the Secretary of State peering over its shoulder. Clause 58 as drafted provides that the Post Office shall have power to provide services to those bodies falling within subsection (1A), and that says that it can provide such services for:
"(a) any body corporate—

(i) which supplies goods or services by way of business;

(ii) the affairs of which are managed by its members; and

(iii) the members of which hold office as such by virtue of their appointment to that or another office by a Minister of the Crown under any enactment.".

The effect would be that the Post Office could provide services to allow, for example, a member of the public to book an airline ticket on a public airline like British Airways but not on a private one like Laker. That is a ridiculous interpretation of the provision, but as the clause is drafted that appears to be the effect of it. The position in sub-post offices would be even more absurd. They are often situated in shops which also act, for example, as newsagents or stationers and sell such items as groceries and sweets. Why cannot the sub-post office within the shop take on board work from the private sector as well?
The principle here goes to the heart of the Bill. The Government are seeking to place the Post Office in a more openly competitive situation in relation to the private sector. Already they have sensibly drawn back from the privatisation on counters that they are proposing for British Telecom and the mails. The new Post Office Corporation as a whole will be facing much more competition than it has in the past and, if it is to survive and prosper, it must have the ability to take advantage of any appropriate market that is available; and the amendment would facilitate that. It would protect not only Crown Offices but also act as a lifeline for sub-post offices, especially those in rural areas.
Why is there great concern on behalf of the Post Office to get this extra business? The concern arises because the Post Office sees some of its traditional business falling away. For example, the implementation of the Rayner recommendations on the payment of social security benefits would reduce counter business, it is estimated, by 6 per cent. The Post Office plans to get that back through the expansion and promotion of its existing business, especially Girobank, by acting competitively in seeking new public sector business, such as business from local authorities, and by taking advantage of the new powers in subsections (1)(e) and (1)(f) of this clause, and of course by promoting, selling and fostering the increased use of mails.
To win new markets and expand counter traffic, the Post Office, its management and the unions need
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flexibility to do what they feel is right; they need to be able to manage their own business. We have already seen a fruitful conclusion to discussions over productivity on the counters and in the writing rooms behind which service them. A recent agreement between the Post Office and the Union of Communication Workers, which represents 22,000 postal officers and 2,000 postal assistants—those are the grades who work in this area of the postal business—provides for an experimental productivity scheme which, if successful, will produce savings and compensate staff. If all these issues are to be successfully tackled, the Post Office and its employees need the ability to get on with the job without the Minister constantly peering over their shoulders, and without having all the time to go to the Department of Industry for permission to do what they think is in the best interests of the Post Office.
Lord Morris: The noble Lord, Lord Ponsonby, in pleading the case for the amendment, painted a picture which I believe flew straight in the face of reality. He seemed to imagine a series of sub-post office mistresses in rural areas tripping over themselves trying to take the opportunity of benefiting from the market forces available to them. I do not believe that to be the case. The sub-post offices I use are, generally speaking, bitterly complaining about the plethora of bumph-shifting they have to do now, and the last thing they want to do is expand the borders of their responsibilities.
Lord Trefgarne: I have listened with great care to the arguments of the noble Lord, Lord Ponsonby, and I understand that his intention, and that of his noble friend, in tabling the amendment is to allow the Post Office to provide counter services for private as well as public sector bodies under the new Section 7(1A) of the 1969 Post Office Act, as inserted by Clause 58(2) of this Bill. I understand his reasons, but I am afraid that I must disagree with them.
I note that the suggestion embodied in this amendment was raised in Committee in another place by my honourable friend the member for Fife, East, and that at that time my honourable friend the Parliamentary Under-Secretary agreed to look at the point. I have to say now that since then we have looked at this suggestion in some detail, but we have not changed our overall view on the subject.
The noble Lord has criticised this new power for the Post Office as being too restrictive and not allowing them sufficient flexibility. However, I am not sure that he actually acknowledged that it is a new power and that it allows the Post Office to provide counter services for a very much wider range of bodies than they can at present. Your Lordships' Committee may be aware that our decision to include this new power was influenced in part by the decision of my right honourable friend the Secretary of State for Social Services, which my noble friend Lady Young, I think, announced here on 12th May, to change the arrangements for the payment of social security benefits. As was made clear to your Lordships on 12th May, our estimates have indicated that these changes might result in a loss of counter business for the Post Office as a whole of about 5 per cent., which could put at risk in particular some of the smaller sub-post offices.
The Government are of course fully committed to

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maintaining an adequate sub-post office network, and as part of our measures to do so we have decided to give the Post Office this new, wider power in respect of the provision of counter services. Our estimates, made in consultation with the Post Office, indicate that the extra business available through the power, plus the extension of business from existing users, will amount to up to 10 per cent., which is of course more than the loss resulting from the new DHSS arrangements.
The noble Lord is now suggesting that we should extend this power even more and enable the Post Office to provide counter services for private sector bodies. I must point out that, of course, sub-post masters can already make their own arrangements to provide counter services for the private sector over their non-Post Office counters, but this amendment would enable the Crown Offices to extend their activities into the private sector, and we do not believe that that would be right. The Government are committed to reducing the size of the public sector and we are therefore firmly of the view that the Post Office should not enter into fields of activity which would be more appropriately undertaken by the private sector, or which would require specific expertise in a specialised field. I fear that I must therefore resist the noble Lord's amendment.
Baroness Phillips: I should like to raise a point before the noble Lord, Lord Ponsonby, replies. I feel somewhat disturbed and I hope that I have heard the Minister incorrectly. As I understood it, he mentioned the loss of the business of paying out social security benefits. We received a very large deputation of sub-post masters not very long ago. It was a most impressive gathering. I was present, along with other Peers, and I recall that the Minister then gave a solemn assurance that the recommendations of the Rayner Report would not be taken up. It now appears that the Minister is saying that this business is to be taken away from sub-post offices. Is my understanding incorrect? I hope that it is.
Lord Trefgarne: As I said in my remarks just now, speaking from memory—I cannot be precise about the announcement—it was announced on, I think, 12th May that certain social security payments would, I think from the middle of next year, be payable into a bank account, at the wish of the recipient. Of course, that will mean that certain payments at present made over Post Office counters will not in future be made that way. I think that reference was made to other payments that might in future be made on a monthly basis, or a basis that is less frequent than that at present—I confess that I do not have the precise details in front of me—and that point relates to the small percentage loss in the number of transactions to which I referred. That was also one of the factors which led us to bring forward these proposals, which will more than counterbalance the loss which has concerned the noble Baroness.
Baroness Phillips: It is all very well to talk about counter-balancing the loss, but there are customers to be considered. In this instance we seem all the time to be talking about the people who serve at the counter.
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There is great concern in the rural areas over this matter. I know that this point is not strictly within the Minister's particular patch, but it is a very important one. Am I correct in thinking that the Minister is now saying that, if they so wish, individuals need not go to the post office to collect their benefits, but that if they do not so wish, the facilities will still be available at sub-post offices?
Lord Trefgarne: The matter to which I am referring, and on which the noble Baroness is questioning me, was, as I have said, the subject of a Statement made to your Lordships on 12th May. As is normal, the Statement was in fact a repetition of a Statement made in another place. I confess that I do not have a copy of the Statement before me, but the effects of the new arrangements that were then announced are exactly as I said in my earlier remarks, and I do not think I can go farther than that.
Lord Ponsonby of Shulbrede: We appreciate the new power that is being given under the subsection and we appreciate, too, the reasons for it, which the noble Lord, Lord Trefgarne, enumerated in his reply. They were very similar to the reasons that I gave as to why the new powers were being granted under the clause. However, I still feel that the powers could be exercised in an illogical way. I accept many of the Minister's arguments, but I feel that this is a matter that I shall want to look into further and return to on Report. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 138 not moved.]
6.28 p.m.
Lord Morris Lord Morris moved Amendment No. 139:
Page 47, line 41, leave out ("or") and insert ("and").
The noble Lord said: As the Committee is aware, Clause 58 gives power to the Post Office to provide, inter alia, telepost services, and subsection (2) of the clause contains a definition of "telepost service". As Members of your Lordships' Committee can see the definition is divided into three paragraphs, paragraphs (a), (b) and (c). The amendment is an attempt to define "telepost service".
I wish to explain why I have tabled the amendment. "Telepost service" is a modern phrase that of course includes telegrams. Perhaps one day we shall receive "tele letters"—which is a very unpleasant thought. The telepost service expands the current role of the Post Office from that of the traditional, indeed ancient, telegram role, and casts it straight into the area of British Telecommunications.
I suspect that I am being a little simple about this, no doubt not for the first time, but I thought that one of the Bill's major objectives was to split the functions of the Post Office and British Telecommunications. If one of the powers of the Post Office is to remit hard copy communications transmitted by a telecommunications system—which it receives or collects in hard copy—then it is basically performing a function which I should have thought would be better performed by British Telecommunications. On the other hand, if it wishes to maintain the telegram service, which traditionally is a service which receives the instruction

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in writing and delivers the instruction in writing, then my amendment would meet that point. With that, I beg to move, and in so doing I would say that I am speaking to Amendment No. 140 at the same time. I beg to move.
Lord Lyell: My noble friend has sought to explain the reasons for his amendment, and I understand that he spoke to both Amendment 139 and Amendment 140. As far as No. 139 is concerned, it may appear to be innocent—certainly nobody would ever accuse my noble friend of being simple; he tends to do his homework, as the Committee will have observed in the long days we have been discussing this Bill—but I believe that that amendment—the first amendment, at least—would make nonsense of subsection (2) of Clause 58. Paragraph (a) in the definition of what we call "telepost" services points out that the Post Office may receive or collect messages which are to be transmitted by a system of telecommunications. If my noble friend suggests that we should replace "or" with "and", then we believe that this would mean that every communication (in hard form, in soft form or in whatever form may be referred to in the paragraph) would have to be both received and collected in material form.
We think this would be impossible, since the two activities of receiving and collecting are mutually exclusive, for this reason. A communication would either be received by the Post Office when taken there by the customer, or it would be collected by the postman going out on his rounds. But the same communications could not be both received and collected by the Post Office simultaneously. Certainly the Post Office does not intend itself to provide a telecommunications system for telepost, but it will use the network which is provided by British Telecom; and, indeed, it will need a licence so to do.
My noble friend will be interested to hear that British Telecom will provide the telegram service, although the postal business will continue to provide assistance to British Telecom in the delivery of telegrams. I hope I have said enough to explain why we believe that certainly Amendment No. 139 is not necessary in this particular instance.
Lord Morris: I am most grateful to my noble friend. I take no credit for this, but I have managed to extract an answer from him which gives a great deal of comfort to me and will be of immense interest to those in the industry who are concerned about the definition of the telepost service. I am most grateful to my noble friend for his answer, and I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 140 not moved.]
Clause 58 agreed to.
Clauses 59 and 60 agreed to.
Clause 61 [Control of wholly owned subsidiaries]:
Lord Glenamara Lord Glenamara moved Amendment No. 141:
Page 50, line 47, at end insert—
("(5) As regards any wholly owned subsidiary of the Post
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Office, the Post Office shall secure that, notwithstanding anything in the subsidiary's Memorandum or Articles of Association, the employees of the subsidiary are employed at all times on terms and conditions of employment which, other than as to the identity of the employer, are the same as those of employees of the Post Office employed on like work.
An employee of a wholly owned subsidiary is to be regarded as employed on like work with an employee of the Post Office if their work is of the same or a broadly similar nature and the differences (if any) between the things they do are not of practical importance in relation to terms and conditions of employment; and accordingly in comparing their work regard should be had to the frequency or otherwise with which any such differences occur in practice as well as to the nature and extent of the differences.").
The noble Lord said: I can move this amendment in a very few sentences because it is identical to Amendment No. 30, which we discussed yesterday, except that No. 30, of course, applies to British Telecom and this one applies to the Post Office Corporation. Its purpose is to ensure that the terms and conditions of employees in the subsidiaries are the same as they are for those in the Post Office Corporation itself. This is an entirely helpful amendment to the Government and to the Post Office. We hate the whole idea of the Post Office setting up subsidiaries to carry out any of its activities, but if they are to be set up we want them to go with a swing and succeed. They can succeed only if they have the goodwill—the enthusiastic goodwill—of the employees.
In the main, I imagine, that these employees will come from the Post Office Corporation. There will be personnel transferred from the Post Office into the subsidiary; and when the thing gets going and the whole pattern is established, from the subsidiaries back to the Post Office and from one subsidiary to another. There will be a great deal of transferring. In order to get the support of the Post Office workers, I believe they should be assured that if they are going to be transferred from the corporation to a subsidiary, or back again, or from one subsidiary to another, their terms and conditions will not suffer. We believe, and they believe, that this should be embodied in the legislation. I must say that the Government have helped a little by undertaking in the other place that they will consuit the unions when a subsidiary is going to be established, but the unions are firmly of the opinion—and my noble friends and I support them—that it should be in the legislation.
We are not alone in this. The EEC has moved towards the same position, because in 1977 they issued a directive saying that the same terms and conditions should apply in subsidiaries as in a parent company. Unfortunately, we cannot rely on that directive for one or two reasons which I gave yesterday. First of all, it is permissive; Governments do not have to implement it, and the United Kingdom Government have not yet made any regulations under it. So it is not operative in this country yet. But the main reason why we cannot rely on it is that it would apply only at the point of transfer, and for a very limited time afterwards; there would be no continuing assurance that terms and conditions in the subsidiaries would be the same as they are in the corporation. So we cannot rely on that. Therefore, we believe that this should be written into the legislation.
Let me say this in conclusion. I feel that the Government underestimate—they have always underestimated

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—the anxieties in the Post Office, as it is now, in the telecoms side and the postal side, about this Bill. There is tremendous anxiety; and I would hazard the guess that the week after next, from one of the major unions at its annual conference in Blackpool, we shall hear a great deal about their anxieties under this Bill. I believe that they stem, in the main, from the proposal about the corporation and British Telecom being able to set up subsidiaries, and indeed being directed to set up subsidiaries by the Minister. I believe that those anxieties could be allayed if they were assured that their terms and conditions would not suffer because of subsidiaries being established. That is why I say that this is an entirely helpful amendment and why I hope that the Government will be able to look at it. It may be that they will not be able to accept it today, but, if not, I hope they will agree to look at it between now and Report stage. I beg to move.
The Earl of Gowrie: As the noble Lord, Lord Glenamara, in fact told us, we debated the principle of this issue at some considerable length last week, when we were discussing Clause 5, and I regret that there is really very little that I can add to the remarks that I made at that time, which remarks appear in column 512 of Hansard of 12th May. We believe that the Bill already makes adequate provision in this respect through Clause 4 together with paragraph 2 of Schedule 2, which provide that contracts of employment will be transferred intact when staff are transferred to subsidiaries. You cannot get it clearer than that; and if it is at all helpful to the noble Lord, Lord Glenamara, or even to unions about to confer at Blackpool, I am very happy to repeat it.
However, we do not believe that it would be right to create the permanent links sought between terms and conditions of employees in subsidiaries and those in the Post Office. The management and workforce of the subsidiaries must be free to negotiate whatever terms are appropriate to them. It seems rather extraordinary to suppose that Parliament would have an idea about what these should be in perpetuity. Having given the repeated assurance about the transfer problem which, with Lord Glenamara, I recognise has caused some anxiety—although I have tried to show that it is needless anxiety—I hope the noble Lord will withdraw his amendment.
Lord Glenamara: I am sorry that the noble Earl has repeated the arguments used last week. We feel strongly about this and that it will not succeed unless our fears can be allayed, and that the best way to allay them would be to agree to an amendment of this kind. We shall therefore press this amendment to a Division.
6.39 p.m.
On Question, Whether the said amendment (No. 141) shall be agreed to?
Their Lordships divided: Contents, 51; Not-Contents, 89.

CONTENTS

Aylestone, L.

Boston of Faversham, L.

Bernstein, L.

Brockway, L.

Blease, L.

Cledwyn of Penrhos, L.

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Collison, L.

Llewelyn-Davies of Hastoe, B [Teller.]

David, B. [Teller.]

Davies of Leek, L.

Lloyd of Kilgerran, L.

Davies of Penrhys, L.

Longford, E.

Elwyn-Jones, L.

Lovell-Davis, L.

Evans of Claughton, L.

Maelor, L.

George-Brown, L.

Molloy, L.

Glenamara, L.

Phillips, B.

Goronwy-Roberts, L.

Ponsonby of Shulbrede, L.

Gosford, E.

Ritchie-Calder, L.

Greenwood of Rossendale, L.

Sefton of Garston, L.

Hale, L.

Shackleton, L.

Hampton, L.

Stedman, B.

Houghton of Sowerby, L.

Stewart of Alvechurch, B.

Howie of Troon, L.

Stewart of Fulham, L.

Jacques, L.

Stone, L.

Janner, L.

Taylor of Mansfield, L.

Jeger, B.

Underhill, L.

Jenkins of Putney, L.

Wells-Pestell, L.

Kennet, L.

Whaddon, L.

Kilbracken, L.

White, B.

Kilmarnock, L.

Winstanley, L.

Lee of Newton, L.

Young of Dartington, L.

NOT-CONTENTS

Abercorn, D.

Killearn, L.

Abinger, L.

Kimberley, E.

Airey of Abingdon, B.

Kinnoull, E.

Alport, L.

Lauderdale, E.

Ampthill, L.

Lawrence, L.

Auckland, L.

Long, V.

Avon, E.

Loudoun, C.

Bellwin, L.

Lyell, L. [Teller.]

Belstead, L.

Mackay of Clashfern, L.

Bessborough, E.

Macleod of Borve, B.

Brookes, L.

Margadale, L.

Burton, L.

Marley, L.

Clifford of Chudleigh, L.

Mersey, V.

Cockfield, L.

Monckton of Brenchley, V.

Colville of Culross, V.

Monk Bretton, L.

Colwyn, L.

Morris, L.

Cork and Orrery, E.

Mottistone, L.

Cranbrook, E.

Mountevans, L.

Cullen of Ashbourne, L.

Murton of Lindisfarne, L.

Davidson, V.

Newall, L.

de Clifford, L.

Northchurch, B.

Digby, L.

Nugent of Guildford, L.

Donegall, M.

O'Hagan, L.

Eccles, V.

O'Neill of the Maine, L.

Ellenborough, L.

Orkney, E.

Elliot of Harwood, B.

Orr-Ewing, L.

Faithfull, B.

Rankeillour, L.

Ferrers, E.

Rawlinson of Ewell, L.

Fortescue, E.

Renton, L.

Fraser of Kilmorack, L.

St. Aldwyn, E.

Gainford, L.

Sandford, L.

Gisborough, L.

Sandys, L. [Teller.]

Gowrie, E.

Savile, L.

Gridley, L.

Sempill, Ly.

Grimston of Westbury, L.

Shannon, E.

Hailsham of Saint Marylebone, L.

Sharples, B.

Skelmersdale, L.

Halsbury, E.

Stradbroke, E.

Harmar-Nicholls, L.

Strathclyde, L.

Hatherton, L.

Sudeley, L.

Henley, L.

Swinfen, L.

Holderness, L.

Trefgarne, L.

Hylton-Foster, B.

Trenchard, V.

Inglewood, L.

Trumpington, B.

Kemsley, V.

Vivian, L.

Resolved in the negative, and amendment disagreed to accordingly.
Clause 61 agreed to.
Clause 62 [General control and supervision by the Secretary of State]:
6.48 p.m.
Lord Ponsonby of Shulbrede Lord Ponsonby of Shulbrede moved Amendment No. 142:
Page 51, line 28, leave out ("subsections") and insert ("subsection").
The noble Lord said: I beg to move Amendment No. 142 and with it to speak to Amendment No. 143. The purpose of this amendment is to delete the power of the Secretary of State to direct the Post Office to dispose of its assets. This subsection, together with Clause 64, on derogating monopoly, and with Clause 65, on licensing, constitutes, as noble Lords opposite know, the heart of the Bill and of our opposition to Part II of the Bill, which is the postal side of the Bill. It is also, so far as the Government are concerned, a major ideological point for it facilitates the privatisation of parts of the Post Office and threatens thereby the survival of the countrywide postal service.
It may be true that the Post Office is less vulnerable to this kind of asset stripping than is BT, but we wish by this amendment to stop the Secretary of State from hiving off the profitable activities to the private sector. The future of the Post Office is finely balanced; it is under enormous financial pressure at present and largely so because of the Government's attitude to the financing of nationalised industries. The Government squeeze on cash limits is having a severe impact. In fact, we have debated the principle of this amendment very fully under Part I of the Bill. Therefore, I do not intend to make a long speech on it, as we are discussing a principle very similar to the principle we discussed on Part I, on British Telecom; but we wish to make clear our strong views on this particular matter. I beg to move.
The Earl of Gowrie: As the noble Lord said, we have gone over the principle of this in a different connection. The noble Lord, Lord Ponsonby, suggested that powers would allow the Secretary of State to dispose of any asset owned by the Post Office. But this is not so. The power extends only to those assets not required for the proper discharge of their duties to provide either telephone or letter services. Moreover, those parts of their undertaking which require the benefit of statutory privileges could not be disposed of without legislation since the various enactments only apply to the corporation. I think that the noble Lord's fears are not well-founded. I hope that he will not press the amendment to a Division.
Lord Ponsonby of Shulbrede: I do not think that it would be fruitful to take to a Division a matter which has already been decided. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 143 not moved.]
Clause 62 agreed to.
Clauses 63 to 65 agreed to.
Lord Sandys: At this juncture it may be a suitable moment to adjourn and take other business. I suggest
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we return to the Committee at eight o'clock. I beg to move that this House do now resume.
Moved accordingly, and, on Question, Motion agreed to.
House resumed.

European Communities (Definition of Treaties) (Accession of the Republic of Zimbabwe to the second ACP-EEC Convention of Lomé) Order 1981
6.53 p.m.
Lord Skelmersdale: My Lords, I beg to move that the draft European Communities (Definition of Treaties) (Accession of the Republic of Zimbabwe to the Second ACP-EEC Convention of Lomé) Order 1981, which was laid before this House on 30th April, be approved.
I would also draw the attention of your Lordships to the three treaties listed in the schedule to the order. Item 1 in the schedule is the Accession agreement itself (contained in Cmnd. No. 8150); item 2 provides for unrestricted access for products from Zimbabwe in the area covered by the European Coal and Steel Community (this is contained in Cmnd. No. 8151); and item 3 deals with the manner in which the Community's aid obligations to Zimbabwe under the Accession Agreement will be implemented (contained in Cmnd. No. 8219). The House will be aware that the effect of the order will be that these agreements will be able to operate in this country in accordance with their provisions.
The accession of Zimbabwe to the second Lomé Convention is a step of great significance: it is, on the one hand, a mark of Zimbabwe's place in the world, and, on the other, evidence of the further development of the Community's relations with the developing world. As so often in her short history, Zimbabwe's relationship with the Community is something of an exception: she is one of the very few countries which had has the opportunity to accede to the Lomé Convention although she was not listed in the Treaty of Rome as the dependent territory of a member state.
The Government naturally took a special interest in the preparations for the negotiation of this agreement. As soon as we could we prepared the ground by steering through a special régime for Zimbabwe's trade with the Community which took effect in January 1980. This régime gave Zimbabwe roughly equal treatment with those dependencies of member states which are associated with the Community through what is known as the OCT (the overseas countries and territories) decision; that is, the dependencies of member stafes. This in turn largely mirrors the trade provisions of the Lomé Convention. Through this interim régime, the Zimbabwe Government was able to learn at first hand the extent of the privileged trade access to the Community enjoyed by the ACP (the African, Caribbean and Pacific) states which are signatories to the Lomé Convention. It should be noted that the application to accede to the second Lomé Convention was one of the earliest decisions taken by the Government to Zimbabwe after independence. This is clear evidence of the value the ACP states put on Lomé membership.

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The Community was equally well aware of the importance of Zimbabwe's accession, in particular its political importance. There is a clear European interest in ensuring the emergence of a stable Zimbabwe firmly linked to Europe both politically and economically. Association with the Community through the Lomé Convention, with all the advantages that that gives the ACP, is the natural instrument for this purpose.
Once Zimbabwe had joined the ACP Group of states and her application to accede to Lomé had been approved by the ACP/EC Joint Council of Ministers in Nairobi in May 1980, the next step under the provisions of the Convention was to negotiate an accession agreement with the Community. It was clear from the start that the negotiations would not be easy. Many of Zimbabwe's major exports are product-sensitive for certain Community member states. For example, sugar for France and Belgium; beef for France and Ireland; and tobacco for Italy. But every member state recognised in the end that the political prize at stake far outweighed any small economic cost, and agreement was finally reached.
Throughout the negotiations which lasted from June to October 1980 we kept in close touch with the Zimbabweans so that we could give them any advice they sought on the conduct of the negotiations and could ensure that the outcome of the negotiations was satisfactory for them.
Under the Interim agreement at present in force between the Community and Zimbabwe, Zimbabwe enjoys access for her exports to the Community market which is virtually identical to that provided for in Lomé II; that is, free access for most Zimbabwean agricultural exports, and all her industrial goods, subject only to the safeguard provisions of the convention. Once the accession agreement is in force Zimbabwe will be able to benefit from all the provisions of Lomé II, as well as the special provisions of the agreement itself.
The benefits of greatest importance to Zimbabwe are, first, sugar. The Zimbabweans made it clear from the beginning of the negotiations that access for their sugar was their major interest in Lomé. The Zimbabwean Government hopes to find employment for large numbers of displaced Africans, perhaps as many as 500,000, in an expanded sugar industry. But secure markets are essential if that planned expansion is to succeed. In the negotiations the Community recognised that, by virtue of her former membership of the Commonwealth Sugar Agreement, Zimbabwe was entitled to be allocated a quota of sugar which she could sell to the Community. The quota of 25,000 tonnes which was agreed is equivalent to the old Commonwealth Sugar Agreement quota. Zimbabwe will have the right to sell 25,000 tonnes of sugar to the Community annually from 1st July 1982, on price conditions equivalent to those set out in the Sugar Protocol to the Lomé Convention. The Community has also agreed that Zimbabwe should become a member of the Lomé Sugar Protocol. This will have to be negotiated with the ACP in due course.
Beef. This is also an important product for Zimbabwe. In the accession agreement Zimbabwe has been granted an annual quota of 8,100 tonnes of beef and veal which she will be able to export to the Community once she can meet the Community's animal
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health requirements. There is provision for review of the quota after two years.
The question of tobacco exports is of particular interest to Zimbabwe. Under the provisions of Lomé II, Zimbabwe's tobacco exports automatically enjoy duty-free access to the Community market. But in order to allay the concerns of Community tobacco producers, it has been agreed that consultations will be held with the ACP producers if ACP imports should be shown to cause problems. The Government will, of course, take into account the interests of United Kingdom tobacco manufacturers in addition to those of Zimbabwe and other ACP producers.
Once the accession agreement is in force, Zimbabwe will also be able to benefit from the aid provisions of Lomé. The Community has agreed to enlarge the European Development Fund, through which Lomé aid is channelled, by 85 MECU (not far short of £50 million) to take account of Zimbabwe's accession. Of this, 40 MECU has been allocated for Zimbabwe's country programme and 30 MECU for regional projects.
The Community will also propose to the ACP that Zimbabwe should be included in the list of landlocked ACP states in Article 155(3)(b) of Lomé II. This will ensure that particularly favourable consideration is given to Zimbabwe's needs as regards a wide number of provisions of the convention, in particular those concerning the application of safeguard measures, derogations from the rules of origin for Zimbabwe's exports to the Community, and the Stabex Scheme (which is designed to compensate the ACP for fluctuations in earnings from exports of certain products to the Community) and the Sysmin Scheme (which is intended to provide some support to certain ACP minerals industries in times of difficulty). In the application of these two schemes a lower level of dependence on the products concerned than that applied to other ACP states will enable Zimbabwe to qualify for assistance. In addition to Zimbabwe's aid allocation under Lomé II, the Community has also made substantial aid funds available to Zimbabwe in advance of accession and 13 MECU (some £7 million) has been allocated to her to help in post-war reconstruction and rehabilitation, and at ZIMCORD, the recent donors' conference in Salisbury, the Community pledged a further 14·5 MECU (some £8 million).
I hope, with this additional information, that the order will commend itself to your Lordships. I beg to move.
Moved, That the draft order laid before the House on 30th April be approved.—(Lord Skelmersdale.)
7.3 p.m.
Lord Goronwy-Roberts: My Lords, the House will be very grateful to the noble Lord, Lord Skelmersdale, for the lucid and very informative way in which he introduced this order which, I hasten to assert from this side of the House, meets with our enthusiastic approval. I gather that the other place stole a march on us this morning but there was not time for either the noble Lord or I to find out what they have made of the order. I doubt if any difficulty arose during their discussion.
The purpose of the order, of course, is common form. The agreements between Zimbabwe as an applicant and the EEC and its member states have to

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be squared, as it were, with the relevant sections of our own Act, the European Communities Act 1972, whereby those treaties are implemented. This order is essential for that purpose and I think it is the last thing we need to do in order to make the accession effective.
I see that Zimbabwe applied to accede to Lomé II soon after independence, I think, in April 1980, and that the agreements to accession were signed in Luxembourg in November last year. Obviously various parts of the sections of the agreements will come into effect on various dates, and the Minister has indicated one or two transitions which will take some months to effect. I was particularly impressed in this regard to hear of the way in which this country has helped the Zimbabwean officials and Government to negotiate their accession. This country, since independence, has extended quite substantial financial aid to the new republic, the new member of theCommonwealth. It has also assisted them in other very essential ways by advice and guidance, and I am sure this is deeply appreciated in Salisbury.
As the Minister has pointed out, there is no doubt that Zimbabwe stands to gain very much from Lomé II in trade co-operation, in financial and technical aid and also by means of the Stabex scheme, designed to stabilise ACP export earnings from certain commodities—in this case particularly beef, sugar and tobacco.
Stepping right outside the Lomé traditions, may I once more suggest to Africa as well as to Western Europe, and indeed to the Commonwealth and to all countries concerned with the future of Zimbabwe and therefore of Central Africa, the possibility of special arrangements whereby certain surpluses in Zimbabwe—these days we have maize very much in mind—could be made available to contiguous countries who suffer very often from devastating famine through lack of staple foodstuffs. I know this does not precisely come within the terms of the order, or indeed within the terms of the Lomé Convention, but I think this possibility is rightly raised—in other words, we expect countries including those in Africa, to apply themselves to the possibility of other forms of aid to advance African prosperity, perhaps through special assistance to a specific member of that community.
The Minister also gave details of the financial help which the Fifth European Development Fund will make available to Zimbabwe. It is gratifying to see that the increase in the funds corpus will be funded as to 80 per cent., or some £88·5 million, by this country. I would repeat that, all told, the British contribution to Zimbabwe since independence is very substantial and it is of course well worth making the point that the viability and stability of Zimbabwe is essential not only to the progress of its own people but to that of central Africa as a whole. A chaotic and poverty-stricken Zimbabwe would very soon add to the already very difficult problems of Central and Southern Africa, and it is most encouraging to see how since last April, politically and economically, there has been this wise guidance and statesmanship in Zimbabwe leading to an increasingly stable state,which in turn contributes to the stability of a very important part of the world politically and economically.
Zimbabwe, of course—many Members of this House who have lived and worked there will know
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those who have made a tremendous contribution to the country—has very great potential mineral and agricultural wealth. Its agricultural surplus, as I mentioned, could well be used so as to alleviate serious discrepancies in the supply of food in other African countries. But, of course, a larger amount of financial and technical aid would be necesssry to effect such a programme than is envisaged even in this very promising and very acceptable system that we are discussing. Indeed, a good deal needs to be done, and a good deal of finance and technical aid needs to be devoted to the development of transportation if these surpluses—which are bound to recur and possibly increase in the future—are to be used meaningfully so as to rebound to the internal prosperity of Zimbabwe and to the survival of many millions of people outside it.
However, while these larger measures still need to be undertaken, possibly within the ambit of something as tremendous as the Brandt proposals, the benefits which will accrue under this order and through the Lomé Convention as it stands are to be welcomed, and welcomed very warmly. Since independence Zimbabwe has indeed been led with great ability and responsibility by Mr. Mugabe and his Government and in approving this order the House will, I am sure, wish to send once more to the Government and people of Zimbabwe our warmest good wishes for their continued progress.
7.11 p.m.
Lord Skelmersdale: My Lords, I am very grateful to the noble Lord, Lord Goronwy-Roberts, for his very sympathetic reception of this order. He asked a number of detailed questions and made comments on some of the things I said. One thing I should like to tell him at this moment—and if there is anything else which, jointly, we feel I ought to be communicating with him about, I shall of course write—is on the subject of maize and other surpluses. The Community is currently considering in what way it can help Zimbabwe's maize surplus to be made use of in neighbouring countries, but there are major difficulties over transporting the maize. I further understand that in recent weeks Zimbabwe farmers have been able to dispose of a considerable amount of the surplus through commercial contracts. So a small step in this direction is being taken. I, like the noble Lord, should like to see this step made considerably greater, and I am sure that it will be.
The noble Lord also made some very kind remarks about myself. I hope that I shall be worthy of them in a few months' time, but we shall see. But I am very grateful to him for what he said. Of course, we are concerned with the progress, in whatever field, of all Commonwealth countries, and Zimbabwe now, under this régime, is certainly no exception to our commitment to further the aims and objectives of the Commonwealth and to do all that we can in London and Britain to help them along their way, in whatever they seek to do. I shall of course refer the noble Lord's remarks to my honourable and right honourable friends and, as I have said, if I have missed anything that I should have said to him, I shall make full use of the facilities to write to him.
The Lord Bishop of Norwich: My Lords, before the noble Lord sits down, may I ask him this question? When he used the phrase "other Commonwealth countries", did he mean that the possibility of the maize being exported might help Uganda, which is in such need of both transportation and all forms of food, and in Commonwealth concerns, in the next month or two especially, may be in real need?
Lord Skelmersdale: My Lords, I did not use the word "Commonwealth" in relation to maize. But I am sure that these are some of the things that will be looked at, both here and in the Community in Brussels.
On Question, Motion agreed to.

Sheriff Courts (Scotland) Act 1971 (Summary Cause) Order 1981
7.14 p.m.
The Lord Advocate (Lord Mackay of Clashfern): My Lords, I beg to move that the Sheriff Courts (Scotland) Act 1971 (Summary Cause) Order 1981, a draft of which was laid before the House on 6th May 1981, be approved. This order will be made under Section 41 of the Sheriff Courts (Scotland) Act 1971, and its purpose is to raise the upper financial limit of the summary cause in the sheriff court from £500 to £1,000. The summary cause was introduced into the sheriff court on 1st September 1976, with an upper financial limit of £500. Since that time, the change in monetary values has been such that the approximate equivalent of £500 is £1,000. This order accordingly increases, as from 1st September 1981, the fifth anniversary of the introduction of the summary cause, the upper financial limit of that procedure to £1,000. The Joint Committee on Statutory Instruments has considered this and has, in its 20th Report, indicated that it has no special point to draw to the attention of the House. My Lords, I beg to move.
Moved, That the draft order laid before the House on 6th May be approved.—(Lord Mackay of Clashfern.)
Lord Boston of Faversham: My Lords, your Lordships will be very grateful to the noble and learned Lord the Lord Advocate for explaining the purpose of the order. I hope the fact that I cannot, unfortunately, claim any expertise in Scottish law will not make my support for him and for his order any less acceptable to him. It is with much pleasure that I join him in inviting your Lordships to accept it.
On Question, Motion agreed to.

Licensing (Amendment) Bill [H.L.]
7.15 p.m.
Lord Gainford: 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.—(Lord Gainford.)
On Question, Motion agreed to.
House in Committee accordingly.
[The LORD ALPORT in the Chair.]
Clause 1 [Special hours certificates: amendment of provisions as to revocation]:
Lord Gainford Lord Gainford moved Amendment No. 1:
Page 1, line 7, after ("certificate") insert ("for any premises or for part of any premises").
The noble Lord said: In moving this amendment, also wish to speak to Amendment No. 2. These are technical amendments which seek to obviate a possible ambiguity in the construction of the proposed new subsection (4) of Section 81 of the Licensing Act 1964. I have been advised that the references in Section 81 to "part of premises" are intended to cover the case where a special hours certificate relates to part only of licensed premises or club premises. As the new subsection which is proposed by Clause 1 now stands, it could be construed as enabling a chief officer of police to apply for the revocation of a special hours certificate on grounds of disorderly or indecent conduct in a part of the premises not covered by the certificate. I am sure your Lordships will agree that this would be unjust, and the purpose of these amendments is to ensure that the grounds of an application for revocation relate solely to conduct on the premises, or part of the premises, specified in the special hours certificate. I beg to move.
On Question, amendment agreed to.
Lord Gainford Lord Gainford moved Amendment No. 2:
Page 1, line 13, leave out ("of the premises").
The noble Lord said: I have already spoken to this amendment. I beg to move.
On Question, amendment agreed to.
Clause 1, as amended, agreed to.
Lord Gainford Lord Gainford moved Amendment No. 3:
After Clause 1, insert the following new clause:
("Procedure on applications to justices under section 81A(2) Licensing Act 1964
. In section 91 of that Act (procedure of licensing justices) for the words "or 81" there shall be substituted the words ", 81 or 81A(2)".").
The noble Lord said: In moving this amendment, I also wish to speak to Amendment No. 5. These are further technical amendments. Amendment No. 3 seeks to extend the power of the Secretary of State to make rules prescribing procedures on applications to the licensing justices in respect of special hours certificates. His existing powers extend only to applications for the grant and revocation of special hours certificates. They do not extend to applications which chief officers of police will shortly be able to make under a new Section 81A(2) of the Licensing Act 1964, when Sections 2 and 3 of the Licensing Act 1980 are brought into operation.
This will enable a chief officer of police to apply to the licensing justices, or to the magistrates' court, for the imposition of a condition restricting the hours of operation of a special hours certificate on the grounds that bona fide use of the premises for the purpose of providing music and dancing is likely to end at an

895
earlier hour than laid down as a general rule by the Licensing Act 1964; or if it is desirable for the permitted hours to end earlier, in order to avoid or reduce any disturbance or annoyance to residents in the neighbourhood of the premises, and also to avoid the occurrence of disorderly conduct on the premises.
All that this clause seeks to do is to enable the Secretary of State to establish procedures for the police and licensing justices to follow in relation to these applications. The amendment to the Long Title, Amendment No. 5, is to make it consistent with the inclusion of this new clause which deals with a matter other than simply the revocation of special hours certificates. I beg to move.
The Parliamentary Under-Secretary of State, Home Office (Lord Belstead): May I say a word on my noble friend's two amendments to which he has just spoken and which the Government certainly support. If this new subsection, Amendment No. 3, is accepted and if the Bill is later enacted, it is the intention of my right honourable friend the Home Secretary to re-make the existing licensing special hours certificates rules to take into account the provisions of the new Section 81A(2). The delay in bringing Sections 2 and 3 of the Licensing Act 1980 into operation has been due to the need first to amend the Crown Court rules. The preparation of these amendments is almost complete and my right honourable friend hopes shortly to make an order to bring the Act fully into operation.
Lord Boston of Faversham: The information which has been provided by the Minister, the noble Lord, Lord Belstead, is very helpful and I am very happy to join his noble friend, the noble Lord, Lord Gainford, in inviting your Lordships to accept it.
On Question, amendment agreed to.
Clause 2 [Short title and extent]:
Lord Gainford Lord Gainford moved Amendment No. 4:
Page 1, line 18, at end insert—
("(1A) This Act shall come into operation on such day as the Secretary of State may by order made by statutory instrument appoint.").
The noble Lord said: Amendment No. 4 has a two-fold purpose. In the first place, it is intended to provide adequate time for the police and licensing justices to become aware of the provisions of the Bill after it is enacted. A further reason is to ensure that it does not come into effect before Sections 2 and 3 of the Licensing Act 1980 come into operation.
This Act will provide parties aggrieved by a decision of the licensing justices to revoke or not to revoke a special hours certificate, with the right of appeal to the Crown Court. I am sure your Lordships will agree that it is desirable that this right should exist when, as I hope, the provisions contained in Clause 1 of my Bill come into force. I hope that my noble friend the Minister will be able to give an assurance to your Lordships that it will not be long before the remaining provisions of the 1980 Act come into effect. I beg to move.
Lord Belstead: The reason for the delay in bringing the 1980 Act into force which my noble friend is asking me about is because of the amendment to the Crown Court rules to which I have just referred. It is hoped that these amendments will be incorporated into the rules very soon and the Act brought into force in the early summer.
On Question, amendment agreed to.
Clause 2, as amended, agreed to.
Lord Gainford Lord Gainford moved Amendment No. 5:
In the Title, line 2, leave out ("the revocation of").
The noble Lord said: I have already spoken to this amendment, which I beg to move.
On Question, amendment agreed to.
House resumed: Bill reported with the amendments.
[House adjourned during pleasure from 7.25 until 8 o'clock.]

British Telecommunications Bill
House again in Committee.
Clause 66 [Exclusive privilege of the Post Office with respect to the conveyance etc. of letters]:
Lord Ponsonby of Shulbrede Lord Ponsonby of Shulbrede moved Amendment No. 144:
Page 55, line 24, leave out from ("addressee") to end of line 26.
The noble Lord said: The deletion of this subsection would ensure that the delivery of hard copy transmitted by British Telecom as part of an electronic mail service would be covered by the postal monopoly unless, of course, a licence was issued by the Secretary of State under the provisions of Clause 68. The important point here is that there is no need for the Government to take a decision about this matter now. I think it would be preferable to monitor developments and take such suitable action later, if such action is required. For example, supposing it was decided that it would be desirable for the hard copy to be delivered either by British Telecom staff or by some private operator, there would be power under Clause 68 for the Secretary of State to grant a licence specifically for that purpose. So to that extent subsection (5)(c) is really unnecessary.
However, there are more serious arguments against this particular proposal as well, for it clips away at the basic letter monopoly, potentially damaging the viability of the letter service. There is no question of the Post Office gaining the monopoly of electronic mail at all stages of its progress through the system, if only because transmission by electronic means lies fairly and squarely within the monopoly of British Telecom under Clause 12 of the Bill. For transmission the Post Office is likely to be dependent on British Telecom purchasing the service from them by paying for circuits just like any other licensee. Effectively therefore the issue is restricted to whether the Post Office should have the exclusive privilege of delivering the hard copy element of electronic mail.
The Bill defines a letter as a communication in written form directed to a specific person or address

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and relating to the personal, private or business affairs of the sender or the addressee. The majority of electronic mail hard copy will meet these three criteria. The Post Office itself has a unique and ubiquitous delivery network which is ideally tailored for the delivery of these items to any address in the country without the need for an additional infrastructure—an important consideration in an era of resource considerations.
The Post Office anticipates that electronic mail in hard copy form will form a growing proportion of letter mail in the future and indeed will become a significant proportion of the total mail. For example, electricity bills could be printed by computer and sent over the wire for printing, enveloping and delivery by the relevant local mechanised letter office; and if there is no monopoly on delivery then there is a considerable longer-term risk of the Post Office losing this kind of traffic to operators who will cream off the profitable routes and deliver in major centres, but leave the Post Office with the statutory obligation to serve, as it were, the Highlands and Islands, so in fact increasing its unit costs. The Post Office has the right to some protection for its basic traffic, otherwise the whole fabric of the postal service is potentially at risk.
This subsection as it stands makes the assumption that the Government are thinking of electronic mail hard copy as a premium service involving relatively few high-speed, high-cost messages. That may indeed be so at first, but it is far from being the longer-term pattern foreseen by the Post Office. Indeed, a recent report by the Science Policy Research Unit, commissioned by the Union of Communications Workers, predicts a huge growth in electronic mail, directly affecting the postal traffic. In particular, the report highlights the growth of communicating word processors; basically that is typewriters with visual display units that can store and edit texts of facsimile, like remote photocopying enabling a document to be electronically scanned and transmitted to a distant location over the telephone network and there printed out as a hard copy and a view data which links the telephone and the television set to provide an information service.
Electronic mail will be used particularly on a business-to-business basis and the review makes various forecasts about its impacts. It concludes by predicting a loss of postal traffic of 25 per cent. as a result of electronic mail by the end of this decade. This in turn could lead to a loss of about some 35,000 jobs in the postal service. Therefore, as your Lordships will appreciate, it is vital to the Post Office that it shall continue to have the monoply for the delivery of hard copy from electronic mail services. So this amendment, which will cost the Government very little and is strongly supported by the Post Office Board, is an important one, and there does not really seem to be the need for this particular subsection in any case. I beg to move.
The Earl of Gowrie: When amendments are very close to those moved in another place we try to look at them afresh and to consider them absolutely on their own merits. I have looked at the amendment and I have listened carefully to what the noble Lord, Lord Ponsonby, has said. Nevertheless, I am afraid that
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I have not heard anything which makes me feel that the line taken by my honourable friend the Minister of State in another place should substantially be altered. The noble Lord has argued that the Post Office already has a comprehensive delivery network throughout the country and that resources would be duplicated if rival delivery services for electronic mail were to be established; but surely the very fact that the Post Office has the delivery network should give them a huge head start over any potential competitiors. One wonders what they are fussing about. Furthermore, the noble Lord has argued that the Post Office will lose some 25 per cent. of its traffic if the monopoly is not extended in this way; but I do not believe that this need be the case. The Post Office should not fear this competition when it is in a position to meet it.
The noble Lord has also argued that the exclusion of hard copy electronic mail from the Post Office monopoly is unnecessary at present because if the service proves to be inadequate, then the Secretary of State could use his powers under Clause 68 or Clause 69 to license private operators or to suspend the monopoly entirely in this respect. Certainly that is true in theory, but while it is true in theory I am afraid, as I have said before, that if the Post Office is given the monopoly in this field now, it is quite likely that private operators will be deterred from setting up in this type of electronic mail business, and we shall therefore never reach the point where the Post Office service may in fact be judged to be adequate or inadequate.
This is an issue which we have considered very carefully and at great length, and I must say that I remain firmly of the view—and it is an essential principle of the Bill—that to give the Post Office a monopoly of delivery over hard copy electronic mail could have a very damaging effect on the growth and development of this extremely important new form of communication. Therefore, I would ask the Committee to resist the amendment.
Lord Ponsonby of Shulbrede: I thank the noble Earl for his response to my amendment. I shall read closely what he has said in Hansard and then later decide whether to return to it. In the meantime, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 66 agreed to.
8.12 p.m.
Lord Elwyn-Jones Lord Elwyn-Jones moved Amendment No. 145:
After Clause 66, insert the following new clause:
("Interception of mail
.—(1) A person who—

(a) intentionally intercepts the contents of the mail carried by the Post Office;

(b) instigates any person engaged in the business of the Post Office to intercept the mail; or

(c) discloses the contents of any mail intercepted under paragraph (a) or (b) above.

unless acting in obedience to a warrant issued pursuant to the following provisions of this section, shall be guilty of an offence and liable on conviction on indictment to a fine not exceeding £5,000 or to imprisonment for a term not exceeding three years or to both.
(2) Proceedings for an offence under subsection (1) above shall not be instituted in England or Wales except by or with the consent of the Attorney-General, or in Northern Ireland except

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by or with the consent of the Attorney-General for Northern Ireland.
(3) No person shall be guilty of an offence under subsection (1) above as respects any act done by him whilst engaged in the business of the Post Office.
(4) The Secretary of State may, on the application of a chief officer of police or the Commissioners of Customs and Excise, issue a warrant for the interception and disclosure of the mail if he is satisfied that—

(a) it would assist in the detection of a serious offence;

(b) normal methods of investigation have been tried and have failed or from the nature of things are unlikely to succeed if tried; and

(c) there is good reason to think that the interception would result in a conviction for that offence.

In this subsection "serious offence" means—

(i) an offence for which a person not previously convicted could reasonably be expected to be sentenced to imprisonment for a term of three years; or

(ii) an offence in which either a large number of people is involved or there is good reason to apprehend the use of violence.

(5) The Secretary of State may, on the application of a chief officer of police or the Director-General of the Security Service issue a warrant for the interception and disclosure of the mail if he is satisfied that—

(a) it would assist in the detection of a major terrorist or espionage activity giving rise to external or internal danger to the defence of the Realm; and

(b) normal methods of investigation have been tried and have failed or from the nature of things are unlikely to succeed if tried.

(6) An application for a warrant under this section shall be made in writing and shall specify—

(a) the person whose mail it is sought to intercept; and

(b) the facts and circumstances in support of the application;

but the Secretary of State may allow any information required under paragraph (b) above to be provided orally and not in writing in respect of an application for a warrant under subsection (5) above.
(7) Except in a case of emergency, any warrant under this section shall be issued only under the hand of the Secretary of State; and, in any such case, shall be confirmed under his hand as soon as reasonably practicable after issue.
(8) In this section "intercept" includes the doing of any act designed to enable an interception to take place, and "intercepts", "intercepted" and "interception" shall be construed accordingly.").
The noble and learned Lord said: This amendment runs parallel to Amendment No. 123 which we discussed and upon which a Division took place. Much the same principles apply in the consideration of this amendment as applied to Amendment No. 123. It is a very important amendment in that it deals with the interception of mail, the right to open private letters between citizens, and as much of a serious invasion of privacy as telephone tapping. The techniques available are very considerable. Interception of mail, opening of letters, curiously enough has not excited anything like as much concern or arousal of public interest as telephone tapping. Whether that is because fewer people know about the fact that letters of citizens are opened than know about telephone tapping, I do not know. The extent of it is not very clear either, and it may well be that I may be able to persuade whoever is to reply, perhaps the noble Earl, Lord Gowrie, to give us some indication of how extensive the practice is.
It was said by one of my honourable friends in another place that the figure for mail interception is
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enormous; that was the adjective he used; and that half a dozen agencies, apparently called "requesting agencies", have a right to demand interception of mail. I do not know whether this is true or not, but it would be helpful if we could have some light thrown upon this by the noble Earl.
Then, the means for carrying out interception of letters and the techniques that are now available, of course, need not make and do not make apparent the fact that the letters have been opened. There are various ingenious devices like rays and carbon lights that can apparently show through envelopes and can record letters. So that here again the possibility of abuse and the instruments for making abuse possible are considerable, although clearly access by those who seek to intervene is obviously much more complicated and more difficult than it is in regard to tapping telephones. If the noble Earl is in a position to enlighten the Committee about the extent of this, I think it could well reassure the public.
So far as the clause is concerned, it seeks once again to give a statutory basis to the right to open the citizens' letters. The present legal position is, in my submission, as uncertain as it is in the case of telephone tapping. Here again we may well find ourselves, when we are arraigned before the European Court of Human Rights, to be in breach of Article 8 of the Convention on Human Rights, which includes among its provisions in express terms the protection of the privacy of correspondence. It reads:
"Everyone has the right to respect for his private and family life, his home and his correspondence".
Once again it would indeed be unfortunate if we found ourselves arraigned and found wanting before that body.
I cannot help recollecting, when I was on the Woolsack, the alarming warnings that were given to me that we might have been in breach of the Convention in regard to the closed shop. This is a much more public and probable, or possible at any rate, field for infringement of rights than the limited aspect of the closed shop.
A great deal was made by the noble Earl, in his speech on Amendment No. 123, of the value of the safeguard provided by the monitoring of my noble and learned friend Lord Diplock, the value of which of course I do not under estimate, within the sphere in which it operates. But there is no Diplock monitoring of letters, as I understand it, no equivalent monitoring to see that this is done in accordance with the tests, within the limitations that are set out in the undertakings and the description of what is done by the Home Secretary in the field of telephonic communication.
What we have done in the new clause which I am moving is once again to set out a strong penalty for those who intercept letters without authority, or instigate persons to do so, or disclose the contents of wrongly intercepted mail. Then we give again the safeguard of the Attorney General in respect of the bringing of proceedings, and then set out the circumstances in which the Secretary of State should properly and within the law issue warrants for the interception and disclosure of mail. As I say, they still enable him to do so—as he himself says is his purpose, and I have no doubt it is—to assist in the detection of serious

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offences; as a last resort measure; and when there is good reason to think it will result in a conviction.
Then in subsection (5), as in the case of Amendment No. 123, there are set out the circumstances in which on the application of a chief officer of police or the Director-General of the Security Service a warrant can lawfully be issued to intercept mail—when,
"it would assist in the detection of a major terrorist or espionage activity giving rise to external or internal danger to the defence of the Realm".
Then it sets out the procedure for the application for the warrant to be made in writing, et cetera. We have been careful there once again merely to set out what the Home Secretary says is his practice in this field. To put it into statutory form will certainly strengthen his position if he is arraigned in the European Court, or indeed if he is brought before the courts of this country. I beg to move.
The Earl of Gowrie: I must confess that in some respects the noble and learned Lord, not for the first time—and I am sure not for the last—has bowled me out because I had not really anticipated that this particular amendment would be moved. The reason is that almost everything—indeed, I think everything—that I said in our debate on Amendment No. 123 applies to the interception of mail. It is certainly my advice that there is no, as it were, class distinction as between interception of mail and telephonic interception.
However, I can give the noble and learned Lord some information. The statistics on the interception of mail were, in fact, in the Home Secretary's White Paper—not the Diplock Report. Therefore, they are available. As regards the question whether Lord Diplock's remit covers mail, I would imagine that it does do so, but I would have to consult the Home Office about that. If I may, I shall write to the noble and learned Lord about that matter if that would be satisfactory to him. However, on the general issues, the Government's position on the interception of mail is the same as their position on bugging. I went into that in some detail and with care when we dealt with Amendment No. 123.
Lord Elwyn-Jones: I would not be discourteous in saying that that answer is less than adequate. Indeed, it hardly touches on nine out of 10 of the points that I raised. However, I certainly did not intend to bowl out the noble Earl. I am not a very good bowler anyway, and he is a very good batsman. Perhaps I should have given the noble Earl greater notice. I am not sure that I am at fault but, in all the circumstances and in view of the fact that, without criticising him, I must say that he has not been able to deal with the points I have raised, I shall not divide the Committee. We have had a Division on the question of the main principles.
Nevertheless, it may well be that I shall return to the matter on Report, by which time the noble Earl will certainly not be bowled out and may—indeed, I hope that he will—have answers to the serious questions that I have raised and which cause concern to the public. In those circumstances and in the light of—I shall not call it a threat—my expectation to raise the matter again, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 67 [General classes of acts not infringing the postal privilege]:
8.23 p.m.
The Earl of Gowrie The Earl of Gowrie moved Amendment No. 146A:
Page 56, line 2, leave out ("the sender") and insert ("either correspondent").
The noble Earl said: I beg to move Amendment No. 146A. Clause 67(1)(c) exempts from infringement of the monopoly the conveyance and delivery of a letter by a messenger sent for the purpose by the sender. This amendment which replaces Amendment No. 146 extends this exemption and allows the addressee of a letter also to send a messenger for the purpose of collecting that letter from the sender. Representations have been made to my honourable friend the Minister of State for Industry in particular from small businesses that an amendment on these lines should be made. I believe that it is a sensible amendment which removes a certain amount of illogicality in the present position which would, for instance, allow me to send a messenger with a letter direct to the addressee—that is to say to the noble Lord, Lord Ponsonby of Shulbrede—but would not allow me to send that same messenger to pick up a letter addressed to me from the person sending it—again, let us say from the noble Lord, Lord Ponsonby.
This amendment should also be seen in the light of our proposed amendment to Clause 67(1)(i), which would put an employee in a broadly similar position with respect to mail addressed to the group in which he is employed, and I think that it is logical to treat the messenger on a similar basis.
The expression "correspondent" is the subject of Government Amendment No. 156, which inserts into Clause 67(3) the following definition:
"'correspondent', in relation to a letter, means the sender or the addressee".
Thus the words being inserted by my amendment, "either correspondent", cover both sender and addressee. This is modest, sensible and practical and I hope that the Committee will accept it.
On Question, amendment agreed to.
Lord Ponsonby of Shulbrede Lord Ponsonby of Shulbrede Amendment No. 147:
Page 56, line 3, leave out paragraph (d).
The noble Lord said: I beg to move amendment No. 147. This is the first of my amendments to Clause 67, and the noble Earl, Lord Gowrie, in speaking to the last amendment spoke of a number of the ensuing amendments which we have tabled to Clause 67. Clause 67 deals with the general classes of act not infringing the postal privilege. Our intention in tabling these various amendments to Clause 67 was to restore the position as it was under the 1953 Act. In fact, I note that our last amendment to this particular clause has attracted the support of the noble Earl, so I am glad that we have his agreement in that respect at any rate.
In view of the fact that a number of the amendments tabled by the noble Earl this evening are effectively amending provisions which I shall propose to delete, probably the best way to make progress—and I am anxious to make progress—is to return basically to our reaction to the amendments moved by the noble

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Earl after they have been incorporated into the Bill. I beg to move.
Lord Swinfen: I should like to raise just one point on this particular paragraph. Why should it be limited to an aircraft only and not a ship as well? I wonder whether my noble friend the Minister when replying could answer that point.
Lord Trefgarne: Let me deal first with the point made by my noble friend Lord Swinfen. The purpose of the special exemption for "air couriers", as they are called, was to enable them to carry on their business. I must confess that we were not originally convinced that they would not be able to do so because of certain intentions which we had in mind in respect of a general suspension of the monopoly as regards express mail. However, we responded to pressure from the air courier companies and, as their business is strictly related to the carriage of express mail by aircraft, "aircraft" were included in the Bill and there was no need, as far as we could see, to include "ships" which were certainly not used for express mail purposes.
Returning to the remarks of the noble Lord, Lord Ponsonby, as your Lordships may recall, my right honourable friend the Secretary of State announced last year that he intends to derogate the postal monopoly in respect of time-sensitive/valuable mail—that is to say, express mail. This derogation will be carried out by means of a suspension of the monopoly under Clause 69. We had intended that the activities of air couriers in this country, to which the noble Lord referred, should be covered, as I said in answer to my noble friend, by that general suspension. However, after receiving a number of representations from the air couriers, my honourable friend the Minister of State decided that there were arguments for putting something more definite in the statute, and he therefore accepted the amendment which inserted this new exemption during the Committee stage in another place.
The amendment would allow an air courier to take mail to an aircraft for onward conveyance out of the country by that aircraft. I must, therefore, emphasise that this exemption will have no more effect on the Post Office monopoly than will the general express mail suspension. It is true that, under the general suspension, carriers of express or time-sensitive mail will be required to charge £1 per item, but I am sure that air couriers would, in virtually every case, charge more than that in any event.
I think that the noble Lord is unduly alarmed by the effect on the Post Office of this new provision, which I do not think will have any greater effect on the Post Office than the general suspension for express mail, to which I have referred. I hope that this will set the mind of the noble Lord at rest.
Lord Ponsonby of Shulbrede: As I indicated when I moved this amendment, I do not at this stage intend to press it to a Division, but I shall take another look at the whole structure of Clause 67 after it has incorporated the various amendments which are being moved. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 147A not moved.]
Lord Lyell Lord Lyell moved Amendment No. 148:
Page 56, line 14, leave out ("addressee") and insert ("addressees").
The noble Lord said: With the Committee's permission, I should like to move Amendment No. 148 and speak to Amendment No. 150. These are two purely drafting amendments. Clause 67(1)(f) and (h) both refer to the conveyance of letters, in the plural. The two amendments that I propose make it clear that these letters, in the plural, may be delivered to more than one addressee. This is a simple and. I hope, fairly straightforward drafting change. I beg to move.
On Question, amendment agreed to.
The Deputy Chairman of Committees (The Earl of Listowel): Before I call the next amendment, I should point out to the Committee that if Amendment No. 149 is agreed to, I cannot call Amendments Nos. 150 or 151.
[Amendment No. 149 not moved.]
Lord Lyell Lord Lyell moved Amendment No. 150:
Page 56, line 25, leave out ("addressee") and insert ("addressees").
On Question, amendment agreed to.
The Deputy Chairman of Committees: Before I call the next amendment, I should point out to the Committee that if Amendment No. 150A is agreed to, I cannot call Amendment No. 151.
Lord Morris Lord Morris moved Amendment No. 150A:
Page 56, line 27, leave out paragraph (i) and insert—
("(i) The sending, conveying and delivery of business letters by means of a person or a number of persons who are associated in business with the senders or the recipients or by a body corporate which is a member of the same group as the senders or the recipients, and the collection of such letters for that purpose.").
The noble Lord said: As your Lordships are aware, subsection (1), inter alio, permits the delivery of a letter by a person in the same group as the sender. However, this freedom is limited to conveyance and delivery by one natural person. I believe that this subsection should provide for the conveyance and delivery by a number of persons in, for example, the chain, alternatively, by a corporate body which is in the same group as the sender.
As currently drawn, the exception contained in Clause 67 does not permit the collection of letters by a person for delivery to a collect catalogue, mail order company. Thus, a person delivering letters to a mail order agent or a customer on behalf of a mail order company, cannot collect any return correspondence from that person. I have a suspicion that the amendment of my noble friend Lord Gowrie, Amendment No. 151–and I may have completely missed this—covers this point. So, I shall not develop the point, but simply ask whether my surmise is correct as regards that. I beg to move.
Lord Trefgarne: I can confirm that my noble friend's fear, which he described, was covered by the earlier amendment of my noble friend Lord Gowrie. I must also add that there are two further difficulties in the amendment of my noble friend Lord Morris, but in the light of my first assurance, I hope that in any event he will not want to proceed further.
Lord Morris: I wish only to express delight. With that, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
8.35 p.m.
The Earl of Gowrie The Earl of Gowrie moved Amendment No. 151:
Page 56, line 27, leave out from (."of") to ("letters") in line 29 and insert ("letters by a person who has a business interest in those letters, and the collection of").
The noble Earl said: I am afraid that imperfect paper control is being evidenced because I had anticipated a much longer debate over the last amendment. Of course, I congratulate my noble friend on his brevity, even if it has left me somewhat confused.
This group of amendments—and if I may, I shall speak also to Amendments Nos. 153, 156, 157 and 158—has been tabled primarily to meet a point presented to Ministers by the Mail Order Traders' Association, but it also contains some drafting changes to meet some particular concerns which have been expressed to us by the Post Office. These are two separate issues which I shall take in turn.
On the first point, the mail order traders have expressed concern that the provisions contained in the Bill in Clause 67(1)(i) concerning the delivery of letters by persons "associated in business" with the sender would not allow them to carry on their business as they have done for many years, as it would not allow them to use their employees to pick up letters from persons other than those with whom they were associated in business. I understand that employees of mail order companies pick up letters from such "other persons" notably those who act as agents for the companies in the field.
When this point was discussed in another place, my honourable friend the Parliamentary Under-Secretary said that he would consider whether it was possible to make an amendment of this nature, and he promised to consult the Post Office. Since then my colleagues have considered this question very carefully, and it has indeed been discussed with the Post Office, and we have come to the conclusion that it would be right to make these amendments in order to clarify the position for the mail order traders. Now it is true that the wording of the amendments does not limit this particular exemption only to the activities of the mail order traders, and the Post Office has expressed very considerable concern that there could be serious inroads on the volume of their letter traffic. However, we consider that it would in practice be illogical not to allow an employee of any company to pick up letters addressed to his employer from third parties when he will be able to deliver letters to those third parties themselves. We therefore accept that a proportion of the letter mail could be at risk, but we do not believe that in practice there will be any large-scale erosion of the Post Office's traffic just because, as in the case of Amendment No. 146A which we have just discussed, these amendments will not allow an employee of company A, delivering letters to third party companies B and C, to deliver letters between B and C. He will only be able to pick up letters addressed to his employer or another company in the same group as his employer. Thus, the amendments will not permit the setting up of full-scale private delivery
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services between completely separate companies. That is the kind of thing that could create an inroad into the postal monopoly, and that we have rejected altogether.
I also mentioned that these amendments contain some drafting amendments to take account of certain Post Office worries, and in this respect the amendments have been agreed with them. Their concern was that under Clause 67(1)(i), taken with Clause 67(3), it would have been possible for employees of a group of companies to set up their own private delivery service for their own business letters rather than only business letters referring to the business of their employer or another company in the same group as their employer. This was clearly not our intention and these drafting amendments, contained in Amendments Nos. 151 and 153, make it quite clear that the letters being conveyed, delivered and collected, must relate to the business affairs of the company whose employee is actually delivering or picking up the letters, or to the business affairs of another company in the same group as the first company. The term "group" is defined by Amendment No. 151 to mean:
"a body corporate and all of its wholly owned subsidiaries taken together".
I am afraid that I have not been using the language of the Areopagitica. This is a complicated set of amendments, and I have had to take care to explain their exact intent. I commend these amendments despite the rigidity of their phrasing.
On Question, amendment agreed to.
Lord Lyell Lord Lyell moved Amendment No. 152:
Page 56, line 31, after ("another") insert ("or from a bank to a government department").
The noble Lord said: I hope it might be for the convenience of the Committee if I also speak to Amendments Nos. 154 and 155 and also to part of Amendment No. 157 to which my noble friend the Minister spoke a little earlier. What I shall have to say is relevant to all of these amendments. All of these amendments have been agreed with the existing Post Office. They make drafting changes to the exemption from the monopoly for what are bound to be in Clause 67(3) and described as "banking instruments". Naturally enough, these banking instruments tend to pass between banks. All four of the amendments are necessary to ensure that all the documents which currently pass through the banks' clearing system are covered by the definition "banking instrument" which we shall find in Clause 67(3).
In particular it has been drawn to the Government's attention that certain things called warrants issued by the Commissioners of Inland Revenue and also by the Commissioners of Customs and Excise and by the Department of National Savings pass through the clearing system. These are not covered by the definition of banking instrument as it now stands in Clause 67(3).
This particular point is now covered by Amendment No. 154, and this also adds to the definition "banking instrument" some other kinds of documents which pass through the clearing system. These particular documents were not previously covered. Examples of them which the Committee might be interested to note include

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bills of exchange, promissory notes, postal orders and money orders. All of these are now covered under the definition "banking instrument". Furthermore, we have now been informed that warrants not only pass between banks but are also returned by the banks to the department that issued them. It has therefore been necessary to amend the exemption in Clause 67(1)(j) to make this possible, by allowing banking instruments to pass between banks and between a bank and a Government department. The term "Government department" is defined in Amendment No. 157. I beg to move.
On Question, amendment agreed to.
Lord Trefgarne Lord Trefgarne moved Amendment No. 153:
Page 56, line 39, at end insert—
("(2A) For the purposes of paragraph (i) of subsection (1) a person has a business interest in a letter if, and only if—

(a) he is employed by one of the correspondents or by a member of the same group as one of the correspondents and the letter relates to the business affairs of that correspondent; or

(b) he and one of the correspondents are employed by the same person or by different members of the same group and the letter relates to the business affairs of that person or, as the case maybe, the employer of that correspondent.").

On Question, amendment agreed to.
Lord Trefgarne Lord Trefgarne moved Amendment No. 154:
Page 57, line 13, at end insert—
("(aa) any document issued by a public officer which is intended to enable a person to obtain payment from a government department of the sum mentioned in the document;
(ab) any bill of exchange not falling within paragraph (a) or (aa) or any promissory note;
(ac) any postal order or money order;").
On Question, amendment agreed to.
Lord Lyell Lord Lyell moved Amendment No. 155:
Page 57, line 16, after ("items") insert ("or any copy of an item").
On Question, amendment agreed to.
Lord Lyell Lord Lyell moved Amendment No. 156:
Page 57, line 17, at end insert—
(""correspondent ", in relation to a letter, means the sender or the addressee;").
On Question, amendment agreed to.
Lord Lyell Lord Lyell moved Amendment No. 157:
Page 57, line 21, at end insert—
(""government department" includes any Minister of the Crown and any Northern Ireland department;
"group" means a body corporate and all of its wholly owned subsidiaries taken together;").
The noble Lord said: This is the last in the series of four amendments to which I spoke, and I beg to move.
On Question, amendment agreed to.
8.44 p.m.
Lord Ponsonby of Shulbrede Lord Ponsonby of Shulbrede moved Amendment No. 158:
Page 57, line 31, leave out subsection (4).
The noble Lord said: I am glad to know that, for once, I am moving an amendment that will be accepted.
On Question, amendment agreed to.
Clause 67, as amended, agreed to.
Clause 68 [Savings for things done under a licence]:
Lord Glenamara Lord Glenamara moved Amendment No. 159:
Page 57, leave out from beginning of line 39 to ("the") in line 40 and insert ("A licence may, with the consent of, or in accordance with the terms of a general authority given by, the Secretary of State, be granted by").
The noble Lord said: In moving this amendment I should also like to discuss Amendments Nos. 165, 166, 167 and 168.
Lord Trefgarne: If the noble Lord will allow me, may I suggest that it would be appropriate to consider Amendments Nos. 172, 173, 174 and 175 at the same time?
Lord Glenamara: We shall see. When we discussed Clause 15, which is the sister clause to Clause 68, I described it as the heart of the Bill. This clause is also the heart of the Bill; this Bill has two hearts, or perhaps a split heart, because this is the clause which, from the postal side, empowers the Minister to grant licences which derogate from the postal monopoly. These are licences defined in any way the Minister chooses, to do anything whatsoever which falls within the postal monopoly. The licences can be for any period of time. The power of the Post Office to grant licences under Clause 3 of the 1953 Act falls.
Clause 68 contains extremely sweeeping powers allowing the Secretary of State to promote extensive privatisation. Like the word "liberalisation", I think that "privatisation" is a horrible word which has come into general use nowadays. This clause would promote extensive privatisation of any of the services within Clause 66(1). It is under this clause that the Secretary of State plans to encourage express services, document exchange services, and charities to deliver their own mail. Together the derogation stated under Clause 67 and the likely ones under Clause 68 would immediately cause the Post Office to lose 1 to 2 per cent. of its mail traffic. The Post Office can ill-afford to lose 2 per cent. of its mail traffic. The Post Office in Britain, as elsewhere, is one of the most labour-intensive industries in the economy. It has problems enough without losing any of its revenue.
I do not know whether noble Lords noticed, but earlier in our debate, when we were discussing the pension fund, the noble Lord, Lord Hawke (who I believe is no longer with us) said that telecommunication workers were on to a winner but postal workers were on to a loser. I take it that by that he meant the postal business is scarcely viable. Certainly it cannot afford to lose 2 per cent. of its mail traffic.
Again, the Secretary of State is here taking exorbitant powers as he did on the telecommunications side in Clause 15, and because licences can be granted by him at any time Clause 68 hangs like tht sword of Damocles over the Post Office. There is an additional and very important point; there is no provision whatever for monitoring the licences which the Secretary

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of State issues. The Government can grant a licence and yet it has not set any curbs or any method of regulating the private companies to which the Secretary of State grants licences. What an extraordinary state of affairs that is. There are strict controls governing the provision of Post Office letter services, and in the matter of tariffs, the Government and the Post Office Users' Council have clear and definite roles to play.
When the noble Lord replies I would like him to say whether, in the event of a licence being granted to someone to carry part of the mail, the Post Office Users' Council will have a role to play with regard to that company. There are also very strict operational safeguards applied to the Post Office. The Post Office is subject to the most intense departmental interference. The noble Lord, Lord Winstanley, quoted the number of occasions on which the present Secretary of State has interfered in the running of the Post Office under this Government, compared with interference by the previous Government. In my own case the figures were four times under the previous Government and I think 24 times under the present Government.
The Post Office is subject to the most intense Government interference, and also of course to Parliamentary scrutiny of its operations. But the private companies who are going to get licences under this clause will be subject neither to departmental interference nor to Parliamentary scrutiny. However, I should like to make a suggestion, and I intend to convey it to the right quarter. I hope very much that one of the new Select Committees in the other place will step in and fill this gap and will monitor the companies to whom licences are given. I hope they will take up that proposal.
The most pernicious aspect of this clause is the absence of any realistic definition or limitation on the Secretary of State. If this is carried, the Secretary of State, or any subsequent Secretary of State so long as the Bill remains on the Statute Book, can license whatever takes his fancy. I may say that the strangest things take the fancy of the present Secretary of State. This clause amounts to privatisation by executive action. The Minister is asking for enabling powers to enable him to privatise whatever he likes in the Post Office. I wonder what the party opposite would say if a Labour Government introduced a general Bill to enable them to nationalise anything they liked. The Conservative Government, of course, are doing that in reverse.
May I make it clear, as it was made clear in another place, that when the Labour Party returns to power in two years' time, or whenever it is, we shall immediately call in for review all licences granted under this clause with the intention of revoking them? We shall not hesitate to use the same powers that the Conservative Government are taking to restore the monopoly and protect the Post Office system. Quite frankly, if I were a private operator I should think very hard indeed, very carefully, before taking up one of the Secretary of State's licences.
The purpose of our amendment is to preserve the status quo; to drop the Secretary of State from the power to give licences and to leave that with the Post Office as it is now. Only the Post Office would
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have the ability to grant licences. Surely that is the right thing to do. Why should the Government have the ability to chisel away at the monopoly, depriving the Post Office of its much-needed revenue by positively inciting all the cowboy firms in the country to grab their share of the profitable mail services?
Why should the Government interfere at all? In their manifesto they gave a specific promise—and have taken the trouble to get a copy of the paragraph in the Conservative Party manifesto of the last general election, which I intend to quote in a subsequent debate this evening. Let me read what they say in that paragraph, which is headed "Nationalisation". They say:
"We want to see those industries that remain nationalised running more successfully, and we will therefore interfere less with their management and set them a clearer financial discipline in which to work".
They say "interfere less". Why should they interfere at all? Why interfere with the Post Office in this way and deprive it of much-needed revenue? All we are trying to do is to see that the Conservative Government keep that promise that they made in their manifesto, and do not interfere with the Post Office's monopoly to issue licences. I beg to move.
8.55 p.m.
Lord Trefgarne: In tabling these amendments the noble Lord is trying to take away all powers from the Secretary of State to make derogations from the postal monopoly, whether that be done through licensing under Clause 68 or suspension of the monopoly under Clause 69. As regards licensing, it appears that the noble Lord would wish to return to the status quo whereby only the Post Office would be able to issue licences for activities otherwise falling within the monopoly, albeit only on the authority of the Secretary of State. Then on suspensions of the monopoly he is suggesting that the Post Office itself should be given a power to end the monopoly.
However, my right honourable friend the Secretary of State has said that he wants to be able to make derogations from the monopoly, either generally or in respect of specific categories of mail, in situations where the Post Office is not providing a satisfactory service. Such a situation might arise in the event of industrial action in the Post Office, either in one particular area or throughout the country, resulting in a cessation or serious decline in service, or if, after due warning, the Post Office performance has been unsatisfactory for other reasons within its control or simply if it fails to meet demand for a particular letter service.
If the Secretary of State did not have these powers in Clauses 68 and 69, he would simply not be able to carry out his stated policy and thus ensure the best service to the customer. Even if he gave the Post Office a general authority to issue licences or suspend the monopoly, he would have no means of ensuring that they did so in the circumstances where he considered it to be appropriate.
It may be of some help to your Lordships if I describe briefly the way in which we envisage that these powers will be used. Above all, I should say that we have no intention of using these powers arbitrarily in such a way as seriously to damage the Post Office's interests. Indeed the powers may only be used after consultation

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with the Post Office and they will of course be given every opportunity to put forward their views. Furthermore, I do not envisage that the powers will be used frequently; what I do hope and expect is that the very existence of these powers will act as an incentive to the Post Office to provide an adequate service and thus obviate the need for their use. The powers should thus, when they are used and even when they are not, help to achieve our prime aim, which is the provision of the best possible postal service to the customer. However, we do have some plans for use of the powers as soon as the Bill is passed and my right honourable friend has announced these already: we intend to allow charities to deliver Christmas cards and document exchanges to transfer mail in bulk between themselves, and we intend to derogate time-sensitive/valuable (that is to say "express") mail from the monopoly, which is a matter I referred to a few moments ago. The first two derogations which I just mentioned will be carried out by means of the issuing of licences under Clause 68, and I should point out here that in each of these cases, charities and document exchanges, it will not be necessary for individuals to obtain separate licences; rather, the Secretary of State will issue a general licence covering a class of people.
The derogation in respect of express mail will, however, be carried out under the powers of suspension in Clause 69; in effect, the monopoly will be suspended in favour of any person wishing to run an express letter service subject to such conditions as may be set out in the suspending order; one such condition which we plan to impose is the minimum charge of £1 per letter carried. It is not possible to issue licences under Clause 68 for all persons, since that clause only allows the granting of licences to specific individuals or classes of person. In time it may be appropriate, after full consultation with the Post Office, to make further derogations from the monopoly, but these three are all we have planned for now.
In conclusion, therefore, I can repeat only that these powers must rest with the Secretary of State rather than the Post Office if he is to be able to carry out his policy of ensuring the best service to the customer by allowing others to provide letter services in situations where he considers it appropriate. In all cases the Post Office will be fully consulted. I hope that, in the light of what I have said, the noble Lord will not wish to press his amendments.
When moving the amendment the noble Lord, Lord Glenamara, asked some specific questions, first about POUNC, the Post Office Users' National Council. I nca tell him that POUNC will remain responsible, as the consultative body, with regard to the Post Office, but will not have a role to play in respect of any of the private companies who in due course are offering some of the services. As for monitoring, something may be said on that when we come to later amendments. Suffice it for me to say that at present we should not wish to impose on private companies new monitoring arrangements peculiar to them which were not in general applied to other commercial interests.
The noble Lord complained that we were seeking a provision to enable us to privatise, as he put it, anything we liked. Of course the Bill relates specifically to the Post Office, and the part we are discussing now is
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the postal services only. It has long been part of our policy, and was certainly included in past manifestos, that we should liberalise the monopoly in the postal services, and that is what the Bill is about.
Lord Glenamara: I fear that I did not note the additional amendments which the Minister said he wished to discuss. Would he tell me which they are?
Lord Trefgarne: We are dealing with Amendment No. 159. In addition, I suggested we might consider this discussion to be covering Amendments Nos. 165 and 168 inclusive and Amendments Nos. 172, 173, 174 and 175.
Lord Mottistone: I was distressed to hear the noble Lord, Lord Glenamara, issue threats as part of his speech. He seemed to feel that monopoly was sacrosanct and that monopoly controlled not only the Post Office but was the best way of handling things. He must have witnessed over the last 30 years that monopoly systems have not worked as efficiently as, I am sure, everybody hoped they would when they set them up in the first place. In fact, in general terms for all sorts of reasons the Post Office is not providing as good a service today as it did 30 years ago, so there is surely some justification for thinking there could be arguments for having some of the responsibilities of the Post Office freed—liberalised, as my noble friends call it—so that other people can take them up and at least provide some measure of competition against which the Post Office can measure its own performance.
To round off an argument by saying, "When we get back into power we shall reverse the whole thing and call in"—"revoke" was the word I think the noble Lord used—"all the licences", is no way to run the country. We must experiment, not get stuck the way we always have been; we must experiment and try new things. Let us do that in the way the Bill is trying to do it, with relatively small amounts of the business; 2 per cent., the noble Lord was talking about, and that is reasonable. If the whole thing was being run on the basis of, say, 60 per cent., that would be a different matter.
We must get ourselves out of the mould into which we have been cast and try experiments in all sorts of directions. This is one of the bold ways in which it is being done, though in my view it is being done in too mild a style. Let us hope the Secretary of State in due course does more rather than less than my noble friend was saying. Let us not get stuck with the thought that monopoly is the only answer. I implore noble Lords opposite to cast off the great shibboleth of imagination in which they have cast themselves. Let them look widely and think about new things. They should stop bothering about the past and acknowledge the errors of their ways, and then perhaps we can get a new picture in this world.
Lord Underhill: What the noble Lord, Lord Mottistone, said may sound very nice to him. He talks about experimenting, but let us see what the Bills says. It gives full powers to suspend or give away any service carried out by the Post Office. Therefore, the noble Lord should not just talk about powers to experiment. Indeed, the noble Lord, Lord Trefgarne, said there was

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no intention to use the powers arbitrarily. Where is that said in the Bill? We may have a Secretary of State who will not use the powers in an arbitrary way, but once the powers are on the statute book they will be there for any Secretary of State to use.
The noble Lord then said they would not be used frequently. That is not said in the Bill. Very importantly, he said three activities were planned "for now", which must mean he is contemplating the possibility of conducting further experiments and innovations which, in the end, will destroy the present Post Office system. It is all very well to be told that things will be done "after consultation with the Post Office", but what if the Post Office says, "If one of these activities is taken away, it will imperil our service"? Will the Secretary of State listen to that, or will he say, "The powers are in the Bill and I am going ahead irrespective of what the Post Office says"?
I see noble Lords opposite smiling at what Lam saying. I agree that the Post Office had rather fallen down two or three years ago, but it has pulled itself back and is innovating new services itself. It is based on a system which has spread throughout the world, yet we are one of the few countries which want to mess about with our Post Office in this way. Once services are started to be taken away, what will be the result? The only services that people will want to take are those which make a profit. As I asked on Second Reading: Who will want to deliver in the Highlands and Islands? The answer is, only the Post Office, which is built on a national system with common services. I remind noble Lords opposite that while words may sound all very well, they must look at what is actually in the Bill and the powers being given to the Secretary of State. They will see that the Bill gives him power to take anything away from the Post Office and destroy the whole of the services.
Lord Brookes: I sense the sadness that the Committee may be about to divide on this issue. For many of us here, and for many outside, that will be a matter of real regret. To most of us the Post Office is a commendable institution, well established and historically well run, with the occasional hiccup here and there; something which renders a great corporate service to us, something which, through the postman (who to many of us is a cheery friend) is a necessary symbol and part of our lives. To hear it cast in terms of something which is to be lightly and readily disregarded by any Government, whether of the Right, the Left, or the centre, is I think a measure of exaggeration of anything that any of us would believe would happen or is likely to happen in real life.
In short, if the Post Office is as good in the future as it has been in our history, it will survive on its own merit. If it ceases to be so good, then against that contingent risk it should not require the defence of special privilege, which should be accorded to no monopoly. I think it sad that in a nation which I think always regrets retrospective legislation we should tonight have heard condemned to instant death any future opportunism, efficiency and effectively pursued to serve the cause of the public, and should have been told that a future Labour Government would kill it, regardless of its quality, its merits, or the necessity for its existence. I particularly deplore that coming from
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the Front Bench opposite, from a noble Lord who is elegant in mind, and I am sure in purpose, too, and I hope that he will not press harsh thoughts of this kind at this stage in our discussions.
Lord Ponsonby of Sholbrede: I had not intended to intervene in the debate on Amendment No. 159, but since the debate is covering also Amendments Nos. 173, 174 and 175, I feel I should now state yet again that the point of the latter amendments—to which my noble friend Lord Glenamara did not speak when he moved Amendment No. 159—is to restore to the Post Office the sole right that it has at present to lift the monopoly, to restore the status quo under the 1953 Act. As the Committee will realise, we and the Post Office regard this as a vital issue. Bearing in mind the discussion on previous clauses, the Committee will appreciate how vital it is that the basic letter monopoly is preserved. What is at stake is whether or not the Post Office is able to manage its own business.
There is no conceivable justification for giving the Secretary of State carte blanche to suspend the monopoly as and when he chooses. What is especially curious is that he already has power, under Clause 66, to grant licences if he wants to erode or suspend the monopoly. Now, under these partiular clauses, he wishes to have dictatorial powers. Besides being unacceptable in principle, that could have a damaging effect on the management and industrial relations in the Post Office.
In the light of the more ample powers taken by the Secretary of State under Clause 66 (on licences), it is evident that this proposal is about using a stick to beat the workers in the Post Office. It is about blackmailing the Post Office workers not to take industrial action. We object in principle to the Secretary of State using the threat of lifting the monopoly to deny Post Office workers the rights that other workers have. It is for that reason that I support the latter amendments in the series of amendments that we are now discussing.
Lord Glenamara: First, I should like to say a few words about the intervention of the noble Lord, Lord Mottistone. I am becoming very tired of being accused of issuing threats or spreading alarm and despondency. This is the third time that this has happened in the debate. I have been a parliamentarian for a very long time. I have not been in your Lordships' House for so very long, but I have been in the Palace of Westminster for very many years, and as long as I am a parliamentarian I shall regard it as part of my duty in opposition to point out to the public the probable effects of Government actions, policy and legislation. That is my job in opposition. So I hope that noble Lords will not accuse me of spreading alarm and despondency or issuing threats.
I believe that when one is a member of a party it is equally important, where one is able to do so, as I am, with great clarity, to tell the public what a future Government of my own party would do—and I have done that absolutely clearly. The noble Lord, Lord Brookes, did not listen to what I said, and I hope he will do me the honour of reading what I said, tomorrow.
The noble Lord, Lord Mottistone, said that the Post Office was not as good as it was 20 or 30 years ago.

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I quite agree with him; it is not. But can he tell me a Post Office in the world which is? Has he any experience of the American Post Office, the Canadian Post Office, the French Post Office or the German Post Office?
Lord Mottistone: I have some experience of the American Post Office, which has consistently been inferior to ours and is today; but I do not think its standard has changed much over the last 30 years. I do not know for what reason—at least, I have my own ideas but I would not advance them at this stage—but the standard of our Post Office back in the 1950s was infinitely superior to what it is now. The American Post Office, which is worse, has been pretty consistent; and I would say the same of the French Post Office.
Lord Glenamara: The noble Lord confirms what I said; the American Post Office could not get any worse. It is one of the most inefficient Post Offices in the world, with all its mechanisation. I would say this, as I did on Second Reading: I believe that with all its faults the British Post Office is probably the most efficient Post Office in the western world. I do not know anything about Post Offices in the eastern world, but certainly it is in the western world—with all its faults. Of course, its difficulties arise from the fact that it is a very labour-intensive industry, with all the problems which that nowadays involves. That is the trouble. Certain things can be mechanised, but no machine can take the letters round and push them through the letter-boxes. They must employ a great many people, and that is the cause of the difficulties.
The noble Lord said that we should all become brave innovators. I listened carefully to what he said, but that bears no relationship to the way Conservative Governments act. This Bill has nothing whatever to do with innovation. The whole purpose of this Bill is to provide still more pickings for private enterprise; that is what this Bill is about.
I should like to thank the noble Lord who replied from the Front Bench, Lord Trefgarne, for giving more information about the Government's intention on licences, but I am very sorry and sad about what he said on the question of POUNC. He confirmed that it is not going to have any function in relation to licensees. But why not? If they are carrying out part of the functions which the Post Office are carrying out now, why should not the Post Office Users' Council monitor their operations which are at present done by the Post Office, as well as monitoring the operations of the Post Office itself?
Then the noble Lord said that the companies to whom licences are given will not be monitored, but the Post Office will be monitored. It will be monitored by the Users' Council; it will be monitored by the Secretary of State; and it will be monitored, and not half monitored, by a Select Committee in another place. But none of those three things will apply to its competitors, who are exactly on all fours with the Government's proposals on telecommunications. This is not fair competition; it is grossly unfair competition. British Telecom is going to be subjected to unfair competition; the new Post Office Corporation is going
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to be subjected to unfair competition. I think our points of view are irreconcilable on this, but, with Clause 15, we regard this as the core, the centre, of the whole Bill, and I would advise my noble friends to press this to a Division.
9.18 p.m.
On Question, Whether the said amendment (No. 159) shall be agreed to?
Their Lordships divided: Contents, 24; Not-Contents, 57.

CONTENTS

Blease, L.

Lloyd of Kilgerran, L.

Boston of Faversham, L.

McNair, L.

Brockway, L.

Molloy, L.

Clifford of Chudleigh, L.

Ponsonby of Shulbrede, L.

Collison, L.

Ritchie-Calder, L.

David, B. [Teller.]

Sefton of Garston, L.

Davies of Leek, L.

Stewart of Alvechurch, B.

Glenamara, L.

Stewart of Fulham, L.

Greenwood of Rossendale, L.

Stone, L.

Jeger, B.

Taylor of Gryfe, L.

Listowel, E.

Underhill, L.

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

Winstanley, L.

NOT-CONTENTS

Abinger, L.

Grimston of Westbury, L.

Airey of Abingdon, B.

Hatherton, L.

Auckland, L.

Henley, L.

Avon, E.

Holderness, L.

Belstead, L.

Inglewood, L.

Bessborough, E.

Kemsley, V.

Broadbridge, L.

Long, V.

Brookeborough, V.

Lyell, L. [Teller.]

Brookes, L.

Mackay of Clashfern, L.

Brougham and Vaux, L.

Margadale, L.

Buxton of Alsa, L.

Marley, L.

Caithness, E.

Montgomery of Alamein, V.

Cockfield, L.

Morris, L.

Colville of Culross, V.

Mottistone, L.

Cork and Orrery, E.

Murton of Lindisfarne, L.

Cranbrook, E.

O'Hagan, L.

Cullen of Ashbourne, L.

Orkney, E.

Digby, L.

Rankeillour, L.

Donegall, M.

Redesdale, L.

Ellenborough, L.

Sandys, L. [Teller.]

Elliot of Harwood, B.

Sharples, B.

Ferrers, E.

Skelmersdale, L.

Fortescue, E.

Stradbroke, E.

Gainford, L.

Strathclyde, L.

Gibson-Watt, L.

Swinton, E.

Gisborough, L.

Trefgarne, L.

Glendevon, L.

Trumpington, B.

Gowrie, E.

Vivian, L.

Gridley, L.

Resolved in the negative, and amendment disagreed to accordingly.
9.26 p.m.
Lord Ponsonby of Shulbrede Lord Ponsonby of Shulbrede moved Amendment No. 160:
Page 57, line 40, leave out from beginning to ("for") in line 42.
The noble Lord said: In speaking to Amendment No. 160, I am also addressing my remarks to Amendments Nos. 161, 162, 163, 164, 169, 170, 171 and 172. This clause, as drafted, empowers the Secretary of State, after consultation with the Post Office, to grant licences for the doing of things falling within the postal monopoly. We have already debated the desirability

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of transferring this licensing power which currently resides with the Post Office to the Secretary of State and it is not my intention, in moving this amendment and the following amendments, to re-open that issue.
My concern here is rather the extent of the powers which it is proposed to confer on the Secretary of State. They are couched in the very widest of terms. For example, it is left open to him if he wishes to grant licences which are unconditional and irrevocable. He can set conditions and provide for revocation; but the clause is silent on the mechanics of the revocation procedure where the conditions are flouted by licensees.
The Secretary of State can grant a licence to persons of a class, the definition of which may be framed by reference to any circumstances whatever. Anybody who falls within that class, however dubious his character, can take advantage of such a licence since there is no requirement on the Secretary of State to ensure that people or organisations that he licenses are fit to run the postal service. Moreover, a class licence, if revocable, can only be revoked against the whole class. Surely, the deterrent of revocation should exist for cases of flagrant abuse of a licence; but the deterrent can be meaningful and effective only if it can be applied to the individuals who warrant it.
I believe that these are serious defects. My belief is not founded on mere hypothesis. There is an example in recent history of the Post Office which points at least to the need for some measure of control over the appointment of licensees and the desirability for some check on their activities. I refer of course to the Post Office strike in 1971. At that time the Post Office exercised its existing powers to licence others to handle mail. Experience showed that while some operators gave a reasonably good if necessarily limited service, others appeared to be more concerned with the selling of philatelic items than with the carrying of letters, and they also fell far short of the standard which the public expects. Indeed, when the strike was over, there were a number of instances of licensed operators dumping—or at least attempting to dump—on the Post Office mail which they had not delivered, and some of this mail dated back several weeks. Post Office managers at that time were too heavily committed to coping with the effects of the strike to be able to vet or monitor these operators; but the need to do so quickly became apparent.
I am convinced that consumer interests demand that we should not ignore the lessons of history. I do not believe that it is sufficient, as some may argue, to leave this to market forces. Of course, if a tailor makes a bad suit for a customer one changes one's tailor. But we are talking here about the carriage of mail, and when we find out that mistakes have occurred there is no remedy and an important letter has gone astray; so the market force argument is going to be small consolation to those members of the public who, on the strength of an operator's claim that he is licensed by Her Majesty's Government, may have entrusted their mail to a villain or to an incompetent operator.
Therefore, what these amendments standing in my name and that of my noble friend seek to do is to introduce some basic devices into the clause which will protect the public from the risk that potentially unscrupulous and grossly incompetent operators will
918
be licensed without any check to carry mail. Let me emphasise that the devices I am advocating are quite basic. The improvement I seek is modest. There is a good case for maintaining that it should be incumbent on the Secretary of State, having granted licences, to monitor the performance of licensees and subject them to the same rigorous scrutiny as will no doubt continue to be applied to the Post Office. But I am not pressing for that and I am conscious of the need to keep any machinery simple.
Essentially the amendments seek to enable the Secretary of State, instead of licensing all persons of a class indiscriminately, to state his intention to grant individual licences to persons of a class who satisfy him that they are fit and proper persons to hold a licence, to require him to maintain a register open to public inspection which records details of licences granted and to whom, and contains references to the services licensed. They will require the Secretary of State to impose on all licensees the condition that each item of mail bears an endorsement identifying the licensee, and they will set out the specific circumstances in which the Secretary of State may revoke licences.
I should have explained why I consider that the Secretary of State should interest himself in the bona fides seeking a licence, and I should now like briefly to speak to the other changes which I have described. In the clause as drafted, a licence can be to persons of a class as well as to a particular person. However, as I said earlier, once the Secretary of State has issued a licence to a person of a class he would have no idea at all who was taking advantage of it; nor would the public.
The amendments will ensure that the Secretary of State not only keeps a record of those who are entitled to carry on licensed activities, but that he also makes that record available for public inspection. I do not think that such requirements will impose intolerable burdens on him or his department. What I have in mind is quite simply that all licensed carriers of mail will endorse on each item their name and licence number.
Despite the use of the word "written" in the amendment I am proposing—that is new subsection (2A)(e)—I envisage the use of a stamped impression, and the Interpretation Act 1978 will permit this. This is not unreasonable. We all now take it for granted that each letter carried by the Post Office carries an invitation—whether that is a stamp, a franking mark or a printed impression—that the Post Office service is being used. I can see every reason why, in a competitive situation, every carrier should be identifiable in this way. Otherwise, how will the public know to whom to complain or, indeed, which carrier to recommend, in the light of the service which they have been given by a particular operator. On the question of the revocation of licences, the amendments impose what, I suggest, are very reasonable criteria for helping the Secretary of State to decide whether or not to revoke a licence.
Those are the modest objectives of these amendments. Unfortunately, in turning those objectives into draft legislation, it has been necessary for the amendments to be couched in rather more lengthy terms than, ideally, one would wish. But I should not want to lay myself open to the charge that the legal and practical implications of what I am seeking to do have not been

919
thought out in full; they have been and the amendments demonstrate that. There are no hidden catches.
It might, of course, be argued that, as the Government have said that they do not envisage that they will use their licensing powers frequently, it is unnecessary to have even the minimum machinery that I have suggested. But the Government have, after all, already declared their intention of using the Secretary of State's powers as soon as the Bill is enacted to grant general licences to cover the different classes of person. The classes suggested were charities to deliver Christmas cards, document exchanges and the transfer of mail in bulk. In my view, however much or little the Government may exercise their powers, the public have the right, first, to know the extent to which they are actually being exercised; and, secondly, to be assured that the persons to whom Government licences are granted are fit persons, who will honestly and speedily deliver mail entrusted to them. These criteria apply just as much to the delivery of Christmas cards, and the book tokens, record tokens and postal orders that will undoubtedly be enclosed with them, as to any other class of mail. For all these reasons, I commend this series of amendments to your Lordships. I beg to move.
The Deputy Chairman of Committees (Lord Greenwood of Rossendale): If your Lordships agree, we shall discuss with this amendment, Amendments Nos. 161, 162, 163, 164, 169, 170, 171 and 172.
9.38 p.m.
Lord Trefgarne: I have, as always, listened most carefully to the noble Lord's explanation of this long and complicated set of amendments, and I understand him to be saying that these are really modest and reasonable requests. However, I must say that it seems to me that their effects would be far from modest, in terms of the bureaucracy needed to administer them. The noble Lord said that it was a grave error for the Bill not to include any express provisions laying conditions on persons who operate private letter services under a licence issued under Clause 68, but we do not believe that such detailed provisions are necessary in primary legislation.
Clause 68(1) empowers the Secretary of State to impose any conditions at all in the licence, thus giving him the necessary flexibility to fit each situation. Any person operating under a licence who breaks those particular conditions will be in breach of the postal monopoly and thus guilty of an offence. Moreover, I must point out that any customer who has a complaint against a private operator will be able to take up his complaint in the courts, should he so wish. I do not, therefore, believe that it is right to suggest that we are abandoning the poor gullible customer to his fate. The powers are there to impose such conditions as are appropriate. And, of course, the Post Office has to be consulted before any licence is issued and will no doubt put forward its views on the matter.
But I must resist these amendments for another reason as well. As I said, I believe that the effect of the noble Lord's amendments would be to set up a whole new bureaucratic licensing system within the Department of Industry, and this is something which
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we expressly wish to avoid. My right honourable friend the Secretary of State has said clearly on several occasions that in the two areas in which he intends to issue licences—the delivery of Christmas cards by charities and the bulk transfer of mail between document exchanges—those licences will be issued to a class of persons and that it will not be necessary for each person who intends to take advantage of that licence to apply for his own individually. At present we have no plans to grant any other licences, but should we do so I expect that those other licences will also be general in nature. Thus, although I appreciate the noble Lord's sentiments and the spirit in which he has proposed these amendments, I must resist them because I believe that they are both unnecessary and impracticable.
Finally, may I point out that even when private operators have been licensed to run particular letter services the final decision as to who should be entrusted with his mail lies with the customer. He will of course always be able to choose the Post Office if he is not prepared to trust the alternatives.
Lord Ponsonby of Shulbrede: I find that reply by the noble Lord not at all satisfactory. I have in mind that what is not provided for in any way in his reply is how somebody who receives a communication—a Christmas card, shall we say—which is grossly delayed in its delivery is to know to whom to complain. One part of my amendment would have made it easy for such a complaint to be lodged. The noble Lord might be able to be more helpful to your Lordships if he could indicate what sort of conditions would attach to the granting of a licence. Would there be some of the sorts of conditions which I think I indicated should be attached to the granting of a licence in the series of amendments which I moved?
Lord Winstanley: Before the noble Lord responds to that point, may I raise another to which I hope he may be able to respond at the same time. I do not necessarily support this group of amendments as a whole; I accept part of what the noble Lord said in reply with regard to unnecessary bureaucracy, controls and so on. The narrow point with which I am concerned is that it is a fact, as the noble Lord knows very well, that the Post Office Act relieves the Post Office of any common law liability in respect of any damage done or any loss, however caused, to anything carried through the post. They have complete relief from common law liability. One cannot sue the Post Office for negligence with regard to the mail, although we know that the Post Office have now introduced both their own code of practice and certain methods of compensation.
I think that in reply the noble Lord made it utterly clear that the issue of a licence for some kind of limited carriage of mail did not carry with it immunity from the common law. He made it clear that it would be perfectly possible for anybody who suffe loss through negligence or any other cause as a result of the carriage of something by a licensee to have a common law remedy through the courts.
With regard to the question of Christmas cards being sent by a charity and being delayed in the mail, I cannot regard that as such a distressing loss or delay that the ordinary citizen would want to go to the

921
courts. However, the possibility of licensing might extend much more widely in the future. I know that the examples which the noble Lord has given are very restricted, but in future there might possibly be a licensee whose work was more comprehensive and perhaps of more significance, in whose case loss could be of real concern to an individual. It is absolutely clear that then there should always be some readily available way whereby the person who has suffered such loss can identify the person against whom he may have to bring some kind of common law action. On that narrow part of the noble Lord's group of amendments, perhaps one might hear a little more from the noble Lord in reply.
Perhaps he could say whether or not things which are carried in some future situation by some future licensee should be required to carry some kind of identifying message so that those who are concerned about damage, loss or whatever would know to whom they must make application.
Lord Ponsonby of Shulbrede: I am not thinking about anything so extravagant as the noble Lord suggested, such as a legal action about the late receipt of a Christmas card. Surely the point here is that there may be a number of charities who involve themselves in (shall we say?) the delivery of Christmas cards, and as somebody who receives Christmas cards unfranked, with no identification, falling continuously through one's letter box in the pre-Christmas and also the post-Christmas period, one will be very interested to know in fact what sort of service is being given by the various organisations and charities who are doing this and who in fact they are. I really cannot see the problem of identification marks being put by the carrier on to the particular class of mail which is being delivered.
Lord Trefgarne: I think the noble Lord is quite right to point his finger at all sorts of things which it might be appropriate for licensees to do, such as, for example, putting their name and address, and possibly also the telephone number, on the communications which they handle, but I do not think that what the noble Lord is proposing is appropriate for primary legislation like this. This is just the sort of thing that perhaps ought to be imposed in certain cases as a condition of the licence that is issued.
As I have said, the Post Office will of course be consulted before these licences are issued and I have no doubt that they will wish to suggest to the Secretary of State just these sort of conditions. I think this argument applies to the rather limited services which we are at present contemplating, and equally to the more comprehensive services which might perhaps come one day and which worried the noble Lord, Lord Winstanley, rather more. The conditions which will be attached to the licences are to be considered in each and every case. I am certain that conditions which are appropriate for one licence might not be appropriate for another, and the views of the Post Office will be taken into account in arriving at a decision as to exactly what conditions are to be imposed in any particular case. I hope that explanation is helpful and that the noble Lord will not wish to take the matter further.
Lord Ponsonby of Shulbrede: The noble Lord, Lord Trefgarne, is always very helpful to your Lordships, and indeed I am mindful that in earlier debates on other legislation this year there were matters which were not suitable for primary legislation and he was able to help your Lordships considerably by placing in the Library certain details—and what particularly comes to mind is the articles of association of companies which it was proposed to set up. So your Lordships were able to see what the noble Lord and his department had in mind in regard to particular items of legislation. I think it would be very useful to your Lordships if the noble Lord could place in the Library before Report stage the sort of conditions which would attach to the issuing of a licence.
Lord Trefgarne: I am afraid I am not in a position to give an undertaking to do that, but I will undertake to see whether there is any more information that I can give to the noble Lord on this matter by means of private communication between now and the next stage of the Bill; and then, if the noble Lord is not satisfied, he can raise the matter again on another occasion.
Lord Morris: I believe I can be of assistance to the noble Lord, Lord Winstanley. I have always believed the Christmas mail was carried by Santa Claus.
Lord Winstanley: I am grateful to the noble Lord for his assistance, but before we finish with these matters, as I suspect we are about to do, would the noble Lord give an absolutely categorical assurance that there is no question at any time of a licence to the licensee carrying with it the legal immunity which is at present enjoyed by the Post Office under the Post Office Act?
Lord Trefgarne: As I understand it—and without considering the matter further I would have to qualify the assurance—the noble Lord's understanding of this matter is correct. If I am wrong, I will write to the noble Lord and let him know.
Lord Ponsonby of Shulbrede: In view of the noble Lord's remarks and his promise to be as helpful as he can in letting your Lordships know by one means or another the sort of conditions he would envisage attaching to the licence, I do not intend to press this amendment this evening. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendments Nos. 161 to 172 not moved.]
Clause 68 agreed to.
Clause 69 [Suspension of the postal privilege]:
[Amendment No. 173 not moved.]
Lord Lyell Lord Lyell moved Amendment No. 173A:
Page 58, line 34, at end insert—
("(1A) For the purposes of an order made under this section, any definition of a class of letters may be framed by reference to any circumstances whatever.").
The noble Lord said: This is a brief amendment which we believe does fit into this clause. I hope I may make

923
a brief explanation of its necessity. The Committee may know that Clause 69(1) empowers the Secretary of State to suspend the postal monopoly for such period and to such extent as he may specify. The Secretary of State has already said that he may use this power to suspend the monopoly entirely, or merely in respect of a particular geographical area, or alternatively in respect of a particular class of letters. In one special case, he intends to use the power to suspend the monopoly in respect of time-sensitive or valuable—in short, express—letters, and he has said that he will require all carriers of such letters to charge a minimum fee of £1 per item.
There have been doubts expressed to us that the clause as drafted may not have allowed this particular suspension of the monopoly. The purpose of the amendment that I am moving is to make it quite plain that any of these doubts as to the meaning of the word "extent" are resolved in favour of the widest possible interpretation. I beg to move.
On Question, amendment agreed to.
[Amendments Nos. 174 and 175 not moved.]
On Question, Whether Clause 69, as amended, shall stand part of the Bill?
Lord Winstanley: Before we finally decide that very weighty matter, I understand it is possible that the noble Lord the Minister might have further comments to make on matters which arose under this clause and the earlier clause, further information which he might be in a position to give to your Lordships' Committee.
Lord Trefgarne: Under an earlier amendment, the noble Lord, Lord Winstanley, asked me whether certain privatised services would enjoy any exemption from liability as do existing postal services. I am now able to give the noble Lord a categorical assurance that they will not enjoy any such immunity.
Clause 69, as amended, agreed to.
Clause 70 [The Post Office to be subject to limited liability in respect of certain inland packets]:
9.55 p.m.
Lord Lyell Lord Lyell moved Amendment No. 176:
Page 59, line 28, at end insert ("at the time when they are posted").
The noble Lord said: I beg to move Amendment No. 176. Clause 70 amends the law in relation to the Post Office's liability for loss of or damage to letters and other postal packets. I hope that it may be of some assistance to your Lordships if I explain, albeit briefly, that the effect of this particular clause is to allow the Post Office to accept legal liability for loss of or damage to a wider range of postal packets than it is able to do at present. As a result, the arbitration procedures in the code of practice can now be binding on the Post Office and, indeed, the Post Office have accepted that they will be legally bound by the findings of the arbitrator. I believe that the Committee will welcome this improvement in the rights of customers and especially the rights of customers of the Post Office.
Turning to the details of this particular amendment, I point out that, since its effect is not immediately obvious from Clause 70(3), I hope that I may be able to explain the resulting wording in Section 30(4) of the 1969 Act as it would be amended by Clause 70(3) of the Bill before us tonight. It would read as follows:
"The Post Office shall not be liable under this section in respect of a packet of any description unless any such conditions as are required by a scheme under Section 29 of this Act to be complied with in relation to packets of that description at the time when they are posted have been complied with in the case of the packet".
The effect of the amendment is to put beyond any doubt at all that the Post Office can only impose conditions requiring particular things to be done relating to the time before the packet is posted. For instance, the Post Office will be able to require a customer to obtain a certificate of posting before they undertake the conveyance and delivery of a postal packet; they will not, however, be able to make production of the certificate a pre-condition of their being liable for loss of or damage to the packet. Of course a court would be able to accept other evidence that the certificate had been obtained, for instance, from eyewitnesses who were present. The addition of the words in the amendment emphasises that the Post Office will be in a similar position to other suppliers of services, and I hope that the Committee will agree that that is the right policy. I beg to move.
On Question, amendment agreed to.
Lord Lyell Lord Lyell moved Amendment No. 176A:
Page 60, line 12, at end insert—
("(8) This section shall come into operation on the appointed day.").
The noble Lord said: I beg to move Amendment No. 176A. The purpose of this particular amendment is to ensure that the clause takes effect on the appointed
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day rather than, as at present drafted in the Bill, at Royal Assent. Of course we would accept that this means that the new régime of liability will not come into force until a little later than otherwise would have been the case, but this, I am afraid, is necessary because of a number of legal complications.
Clause 70 modifies Section 30 of the Post Office Act, and Section 30 sets out the liability imposed on the Post Office in connection with the carriage of registered mail. This power is also to be extended to cover other categories of mail. But the Post Office will not be able to publish a new scheme containing its terms and conditions of service compatible with the modified Section 30 until the Bill before us tonight is enacted. Since it would not be possible in practice for this scheme to be published immediately the Bill receives Royal Assent, if only because the exact date might not be known very long in advance, there will be a danger of a hiatus when the law has been changed but the Post Office scheme has not yet been changed to correspond with it.
I am sure that the Committee will agree that such a hiatus would be undesirable and this problem can be avoided by delaying the coming into force of Clause 70 until some time after Royal Assent, as Section 13 of the Interpretation Act will allow the Post Office to publish its scheme after Royal Assent but before Clause 70 takes effect. I am afraid that this is a little complicated, but I have made it as clear as I can. I beg to move.
On Question, amendment agreed to.
Clause 70, as amended, agreed to.
Clauses 71 and 72 agreed to.
Clause 73 [Borrowing powers of the Post Office and its wholly owned subsidiaries]:
Lord Lloyd of Kilgerran Lord Lloyd of Kilgerran moved Amendment No. 176B:
Page 61, line 28, leave out ("with the consent of the Secretary of State and the approval of the Treasury").
The noble Lord said: We have now arrived at Clause 73, an important clause dealing with the borrowing powers of the Post Office and its wholly-owned subsidiaries. In view of the long debate that we had last night on an amendment initiated by myself in relation to Clause 26, I move this amendment, No. 176B, by way of a probing amendment in order to ascertain the views of the Government in relation to the Post Office and whether or not they are similar to those that they held last night in relation to the borrowing powers of Telecom.
With the leave of the Committee, I should also like to speak to Amendment No. 176C. On these Benches we believe—as I hope I made clear last night—that the quicker we get rid of the odd PSBR rule, the better for British Telecom and the Post Office. In view of the massive investment involved, we consider that British Telecom and the Post Office should be free to find their own money for capital investment in the private market.
Last night the amendment that I initiated concerned the powers of British Telecom to raise money tempor-

927
arily by way of overdraft or otherwise. I submitted that it would be proper to delete from that clause the words that British Telecom should only borrow temporarily:
"with the consent of the Secretary of State and the approval of the Treasury".
At that stage in relation to British Telecom the Government said that even for temporary borrowing the consent of the Secretary of State and the approval of the Treasury were needed. Therefore, my amendment failed. But Amendment No. 176C is concerned with the powers of the Post Office to borrow otherwise than by way of temporary loan. In my submission the Post Office, for the purpose of borrowing otherwise than by way of temporary loan, should be free to go to the market and, therefore, Amendment No. 176C is directed to removing from subsection (2)(b) the words:
"with the consent of the Secretary of State and the approval of the Treasury"
I do not know whether the Government are differentiating between the borrowing powers which are necessary for British Telecom and those which are necessary for the Post Office. I anticipate that the Government will take the same view, but because of the importance of the matter I think that it should be made clear to the Committee whether or not the Government have any difference of view as to the borrowing powers of the Post Office as against those of British Telecom. Therefore, I beg to move Amendment No. 176B.
The Earl of Gowrie: I have to say to the noble Lord, Lord Lloyd of Kilgerran, that the position as between British Telecom and the Post Office is identical.
Lord Lloyd of Kilgerran: I am obliged for that categoric assurance that the position with regard to the borrowing powers of the Post Office is the same as it is for British Telecom in relation to temporary loans as well as to long-term loans. I am very grateful to the noble Lord for giving that positive assurance.
Amendment, by leave, withdrawn.
[Amendment No. 176C not moved.]
Clause 73 agreed to.
Clause 74 agreed to.
Clause 75 [The Post Office's accounts and audit thereof]:
10.6 p.m.
Lord Lyell Lord Lyell moved Amendment No. 177:
Page 64, line 14, after ("has") insert ("after consultation with the Post Office and").
On Question, amendment agreed to.
Clause 75, as amended, agreed to.
Clauses 76 to 78 agreed to.
Clause 79 [Powers of Treasury to dispose etc. of the shares of Cable and Wireless Limited]:
Lord Glenamara Lord Glenamara moved Amendment No. 178:
Page 67, line 4, after ("State") insert ("and the Chairman of Cable and Wireless Limited").
The noble Lord said: In moving this amendment I should also like to discuss Amendments Nos. 179 and
928
182. I shall say most of what I have to say when speaking to Clause 79 and will move the other amendments very briefly. This is a very bad Bill indeed. It is a Bill that is going to do great harm to the telecommunications system, to the postal services, to subscribers in rural areas, and to electronics manufacturers. The proposal in Clause 79 is in a category of its own. This proposal is sheer, crass stupidity. One of my honourable friends in the other place described this clause as "industrial sabotage". It is worse than that; it is sabotage of an important British national interest. I am intensely proud of being British. The people of this little island have contributed so much to the forward march of mankind. They have created vast new countries and have given those countries enduring constitutions, our language, our skills, and our laws. They have built great ports, great cities, great railways and great roads on almost every continent. I believe that no nation has done so much for mankind and for civilisation.
Whatever one may think about imperialism and empires, the British Imperial era did exist. One of the good things that emerged from that era was that we built up a worldwide system of telecommunications, often under the pressure of events. For example, the line from the United Kingdom to India was created very quickly as a result of the invasion of Afghanistan by the British in India. It was done without any reference to London because that would have taken too long. The system was built up throughout the Empire initially by submarine telegraph cables, by the ancestor of a Member of your Lordships' House, Lord Pender. In a very few years a girdle of submarine cables was thrown around the earth. In the early decades of this century that was followed by the new radio links to the Commonwealth and the Empire, and then sensibly the two came together to form Imperial Communications Limited.
Just as the Roman Empire left behind a network of roads, some of which are still in use today, the British Empire left a legacy of a vast network of Commonwealth communications. It exists today partly as a system of submarine telephone cables with enormous capacity—some carrying up to 5,000 telephone conversations simultaneously—and partly as a system of earth stations and satellites. Your Lordships may not know it but this whole vast network of Commonwealth communications is co-ordinated in the Commonwealth Communications Financial Organisation. The indebtedness of one country to another is co-ordinated through the Commonwealth Telecommunications Financial Organisation.
Of course the largest self-governing Commonwealth countries now own and run their own international telecommunications, but within the Commonwealth Telecommunications Organisation. But the smaller Commonwealth countries, and those which are still colonial territories—and there are still one or two of them—have their international communications run with great skill and competence by Cable and Wireless, who have provided satellite earth stations in many small countries round the world and given them worldwide telecommunication links which are as good as those of major developed countries. To give only two examples: Gambia, which everybody knows now was the home of Kunte Kinte, now has an earth station and is in satellite

929
contact with the rest of the world. So has Belize on the other side of the Atlantic. Two small countries and Cable and Wireless have given them first-rate telecommunications.
This is a major contribution to the economies of these developing countries: a really major contribution. As I pointed out in the Second Reading debate, Cable and Wireless do this also for non-Commonwealth countries. Bahrain, for example, certainly has the best telecommunications between Europe and Hong Kong, and probably one of the best systems in the world. In the case of Bahrain both the internal telephone system and the external telecommunications are provided by Cable and Wireless. I have driven in a car along the street in Bahrain and dialled a number in London and got through in a few minutes. You can do that from a motor-car in Bahrain. All that is provided by Cable and Wireless.
I also pointed out in the Second Reading debate how many newly independent countries in the Indian Ocean and the Pacific rely on, and trust, Cable and Wireless for their external telecommunications. Our naval influence in these areas may have gone but this vital British influence remains, thanks to this wholly-owned British company. Apart from the fact that Cable and Wireless have woven a web of tremendously worthwhile and lucrative British influence around the globe, they are our most consistently successful publicly-owned industry.
It is all this—and I have explained this at great length because very little is known about Cable and Wireless in this country—that the Government are putting at risk. I ask the noble Earl, Lord Gowrie, to believe that that is not rhetoric. They are putting this at risk in order to get a one-off payment to the Exchequer—if ever there was an example of eating the seed corn this is it; Cable and Wireless have paid £10 million in dividend this year and a vast amount of tax—and in order to provide more pickings for private investors. I do not know how many thousands of listed securities there are on the London Stock Exchange, but in order to provide one more they have to savage this successful, excellent British company.
Now why will it be put at risk by what the Government are proposing? First of all I believe there is great danger of it falling into foreign hands. I shall not discuss that now because it comes up on another amendment. Secondly, I believe that it could lead to the disintegration of Cable and Wireless. It certainly could lead to the disintegration of the Commonwealth Telecommunications Organisation, which is a bit of the Commonwealth that really works; a mechanism which functions very well indeed: one of the most successful aspects of it.
A great deal more information should be given to the Committee by the noble Earl about the Government's consultations with Governments of countries where Cable and Wireless operates. How many Governments, for example, in the Government's view are now likely to nationalise Cable and Wireless operations in their countries? How many? In particular, I should like him to tell us—and I asked him during the Second Reading debate, but he did not tell us—about the two territories where Cable and Wireless earn about 80 per cent. of their profits; Hong Kong and Bahrain. What about the partial nationalisation there? Is it not
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a fact in Hong Kong that the price of Hong Kong's acquiescence in this is that they are insisting that a joint company be established in Hong Kong consisting of Cable and Wireless and the Hong Kong Government? At the present time of course all the Hong Kong profits of Cable and Wireless are remitted to London. If that happens, what will happen to the profit in Hong Kong? The whole of it will not be remitted to London. A good deal of it will go to the Hong Kong Government if the Government become a major shareholder. Is that the price of their acquiescence in this plan, and does it mean a major reduction of Cable and Wireless profit from there? Is it a fact that similar arrangements are being discussed in Bahrain and that they too will insist on something like this Hong Kong pattern of a joint company between the Bahrain Government and Cable and Wireless?
I do not want to be misunderstood, but in some respects—I felt this acutely when I was its chairman—Cable and Wireless is rather like a house of cards; it depends for its stability on the most sensitive political handling both by Government and by the company itself. I am afraid that the crude commercialism of this Government and their approach to the company is absolutely alien to Cable and Wireless, to its history and to its careful and sensitive mode of operation. Specifically, may I have a reply to the point on Amendment No. 182: has the Commonwealth Telecommunications Organisation agreed to this by resolution? I ask that because, if this happens, it will be the only non-Government organisation in the whole Commonwealth to be in the Commonwealth Telecommunications Organisation. I should therefore like to know if they have agreed to it by resolution. I beg to move.
10.17 p.m.
The Earl of Gowrie: I am sure that all noble Lords on this side of the Committee are no less proud about being British than the noble Lord, Lord Glenamara. Again, as so often—and we must accept this as a difference of view—he tends in our view to try to confuse nationally-owned assets with national assets, and we do not necessarily make that connection. There is no reason why privatising a company or selling Government holdings in that company should make it any less or any more successful. The questions of the ownership of shares do not seem to me to be the integrally important thing about the direction of such a company.
The noble Lord treated us to a historical perspective very clearly and interestingly about the history of this company in terms of the British Empire. He will be just as aware, however, that the British Empire started life as a mercantile and commercial enterprise, and there is no reason why the commercial activities of Cable and Wireless should not be, if anything, strengthened by the proposals we are seeking to make.
All of us have different bees in the bonnet or different ideologies or doctrines. My own, and I do not mind declaring it, is that modern Governments. including my own, are obsessed by the ownership of assets. There is no reason I can see for Governments as organisations to own any assets or shares at all. It does not seem to do them much good, and if I had my way there would be a far more rapid and greater programme of privati

931
sation, and I hope that my noble and right honourable friends will slowly and surely come round to my point of view.
We made it clear in a Statement on 9th March that the decision to dispose of part of the Government's current shareholding in Cable and Wireless was taken with the full knowledge and agreement of the court of directors. We recognise that the size of the Government's shareholding is an important factor in the company's commercial activities and in particular in its relations with overseas Governments, for whom it provides telecommunications services. There can be no doubt that the Government, and indeed any Government, would wish to consult the chairman of the company before selling any shares. I appreciate therefore the motive of the noble Lord, Lord Glenamara, in the first amendment, but I do not see that it is necessary. In any case, as it stands, the amendment is open to the objection that it imposes a statutory obligation on the Treasury, rather than on the Secretary of State, who is in fact responsible for the company and who should therefore be responsible for carrying out consultation on any decision by the Government to sell shares.
Turning to Amendment No. 182, I would say that I appreciate and indeed share the concern expressed by the noble Lord about the connection between Cable and Wireless and the Commonwealth, and I hope that I can reassure the noble Lord that the Government did not make a final decision about selling shares in the company without taking close account of the formal relations as they exist.
Reference has been made to the fact that after the last war Cable and Wireless's operations were taken into public ownership in the United Kingdom and in some Commonwealth countries as a result of Commonwealth initiative. It might help the Committee if briefly I say why the circumstances today are very different and why, therefore, it would be quite inappropriate for the British Government to be obliged to ask the CTO to agree any proposal to sell shares in Cable and Wireless, as is proposed in the amendment.
The Commonwealth Conference resolution of 1945, which led to nationalisation of the company, was passed when Cable and Wireless owned and operated all the facilities and services which comprised the Commonwealth's international telecommunications network. After the disruption of the war some Commonwealth Governments—those of Australia, New Zealand, Canada, India, South Africa and Southern Rhodesia—felt that they would be better able to protect their vital communications links if they took over the operations themselves. Nationalisation of the company's operations in those countries and in the United Kingdom was accepted and embodied in the Commonwealth Telegraphs Agreement in 1948, and a Commonwealth Telegraphs Board was set up to administer the operating agreements signed between the partner Governments, their national operating bodies, and the board itself. Other Commonwealth countries joined this organisation in subsequent years and Cable and Wireless would have been a signatory as a national operating body in some of those countries.
However, the arrangement was replaced in 1966 by the existing Commonwealth Telecommunications
932
Organisation (the CTO), following another Commonwealth Conference. The CTO is not in itself a decision-making body. Its constitution provides for Government meetings at an official level. The conference convenes at 3-yearly intervals and all independent Commonwealth Governments are eligible to take part. Neither Cable and Wireless itself, nor its overseas operations, have anything official to do with the conference. The council is composed of representatives of Governments who are partners in the collaborative financial arrangements of the CTO. As with the conference, Cable and Wireless has no formal status in the Council. The company simply provides telecommunications services under franchises on behalf of some of the partner Governments. The British Government's representative on the council is an official of the British Post Office. He also acts as the representative on the council on behalf of a dozen British overseas territories and associated states with some of which Cable and Wireless has franchise agreements.
I can assure the Committee that the present relationship between Cable and Wireless and the CTO has been examined very carefully. There is no legal obligation to consult the organisation about our policies vis-à-vis Cable and Wireless, and I believe that we are no longer under any moral obligation to do so. The nature of the company's Commonwealth connection is now quite different from what it was in 1945. That is not to say we would deny that the services provided by the company are still a significant part of the international network between many countries with past or present associations with the Commonwealth; for example, by the very nature of its services Cable and Wireless happens to be closely involved with the CTO's financial arrangements, which come under the CTO Council's responsibilities. Out of courtesy to the CTO and its member Governments arrangements were made to notify the organisation before the decision to sell shares last March.
The noble Lord, Lord Glenamara, asked me one or two specific questions. My advice is that protection from foreign control will be contained, as it is now in the articles of association. Cable and Wireless is not a member of the CTFA and therefore cannot affect the CTFA's future. None of the overseas Governments has in fact objected to the sale of shares; and the Hong Kong licence was in any case due for renegotiation. I hope that noble Lords will be persuaded that the Government undertook all necessary overseas consultations before the final decision to sell shares in Cable and Wireless, and would always consult in the event of further disposals. I therefore hope that if the noble Lord, Lord Glenamara, presses his amendment the Committee will reject it.
10.26 p.m.
Lord Mottistone: Perhaps I might intervene before the noble Lord replies. I qualified as a naval signal officer in 1944–45, and had dealings thereafter with Cable and Wireless for many years, with the greatest possible regard throughout all those years for the high quality of Cable and Wireless. The only point I should like to make is that at the time I qualified Cable and Wireless was an independent company, before its nationalisation. It was of a very high quality then.

933
Indeed, a lot of the historical facts which the noble Lord, Lord Glenamara, gave us, which I entirely agree with, came about before the nationalisation in 1946.
At Second Reading the noble Lord rather implied that this was a new move to denationalise something in some regard—and obviously not wholly, in view of what my noble friend Lord Gowrie has just said. It is not; it is a reversion to what it was before, and it probably is not a full reversion to what it was then. We must not get worried about the quality which this great company has maintained through both its private existence, when it built itself up (which is significant in itself), and the time when it had to be nationalised. It may be that this suited the other countries of the Commonwealth, but that is a matter of which the Navy was not aware.
But this is not something which need affect the efficiency of this great company in any way at all; and I should have thought that there was every other reason, such as my noble friend has so very eloquently put to us, why there should be changes. We should march with the times; we should not be pinned back to 1946. We should look forward and see how we can develop. We should give Cable and Wireless a chance to get better, rather than stay stuck. I should have thought that, really, the noble Lord, in the best interests of Cable and Wireless, which he obviously served well, would do as well not to proceed with this amendment or with any of the others.
Lord Kennet: The noble Earl, Lord Gowrie, has, as he often does, enlivened the debate by introducing some general principles by reference to which the particular issue before the Committee may be judged. They were two. His first principle was that the distinction between national assets and nationally-owned assets was a false one, and should not be taken account of in this matter. At this point I think he was drawing a picture somewhat akin to the Japanese economy and saying that we should go in that direction: if it is British it does not matter whether it is public or private.
His second principle was that it makes no difference to the commercial success of an entreprise whether it is publicly owned or privately owned. If I misunderstood him I apologise, but I think that is what he was saying, that intrinsically it should not make any difference to the success of an enterprise whether it is privately or publicly owned, as an abstract proposition. He then passed, thirdly, to express a hope, which I took to be a personal one, expressed by one Minister among many, that his own Government would go faster towards the privatisation of commercial enterprises. I have this question for him, assuming I have summed up his two general propositions correctly. In those circumstances, why does he hope that privatisation will go yet faster than it is going?
The Earl of Gowrie: I think it is a little wide of the amendment but that is perhaps my fault for introducing at this late hour some general principles; but the noble Lord, Lord Kennet, was good enough to be interested in my principles, so I had better qualify a little what he said. Other things being equal, there are great advantages in commercial enterprises being denationalised and being private. The qualification exists where there are defence considerations or where there are security
934
implications or the rest. What I think would illuminate the noble Lord most about my position which he is kind enough to be interested in, is if he looked at the interesting debate in this Committee that took place yesterday on the problems created by the ability of public sector corporations to borrow money. I argued then that one of the central political debates in this economy which cut across party lines at the present time was on the problem of the funding and financing of Government debt. As I say, other things being equal, privatised companies are able to go on to the money markets with much more independence than if they remain in the public sector. That is one of the reasons—and there are others if one likes to adduce them all—why I would like more privatising done, much though I dislike the particular word.
Lord Glenamara: I do not intend to press these amendments to a Division because they are three technical points. I should point out to the noble Earl, Lord Gowrie, that he has a number of inaccuracies in his brief. Looking at the balance sheet of C and W he will see whether C and W is involved in the CTFO. It is. it receives all its payments from Commonwealth countries via the CTFO. They are technical points. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 179 not moved.]
Lord Glenamara Lord Glenamara moved Amendment No. 180:
Page 67, line 4, after ("time") insert ("not earlier than 1st day of January 1985").
The noble Lord said: The purpose of this amendment is obvious. The Government have no electoral mandate of any kind for doing this. The purpose of the amendment is to defer implementation until after the general election. Earlier I said that I had taken the trouble to obtain a page of the Conservative Party manifesto. It says that they will sell back to private ownership the recently nationalised aerospace and shipbuilding concerns; they will sell shares in the National Freight Corporation to the general public and relax the Traffic Commissioner Licensing Regulations. They are the only specific denationalisation proposals mentioned.
I take it that the public who want to know what Conservative candidates will do about nationalisation will look at the paragraph of the manifesto headed "Nationalisation". There is no mention of Cable and Wireless; they have no mandate whatever to do what they are doing to this company. I do not believe that the electors imagine for a moment that they will be foolish enough or doctrinaire enough to sell off our most successful publicly-owned company—and this enables them to sell off the entire 100-million shares.
If this amendment is agreed—and I intend to press it to a Division—the Labour Party will state in terms—and this is the second time I have said what the next Labour Government will do—in the next general election that they will not use the powers provided in Clause 79 to dispose of the shares. This will give the electors in the next general election the chance to find out what Cable and Wireless is, what it does, what it stands for in the world, and how much it is

935
contributing annually to the Exchequer in tax and dividends. They can question candidates at the general election about it, make their views known and arrive at their own decisions. Nothing could be more sensible or democratic than that. Therefore, I beg to move this amendment deferring the selling of any shares in Cable and Wireless until not earlier than 1st January 1985.
The Earl of Gowrie: Given the premises on which the noble Lord, Lord Glenamara, has pursued his arguments and defended his amendments, I am not surprised or in any way shocked at this one. I think that it is a little bit disingenuous to think that anybody in the public was really left in the dark about the fact that the policies under which the Government fought the last election included substantial measures of privatisation. If electoral manifestoes spelt out every clause of every Bill that was liable to be brought before the House they would be less read than they are.
I can tell the noble Lord that it is the Government's intention to achieve our objective of selling some of our shares in Cable and Wireless, subject of course to obtaining the necessary powers in this Bill, well before the next general election. I have no doubt that by the time that comes along the noble Lord's amendment will be redundant, and I suggest, as a result, that he does not pursue it tonight.
Lord Glenamara: The noble Earl did not tell me whether he told his electors that he intended to denationalise Cable and Wireless or whether he knows any Conservative candidate who mentioned Cable and Wireless in the election. However, I certainly intend to press the amendment to a Division.
10.37 p.m.
On Question, Whether the said amendment (No. 180) shall be agreed to?
Their Lordships divided: Contents, 18; Not-Contents, 46.

CONTENTS

Blease, L.

Ponsonby of Shulbrede, L.

Boston of Faversham, L.

Ritchie-Calder, L.

David, B. [Teller.]

Shackleton, L.

Glenamara, L.

Stewart of Alvechurch, B.

Greenwood of Rossendale, L.

Stewart of Fulham, L.

Jeger, B.

Stone, L.

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

Underhill, L.

White, B.

McNair, L.

Winstanley, L.

Molloy, L.

NOT-CONTENTS

Abinger, L.

Donegall, M.

Avon, E.

Elliot of Harwood, B.

Belstead, L.

Ferrers, E.

Broadbridge, L.

Fortescue, E.

Brougham and Vaux, L.

Gainford, L.

Buxton of Alsa, L.

Gibson-Watt, L.

Caithness, E.

Gisborough, L.

Cockfield, L.

Glendevon, L.

Colville of Culross, V.

Gowrie, E.

Cork and Orrery, E.

Grimston of Westbury, L.

Cranbrook, E.

Hatherton, L.

Cullen of Ashbourne, L.

Holderness, L.

936

Kemsley, V.

O'Hagan, L.

Long, V.

Redesdale, L.

Lyell, L. [Teller.]

Renton, L.

Mackay of Clashfern, L.

Sandys, L. [Teller.]

Margadale, L.

Sharples, B.

Marley, L.

Skelmersdale, L.

Marshall of Leeds, L.

Stradbroke, E.

Montgomery of Alamein, V.

Swinton, E.

Morris, L.

Trefgarne, L.

Mottistone, L.

Trumpington, B.

Murton of Lindisfarne, L.

Vivian, L.

Resolved in the negative, and amendment disagreed to accordingly.
10.44 p.m.
Lord Glenamara Lord Glenamara moved Amendment No. 181:
Page 67, line 4, after ("dispose") insert ("to any citizen or citizens of the United Kingdom or to any company or companies which are completely controlled by a citizen or citizens of the United Kingdom").
The noble Lord said: With this amendment, if I may, I should like to discuss Amendments Nos. 183 and 184. The purpose of these amendments is to call attention to the first of the two dangers I mentioned when moving previous amendments—namely, that Cable and Wireless may, if the shares are sold, fall into foreign hands. I know the Government have said they intend to sell only up to 49 per cent. of the shares; but I point out that this Bill empowers the Government to sell all the shares in Cable and Wireless and to do so without any further reference to Parliament. Does anybody really believe that, with a monetarist Chancellor of the Exchequer of the kind we have now, the Secretary of State for Industry will not have his arm twisted over the next three years? Of course he will: quite well.
So the 49 per cent. announcement is no safeguard against the company falling into foreign hands. Of course, when the company is put on the market it is possible to ensure that the shares do not go to foreign nationals but, in a free market and particularly in the EEC, Cable and Wireless shares could end up in the hands of a subsidiary of a French company, a German company, an Italian company, a United States company or any other foreign company, and there is nothing anybody can do about it.
From what Ministers said on Second Reading, the Government do not intend, even initially when the shares are floated, to ensure that they are sold only to British nationals. I realise at once that because of the nature of Cable and Wireless there is a dilemma here. I myself urged the Government some time ago, if they were going to sell these shares, to give some preferential allocation to the employees of the company, and I am glad that they agreed to do that. On the other hand, the majority of employees of Cable and Wireless are not United Kingdom citizens; they are nationals of the overseas countries where the company operates, and this is the problem. O really has to consider where the balance of advantage to everybody concerned.
Should everyone, United Kingdom and overseas staff, be allowed a preferential allocation when the shares are sold, with the near certainty that Cable and Wireless will fall into foreign ownership? Or should there be a preferential allocation of shares in this United Kingdom company only to United Kingdom

937
nationals, with, one would hope, much less chance that it would fall into foreign hands? Neither of these alternatives is entirely satisfactory. But that is how it is, I am afraid, in Government, in business and in life. It is a choice of the more satisfactory of two unsatisfactory alternatives.
But I myself have no doubt about what my choice would be. I would risk being charged with unfairness—and I do not think the charge would be made, knowing Cable and Wireless's national staffs—in order to keep Cable and Wireless in British hands, because that would be in the best interests of all the staff, United Kingdom and overseas. So the overseas national staffs of Cable and Wireless might lose out in the preferential right to buy shares initially, but their security would be much more likely to be assured; and they are reasonable people who, I am certain, would accept this, if it were put to them. So I believe that the Government are making a great mistake in selling the shares initially to foreign nationals. I feel that they should be confined to British nationals, which I believe—I cannot be certain—would help the company to remain in British hands. I beg to move.
The Deputy Chairman of Committees: If your Lordships agree, we will discuss Amendments Nos. 183 and 184 with this amendment.
The Earl of Gowrie: These amendments would, in any case, be insufficient to achieve the end of trying to prohibit any shareholding in Cable and Wireless by foreigners, since they would not control trading in new issues of capital. Leaving that aside, it is well-known that trade in company shares is a notoriously difficult thing to regulate altogether. I can, of course, understand the noble Lord's desire that Cable and Wireless should remain British; it is a successful company and a valuable national asset. But to prohibit any foreign shareholding would be quite inappropriate for a company like Cable and Wireless. The noble Lord himself made the good point about employees' share participating schemes, which he would wish to have—and I would—and it would be quite extraordinary if employees of the company were prohibited from employee participation simply because they were foreign nationals. That would he an astonishingly illiberal form of provision for so famously international a company.
Of course, there is a great difficulty in trying to define in a few lines of statute the necessarily complex provisions required to prevent foreign control of the company. Part II of the Industry Act 1975 runs to 10 sections and seven pages alone. But the question of foreign shareholding will, as Cable and Wireless themselves have recognised, continue to be a matter appropriate for the articles of association of the company which will need to be reviewed before the sale of any shares. This is in line with precedent—for example, British Aerospace. In addition to the fact that the Government are remaining a majority shareholder, the noble Lord's anxieties are not well placed. I would therefore ask him to withdraw the amendment.
Lord Glenamara: T do not intend to press these amendments to a Division. I think that the Government are wrong. They are making a great mistake and
938
running a very great danger. I do not think it matters what is written into the articles of association. This could happen. As the noble Earl himself said, it is notoriously difficult to control this situation, particularly in the EEC. However, we shall watch very carefully indeed what happens to the shares of Cable and Wireless. I hope the Government will take any steps which are available to them—I am grateful for what the noble Earl said about re-writing the articles of association—to safeguard the position.
Amendment, by leave, withdrawn.
[Amendments Nos. 182, 183 and 184 not moved.]
Clause 79 agreed to.
Clause 80 [Extended application of the Telegraph Acts]:
On Question, Whether Clause 80 shall stand part of the Bill?
10.52 p.m.
Lord Morris: Clause 80 extends the definition of "telegraph" as contained in the Telegraph Act 1963. As the definition of "telegraph" in that Act is the peg upon which every single piece of legislation in this field is hung, I think it is very important to know, in a few words, what the effect of this clause is. I could go banging on about this for a very long time, taking your Lordships through the history of the Telegraph Acts from 1863 to the present day, but I do not wish to do so at this late hour.
Lord Trefgarne: Your Lordships will be relieved to hear that we are not to be given the history of the telegraphs since heaven knows when! My noble friend has asked about the purpose of the clause. The original wording of Section 3 of the Telegraph Act 1863 defined "telegraph" in terms only of wires, which are usually made of metal. This was in keeping with the technology of the time. But British Telecommunications are now using optical fibre cables which are made of glass. The new definition of "telegraph" therefore includes optical fibres and therefore ensures that all the legislation covering telegraphs and telegraph works or wires extends to the new optical fibre cables.
I hope your Lordships will agree that this is a sensible change.
Clause 80 agreed to.
Clauses 81 to 87 agreed to.
Schedule 3 agreed to.
Clause 88 agreed to.
Schedule 4 [General transitional provisions]:
Lord Lyell Lord Lyell moved Amendment No. 185:
Page 110, line 8, leave out ("Part I") and insert ("this Act").
The noble Lord said: This is a minor technical amendment. It corrects a slip in the drafting. It ensures that the transitional provision contained in paragraph 1 of Schedule 4 will apply wherever changes are made in any part of the Bill, not just in Part I. I hope this amendment is acceptable to your Lordships. I beg to move.
On Question, amendment agreed to.
Lord Lyell Lord Lyell moved Amendments Nos. 186 and 187:
Page 111, line 1, after ("years") insert ("or that year")
Page 111, line 6, leave out ("and third") and insert ("third and fourth").
The noble Lord said: It may be for the convenience of the Committee if I move these two amendments together. These again are two technical and minor amendments to the transitional provisions of the Bill. They take into account the definition of the words "accounting year". I beg to move.
On Question, amendments agreed to.
Lord Lyell Lord Lyell moved Amendment No. 188:
Page 111, line 42, at end insert—
("(2) Any charges fixed under any such scheme, so far as so relating, shall have effect as fixed under a scheme made under section 20.
(3) A scheme made under section 20 which is to come into effect on the appointed day may revoke or amend any such scheme as is mentioned in sub-paragraph (1).").
The noble Lord said: This is a technical amendment covering the transition from the Post Office to British Telecom. It ensures that there is continuity in any schemes which contain the conditions under which the telephone service is supplied. I beg to move.
On Question, amendment agreed to.
Lord Lyell Lord Lyell moved Amendments Nos. 189 and 190:
Page 112, line 6, at beginning insert—
("(1) Sections 26(3), 27(2), 73(3) and 74(2) shall have effect as if—

(a) any money borrowed by the Post Office the liability to repay which is transferred to the Corporation by this Act were money borrowed by the Corporation and not by the Post Office;

(b) any sums issued by the Treasury in fulfilment of a guarantee under section 38 of the 1969 Act, being sums the liability to repay which is so transferred, were sums issued by the Treasury in fulfilment of a guarantee under section 29 and not a guarantee under the said section 38; and

(c) so much of the debt assumed by the Post Office under section 33 of the 1969 Act as is so transferred (in this paragraph referred to as "the Corporation's assumed debt") were money borrowed by the Corporation and not part of the debt assumed by the Post Office.

Page 112, line 11, at end insert—
("(3) The rate of interest on the Corporation's assumed debt and the date from which interest is to begin to accrue, the arrangements for paying off the principal of the said debt and the other terms of the said debt shall be such as the Secretary of State, with the approval of the Treasury, may from time to time determine; and different rates and dates may be determined under this sub-paragraph with respect to different portions of the said debt.
(4) The Secretary of State shall give notice in writing to the Corporation of any determination under sub-paragraph (3).
(5) Any sums received by the Secretary of State by way of interest on, or repayment of, the Corporation's assumed debt shall be paid into the National Loans Fund.").
The noble Lord said: These are consequential upon the vast list of amendments that I moved, I think it was on the first day of our deliberations on Committee stage—what we might call the "Mottistone amendments", since my noble friend was able to remind me of the group earlier today. I beg to move.
On Question, amendments agreed to.
Lord Trefgarne Lord Trefgarne moved Amendment No. 191:
Page 112, line 15, after ("shall") insert ("so far as so relating").
On Question, amendment agreed to.
Lord Trefgarne Lord Trefgarne moved Amendment No. 192:
Page 112, line 20, after ("shall") insert ("so far as so relating").
On Question, amendment agreed to.
Lord Lyell Lord Lyell moved Amendment No. 193:
Page 112, line 21, at end insert—
("(2) Section 53(1) shall have effect as if any sum due to the Post Office before the appointed day under the provisions of a scheme made under section 28 of the 1969 Act, being a sum the right to recover which is transferred to the Corporation by this Act, were a sum due to the Corporation under the provisions of a scheme made under section 20.").
The noble Lord said: This is a consequential amendment upon an earlier amendment moved on the first day of Committee. I beg to move.
On Question, amendment agreed to.
Schedule 4, as amended, agreed to.
Schedule 5 agreed to.
Clause 89 [Repeals and savings]:
Lord Lyell Lord Lyell moved Amendment No. 194:
Page 74, line 15, at end insert—
("(2A) Notwithstanding the repeal by this section of the said Act of 1961, the Exchequer and Audit Departments Act 1866 and the Exchequer and Audit Departments Act 1921 shall continue to have effect with the amendments made by Schedule 1 to the said Act of 1961.").
The noble Lord said: This is a technical amendment. I beg to move.
On Question, amendment agreed to.
Clause 89, as amended, agreed to.
Schedule 6 [Enactments repealed]:
Lord Lyell Lord Lyell moved Amendment No. 195:
Page 129, line 22, column 3, leave out from ("Act") to end of line 26.
The noble Lord said: This is another technical amendment which follows an earlier amendment which we discussed on the second day of the Committee stage. I beg to move.
On Question, amendment agreed to.
Lord Lyell Lord Lyell moved Amendments Nos. 196 and 197:
Page 130, line 11, column 3, after ("Schedule 4") insert ("in paragraph 2(1), in the Table, the entry relating to section 3 of the 1953 Act and")
Page 130, line 50, at end insert—

("1968 c. 60

The Theft Act 1968.

In Schedule 2, in Part I, paragraph 8.").

The noble Lord said: I think it convenient to move Amendments Nos. 196 and 197 together and I should like to speak also to Amendments Nos. 199 and 200. These four amendments add some additional repeals of enactments which, to the surprise of your Lordships, will be either spent or will become so after the creation of British Telecom. I hope that would suffice as an explanation this evening. I beg to move.
On Question, amendments agreed to.
Lord Morris Lord Morris moved Amendment No. 198:
Page 131, line 8, after ("(b)") insert ("(c)").
The noble Lord said: I believe, no doubt wrongly, that if this amendment were not to pass, the limitation of liability not of British Telecom but of the Post Office with regard to failure, interruption, suspension or restriction of its telecommunications service would be retained in the law. I fail to see the necessity of that as I was firmly under the impression that the intention of the Bill was to split the telecommunications from the postal service of the Post Office. I beg to move.
Lord Trefgarne: I hope my noble friend will not seek a long and detailed explanation of this. We went into the principle of this matter at an earlier stage of the Bill, and I hope my noble friend will be satisfied with the explanation I gave at that time.
Amendment, by leave, withdrawn.
Lord Lyell Lord Lyell moved Amendments Nos. 199 and 200:
Page 131, line 35, at end insert—

("1974 c. 8

The Statutory Corporations (Financial Provisions) Act 1974.

In Schedule 2, paragraph 4.").

Page 131, line 37, column 3, at end insert ("In Schedule 4, paragraph 5.").
The noble Lord said: I spoke to these two amendments earlier. I beg to move Amendments Nos. 199 and 200.
On Question, amendments agreed to.
Schedule 6, as amended, agreed to.
Clause 90 agreed to.
House resumed: Bill reported with the amendments.

British Railways Bill
Committed to an Unopposed Bill Committee.
Whitehaven Harbour Bill
Brought from the Commons, read 1a and referred to the Examiners.
British Railways (Victoria) Bill [H.L.]
Returned from the Commons agreed to.
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