Sitting of 26 January 1982

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

    Disarmament
    Mr. Andrew F. Bennettasked the Secretary of State for Defence what contingency plans exist in the Ministry of Defence to review contracts, reduce manpower and to reallocate resources if disarmament talks reach successful conclusions.
    The Secretary of State for Defence (Mr. John Nott)We shall, of course, be ready to adjust our forward programmes if balanced, binding and verifiable agreements to reduce armaments and force levels are reached; but we cannot plan to do so until the nature and timing of specific agreements are known.
    Mr. BennettI thank the Secretary of State for that reply. What does he mean by "ready"? Do any of the contracts that are being placed contain contingency clauses that show that the Government have any faith that they genuinely want the disarmament talks to be successful?
    Mr. NottI hope that the current round of disarmament talks will be successful. If they are, I do not foresee any problems in reducing the level and scale of our armaments in accordance with any agreement. However, it is not necessary to have in contracts clauses of the kind suggested by the hon. Gentleman.
    Sir Victor GoodhewWill my right hon. Friend confirm that one hindrance to any agreements in the past has been the difficulty of verification, because the Soviet Government will not allow any inspection? Will he also confirm that the moment that the Soviet Government make such a move the British Government will enter into a verifiable and reasonable agreement?
    Mr. NottI congratulate my hon. Friend on his knighthood. I am sure that it is a delight to the whole House.
    My hon. Friend is correct in saying that the unwillingness of the Soviet Union to agree to inspection is one of the principal obstacles to successful arms talks. That is particularly so with regard to chemical weapons, of which the Soviet Union has been unwilling to allow any inspection procedures. That is one of the most worrying features of the present situation.
    Mr. John SilkinWas not our nuclear capability considered to be a basis on which we could attend the top
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    table of negotiations? As we are not there, is it not about time that we dropped the humbug of pretending that we have an independent nuclear deterrent and got on with the job of disarmament?
    Mr. NottIt is no humbug that we have an independent nuclear deterrent; it is a question of fact. It was a question of fact when the right hon. Gentleman was a member of the Labour Cabinet. I assure him that the Soviet Union regards our nuclear deterrent not as humbug, but as real.
    We have never sought to be party to the arms control talks, although we are giving them every support.

    Military Equipment (United States Order)
    Mr. Dykesasked the Secretary of State for Defence if he foresees the possibility of further United States orders for United Kingdom military equipment in the current year beyond the contracts and orders already announced.
    The Under-Secretary of State for Defence Procurement (Mr. Geoffrey Pattie)There are a number of United Kingdom equipments under consideration by the United States Government for use by their Services which we consider could fulfil their requirements. These are being discussed by industry and the Government, and we hope that this will lead to orders being placed. The exact timing of any orders is, however, uncertain, and I cannot predict which contracts will be signed this year. My hon. Friend will be aware that the past year was a most successful year for sales of British equipment to the United States.
    Mr. DykesI thank my hon. Friend for that reply. Does he still detect a certain reluctance by the American authorities to order European and British equipment? Specifically, is he worried about the Hawk trainer orders, or is he confident that they will go ahead intact?
    Mr. PattieThere have been some difficulties in Congress in recent weeks and prior to Christmas, but we are confident that the merits of the Hawk will win through. For some of the smaller British companies, not all pans of American industry are as aware as they might be of the working and implication of the 1975 memorandum of understanding. We are considering ways in which we can make this information and knowledge more widely available.

    Sea Dart
    Mr. Greville Jannerasked the Secretary of State for Defence when he now expects to decide whether to cancel the order for five 909 (GWS30) Sea Dart area air defence guided weapons systems to be fitted on type 42 destroyers.
    Mr. PattieDiscussions are currently being held with a view to converting the existing contract for five complete 909 radars to one which will provide spares for support of the Fleet. Assuming that these are successful, I hope to be in a position to take a decision shortly.
    Mr. JannerI welcome the Minister's assurance, but is he aware of the difficulties that the delay is causing to the talented, experienced and highly skilled work force at both the Marconi plants in my constituency and how anxious those people are to know that their jobs will be secure as a result of firm orders in connection with this or other contracts?
    Mr. PattieI am indeed aware of what the hon. and learned Gentleman says. I assure him and the House that these decisions will not be unnecessarily prolonged.
    Mr. FarrWill my hon. Friend bear in mind that the works team has built up a great fund of expertise and that it would be sad for the nation if that expertise were to vanish through lack of work?
    Mr. PattieI agree with my hon. Friend about the excellent record of the Marconi work force. That fact is being taken into account in our deliberations.
    Mr. James LamondIn view of the exchanges that have just taken place about employment for people on defence contracts, was it not rather naive of the Secretary of State to suggest that if disarmament talks were successful there would be no difficulty in fulfilling our side of the bargain? Is it not obvious that long-term planning is necessary if we are to enter into meaningful disarmament talks, including the meeting of the United Nations which starts in June in New York?
    Mr. PattieI was under the impression that my right hon. Friend had made clear his response to the previous question. I am sorry that the hon. Gentleman could not follow it.

    Armed Forces (Overseas Deployment)
    Mr. Hooleyasked the Secretary of State for Defence in which countries or territories outside Europe the United Kingdom is maintaining military garrisons or units of the Armed Forces, whether Army, Navy or Air Force, including forces deployed in accordance with United Nations resolutions.
    The Minister of State for the Armed Forces (Mr. Peter Blaker)There are British military garrisons stationed in Hong Kong, Belize, Brunei and the Falkland Islands. There are small administrative, or similar, detachments in Bermuda, the Bahamas, Diego Garcia, Malaysia, Canada and Kenya. We also have small teams of training and advisory personnel on loan or secondment to the Armed Forces of about 30 countries outside Europe. We provide a guard for the United Nations Command in Korea.
    Mr. HooleyDoes the Minister agree that, apart from supporting United Nations peacekeeping operations, this world-wide scatter of military activities is a delusion of grandeur not shared by anyone outside the Tory Party? Would it not be more sensible to deploy the resources at home for education and health and recreating jobs?
    Mr. BlakerIt is easy to say that health, education and so on are important, but if we neglect our defences and those of our allies, as a former Labour Secretary of State for Defence said, we shall be left with nothing but a heap of cinders. The garrisons to which I referred are in countries for which we have direct responsibility. Most of the other countries to which I referred have very small numbers of British personnel—perhaps two or three—who are there for particular reasons, such as looking after our training needs.
    Mr. Alan ClarkDoes my hon. Friend agree that certain factors—such as long-term strategic considerations, Service morale and humanitarian obligations to the people of the territories concerned—have to be divorced
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    from the cold statistics of the MOD balance sheet? Will he suggest to our right hon. Friend that one instance of this is HMS "Endurance" and our demonstrative will to defend our interests and those of the population of the Falkland Islands?
    Mr. BlakerThere is a later question on the Order Paper on this subject. I ask my hon. Friend to wait for that.
    The answer to my hon. Friend's general question is that our forces in the countries that I mentioned are there at the request of the countries concerned. We believe that that is in our interests as well as in theirs.
    Dr. McDonaldWhat proportions of our GDP are spent on NATO defences and on other commitments? Do we not spend more on our NATO commitments than any other member of NATO?
    Mr. BlakerThe answer to the hon. Lady's last question is "No". We spend a lower proportion than the United States. The total cost of the garrisons to which I referred is about £60 million a year. The cost of the other elements, which are very small, is much less.
    Mr. BuckDoes not my hon. Friend's last answer show the enormous contribution that we are making to the maintenance of peace on a world-wide basis? What is our contribution to the United Nation's forces in the Cyprus area, where we have a substantial commitment and do excellent work?
    Mr. BlakerI did not refer to Cyprus because Cyprus regards itself as being inside Europe. We make a valuable contribution there to UNFICYP. We have about 4, 000 of our own forces in the sovereign base areas.

    Weapons (Standardisation and Procurement)
    Sir Anthony Meyerasked the Secretary of State for Defence if he is satisfied with progress towards standardisation of weapons and joint weapons procurement within the Western European Union.
    Mr. PattieThere has been substantial progress, but we must aim towards a greater degree of co-operation within Europe in weapons production and development. We are working with all the bodies concerned, and I hope that the WEU colloquium, to be held in London at the beginning of February, will also make a useful contribution.
    Sir Anthony MeyerI am grateful to my hon. Friend for that reply. Does he agree that if there were more joint production and procurement of defence equipment the prospects, for example, for a European armoured fighting vehicle industry or for the European military aircraft industry would be infinitely better and that many more jobs would be available in this country and in other European countries than under the present half-hearted co-operation?
    Mr. PattieI agree with my hon. Friend. Many people share his views in what I call philosophical terms. There is a danger that almost too many bodies are involved in trying to turn his general ideas into reality. The independent European programme group is one body that we feel holds out the best hope of achieving the type of results that my hon. Friend desires.
    Mr. Jim SpicerDoes my hon. Friend recall that four or five years ago within the European Community a token

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    entry was made for a research and development fund to be set up for helicopters? Will he undertake to have another look at that to discover why it died and, if possible, to resuscitate it, because clearly it is a matter in which we have a great interest?
    Mr. PattieI remind my hon. Friend that the Italian and British industries are working together closely on a future replacement for the Sea King helicopter. That is largely covering the aspect that my hon. Friend has in mind.

    Equipment Purchases
    Mr. Hal Millerasked the Secretary of State for Defence whether he has prolonged any previously announced timetable for the purchase of equipment for the Armed Forces.
    Mr. NottTimetable changes in a large and diverse procurement programme costing up to £6 billion will always be necessary, but the main features of the programme envisaged in the Defence White Paper—Cmnd. 8288—stand.
    Mr. MillerDoes my right hon. Friend agree that, contrary to the trend of questions by the Opposition, service in the Armed Forces provides valuable jobs for those who wish to serve their country and that the equipment they use provides valuable jobs in our industry? Does he realise that there is uncertainty in our defence industries arising from the stream of releases about cancellations and prolongations? Will he therefore take an early opportunity to restate the position on defence procurement and thus reassure both industry and those who serve in the Armed Forces?
    Mr. NottMy hon. Friend is right. The professionalism and dedication of our Armed Forces are admired throughout the country, and we should be proud of them.
    On procurement generally, we shall spend more in real terms with British industry in the next financial year than we did this year, and this year we are spending more than we did last year. My hon. Friend is right to point out that there will have to be adjustments—perhaps changes of a few months—to some programmes. Changes are inevitable in such a large programme—amounting next year to about £6 billion—but, as I have made clear, the strategy set out in the White Paper that was published in June remains. I believe that all the major programmes there will be maintained.
    Mr. GeorgeHow many aeroplanes are available for the air defence of the United Kingdom? How does the Secretary of State's recent announcement regarding Tornado affect the air defence variant of Tornado? If that is likely to be delayed, how does he square that with the oft-repeated charges made by the Conservatives in Opposition that our air defences were grossly inadequate?
    Mr. NottThe air defence version of Tornado is hardly affected by the reduction in the peak deliveries from just over 60 aircraft to 44 aircraft. That reduction will affect the strike version of Tornado more than the air defence version, which may be affected by a month or two, but little more than that. Like the hon. Gentleman, I regard the air defence of the United Kingdom as of the greatest importance. We have considerably enhanced the situation and agreed to run two Phantom squadrons into the 1990s.
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    That is a new decision. We intend to arm 72 of our Hawk aircraft with Sidewinder missiles. The huge programme for improving the ground environment, such as radar and other devices for the defence of the United Kingdom, continues. We are concentrating more attention and resources on that area.
    Mr. SpeedDoes my right hon. Friend recall that the 1980 White Paper contained an intention to purchase new mine-sweepers for the Royal Naval Reserve? Two years later there is still no sign of those mine-sweepers, which are desperately needed to replace the ageing fleet. Wile n will they be produced?
    Mr. NottMy hon. Friend is right to point out that the Royal Naval Reserve urgently needs those mine-sweepers. I hope to begin placing the orders in the next financial year.
    Mr. SnapeIs it not a fact that, thanks to the Secretary of State's last announcement, the bulk of the bill for the Tornado programme will have to be paid in the late 1980s? How does the right hon. Gentleman envisage paying the immense bill not only for the 385 Tornado aircraft on order for the Royal Air Force but for the ridiculous, nonsensical and expensive Trident project? The bulk of the expenditure on that project will be due at about the same time.
    Mr. NottThe bulk of the expenditure on Tornado is being met now. In the next financial year the Tornado programme will cost the Ministry of Defence budget about £1, 000 million. The peak expenditure profile will occur in the next few years. Expenditure will be tailing off by the mid-1980s. The Tornado programme as a whole is infinitely more expensive than the Trident programme as a whole. We are talking about a total programme cost of about £11¼ billion for the Tornado. That huge programme is proceeding successfully.
    Mr. Robert AtkinsDoes my right hon. Friend agree that the recession has caused his Department's budget problems, because of the early delivery of a wide variety of equipment, and that the flexibility of his budget should be increased to allow him to encompass the problems that he has mentioned? The example of Tornado springs to mind.
    Mr. NottMy hon. Friend is right. The principal. problem facing the defence budget is that, due to the recession, Ministry of Defence contractors deliver equipment earlier than they would otherwise. That has to be fitted into a tight annual cash limit. More flexibility from one year to another would enormously benefit the management of defence resources and make it much more efficient. More flexibility would be a great plus towards looking after the programme.
    Mr. MarksHas there not been delay in equipping and maintaining our forces because of the takeover and closure of factories? For example, has not Polaris maintenance been delayed because of the closure of Laurence Scott and Electromotors, Manchester?
    Mr. NottI am not aware of any such delays. Polaris is constantly on patrol and has been for the past 15 years. I am not conscious of any problems such as those mentioned by the hon. Gentleman. If he has a particular point to make, perhaps he will draw it to my attention.

    Royal Naval Vessels (Deployment)
    Mr. Trotterasked the Secretary of State for Defence whether he intends to continue to deploy Royal Naval vessels in the Indian Ocean; and what plans he has to deploy naval task forces outside the North Atlantic Treaty Organisation area.
    The Under-Secretary of State for the Armed Forces (Mr. Jerry Wiggin)There are no immediate plans to end the Royal Navy presence in the Indian Ocean. As announced in the White Paper, Cmnd. 8288, we intend to resume this year naval task group deployments outside the NATO area.
    Mr. TrotterI welcome that commitment to an overseas presence, but, given Admiral Gorshkov's statement that the Soviet Navy can win wars by its presence, without firing a shot, will my hon. Friend bear in mind that the Royal Navy's role is to preserve the peace as much by its presence as by fighting a war?
    Mr. WigginI endorse my hon. Friend's comments. Task groups are deployed to demonstrate Britain's capability to defend its interests and those of its allies outside the NATO area as well as to enhance relations with friendly countries in those parts of the world.
    Mr. NewensWhat further military development of Diego Garcia is proposed by the United States of America, which has a heavy concentration of forces in that area? Is the role of British personnel stationed there solely that of a support force? Will the Minister note that many of us would greatly deplore an increase in the British commitment in that part of the globe?
    Mr. WigginThose remarks fall well outside the purview of the question. I understand that our interests are very small.
    Mr. ChurchillIs my hon. Friend aware that the British public are profoundly puzzled and surprised by the proposed sale of HMS "Invincible", which is the most modern and valuable of the Royal Navy's defence assets? According to experts on both sides of the Atlantic, since that class of carrier was first ordered, the threat to our energy supplies, to the Cape sea route and to transatlantic communications in a period of tension—let alone in a period of war—has grown. Therefore, will my hon. Friend confirm that the Government will reconsider the proposed sale?
    Mr. WigginAgain, such points are outside the purview of the question. However, if my hon. Friend studies the White Paper he will find that whatever the Government are planning can be found in it.
    Mr. Denzil DaviesIs it not true that vessels are deployed in the Indian Ocean, not for strategic reasons, but to satisfy the Prime Minister's delusions of grandeur and to help President Reagan with his rapid deployment force and the base on Diego Garcia? As the Government have made such drastic cuts in the Royal Navy, would it not be better to deploy those vessels in the Eastern Atlantic, instead of sailing them aimlessly round the Indian Ocean?
    Mr. WigginAs I said, the original deployment was the direct result of the war between Iraq and Iran and the necessity to protect British and allied interests if the Straits of Hormuz were closed. Although that risk has decreased, it is judicious to keep ships in that part of the world.

    British Aerospace
    Mr. Nicholas Wintertonasked the Secretary of State for Defence if he proposes to place new orders for aircraft with British Aerospace during the next 12 months.
    Mr. PattieYes. The timing and nature of orders will, however, depend on our current consideration of our spending plans.
    Mr. WintertonI had hoped that my hon. Friend would be a little more forthcoming. Does he agree that British Aerospace makes a major contribution to Britain's defence and employs tens of thousands of people? If we purchase aircraft from British Aerospace, will it not set a fine example for exports? The industry has a record that is almost second to none in exporting its goods. Will my hon. Friend assure the work force that orders will be forthcoming to maintain not only the production line, but research and development at British Aerospace?
    Mr. PattieI am glad to endorse my hon. Friend's support and praise for British Aerospace. He will know that at the Woodford and Chadderton division the Nimrod maritime reconnaissance conversion programme is continuing, together with the airborne early-warning programme, and a good amount of civil work is being done. Like my hon. Friend, I hope that the signs of interest being shown by foreign buyers in those aircraft will prove fruitful. In that way we can sell more of those aircraft and possibly open the production line. That would be a highly satisfactory state of affairs.

    P110 Project
    Mr. Robert Atkinsasked the Secretary of State for Defence what assistance he is giving to British Aerospace in its search for private funding of the P110 project.
    Mr. PattieThrough ministerial and other contacts the Government are helping British Aerospace to promote the P110 with potential customers who, it is hoped, will contribute to the cost of this private venture development.
    Mr. AtkinsIs my hon. Friend aware of the critical importance to the Warton division of British Aerospace of an early decision on the P110 project, the so-called Jaguar replacement, because if a decision is not taken soon about whether it should be privately or Government funded the research and design teams there will effectively be broken up? That will be very detrimental both to British Aerospace and to Britain's manufacturing capacity.
    Mr. PattieMy hon. Friend knows that British Aerospace has said that it will continue to fund the project at least until midsummer and possibly to the end of this year. I agree with him about the urgency of attracting some foreign interest so that the money necessary to fund the development is forthcoming.
    Mr. Stan ThorneDoes it ever disturb the Minister that he is involved in the immoral and destructive pursuit of armaments manufacture? Does he not believe that he might be better employed generating improvements in the National Health Service?
    Mr. PattieI am sure that the hon. Gentleman's constituents who work in the British Aerospace factory at Warton would take it somewhat amiss that the comments

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    that he has made to me can be equally applied to them. It is a fine company and a fine work force doing an important job to safeguard Britain's defences.
    Lord James Douglas-HamiltonIs my hon. Friend aware that Ferranti Ltd., which employs several thousand people in and around my constituency, regards the success of the project, in which it has an interest, as being of the utmost importance both in terms of technological development and employment?
    Mr. PattieWe are very much aware of Ferranti's involvement in the project and of its excellent contribution to this and other projects.

    Cruise Missiles
    Sir William van Straubenzeeasked the Secretary of State for Defence when he expects the first cruise missiles to be sited in Berkshire.
    Mr. BlakerOn current plans, the first cruise missiles are due to be deployed at RAF Greenham Common in Berkshire by the end of 1983.
    Sir William van StraubenzeeIn working on that programme, will my hon. Friend reject totally some local views to the effect that, by virtue of the siting, the county of Berkshire will in some way become a more vulnerable target? Will he remember that the vast majority of local people believe that the best way in which to avoid a third world war is through the robust maintenance of our defences?
    Mr. BlakerI am grateful to my hon. Friend for his robust support of the project. I welcome what he says about opinion in Berkshire in general. The deployment of the cruise missile will help us to deter war, which is the main objective of our military policy. As to the vulnerability of Greenham Common, my hon. Friend will he aware that in times of tension or war the cruise missiles would be deployed away from the base.
    Mr. StoddartIs the Minister aware of the picket of the Greenham Common base by a group of women who, like me, never wish to see the cruise missile deployed there or elsewhere? Is he also aware that Newbury district council is trying to stop the picket by evicting people from that piece of wasteland? Can he assure us that neither he nor the American Department of Defence has put any pressure on Newbury district council?
    Mr. BlakerI am aware of the presence of that group of women on the site. The land is common land and does not belong to the Ministry of Defence. The fate of these people is not a matter for the Ministry of Defence.
    Mr. Michael McNair-WilsonCan my hon. Friend confirm that when those missiles are deployed at RAF Greenham Common there are no circumstances in which they can be fired without the consent of the Government?
    Mr. BlakerI confirm that fact.
    Mr. Denzil DaviesAre not the constituents of the hon. Member for Wokingham (Sir W. van Straubenzee) right to be worried, because was not the cruise missile designed to fight a limited nuclear war in Europe? Does not the very concept of a limited nuclear war make it more likely that there will be a nuclear war? Does the Minister agree that the main priority should be conventional armaments instead of cruise missiles?
    Mr. BlakerThere are many people in Britain and in other Western countries who are worried about the existence of nuclear weapons. One purpose of the Ministry of Defence is to explain the facts about nuclear weapons to counter the many mis-statements of fact that come from other sources. One remark made by the right hon. Gentleman demonstrates that he is suffering from a misapprehension. The missiles are not intended to fight a limited nuclear war in Europe. They are intended to show that the United States of America is closely tied in to the defence of Western Europe, thus adding to the deterrent effect presented to any potential aggressor.

    Public Relations
    Mr. Dubsasked the Secretary of State for Defence how much his Department will spend on public relations in 1981–82.
    Mr. BlakerThis year we expect to spend just over £3·5 million on public relations in the Ministry of Defence. That covers the salaries of Ministry of Defence public relations staff throughout the world, overheads and a wide variety of press briefing and press facility work both at home and abroad.
    Mr. DubsIs the Minister aware that expenditure on defence is inevitably a matter of political controversy? Can he identify the proportion of his public relations budget that is being used to justify his present expenditure policies? For example, is he aware that in recent months the Royal Navy has been carrying out a series of presentations that, according to my constituents, have borne a close resemblance to party political broadcasts? Can he justify those presentations?
    Mr. BlakerIf the need to defend Britain adequately has become a matter of controversy between the parties in the House, that is a matter of great regret, because it used not to be a matter of controversy. We used to agree that a satisfactory defence policy was the prime objective and duty of any Government. The purpose of our public relations effort is to explain the facts of our defence policy. It is obvious from some of the questions from the Opposition that that is a necessary task.
    Mr. StokesWould it not greatly help public relations if some Opposition Members, instead of constantly criticising Her Majesty's Forces, praised Britain's defence effort?
    Mr. BlakerThat would be a welcome change. I have no doubt that the vast majority of British people welcome the activities of our Armed Forces and believe that they are doing an excellent job.
    Mr. Arthur LewisCan the Minister tell us how much of the £3·5 million will be used to explain to the public and the world why, in 1982, the Government are refusing to disclose the documents and evidence about the traitors Burgess, Maclean and Philby, on the ground that those public schoolboys' activities may damage us now? Is it not a cover-up of public schoolboys?
    Mr. BlakerThe hon. Gentleman knows that that is not a question for me.
    Mr. McQuarrieWill my hon. Friend consider spending some of that money in carrying out a public

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    relations exercise in Gibraltar to try to increase the morale of the people there, which was badly deflated by his Department's decision to close the dockyard?
    Mr. BlakerWe shall be explaining, as we have already explained, our policies on Gibraltar. Within the next few days I shall be receiving a deputation from Gibraltar.
    Mr. John SilkinWould it not have helped public relations concerning the closure of the Gibraltar dockyard if the Minister or one of his colleagues had been to Gibraltar and had had the guts to talk and listen to the people there?
    Mr. BlakerThe right hon. Gentleman always gets his timing wrong. Last time we discussed this he urged me to go immediately to Gibraltar. I pointed out that Sir Joshua Hassan was about to arrive and that if I followed the right hon. Gentleman's advice we should cross in mid-air. As I am about to receive a trade union deputation from Gibraltar later this week, if I followed the right hon. Gentleman's advice exactly the same would happen again.

    Trident and Cruise Programmes
    Mr. Cryerasked the Secretary of State for Defence how many representations he has now received on the Trident programme and the siting of cruise missiles in the United Kingdom; and if he will make a statement.
    Mr. Gwilym Robertsasked the Secretary of State for Defence how many representations he has received in connection with the Trident programme and the plans to locate cruise missiles in the United Kingdom; and if he will list these representations in the Official Report.
    Mr. NottSince taking up my present appointment I have received about 210 letters and seven petitions concerning the Trident missile programme and about 370 letters and nine petitions concerning cruise missiles. These came both from individuals and from representatives of various groups.
    Mr. CryerWill the Secretary of State confirm that those representations are based, first, on the fact that Trident will be between 15 and 30 times more powerful than the current Polaris missile, making it an instance of further nuclear escalation, and, secondly, that the cost is soaring out of all control and is now approaching or exceeding the £11·25 million cost of Tornado? Will he confirm that the representations are also based on the fact that cruise missiles will be entirely under the control of the United States, with both keys in the hands of the United States? Does he agree that that, together with the fact that they cannot be verified, is a major cause of concern?
    Mr. NottThe representations cover a wide range of genuine concerns. They are not related to any specific issue. The hon. Gentleman does not yet know the cost of the possible option of a Trident 2 missile, but I can tell him that his figures are widely exaggerated and that the Tornado programme will be far more expensive than the Trident programme. With regard to cruise missiles, there is a long-standing arrangement, which has survived two or three Labour Governments and which we have not changed, covering the decision-making process with regard to the release of nuclear weapons.
    Mr. Eldon GriffithsWith regard to the representations that my right hon. Friend has received, many of them
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    from East Anglia, may I congratulate him and his colleagues in the Foreign Office and the Ministry of Defence on the way in which they have tackled this problem throughout the country? Now that they have won the intellectual argument in respect of nuclear weapons, will he go further and refute some of the nonsense now being talked about nerve gas at American bases in this country?
    Mr. NottOn the latter point, it is utterly untrue that the Americans intend to deploy chemical weapons forward, and the rumour has been denied by the American Department of Defence.
    With regard to the debates about nuclear weapons, we still have much explaining to do and a long way to go, but I am encouraged by the evidence of such polls as we have seen that the broad mass of the British people and, so far as I can judge, a majority of subscribing members of the Labour Party, believe in the maintenance of an independent deterrent for this country, because they know that it is essential for the maintenance of peace. We shall continue to argue that peace depends on our retaining strong defences in this country, and I hope that we shall convince more and more people as we go along.
    Mr. Frank AllaunDid the Secretary of State see the recent interview with David Greenwood on "Panorama"? In the light of that interview and of the fact that we are likely to take the more advanced missile, will he give a firm assurance that, compared with the original Government estimate of £5 billion, the final estimate will not exceed £10 billion at current prices?
    Mr. NottThe hon. Gentleman will have to await the announcement of our decision. When we announce the decision, we shall give the figure. I saw the interview with Mr. Greenwood. Some of the figures presented in the programme were greatly exaggerated. The hon. Gentleman will have to await the Government's decision. When we announce the decision, we shall give the up-to-date figures.
    Mr. BestDoes my right hon. Friend agree that the declaration of nuclear-free zones by certain local authorities, and the belief that the siting of cruise missiles makes this country in some way more vulnerable to attack, are based on a fundamental misapprehension that any future conflict would not be fought against industrial and population targets as well as military targets? Would not those people be better employed in informing the Soviet Politburo of their nuclear-free zones so that it may agree to them?
    Mr. NottI agree with my hon. Friend. The declaration of such nuclear-free zones is a fatuous way to proceed. I cannot understand how anybody could imagine that the Soviet Union or any other nation would take the remotest notice of an area being declared a nuclear-free zone. With regard to the suggestion that Europe should be declared a nuclear-free zone, my hon. Friend will know that if the Soviets removed their SS20 and other missiles out of Europe they could hit exactly the same targets from the other side of the Urals. The whole concept therefore makes no sense and, indeed, will tend to encourage rather than to prevent war.
    Mr. CryerOn a point of order, Mr. Speaker. In view of the totally unsatisfactory nature of the Minister's reply, I beg to give notice that I shall seek to raise the matter on the Adjournment at the earliest opportunity.

  PRIME MINISTER

    Engagements
    Mr. Skinnerasked the Prime Minister if she will list her official engagements for 26 January.
    The Prime Minister (Mrs. Margaret Thatcher)This morning I had meetings with ministerial colleagues and others. In addition to my duties in the House, I shall be having further meetings later today.
    Mr. SkinnerNow that the official figure for unemployment has exceeded 3 million, is the Prime Minister proud of the fact that she has brought so much despair to so many families in the United Kingdom? Is she proud of the fact that she and the Government have created more havoc in the British economy than the German High Command in the whole of the last war? Is she proud that, to carry out this ill-fated monetarist experiment, she has had to increase taxes? [Interruption.] Is it not time—[HON. MEMBERS: "Speech."]
    Mr. SpeakerOrder. The hon. Gentleman must be allowed to finish his question, just as everybody else must be heard this afternoon.
    Mr. SkinnerIs it not time for the Westminster Ripper to join the unemployment trail, pack her bags and go?
    The Prime MinisterIn response to the hon. Gentleman, of course we all deplore the tragic fact that unemployment has reached 3 million and so many people who want to work find themselves without a job. Contrary to what the hon. Gentleman says, Conservative Members also feel very strongly about this.
    Mr. Austin MitchellWhen will the right hon. Lady resign? Does it have to be 4 million?
    The Prime MinisterI find the comments of the hon. Member for Bolsover (Mr. Skinner) and his reference to the German High Command utterly distasteful, particularly for those who suffered or lost relatives in the last war.
    There is a certain amount of encouraging news. There is now less short-time working, more overtime, an increased inflow of vacancies and an increased stock of vacancies, and unemployment is rising at a lesser rate than it was.
    I have but one comment to make about the hon. Gentleman's reference to Germany. Perhaps he will bear in mind that in the past year unemployment in West Germany rose by 586, 000, which is not very different from the 651, 000 by which it rose in this country.
    Mr. John TownendDoes my right hon. Friend agree that the industrial action taken by railwaymen at King's Cross to intimidate newspapers and to influence what they print is a direct threat to freedom? What action does she think that British Rail should now take?
    The Prime MinisterNo one in this country, whether a member of a union or not, must be allowed to jeopardise the freedom of the press. I condemn any action, whether by trade unionists or others, which tends towards that end. All industrial action loses jobs. It does not gain them.
    Mr. FootAs the Budget Statements and the Budgets of the right hon. Lady's Chancellor of the Exchequer have contributed so much to the terrible figures published today, will she give us an assurance that at the meeting of the Cabinet on Thursday there will be no more cuts, no more deflation, no more monetary madness and no more of the measures that have contributed to this terrible disaster for the nation?
    The Prime MinisterThe short answer to the right hon. Gentleman is that I cannot say what will take place at Cabinet next Thursday. Cabinet agendas are not revealed. I can tell the right hon. Gentleman only that the meeting will be interesting, as usual. I know that encouraging figures are never of any interest to the right hon. Gentleman or to Labour Members generally. However, perhaps the right hon. Gentleman will note that our average record on inflation is now better than the record achieved throughout the previous Labour Government's term of office. Inflation is coming down, and it is vital that it should if we are to have a soundly based recovery.
    May I also point out to the right hon. Gentleman that, possibly due to my right hon. and learned Friend's last Budget, the December current account surplus was nearly £500 million and that our productivity record this year put us at the top of the league table of the industrialised countries, and that is something of which we should be very proud. Our reserves are up to $23 billion, unlike during the equivalent period when the right hon. Gentleman was a member of the Labour Government, when they were down to $4 billion and we were broke.
    Mr. FootCannot the right hon. Lady appreciate that when the figures of unemployment reach a total of this nature it is an insult to the unemployed to talk of the encouraging figures presented to the nation, especially when most of her figures are misleading?—[HON. MEMBERS: "Oh!".] Does she not understand that the productivity figures are not back to what they were at the end of 1979? Does she not understand that the inflation figures are not back to what they were when she came to office? Does she not understand that on all these fronts she has taken measures that have pushed up the total of unemployed? Now we are told by the Secretary of State of Employment that we have not reached the peak. What is the peak that the right hon. Lady and her Government are heading for?
    The Prime MinisterIf the right hon. Gentleman studies the productivity figures for the right measure, which is productivity per man-hour, he will find that they have now reached an all-time record. If he will kindly tell me what other figure he challenges, I shall try to respond to him. As for inflation, the right hon. Gentleman's average record in 1974, his first year, was 16·1 per cent. whereas ours was 13·4 per cent. During his second year of office his average record on inflation was 24·2 per cent. while ours was 18 per cent. In his third year in office his average rate of inflation was 16·5 per cent. and ours is 11·9 per cent. That is the answer—we are better on all counts.
    Mr. FootDoes the right hon. Lady understand that, with her unemployment figures, 32 people are chasing every vacancy? Will she tell us what the figure was when she took office?
    The Prime MinisterThe right hon. Gentleman will find the vacancy figures in the Department of

    745
    Employment's press notice. The number of vacancies—the number of jobs now being notified to job centres—is increasing. The stock is greater than a year ago. The fact is that the right hon. Gentleman brought down unemployment temporarily at the cost of reflation, which increased unemployment later. If the right hon. Gentleman is really interested in the figures—[Interruption.]
    Mr. SpeakerOrder. The Prime Minister should not fight for a hearing. I have said that before. If we cannot have free speech in this House, we shall get it nowhere.
    Mr. WinnickShe ought to fight for the unemployed.
    Mr. SpeakerOrder. The Prime Minister is entitled to be heard.
    The Prime MinisterIf the right hon. Gentleman is interested in ascertaining the facts, he will have observed that the total population of working age will increase by about 1 million during the period 1980 to 1985. We had a peak of schoolchildren reaching school leaving age of 16 years this last year of 920, 000. Of course these demographic factors have to be taken into account in judging the tragic figure of unemployment. The only real answer to the right hon. Gentleman is one that he will not accept, and it is that the consumer decides whether jobs go.
    Mr. Pittasked the Prime Minister if she will list her official engagements for Tuesday 26 January.
    The Prime MinisterI refer the hon. Gentleman to the reply that I gave some moments ago.
    Mr. PittIn view of the delays that certain education authorities have suffered—notably Manchester—in receiving decisions from the Secretary of State for Education and Science on education reorganisation plans, will the right hon. Lady tell us when the parents, pupils and staffs of schools in Croydon that will be affected by reorganisation plans may expect to receive an answer to the submissions that were lodged with the Minister on 6 August?
    The Prime MinisterI am not quite certain to which schools or to which sort of notice the hon. Gentleman is referring. I take it that he is referring to a section 13 notice under the Education Act 1944. If he is, there has inevitably to be a two-month period for representations to be made to the permanent secretary. The representations then have to be evaluated by the Secretary of State. They must then be discussed before a decision is reached. The hon. Gentleman must put the precise case to my right hon. Friend the Secretary of State for Education and Science.
    Mr. John MacKayWill my right hon. Friend take time today to welcome the moves made last week by the Bank of England, the Bundesbank and the Dutch to make a combined effort to bring interest rates down? Will she encourage them to do it again this week? Will she also encourage the American authorities to join in this venture?
    The Prime MinisterThe move to lower interest rates last week by a number of the banks in Europe was very welcome. It would hardly have taken place had we run the high deficit that Labour Members wish us to run. It is a fact that fear of the United States having a high deficit is holding up interest rates here.
    Mr. Meacherasked the Prime Minister if she will list her official engagements for 26 January.
    The Prime MinisterI refer the hon. Gentleman to the reply that I gave some moments ago.
    Mr. MeacherOn the day when unemployment is announced to have passed 3 million, is the right hon. Lady aware that official Government returns show that there are over 5, 700, 000 persons living in poverty on supplementary benefit, that it is officially estimated that there are a further 1, 100, 000 living in poverty but not claiming benefit, and that a majority of these are the unemployed and their families? Is she not ashamed that under her regime no fewer than one in eight of the British people are living in poverty, which is the highest figure for 50 years?
    The Prime MinisterThe hon. Gentleman will be the first to know that every time social security benefits are increased more people are eligile to come into benefit. I imagine that the hon. Gentleman's definition of poverty is based on those who are able to draw social security benefits. If he studies the record of the last Labour Government, he will find that increases in benefits usually led to an increase in the number of people eligible to draw them.
    Sir Nigel FisherIs my right hon. Friend aware of the public concern at the increasing number of offences of rape? If, as I understand it to be the case, my right hon. Friend has ordered a review of that problem, could she state what form it will take and how long it will take to be completed?
    The Prime MinisterWe have considered the recent cases very carefully. Hon. Members will know that there was an advisory group on the law of rape, chaired by Dame Rose Heilbron. That was an excellent group. Most of its recommendations were implemented, with the unanimous approval of both sides of the House. Furthermore, building on that, the Criminal Law Revision Committee is now carrying out a comprehensive review of sexual offences, including rape and allied offences, and the penalties for them. [Interruption.] In October 1980 it published a working paper and invited comments. Those comments are still being received. The committee's intention is to produce a report that places the law on rape in the context of sexual assaults. That refers to the law on rape in England and Wales. The law is different in Scotland. I have thought it wise to attempt to discuss the recent events and cases—[Interruption.]—which, although they may not have given cause for concern to Opposition Members—[Interruption.]—have given cause for concern to many others.
    Mr. SpeakerOrder. The hon. Member for Stirling, Falkirk and Grangemouth (Mr. Ewing) has no right to try to shout anyone down from a sedentary position.
    The Prime MinisterI thought it wise to discuss with Dame Rose Heilbron recent events and the concern that people feel following her report of 1976. I am happy to say that she has agreed to come to see me. We shall discuss those matters to see whether any further steps are required. With regard to the law in Scotland, there is a possibility of a private prosecution. Therefore I can say nothing further about that.

Rate Support Grant (Hackney)
Mr. Clinton DavisI beg to ask leave to move the Adjournment of the House, under Standing Order No. 9, for the purpose of discussing a specific and important matter that should have urgent consideration, namely,
"the failure or refusal of the Secretary of State for the Environment to repay to the London borough of Hackney, among others, rate support grant that he has unlawfully withheld."
On 15 January 1981 the House resolved affirmatively the new levels of rate support grant payable for the year 1980–81. Parliament granted no extension of time for making that payment. On 21 October 1981, the Divisional Court decided that the Secretary of State's decision to withhold part of the rate support grant payable to Hackney and five other London boroughs was unlawful. Hackney and the other boroughs have been pressing continuously for the Secretary of State to fulfil his obligations pursuant to the court's judgment, but so far to no avail. The Secretary of State said, however, that he would reach a decision by the week commencing 11 January this year. That date has passed and still there has been no commitment from the Secretary of State, no communication from him and no explanation of the delay.
The conduct of the Secretary of State is, to say the least, thoroughly unworthy of a Minister of the Crown. He is defying a court order. He has no parliamentary authority for his capricious and vindictive conduct against a borough that is having to struggle against appalling deprivation, and he is in breach of his undertaking.
This matter falls within the ambit of Standing Order No. 9 in that it is clearly urgent, for the reasons that I have given. The amount of rate support grant withheld without considering interest is the equivalent of a 3p rate, which must be a substantial amount, and is of great immediacy in determining the rate for 1982–83. The matter is obviously specific and of great public importance not only to the people of Hackney and the other boroughs involved, but with regard to the Minister's responsibilities towards the House of Commons.
Mr. SpeakerThe hon. Member for Hackney, Central (Mr. Davis) gave me notice before 12 noon today that he would seek to make an application under Standing Order No. 9 this afternoon. The hon. Gentleman asks leave to move the Adjournment of the House for the purpose of discussing a specific and important matter that he thinks should have urgent consideration, namely,
"the failure or refusal of the Secretary of State for the Environment to repay to the London borough of Hackney, among others, rate support grant that he has unlawfully withheld."
As the House knows, under Standing Order No. 9 I am directed to take account of the several factors set out in the Order, but to give no reason for my decision. I listened carefully to the hon. Gentleman, but I must rule that his submission does not fall within the provisions of the Standing Order and, therefore, I cannot submit his application to the House.

Railways (Industrial Action)
Mr. SpeakerThe hon. Member for Nuneaton (Mr. Huckfield) gave me notice that he would seek to make the same application today that he made yesterday. In making his application he will no doubt refer to any differences which have arisen since I rejected his appeal yesterday; otherwise his action would be near to a gross abuse of our procedure.
Mr. Les HuckfieldI do not intend to trespass on your generosity in seeking to move the Adjournment of the House, Mr. Speaker.
I beg to ask leave to move the Adjournment of the House, under Standing Order No. 9, for the purpose of discussing a specific and important matter that should have urgent consideration, namely,
"the failure of the British Railways Board to honour its agreement to pay all footplate staff an increase from January this year and its consequences for industry and the travelling public."
As I have said in previous applications under Standing Order No. 9, the award was agreed by the Railway Staff National Tribunal in July and by the Advisory Conciliation and Arbitration Service in August. This interpretation of that award was agreed yesterday by the finance and general purposes committee of the Trades Union Congress. Therefore, it is not just an isolated award that is being interpreted in one way by one union but an issue that is so specific that it has been endorsed by that TUC committee.
I do not need to stress again the important consequences of the failure to pay that award. We are receiving new information day by day. Further information about the industrial consequences has come since yesterday, which shows that we could be in for a bitter and protracted struggle, from which certain sections of railway traffic and services may never recover. Fresh evidence of that has emerged since yesterday.
The matter is so urgent because the dispute has been going on for more than two weeks. It is time that the House had a chance to debate the issue, to hear the full facts and to present its judgment on the issue. I say that because national newspapers such as The Sun seem to be deliberately hell-bent on doing everything to obscure the full facts of the situation.
The only way for hon. Members to learn the full facts is for the House to be given adequate time to debate the issue. I respectfully suggest that, although it has been murmured that one or two of my points could be raised on the Transport (Finance) Bill later this evening, I am sure that you will accept, Mr. Speaker, that if hon. Members sought to raise those points at that time they would be trespassing on the generosity of the occupant of the Chair. Therefore, it is out of respect for you, Mr. Speaker, that I say that at this late stage we should have time to debate this important issue. There is no sign of a resolution of the dispute. The House is entitled to debate the matter. Above all, the country is entitled to hear the facts.
Several Hon. Members rose—
Mr. Robert AdleyOn a point of order, Mr. Speaker.
Mr. SpeakerOrder. I shall take points of order after I have replied to the application under Standing Order No. 9.
The hon. Member for Nuneaton (Mr. Huckfield) gave me notice before 12 noon today that he would seek leave

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to move the Adjournment of the House for the purpose of discussing the motion which he has read out and which I read out yesterday, namely,
"the failure of the British Railways Board to honour its agreement to pay all footplate staff an increase from January this year, and its consequences for industry and the travelling public."
As I said to the House yesterday, I have no doubt that the hon. Gentleman has raised an important matter. We all know that. The whole House knows it. The House also knows that my powers are limited to deciding whether the matter is of such a nature that it is essential for the House to change its business today or tomorrow and to give precedence to a three-hour debate—a three-hour debate only—to deal with the matter. I have listened with great care to what the hon. Gentleman said, but I must rule that his submission does not fall within the provisions of the Standing Order, and therefore I cannot submit his application to the House.
Mr. AdleyOn a point of order, Mr. Speaker. I ask you to rule on the parliamentary implications of the fact that the hon. Member for Nuneaton (Mr. Huckfield) who is, I believe, speaking in the House on behalf of ASLEF, and presumably is retained by ASLEF, is, for the third time, putting forward what one can only describe with the best will in the world as his side, ASLEF's side, or at least a one-sided interpretation, of events. I do not speak for ASLEF. I do not speak for the British Railways Board. There can be no doubt of the seriousness—
Mr. SpeakerOrder. I am waiting to hear a point of order.
Mr. AdleyIs it in order for the record of the House regularly to contain in Hansard a one-sided account, by use of words by the hon. Gentleman such as "honouring agreements" when no one, so far as I am aware, has sought to argue the case from the other side? I ask you, Mr. Speaker, to consider the parliamentary implications of what the hon. Gentleman is doing.
Mr. SpeakerI am obviously looking at the use of Standing Order No. 9, and I intend to use my discretion when it is necessary.
Mr. Robert AtkinsFurther to that point of order, Mr. Speaker, and further to what you said when you called the hon. Member for Nuneaton (Mr. Huckfield), according to the Register of Members' Interests, the hon. Gentleman represents ASLEF in the House and yet is sponsored by the Transport and General Workers Union. Does not that imply a conflict of interest which should have been declared by the hon. Gentleman?
Mr. SpeakerThat is not a point of order for me.
I hope that hon. Members on both sides of the House will not have an argument about that, because there is a Ten-Minute Bill that I believe the House is waiting to hear.
Mr. Bob CryerFurther to that point of order, Mr. Speaker. I was a little concerned to hear you say that you would use your discretion on applications under Standing Order No. 9. As I recall, this was the subject of a debate and vote by the House when the Select Committee on Procedure recommended that they should be subject to your discretion. That recommendation was rejected. The procedure of using Standing Order No. 9 to
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seek your consent for a debate is important and is jealously guarded by Members on both sides of the House. It was extensively used by the Tories—who are now complaining—during the lorry drivers' strike when a Labour Government were in office. Having taken a vote on this important right, we seek to maintain and extend it.
Mr. SpeakerI remind the hon. Gentleman that in order to preserve our rules all hon. Members must take care never to abuse them. That is what I am trying to guard, and I go no further.
Mr. Alexander W. LyonFurther to the point of order, Mr. Speaker. Regarding the issue whether it is an abuse of Standing Order No. 9 procedure to repeat an application and to put one side of the case, surely it can never be argued in the House that it is an abuse of procedure to put one side of the case? There must be many examples from the winter of discontent of Opposition Members repeatedly submitting applications under Standing Order No. 9.
Mr. SpeakerI did not comment on the issue of putting one side of the case. My experience is that almost every hon. Member puts one side of the case. That is the purpose of our being here.
Mr. Jonathan AitkenFurther to the point of order, Mr. Speaker, surely it is common ground that for an application under Standing Order No. 9 to be repeated day after day unless a substantial new point has been made is an abuse of the procedures of the House? Therefore, the vital question is: has anything new been added to the application? The fact that appears to be new, that a committee of the TUC has endorsed the ASLEF action on pay rises, is a hair-splitting addition to an already repeated application. I suggest that it is for you, Mr. Speaker, to consider the new substantive point before deciding whether you will hear the same point of order day after day.
Mr. SpeakerThe hon. Member for Nuneaton (Mr. Huckfield) rightly used that fact as one of his arguments since his application yesterday. I accepted it, which is why I took no further action.
Mr. HuckfieldFurther to that point of order, Mr. Speaker. Of course, I intended no discourtesy to you in making a fresh application. In all cases, I have submitted the application in writing according to the traditions and procedures of the House. I hope that my handwriting was legible. I tried my best. In making a third application—I have checked with the Library—I was merely following the precedent that was set by Conservative Members during the alleged winter of discontent, when they submitted applications under Standing Order No. 9 on the same subject on more than one or two consecutive days.
My relationships with ASLEF and the TGWU are adequately agreed between the two unions and are listed in the Register of Members' Interests.
Mr. SpeakerThose hon. Members who had the privilege of serving in the House during the previous Parliament will recall that I had occasion to comment then about the necessity of not abusing our procedure under Standing Order No. 9. I have made such comments to hon. Members on both sides of the House.

Mr. Speaker's Constituency
3.47 pm
Mr. Clement FreudI beg to move,
That leave be given to bring in a Bill to provide for the creation of a constituency to be known as St. Stephen's and represented by Mr. Speaker.
This is not remotely personal, in that it affects you, Mr. Speaker, as Mr. Speaker Thomas, as opposed to Mr. Speaker generally. The newspapers report that you, Mr. Speaker, are considering not standing after the next election—
Mr. SpeakerOrder. It is grossly discourteous for the hon. Gentleman to refer to my personal position. I ask him to desist from doing so without a motion on the Order Paper.
Mr. Dennis SkinnerHe is trying to get hold of your seat. It is scandalous.
Mr. FreudNo discourtesy was intended, Mr. Speaker. I personally hope that you remain Mr. Speaker for life and that you live for ever.
My proposed Bill provides a rare opportunity for discussing a problem before it arises. The problem is that in the current political climate the re-election of a Speaker, particularly a new Speaker, would be contested, and particularly contested in the event of one who does not have the publicity of having been in office. It would mean that the Member appointed by his fellow Members to sit above them and to keep in order their proceedings in a non-party political context, would fight committed political policies with the counter-punch of: "Good afternoon, I am Mr. Speaker. I hope that I may be certain of your vote." It works terribly well with a record of achievement. It is, however, less eloquent persuasion coming from a new Speaker. If Parliament elects a Speaker, it would be wrong for the people of Croydon, Chelmsford, Canterbury and Cambridge—I mention only four towns that begin with the letter "C"—to support hon. Members in their considered choice.
My Bill would isolate Mr. Speaker from political controversy. It would enfranchise his electorate. In a democracy it is the right of an elector to pronounce on the chief political, international and economic affairs of the day. While Mr. Speaker's seat is a representative one, those he represents are deprived of the opportunity of expressing their opinion on the important issues of the day.
This is not a new Bill, which is perhaps an earnest of its merit. A number of previous attempts to bring about a change in the procedure have been made in Parliament, in Committees and in conferences. Perhaps the last that will be remembered was made in April 1963. It is especially memorable because it was moved by Mr. Richard Marsh and because permission was given for it to be introduced after the tellers mistook the "Ayes" for the "Noes". That permission was rescinded the following day.
As the matter has been argued previously, I should like to explain the standard arguments that are used against this measure. The first is that if one appoints a Speaker to a nominal constituency without an electorate, how does one get rid of him when one wants to get rid of him? Will he, like the poor, remain around? The answer is that when hon. Members elect a successor to a Speaker, the Speaker goes. That is the intention of the Bill.
The question is asked, "Why stop at creating a constituency for one Speaker?" Why not create
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constituencies for the Chairman of Ways and Means and for the Deputy Chairman? Why not create a constituency of St. George, of St. David or St. Denis? This is a specious debating point. We have one Queen, one Prime Minister and one Archbishop each of Canterbury and York. We have one Lord President of the Council. The office of Mr. Speaker comes sixth in the league table of offices of State and is held by one person.
Mr. SkinnerGet back to the roulette wheel.
Mr. FreudAnother argument is that if Mr. Speaker represented a special seat he would cease, on the loss of his office, to be an hon. Member. I believe that is desirable. It would be undesirable for any Speaker to revert to being an active party politician within the House of Commons. The last Speaker who did so was Mr. Speaker Addington in 1789, and he became Prime Minister. While any change in the identity of that office would be welcome, it is not actually the change that we, on the Liberal Benches, have in mind.
The one good argument against this proposal is that Mr. Speaker is "one of us". My contention is that Mr. Speaker is not one of us. He was, but we have elevated him to sit apart. He has absolute power; we must fight for ours. He lives here; we camp. We can practise our democratic right to be cussed; Mr. Speaker is bound by "Erskine May". He does not dress like us. He does not speak like us.
Another distinction is that upon the dissolution of Parliament we lose our office and Mr. Speaker keeps his. Under the House of Commons (Speaker) Act of 1832 he stays in office until his successor is elected. He can technically occupy the Chair without being elected a Member of Parliament. He is, in short, altogether special because we have elected him to be special.
My friend and neighbour, the hon. Member for Cambridge (Mr. Rhodes James), has told me, with his customary courtesy, that he hopes that I will not mind if he opposes the Bill. I have told him that I hope very much that he listens to my arguments. Marshal Clemenceau said:
"I have heard speeches that have changed my mind but my vote, never".
I hope very much that hon. Members will have listened to my speech. I hope that they will think about the opportunity of creating a special constituency for Mr. Speaker, his to have and to hold, while he has the confidence of the House. When the next Speaker loses his seat at the general election it will be too late. I commend the Bill to the House.
3.56 pm
Mr. Nigel Spearing rose—
Mr. SpeakerI understand that the hon. Gentleman has given notice that he seeks to oppose the measure.
Mr. SpearingIt is the custom of the House to allow through a Ten-Minute Bill unless it appears, in principle or practice, to be injurious. I believe that this is one of those occasions. The effect of such a Bill, if it became law, would be contrary to many of the deeply-held principles on which the House operates. I shall seek to show that the arguments of the hon. Member for Isle of Ely (Mr. Freud) fall into that category.
There is, of course, some disadvantage in the present arrangement. That cannot be denied. There is disadvantage, conceivably, in the manner of election, to people who feel that they have no political voice, although how many would feel that that was an acute disadvantage

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in these days I do not know. However, the electorate might gain by the fact that Mr. Speaker writes to Ministers on their behalf. There is the disadvantage that should not be overlooked for local party activists and the national party. I have no doubt that if two national parties were negotiating about seats that they might conceivably contest, the fact that an additional seat was available might make negotiations a little easier.
The hon. Member for Isle of Ely is wrong, I believe, when he says that Mr. Speaker is not one of us. He is an hon. Member but he is clearly an extraordinary hon. Member in many respects. Mr. Speaker Lloyd's remark in his farewell address to the House on 3 February 1976 has great merit. Mr. Speaker Lloyd said:
"I firmly believe that the Speaker should be elected for a constituency, as are other hon. Members, so as to keep personally in touch with the hopes and fears and the personal and individual needs of many thousands of ordinary men and women, meeting them face to face from time to time and to know the problems of the area which he presents."—[Official Report, 3 February 1976; Vol. 904, c. 1140.]
That is one of the features of the House. Face to face, we face Ministers. Face to face, we face the Prime Minister. Face to face, we face each individual constituent who wishes to see us. If Mr. Speaker was not appointed by the House to which he was elected an hon. Member, there would be serious problems. Mr. Speaker was in the past appointed by the constitutional Crown of the day. Although he formally seeks that approval from that constitutional Crown today it is the political Crown of the day that is the opponent of the House of Commons as a whole. I do not believe that the political Crown is a five-year elected dictatorship. I am sure that my right hon. Friend the Member for Cardiff, South-East (Mr. Callaghan) would not agree either. The Prime Minister herself reminded hon. Members only a few days ago that it is certainly not a political dictatorship today.
Parliament has its say and Members of Parliament have their opinions. It is essential that the Speaker of the House, who is responsible for its proceedings and gaining the confidence of Members in those proceedings, is not seen in any way, even if mistakenly, as part of the apparatus of the political crown of the day. If he is not appointed by Members of the Parliament over which he presides, who appoints him? He would be a phantom Member for a phantom constituency and in danger of becoming a phantom Speaker. Why is this? Because, contrary to what the political text books may tell us, so much of what goes on here is in a personal, face to face confrontation between Members, and you, Mr. Speaker, have to face all of us.
It is our confidence in your judgment, Mr. Speaker that places you where you are and you continuously have to maintain that confidence of all sides of the House under all conditions. It is not an easy task and the fact that you, Sir, and any of your successors, whether they be ladies or gentlemen, have to face the temper of the times, the political feel of the age, and meet constituents day to day, places you in a position which any Member cannot therefore deny, whereas, if you were appointed by another body, perhaps a body of a very different political or personal complexion than the one over which you preside, there would be inevitable undermining of the authority which we place in your hands.
In 1939 a Select Committee of the House was set up to look into this problem. It had a widespread membership.
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My esteemed predecessor but one, Mr. Will Thorne, was a Member; so was Mr. Lansbury and Mr. Clynes; Sir Winston Churchill was a Member; it was presided over by Mr. Lloyd George, Liberal. I do not believe that we should take Select Committee reports from the past or, indeed, the present, look at them and accept them, still less when times have changed. But these gentlemen had particularly long foresight. In paragraph 53 of their report, talking about the constituency of St. Stephens, they said:
"Finally, the creation of a special constituency of this type would introduce into out political system the new and potentially dangerous principle of indirect election or co-optation."
Some Members may favour such a move. I believe that that would be fundamentally wrong. The election of Mr. Speaker by such a method should be cited as a precedent.
I conclude by quoting the conclusion of the Select Committee—one to which I hope civil servants and Ministers of all Governments might also pay attention:
"Your Committee have, therefore, been reluctantly forced to the conclusion that each of the proposed schemes is beset by disadvantages of such weight as could not fail to produce worse complaints than those it sought to remedy."
I oppose the motion.
Question put, pursuant to Standing Order No. 13 (Motions for leave to bring in Bills and nomination of Select Committees at commencement of public business):—
The House divided: Ayes 15, Noes 252.

Division No. 49]

[4.05 pm

AYES

Alton, David

Penhaligon, David

Ashton, Joe

Ross, Stephen (Isle of Wight)

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

Sandelson, Neville

Ford, Ben

Steel, Rt Hon David

Freud, Clement

Wainwright, R.(ColneV)

Grimond, Rt Hon J.

Hawksley, Warren

Tellers for the Ayes:

Janner, HonGreville

Mr. A. J. Beith and

Johnston, Russell(Inverness)

Mr. William Pitt.

McNally.Thomas

NOES

Adley, Robert

Canavan, Dennis

Aitken, Jonathan

Carlisle, John (Luton West)

Alexander, Richard

Carlisle, Kenneth (Lincoln)

Alison, RtHonMichael

Carter-Jones, Lewis

Allaun, Frank

Channon, Rt. Hon. Paul

Ancram, Michael

Chapman, Sydney

Archer, Rt Hon Peter

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

Aspinwall, Jack

Clark, Dr David (S Shields)

Atkins, Robert(PrestonN)

Clark, Sir W.(Croydon S)

Barnett, Guy (Greenwich)

Clarke, Kenneth (Rushcliffe)

Beaumont-Dark, Anthony

Clegg, Sir Walter

Bennett, Andrew(St'kp'tN)

Cockeram, Eric

Benyon, W. (Buckingham)

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

Berry, HonAnthony

Cope, John

Best, Keith

Corrie, John

Bevan, David Gilroy

Cranborne, Viscount

Biggs-Davison, SirJohn

Cryer, Bob

Blackburn, John

Cunliffe, Lawrence

Blaker, Peter

Cunningham, G.(lslingtonS)

Booth, RtHonAlbert

Cunningham, DrJ.(W'h'n)

Boothroyd, MissBetty

Davis, Terry (B'ham, Stechf'd)

Boscawen, HonRobert

Dean, Joseph (Leeds West)

Bottomley, Peter(W'wich W)

Dewar, Donald

Boyson, DrRhodes

Dixon, Donald

Brooke, Hon Peter

Dobson, Frank

Brotherton, Michael

Dormand, Jack

Brown, Michael(Brigg&Sc'n)

Douglas-Hamilton, LordJ.

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

Dubs, Alfred

Browrne, John(Winchester)

Dunwoody, Hon Mrs G.

Bryan, SirPaul

Eadie, Alex

Buck, Antony

Elliott, SirWilliam

Budgen, Nick

Emery, Sir Peter

Campbell-Savours, Dale

English, Michael

755

Ennals, Rt Hon David

Hunt, David (Wirral)

Evans, loan (Aberdare)

Jenkin, RtHon Patrick

Evans, John (Newton)

John, Brynmor

Ewing, Harry

Johnson, James (Hull West)

Eyre, Reginald

JohnsonSmith, Geoffrey

Fairgrieve, SirRussell

Jones, Barry (East Flint)

Farr, John

Jopling, RtHon Michael

Faulds, Andrew

Kaufman, RtHon Gerald

Fenner, Mrs Peggy

Kerr, Russell

Finsberg, Geoffrey

Kershaw, SirAnthony

Fisher, SirNigel

Kilroy-Silk, Robert

Fitt, Gerard

King, RtHon Tom

Flannery, Martin

Lamond, James

Fletcher, A. (Ed'nb'ghN)

Lang, Ian

Fookes, Miss Janet

Leighton, Ronald

Forrester, John

LeMarchant, Spencer

Foster, Derek

Lennox-Boyd, HonMark

Fowler, Rt Hon Norman

Lestor, MissJoan

Fox, Marcus

Lewis, Arthur (N'ham NW)

Gardiner, George (Reigate)

Lewis, Ron (Carlisle)

Garel-Jones, Tristan

Litherland, Robert

Garrett, John (NorwichS)

Lofthouse, Geoffrey

Glyn, Dr Alan

Luce, Richard

Golding, John

McCartney, Hugh

Goodhew, SirVictor

McCrindle, Robert

Goodlad, Alastair

McDonald, DrOonagh

Gow, Ian

Macfarlane, Neil

Graham, Ted

McKay, Allen (Penistone)

Grant, George (Morpeth)

MacKay, John (Argyll)

Greenway, Harry

McNamara, Kevin

Gummer, JohnSelwyn

McQuarrie, Albert

Hamilton, James (Bothwell)

Marks, Kenneth

Hamilton, Michael (Salisbury)

Marlow. Antony

Hampson, DrKeith

Marshall, D(G'gowS'ton)

Harrison, RtHon Walter

Marshall, DrEdmund (Goole)

Havers, Rt Hon Sir Michael

Marten, RtHon Neil

Hayhoe, Barney

Martin, M(G'gowS'burn)

Haynes, Frank

Maxwell-Hyslop, Robin

Heffer, Eric S.

Mayhew, Patrick

Henderson, Barry

Maynard, Miss Joan

Hogg, N. (EDunb't'nshire)

Meacher, Michael

Holland, Philip (Carlton)

Miller, Hal(B'grove)

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

Mills, lain(Meriden)

HomeRobertson, John

Miscampbell, Norman

Hoyle, Douglas

Mitchell, David(Basingstoke)

Huckfield, Les

Mitchell, R.C. (Soton Itchen)

Hughes, Mark (Durham)

Molyneaux, James

Hughes, Robert (Aberdeen N)

Monro, SirHector

Hughes, Roy (Newport)

Morris, Rt Hon A. (W'shawe)

Question accordingly negatived

Orders of the Day

  New Towns Bill
  Order for Second Reading read.
  4.14 pm.
  The Minister for Housing and Construction (Mr. John Stanley)I beg to move, That the Bill be now read a Second time.
  The Bill will increase the statutory borrowing limit for the new towns from its present level of £4, 000 million to £4, 500 million, with a provision for a further increase by affirmative order to £5, 000 million. The last two new town money Bills were in 1977 and 1980. The former, under the previous Government, increased the borrowing limit by £1, 000 million, and the most recent Bill in 1980 increased it by £750 million.
  This Bill, of course, covers the five Scottish new towns and Cwmbran new town in Wales.
  Although the 1980 Act increased the borrowing limit substantially—though not, as I have said, as much as the previous one in 1977—the past two years have seen substantial expenditure in the third generation towns, as well as some further development in the earlier towns, and in Scotland and Wales. Total gross development expenditure in this financial year and the last is well over £700 million.
  We estimate that the aggregate net borrowing outstanding will reach the existing statutory limit of £4, 000 million in April or May of this year, but it could possibly be reached as early as mid-March, when towns need to borrow from the national loans fund to cover interest payments due from existing loans. We are, therefore, bringing the Bill forward now to avoid any interruption of the new town programme.
  The extra £1, 000 million of borrowing proposed under the Bill is estimated to last approximately two years.
  We are taking a more fundamental look at the present method of financing the new towns in the light of an assessment of their present and prospective ability to service their national loans fund borrowings out of their current revenue. Some of the new towns will not be able to do so for a great many years.
  The very much higher interest rates that have been experienced since the early 1970s have led to large and long-lasting revenue deficits. It is questionable whether these deficits should continue to be financed by borrowings, which tend to enlarge the deficits still further. The Government will, of course, inform the House when they reach conclusions about the extent of the problem and any measures that are necessary, including, perhaps, the need for legislation. I expect to be able to report our conclusions to the House before the Summer Recess. Until this process is complete, the present method of financing from the national loans fund will continue, and the need for the Bill therefore remains.
  I turn to the expenditure that will be made possible by the Bill. The Government's policy is to round off the existing new towns satisfactorily, making the maximum possible use of private sector finance. Public expenditure is now being concentrated on the inner cities. This means that the resources for the new towns will fall, while the urban programme, including provision for the two urban
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  development corporations, is being increased. However, we recognise that in a number of towns, particularly the third generation ones, there are important developments that still need to be completed. Some are already very advanced. For example, the new shopping centre at Peterborough will open in March, and the new railway station at Milton Keynes will open in May. But there are other important developments still to come—for example, the further town centre developments at Telford and the continuing opening up of the industrial area at Corby.
  Development corporations and the Commission for the New Towns will be seeking to make the maximum use of private finance, but some public funding will still be needed. It will be needed for essential main road schemes—for example, the eastern expressway at Runcorn and the western approach road at Basildon, which clearly cannot be privately financed. Public expenditure will be needed for other essential infrastructure—roads and sewerage in particular—to round off housing, industrial and commercial areas in so far as this infrastructure cannot be financed by developers themselves.
  Public funding may also be required for a limited programme of advance factories in towns such as Washington and Corby, where the private sector may be unwilling to take the development risk, and where there is an imperative local employment need to have industrial space immediately available for incoming firms. The Bill is therefore essential to the orderly and satisfactory completion of the new town programme over the next few years.
  Mr. Giles RadiceWill the Minister confirm that the new towns in the North—for example, Washington—have an important role to play in job creation? Will he say something about the future of those new towns, particularly the three that I am thinking about in the Northern region?
  Mr. StanleyAs the hon. Gentleman will be aware, my right hon. Friend has announced the proposed dissolution dates for the three new towns in the North-East, but I certainly agree with him about the important contribution that is made to local employment. I shall return to that matter a little later.
  The Government are anxious to keep public borrowing down. We have therefore been seeking to make the greatest practical use of private finance. A considerable volume of new town industrial and commercial development is now being financed by sale and leaseback and lease and leaseback agreements with the private sector. Since May 1979 more than £150 million worth of new town development activity has been financed in this way. Basildon, for example, has recently entered into an agreement with a major insurance company which will finance its new £50 million shopping centre.
  Private development finance is also being drawn into the new towns through industrial, commercial and housing developments being wholly privately funded on land sold to the private sector. In the last financial year—1980–81—we estimate that by this means the new towns in England obtained £37 million worth of offices and shops, £38 million worth of industrial space and £100 million worth of housing—all financed entirely by the private sector. These figures are likely to be significantly higher in the current financial year.

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  A further major way in which private finance is supplementing public expenditure in the new towns is through the sale of completed assets. Quite apart from producing a welcome extension of private ownership in the new towns and giving many firms the opportunity to buy their freeholds, the disposals programme has made, and is making, an indispensable contribution to the continuation of the industrial, commercial and private housing programmes of the new towns.
  Mr. John EvansHow much cash flowing from the sale of the assets has been paid back to the Treasury?
  Mr. StanleyThe receipts from the sale of assets have been used in part within the new towns; in part there has been some cash repayment to the Treasury. Any cash repayment to the Treasury has merely enabled the levels of borrowing and public expenditure for the new towns to be maintained at a higher level than would otherwise have been possible. As I have made clear, we could not have maintained the new towns programme at the level at which we have maintained it during the past three years without the special disposals programme. If the hon. Gentleman wishes to have a figure on that basis for the cash transfer I shall be glad to try to assist him if he puts down a question.
  Mr. EvansWith respect, this is a Second Reading debate of a money Bill. It is a question that should be raised during the passage of the Bill. It is grossly unfair to suggest that I should put down a question on an important matter that arises on Second Reading.
  Mr. StanleyPerhaps the hon. Gentleman will let me continue. By the end of this financial year asset disposals will have realised getting on towards £300 million since the Government came to office. There is no question, as I said, that, without this sum, it would not have been possible to maintain new town development activity at the level achieved over the past three years. I can assure the House that we wish to see further public borrowing minimised, and that we shall continue to utilise private finance wherever this is practical.
  I turn now to a number of new town issues which I know are of interest or concern to hon. Members and on which it might be helpful if I commented at this stage. My hon. Friend the Under-Secretary of State will, I know, try to deal with particular constituency points when he winds up.
  First, there is the settlement of claims for defects in new town housing that has already been transferred. As the House knows, we commissioned the National Building Agency last March to assess and report to us on authorities' claims for grant towards the cost of remedying defects in transferred new town housing. These are, of course, claims under what is now section 51 of the New Towns Act 1981—formerly section 10 of the New Towns (Amendment) Act 1976. This work is well advanced and most of the necessary on-site survey work has already been carried out at all towns except Harlow. In Harlow the survey will start shortly. With the impending wind-up of the NBA, as I said in answer to an oral question from the hon. Member for Easington (Mr. Dormand) on 20 January, we have made arrangements for the contract to be completed by a private sector consultancy set up by former NBA staff. That will ensure the necessary continuity.
  Mr. Stanley NewensWill the Minister confirm that this will mean further delay in reaching a solution to a problem that has already caused considerable difficulties for the new towns?
  Mr. StanleyI am coming to that point.
  Under the agreement that we signed with the consultancy last week the report is due to be submitted to us by the end of May. The NBA had in fact told us earlier that it would be unable to meet the original deadline of late April, so I hope that the House will agree with me that the new date for completion does not in practice mean a material slippage of the timetable. We are as anxious to reach conclusions on this long drawn-out matter as the councils concerned. We shall be wanting to put proposals to the local authorities as soon as we can after we hive received the report and have been able to evaluate it.
  Some hon. Members have expressed concern about difficulty and delay experienced by new town industrial and commercial tenants who wish to purchase the freeholds, or possibly long leases, of the factories, offices or shops that they occupy. The Government's policy is clear. It is to give sitting tenants every reasonable opportunity to bid when a development corporation or the commission puts the premises that they are occupying on the market. We have issued detailed guidelines to the commission and the development corporations on this point, laying down in detail the way in which advance notice should be given to sitting tenants.
  In some cases it may not be possible for tenants to buy individually, because their premises are part of a parade of shops or part of an industrial estate and when to sell properties individually would materially reduce the value of the shopping parade or the industrial estate as a whole. However, in this situation, new town coporations and the commission are ready to deal with the tenants as a group if they wish to buy the whole parade or estate as a consortium.
  Mr. NewensWhat price the small business man!
  Mr. StanleyWe know of at least five cases where consortia negotiations are in train and one where a consortium purchase has been completed.
  Apart from this, a large number of sitting tenants, individually, as a result of our disposal policy, have been able to buy the freehold of the premises that they have previously leased. Under the present Government more than 350 industrial and commercial tenants in the new towns have bought their freeholds or are in the process of doing so, thus strengthening the asset base of their own businesses and injecting a substantial element of private ownership into the new towns.
  I now turn to the Commission for the New Towns. Some of my hon. Friends have expressed concern that the rate of withdrawal by the commission is not proceeding fast enough. I assure them that the commission is undertaking a major programme of sales, and will have made disposals worth approximately £100 million by the end of this financial year. That represents a substantial proportion of the total disposals of the new towns as a whole. The commission is also making progress in its negotiations for the transfer of its town centre management responsibilities and other residual assets and liabilities to the district councils concerned.
  As part of its wind-down programme the commission has decided to close its local offices, except at Corby, and

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  to concentrate at its London headquarters from next January. This will permit significant staff savings. I am satisfied that an orderly but continuous process of rentrenchment by the commission is taking place, and that this will be carried through.
  A number of hon. Members—one has already raised the subject—will, I am sure, want to raise the question of the contribution that the new towns can make to mitigate unemployment. Without exception, every new town has generated significant employment opportunities in both the manufacturing and service sectors. The contribution that the new towns have made to creating job opportunities has invariably been not just of local but of regional significance.
  During the first three years of this Government we estimate that in the English new towns the development corporations and the commission will have generated almost 2 million sq ft of office space, more than 3 million sq ft of shopping space and 20 million sq ft of industrial space, which is a considerable development achievement. Despite the recession, the overwhelming proportion of this space has been successfully let.
  At the same time a major contribution has been made to meeting the needs of small firms. Highly successful small nursery unit estates have been completed in towns such as Peterborough, Warrington, Telford and Washington for small firms wanting units of under 2, 000 sq ft in which to get started. I have visited a number of these. They are the most vivid illustration of the potential of small business to provide new job opportunities. Altogether, we estimate that the English new towns have been creating approximately 20, 000 job opportunities a year in each of the last three years, which is a very material contribution indeed.
  I come now to housing in the new towns. The Government consider that a significant and rapid increase in the proportion of home ownership in the new towns is desirable and necessary. I am glad to say that, without exception, all the new towns are making a significant contribution to our low-cost home ownership programme.
  Since June 1979, the 11 English new towns still with housing responsibilities have released nearly 1, 300 acres to private house builders. That is sufficient land for more than 14, 000 owner-occupied dwellings. A sign of the confidence that private house builders have in the new towns is the scale of private house building taking place. At Warrington, for example, 16 house builders are building about 2, 000 dwellings on 25 different sites. At Milton Keynes about 35 house builders are building more than 3, 500 houses for sale on 45 sites.
  The house builders are doing a great deal to provide homes to buy at a wide range of different prices. At the lowest end of the price range they are being imaginative and skilful in providing starter homes that young first-time buyers with relatively small incomes can afford. For example, right now one-bedroom starter homes are available for sale in central Lancashire for £15, 500. Even in Basildon, in the more expensive South-East, starter homes can be bought for just over £17, 000. Those prices are certainly within the reach of young couples and single people with fairly modest earnings.
  As well as building for outright sale, all the new towns have now launched their own shared ownership schemes, thereby bringing home ownership well within reach of
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  those with below average industrial earnings. The comparative costs of buying on a shared ownership basis as opposed to renting are in some parts of the country now remarkably close. I noticed, for instance, in an advertisement put out by Washington new town last year that the weekly cost of buying a new house in Washington on a 50 per cent. shared ownership basis is almost identical to renting the same house.
  The new towns have drawn up their own standard shared ownership lease in agreement with the Building Societies Association. This has helped considerably in securing building society mortgage finance for new town shared ownership schemes and is enabling more schemes to go ahead.
  At Northampton the corporation expects private developers to build about 200 houses each year for shared ownership in the next few years. At Milton Keynes alone, about 700 houses for shared ownership are expected to start this year. I expect to see a significant increase in shared ownership opportunities in the new towns over the next year or so.
  Some new towns, such as Skelmersdale, are making substantial use of homesteading—the sale of dilapidated or badly vandalised houses or flats for improvement by the purchasers. Skelmersdale and Telford have demonstrated vividly that dwellings that have become difficult, if not impossible, to let can be brought rapidly back into use if authorities will release them for sale and let young couples do them up. What the purchasers have achieved with these houses is remarkable as I have seen in Skelmersdale. I hope that more local authorities will take a leaf out of their book.
  Lastly, there has been a remarkable response from sitting new town tenants to the opportunity that the Government have given them to buy their houses and flats on favourable terms. By the end of last December, nearly 8, 000 new town tenants in the 11 English new towns had already completed their purchase. Since the Government came to office two and a half years ago, about 14 per cent. of new town tenants—one tenant in every seven—had either completed the purchase of their homes or were firmly negotiating to do so.
  There are seven new towns where the proportion of tenants who have either bought or are firmly negotiating to do so is already more than 10 per cent. They are Basildon, Northampton, Peterborough, Warrington, Runcorn, Skelmersdale and Telford. In Peterborough the percentage is 21 per cent. and in Skelmersdale it is a remarkable 25 per cent. Indeed, in Skelmersdale the proportion of owner-occupation in the town as a whole is already one-third higher than it was when the Government came to office two and a half years ago.
  There is no question but that, as a result of the initiatives that we have taken, an unprecedented and much-needed upsurge in home ownership in the new towns is taking place. Indeed, I believe that by the end of this Parliament there will have taken place probably the biggest single growth of home ownership in the new towns in any Parliament in the post-war period.
  Although the new towns programme is drawing to a close, I am sure that both sides of the House recognise the key contribution that the new towns have made over the past 30 years to the provision of new housing and job opportunities and to creating a better living and working environment for the hundreds of thousands of families who have chosen to move to the new towns and who, by and

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  large, do not regret their decision. The Bill is essential to help the new town programme to be satisfactorily rounded off. I therefore ask the House to give it a Second Reading.
  4.37 pm
  Mr. Ted GrahamFirst, let me say that the Opposition will give the Bill an unopposed Second Reading.
  I made my first speech from the Dispatch Box for the Opposition on the Third Reading of the previous New Towns Bill. On that occasion the Minister asked the House for permission to increase the borrowing limit from £3, 250 million to a maximum of £4 million. He stated:
  "The length of time that the proposed increase in the borrowing limit of £750 million will last is difficult to estimate with precision, but it should suffice at least until the end of 1983."—[Official Report, 6 June 1980; Vol. 985, c. 1865.]
  We are now told that the moneys will last only until the late spring of 1982. How did the Minister get his sums so wrong 18 months ago? If, as he has just said, he expects the upper limit to last for two years, how can we believe that that figure is correct in the light of his failure to get the figures right 18 months ago?
  We are told that the moneys that we are being asked to approve are to be used to finance housing, sewerage, roads, and other local expenditure. No one on the Opposition Benches would cavil at the list of items for which the money is required—completing, as the Minister said, shop centres at Peterborough, the railway station at Milton Keynes, the town centre at Telford, and the industrial area at Corby. We are certainly in favour of all those projects. However, we are dead set against the crazy economics of the Government. The imperatives for any Government in seeking to provide decent homes must form part of a balanced programme. In my view and in that of the Opposition, the Government have gone overboard in one direction—housing—at the expense of criminally neglecting needs elsewhere.
  In the new towns, especially those of the first and second generations, there is the spectre of second and third generations of the original families being forced to look elsewhere for homes. By turning off the tap of finance for building new homes, and by stimulating the sale of existing homes, thousands of young couples are being squeezed out, and cannot live in the new towns where they were born.
  I hope that we shall be told not only about the number of houses that are being sold but about the number of people who are on the waiting lists. At Easington in Durham there were 8, 000 people on the waiting list last year; at Warrington there were 2, 000; at Hemel Hempstead 4, 000; at Sedgefield 3, 000. For Basildon the figure that I was given by the Library was 3, 440. So what hope is there for young couples under the Government's policy in new towns of selling houses and building fewer and fewer new houses?
  Mr. Anthony SteenDoes the hon. Gentleman agree that a rather curious paradox has arisen, in the inner areas of old industrial areas, such as Liverpool, where houses were demolished and people moved out, many of them to new towns? Those people now live out in the new towns, and the inner area of Liverpool has about 2, 400 council units which are empty. Does he think that some of the people on the waiting lists in the new towns should be encouraged to go back to the industrial areas? Is that what he wants?
  Mr. GrahamI want a decent home to he made available for every young couple, or not-so-young couple, wherever they want it. Families who have lived all their lives, 20 or 25 years, in a new town should have the opportunity, if they wish, to occupy a council house for rent in a new town.
  Mr. John EvansIs my hon. Friend aware that in the new town of Warrington, which I represent, there is much resentment on the part of citizens who have lived there all their lives because the new town regulations preclude them from having a new town house to rent? The regulations say that people have to move into the Warrington area before they can get a house. That resentment has been increased because the strangers who moved into the area to rent a house are now purchasing those houses. People who were trying to get a new house in Warrington three years ago still cannot get one, and they see newcomers purchasing the houses that were originally rented.
  Mr. GrahamI thank my hon. Friend for what he says, and I am sure that contributions from other of my hon. Friends will amplify that. The Government, in accordance with their own political imperatives, are concentrating too much on the present, satisfying the laudable ambitions of tenants to become owner-occupiers. They give too little attention to the needs of the children of those former tenants who look to the local authorities in new towns to provide houses for rent.
  I hope that the Minister who replies will deal with the conundrum inherent in the Government's policy of encouraging the sale of council houses, and at the same time seeking—in our view, inadequately—to meet the needs of those who need homes. The Secretary of State confirmed to the Select Committee on the Environment the equation that a council has to sell 12 homes to have enough capital to build one new house. If that equation is riot correct, the Minister should tell us the correct equation. It is the economics of the madhouse whereby an authority, to get sufficient capital receipts, has to be encouraged to sell so many houses.
  The Labour Party has played a notable part in the history and development of the new town movement. Since 1945, despite the changes of Government, new towns have gone from strength to strength. It is, therefore, no part of Labour's case today to examine in detail or comment on the intricate pattern of control and management that hitherto has been generally accepted as a soundly based system, enabling Government to create and sustain new towns. I am grateful to the Minister for his advance notice that a paper will be published before the Summer Recess to explain to the House and the country changes in the financing of new towns. Labour Members will, of course, examine it with immense care and attention.
  Although the Opposition have argued against the way in which the Government have sold industrial and commercial assets, we have expressed more than once our concern at the problems that have been caused, particularly for the small business man and the small shopkeeper. Sales of individual freeholds are not permitted. As a result, the shopkeeper or business man either has to join a consortium or bid for the freehold of a huge block. I know from inquiries that I have made in new towns that shopkeepers are angry and bitter. The chemist or the greengrocer has been gullible. He has

  765
  listened to the propaganda of the Conservative Party telling him that it would enable him, the shopkeeper or the business man, to buy the freehold of his property.
  The Minister should tell us what steps he intends to take to protect the interests of the small shopkeeper. It is no good telling him to join a consortium, because the block of shops may be bought by a speculator who wants only to make a profit. Instead of ending up with a benevolent landlord, the small shopkepper may end up with the worst possible landlord.
  The Opposition remain unconvinced that it is in the best interest of new towns to be cajoled and suborned by Government pressure to flog off assets that they wish to retain—not least because they form part of a balanced and profitable property portfolio.
  We have been told that there is a programme. I hope, therefore, that the Minister will answer the following question. It relates, in part, to what was said by my hon. Friend the Member for Newton (Mr. Evans). Will he tell us the total of capital receipts obtained by new towns that are forced to dispose of commercial and industrial properties at the behest of the Government, acting under the powers in the Local Government, Planning and Land (No. 2) Act? I accept that there is a quibble. We argue that the new towns are being forced, and the Minister has assured us more than once that they will not be sold at commercially disadvantageous terms. I hope that the Minister will give us the total figures.
  The Under-Secretary of State—not the present holder of that office, but his predecessor, the hon. Member for Hampstead (Mr. Finsberg)—told a Committee on 6 May, when the New Towns (Limit on Borrowing) Order 1981 was being debated, that some of the proceeds from these sales were being used to support investment in other new towns. We would not take exception to taxpayers' money invested in Basildon being realised and reinvested in other new towns or urban development corporations. In Committee, Opposition Members argued for that. Will the Minister give the precise figure and the proportion of new investment represented by that rolled-over capital? We do not want generalisations and we do not want to be told that the money comes in and goes out. On Second Reading, such figures should be available and we should know how much money from the sale of assets in one place has been spent in another. Will the Minister give a categoric assurance that no assets have been sold on commercially disadvantageous terms as a result of the recession, so that the Government can meet their targets and reduce the public sector borrowing requirement?
  We understand that under the system every area is given a target. If the advice given to an authority by its valuers and others is that it is not the right time to sell, what steps will the Government take? Will they waive their requirement to produce £10 million or £20 million, or will they say that the overall imperative demands that authorities should sell on disadvantageous terms? The only justification for selling assets, particularly in the Government's way, would be if private ownership could manage them more effectively and to general advantage. There has never been a shred of evidence to support the Government's contention, but only dogma, malice and spite.
  It is extremely hard to understand the Government's oft-trumpeted cry that they believe in economic efficiency.
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  New towns are successful, but, alas, according to the Government they are fatally flawed because they are successful public enterprises. The pieces of the Government's jigsaw on new town policy do not fit, even if we accept that the Government are cobbling it together as they go along. I hope that the Minister will seriously attempt to put the sale of industrial and commercial assets in context. I refer to house building, community developments and commercial viability. I hope that the Government will not fob us off with generalisations. The situation is far too serious for that.
  The Government do not need to be reminded that they have left a sour taste in the mouths of first generation new towns as a result of their handling of section 10 claims. First generation new towns accepted the hand-over of corporation housing on the clear commitment in section 10 of the agreements that the Government would reimburse district councils for repairs and renovations arising from inherent design faults. The miserable tale has caused intense frustration and anger. The scale of potential calamity is catastrophic and the delays in settling claims do not reflect any credit on the Government. The closure of the National Building Agency by Government diktat has not helped. The Minister seemed to say that that was almost an act of God over which the Government had no control. The delays will be a direct result of the Government's action. The report that will be placed before the Minister in May will give him an opportunity to change that atmosphere of distrust. Before the Minister accepts the detailed report I hope that he will allow new towns to discuss the NBA report on housing. I hope that we shall not be told that the local authority has stated the amount necessary to put any defects right, that the NBA has given its figures and that the Minister has accepted the NBA report without having given the local authority an opportunity to challenge the NBA's figures.
  For example, if an authority estimates that the cost of correcting defects is £7 million and the NBA claims that the cost should be £5 million, the Minister may decide that he will provide only 40 per cent.—£2 million—of the £5 million figure. If it is discovered that £7 million is needed to put right the defects, who will pick up the £5 million tab? The answer is the local authority. The Minister has arbitrarily decided to delete certain subjects from consideration. We cannot understand that. The Minister has excluded all matters and works outside the four walls of a dwelling from consideration under section 10. For example, he has excluded the estate sewers, drains, garages and garage compounds. However, when the agreement was made they were part of the development that it was agreed should be taken into account.
  The Minister has alluded more than once to the fact that the HIP allocations for new towns contain an element that will help them in the meantime to deal with section 10 claims. New town officials have met that with disbelief, not least because Department of the Environment officials have shown a marked reluctance or inability to identify those allowances. For example, Stevenage asked for £5·8 million in its HIP allocation. It has been given £2·8 million. However, it has not been told that that £2·8 million contains an element of £500, 000, £1 million, or whatever, for use towards putting right section 10 claims. The Minister should resolve the problem quickly and sympathetically. He should not present councils with a fait accompli, and a cut and dried, take-it-or-leave-it decision.

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  The Minister, who has been listening attentively to the debate, will be visiting Peterlee towards the end of the week. He will know that he is the third housing Minister to visit it in the past two years. I assure him that he, personally, will be warmly received. However, Peterlee and Easington do not want visits from Ministers, but speedy action and money to put right the defects that they know about.
  Mr. John EvansSend them a cheque.
  Mr. GrahamMy hon. Friend is right. The Minister can do those towns and those who live in the area a great service. He should not ignore the fact that second generation new towns are dragging their feet. They will not enter into anything like a section 10 arrangement because of the treatment given to first generation new towns.
  The new towns resent the fact that the Government, in dealing with the block grant and other financial matters, have failed to consider certain factors. New towns are grateful and relieved that the Government's decision about the E7 housing factor will marginally ameliorate the financial situation of new towns. However, those who represent new towns in the London ring have pressed the Minister to give proper weight to factors such as the cost arising from the planning of new towns, the large amount of open space, communal shrubberies and, in particular, the need to create a community and services for the young.
  No doubt the Minister has perceived that as much as two-thirds of the difference between the needs of new towns and the woefully inadequate grant-related expenditure is accounted for under the two heads of planning new towns and looking after the population. Will the Government try to adjust the GREs for new towns to take such wholly exceptional expenditure into account?
  I must tell the Minister that nowhere more than in the new towns is there complete incomprehension of the basis for GREs. I quote some of the comments that have been made to me recently by chief officers in new towns. They include "suspect and unreliable",
  "inexplicable and widely varying assessments"
  and
  "unrelated to the acual spending needs of the district".
  Those are not generalities. I would be pleased to tell the Minister the names of the chief officers who made those points. It is seriously being asked whether there is a conscious vendetta against new towns because of the way in which the Minister and his colleagues are refusing to adjust the assessments. The volte-face towards new towns by the Government since May 1979 is causing pain, anger and despair in many of them.
  In conclusion, our central charge is that within the general onslaught made by the Government on local government across Britain, piling impossible imposts on already intolerable burdens, they refuse to acknowledge the special factors affecting new towns, arising from their demographic profile, or problems stemming from the base of their funding.
  When the Government produced their incomprehensible formula for block grant aid to authorities, they did not hesitate to involve the most detailed yardsticks and measuring rods to prod local authority spending into line. All local government across the geographical and political spectrum has bitterly protested at the depth of interference
  768
  into local management of local affairs by the Government, a Government who profess to give freedom to councils to run their affairs in their own way.
  When I urged the Secretary of State to interfere a little more so that the special financial problems of new towns could be given due weight, his hon. Friend, the then Under-Secretary of State, said to me in a letter of April 1981:
  "It would not be possible w adjust targets for individual authorities to reflect particular circumstances such as population growth without becoming involved to an unacceptable degree in the decision-making of those authorities."
  That is claptrap. Where there is a will there is a way.
  When the Government choose, they do not hesitate to differentiate between the shires and inner urban areas. If they wished to give weight, in adjustment of GRE assessments, to a class of authority such as new towns or a class of authority with peculiar, significant population factors—which would include most new towns—they could do so. The only stumbling block is the refusal to help. That is deplorable and is no credit to the Government, the system or the Ministers responsible.
  The Labour Party has always accepted that in due time the forms of central direction and control via the Commission for the New Towns, and below that the individual development corporations, would be loosened and changed. The creation of living, vibrant communities primarily as a result of public initiatives and public capital has never blinded us to the reality that taxpayers' investment requires prudent handling, a proper return and a justified role. During the years, under both Governments, we have seen the new towns blossom into a large sector of British life and achievement.
  That background gives the Opposition satisfaction. We are proud to say that we have played a major part in the growth of what we know as the new towns movement.
  5.4 pm
  Mr. Christopher MurphyI support the Bill in the hope that it will assist in bringing about an early normalisation of the new towns. I speak as one privileged to represent two first generation new towns, Welwyn Garden City and Hatfield. The Government should adopt the slogan "Normality for every municipality". The concept of the new town has in many ways proved to be successful in dealing with the circumstances that faced Britain. To support that statement, I quote an independent assessment by Taylor and Chave in their book on the environment:
  "By conventional standards a new town is a good society. It is happy and healthy."
  Although the end product has produced considerable advantages, many disadvantages must still be overcome. The measure before the House may help to achieve that aim. However, in making certain criticisms, it would be wrong not to recognise the benefits inherent in the building of "garden cities" outside urban areas and the results of the way in which that approach has been subsequently developed.
  When Ebenezer Howard first postulated his theories, he saw the logic in transferring people to such garden cities, reducing the population density of the inner city and then renovating and rejuvenating the city centre to an overall plan. There is no doubt that the green belt and decentralised town have been pursued vigorously, but the other side of the equation—the inner city aspect—has been, and has become, neglected. It is therefore to the

  769
  credit of the Government that such neglect is now being overcome with the constructive policies of enterprise zones and urban development corporations. It is also to the credit of the Government that the outstanding problems of the new towns are being tackled firmly.
  Ebenezer Howard based the financial realisation of his plans on private enterprise, but the post-war new towns movement was entrenched in the public sector. Hence, the unfortunate need for the Bill. The new towns were very much established as authoritarian organisations acting as estate developers and owners, but they held on to their property investments.
  It should be noted that that was not the only way to secure such co-ordinated development. Abroad, new town development commissions have had a three-pronged function—land assembly, land planning and land disposal. Rather than raising finance for the purchase of land and the provision of infrastructure and then taking advantage of the skills and expertise of private enterprise to develop the town and sell the properties, we in Britain have erred on the side of almost total public sector involvement. For that reason, to see the task through coherently, the Bill appears necessary.
  To achieve a more satisfactory outcome, it must be right to sell the new town assets, be they commercial or domestic property, to give an opportunity to local people to have a stake in their environment. Thus, the imbalance in ownership can be redressed and the benefits of private capital given to the town, albeit it at a later stage with the resultant reduction in taxpayers' contributions and the reduced need for further new towns Bills.
  Some of the problems that have been faced in the first generation new towns relate to the assets. Their sale is taking place with an alarming lack of speed. The future of the so-called common parts has still to be settled. Those properties not yet for sale have excessively high rents imposed upon them. The homes transferred to district councils still await the final outcome of claims for section 10 grants. The consequent high level of local authority housing has had a disproportionate effect on the rate support grant because of the E7 factor—now, thankfully, ameliorated. The high rateable value created in a county such as Hertfordshire by the new towns and their properties produces a current imbalance in the rate support grant under existing formulae, with resultant threats to services, such as education. There is a need for consideration of a special new town element in assessing future rate support grants. Those are matters of great importance to my constituents and many others similarly affected.
  However, my support for the Bill is tinged with considerable regret. That regret centres on the way in which new towns are administered, and particularly the continuing presence of the Commission for the New Towns. Because of the State's involvement in the development of new towns in the aftermath of the Second World War, it was decided to instigate development corporations that would act as separate entitles from the local authorities and be funded separately by Whitehall. As a town matured, the functions of the corporation were transferred to the NCT, but there the process seems to have foundered.
  Inevitably, this measure will assist the continuing administrative costs of the NCT. It is right on this occasion
  770
  to ask how long this quango will be allowed to continue, recognising that its tasks with respect to the development of first generation new towns should be diminishing day by day. Quangos are born with ease, grow effortlessly, but are "a long time a-dying".
  It would be wrong to be totally dismissive of the NCT's efforts in the past, but equally it would be wrong to condone what is becoming an increasingly undemocratic aspect of new towns. An important element of taxation without representation exists for tenants and local people generally. The experiment of the new towns has undoubtedly achieved much for the people whom it sought to help, although at a high price in terms of countryside lost and urban decay.
  I return to the assessment by Taylor and Chave, who say:
  "Its families have good homes. Its children have good schools. Work is varied and close at hand. Working conditions are good. There are wide facilities for active recreation. The strains of industrial life are reduced to a degree not achieved in unplanned communities."
  The House can take pride in that assessment.
  I support the Bill, but I do so with a firm request that the Government take urgent action to deal with the problems that I have raised which result from the situation regarding the assets of new towns. I also express my firm belief that in the two new towns that I represent the time has come to say
  "never send to know for whom the bell tolls"—
  it tolls for the NCT.
  5.12 pm
  Mr. Stanley NewensLike those hon. Members who have already spoken, I support the Bill. Its effect is to provide further sums of money for the funding of new towns, which represent a highly successful and proven form of urban development.
  As an hon. Member representing a new town, I am anxious because in other respects, whether by accident or design, the Government have inflicted grave damage on new towns, especially those such as Harlow, which I represent and which is regarded as completed.
  As my hon. Friend the Member for Edmonton (Mr. Graham) has said, the method of determining rate support grant which the Government have adopted has failed to take into account the specific features of new towns, with the result that many have been severely penalised in rate support grant settlements. For example, in 1981, six of the seven London new towns lost about £6 million of the £8 million paid to them the previous year. As if that were not enough, the Government have also deprived new towns of substantial housing subsidies and have delayed the settlement of outstanding claims made under section 10 of the New Towns (Amendment) Act 1976.
  On this issue concerning the provision of funds to remedy design defects of housing assets transferred to local authorities from development corporations the Government have procrastinated and passed the settlement of claims to the National Building Agency and then decided to abolish that agency. They now say that they hope that the result will be reached by May this year. I very much hope that it will, but the delay which they have already inflicted has meant that people have been forced to live in houses with serious structural design problems. They have been forced to put up with that and are continuing to do so.

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  The position in new towns now is that, but for the change in the treatment of the E7 factor which governs the assessment to housing revenue for rate support grant purposes, new towns such as Harlow would have been faced with catastrophic losses of income this year. The formula by which the rate support grant is determined fails to take into account the special features of new towns, and to allow for them. The result has been that all new town local authorities, even those under Conservative control, are apt to be regarded, quite unjustly, as high spenders. The fact that new towns have only recently acquired amenities and therefore face higher interest charges and other costs than older towns that were able to begin purchasing such amenities many years ago is not provided for in the present formula. The fact that most new towns have large open spaces that have to be maintained, although they are not available for sale or development, is overlooked. The fact that new towns face a succession of problems that arise very rapidly, due first to the large number of children in those areas, then to the number of old people, and so on, is not reflected in the present rate support grant formula.
  A case exists for a special new towns factor to be incorporated in the rate support grant formula to ensure that new towns are not in danger in the future of being starved of funds when the development corporations are wound up.
  The Government have not only sought to reduce expenditure on new towns. They have also endeavoured to squeeze money out of them in various ways. They have done that, first, by the sale of assets, to which the Minister referred. In speaking of this, the Minister could not give full details. I remind him that when I have tabled parliamentary questions the full details have been refused for a variety of reasons. I believe that the Government have been so tardy about coming forward with the information because their hopes for the success of this policy have never been fully realised on the terms in which the Government originally stated it.
  The Minister said that private capital has been attracted to new towns. To a certain extent, I agree that that is true, but not in all areas. However, as my hon. Friend the Member for Edmonton said and the Minister conceded, small industrial or commercial owner-occupiers have often been denied the right to buy and in some cases have had their premises sold over their heads. That is not a good record for a Government endeavouring to posture as the friend of small business men. The same criticism applies to rents.
  The Government have been prepared to allow an outrageous increase in industrial and commercial rents to be put forward which, in the CNT towns, can no longer be discussed at local level. The hon. Member for Welwyn and Hatfield (Mr. Murphy) should remember that the Conservative Government were responsible for the way in which those issues have been shifted to the New Towns Commission, and did not consider the fact that there would not be local availability, as there should have been. I have raised the question of rent increases with the local office in Harlow. Although I have no complaint against the people there, they have had to pass my query on and I am still awaiting a reply.
  Mr. Nicholas LyellDoes the hon. Gentleman agree that it is desirable that the Government should encourage the Commission for the
  772
  New Towns, in its negotiations with those businesses that would wish to purchase their premises, to take a reasonable attitude when marriage values—difference in values of premises when they are let and when the tenant and landlord are the same—come to be considered? Will the hon. Gentleman agree that a reasonable attitude should be taken so that the occupiers of the premises have as swift and early an opportunity to purchase them on as many occasions as possible?
  Mr. NewensI am not a great advocate of the sale of public property, but if there are to be sales I agree with the hon. and learned Member for Hemel Hempstead (Mr. Lyell) that the owner-occupiers ought to have not only a prior but a better and more favourable opportunity than outsiders. I hope that the Minister will listen to the hon. and learned Member and me.
  The accusation made by the hon. Member for Welwyn and Hatfield against the Commission for the New Towns should be considered, bearing in mind that it is unable to function properly because the Government have not given it the lease of life that would enable it to. For example, an advertisement recently appeared for staff to take on temporary positions. Even in the present situation, the best qualified staff will not go for temporary positions and, in those circumstances, the commission will be unable to act as a driving force in new town affairs. There is still nothing to replace it.
  The Minister referred to jobs created, but it is clear that he now presides over the running-down of the system and much of the drive originally available in new towns has been destroyed because of the policies pursued by his Department.
  Problems are not confined to small business men because many large operators encounter similar difficulties. The prices of freeholds are unattractive to many larger industrialists. It is infinitely better for town premises to be owned by those concerned with the locality—whether a development corporation, new town commission or an industrialist—rather than a finance organisation that is more interested in the return on its investments.
  Increased rents represent an issue of considerable concern to all industrialists and other business men. I hope that the Minister will take note of that and will not continue making tremendous noises about the imposition of high rates on businesses, when the Government are responsible for allowing a policy that imposes considerably increased rents on business men.
  The Government still have no clear idea of what they will do with the industrial and commercial assets now held by the commission, which cannot be disposed of before the dissolution occurs. They are still resisting, for doctrinaire reasons, the transfer of commercial assets that will never make a sufficient profit to attract private buyers to local authorities. The authorities should refuse the Government's policy in that respect, particularly if they are concerned about democracy and local control.
  On the other hand, local authorities are unprepared to accept all the amenities that will be prime loss-makers unless the Government provide the financial means whereby the amenities can be adequately supported. Authorities will not be taken for a ride on that issue, whatever the Government suggest.
  The Government now face many problems in new towns which they cannot resolve with their present policies without doing considerable damage. The Minister claimed

  773
  that there were increased opportunities for would-be home buyers. I hope that he will recognise that his policy has also greatly diminished opportunities for those who need, but cannot afford to buy, homes. That includes not only those wanting their first home, but those accommodated in flats who wish to obtain the tenancy of a house with a garden, which is the justifiable aspiration of many of my constituents and of many living in new towns.
  Labour Governments always provided houses for people to buy in new towns, as well as to rent, but a new problem is being created by the growing waiting list of those who cannot afford to buy and for whom there is no house available to let.
  The Bill aims at providing more funds for new towns and that should be supported. However, I hope that it will not be used to obscure the great damage being done to new towns by the Government's general policies. I hope that the next Labour Government will make funds available, and make it possible for new towns to resume the forward march on all fronts that the Labour Government first launched in 1946.
  5.28 pm
  Mr. K. Harvey ProctorI cannot agree with the hon. Member for Harlow (Mr. Newens) in his strictures on the Government about the great damage he alleges that the Government have done to new towns in the past two and a half years. It is really the reverse, and I shall try to develop some of the success stories of new towns during my speech.
  I welcome and support the Second Reading of the Bill. It underlines the Government's commitment to the development of new towns. I also support the comments of my hon. Friend the Member for Welwyn and Hatfield (Mr. Murphy) about the normality of the new town's position. The sooner that new towns are fully developed, the better. That will not be disputed. I support the Bill for providing a modest increase in the borrowing limits of the new town development corporations. I also welcome the Minister's commitment to a study of the borrowing system by those corporations and his undertaking that, before the Summer Recess, he will make a statement. I shall press my hon. Friend the Under-Secretary of State, who is to reply, on the form of the study and its outcome. Will the result be a Green or White Paper or a ministerial statement with a departmental paper attached? I should be interested in an answer to that question.
  Mr. GrahamIt will be a diktat.
  Mr. ProctorThe hon. Gentleman said that it will be a "diktat", but, when the Minister produces the statement, we shall discuss it with him. This is not a "diktat" House.
  I shall say a few words about housing in new towns. I was astonished to hear the hon. Member for Harlow say that the Labour Party had always provided purchase opportunities in new towns. I think that is what he said. It is a remarkable boast. In my constituency and in new town constituencies throughout the country the great political argument during the 1979 election—in the new town in my constituency it was perhaps the political divide—was whether the Government of the day would give the right to sitting tenants to buy the homes in which
  774
  they lived. In my constituency and in many new town constituencies the electorate gave an overwhelming answer to the question that was posed.
  Mr. NewensWill the hon. Gentleman confirm that development corporations built houses in his new town and in mine explicitly for the purpose of sale to would-be owner-occupiers from the outset, and that those houses were never offered for rent? We are talking not about sales to sitting tenants but about sales generally. Surely the hon. Gentleman will confirm that houses for sale were made available from the outset and that the Labour Party has always been anxious that 100 per cent. mortgages and excellent mortgage conditions generally should be provided for would-be buyers.
  Mr. ProctorI am not disputing what the hon. Gentleman says. The great issue during the 1979 election was whether sitting tenants should buy their own homes. The electorate gave the answer in new town and other constituencies.
  New towns under successive Governments have shown great adaptability in responding to Government policy. It is true that the switch in the balance from homes for rent to homes for sale has been demonstrated markedly in new towns compared with a number of local authorities which have tried to flout the law on the sale of houses. The London borough of Waltham Forest owns a number of houses and other homes in Billericay and Wickford. My constituents have had great difficulty in obtaining the right to buy, despite the law of the land. I am pleased that they are now being allowed to buy, albeit incredibly slowly.
  In new towns there has been enthusiasm in the private sector among those who, without Government policy, might never have contemplated house purchase. The hon. Member for Edmonton (Mr. Graham), in a rather exquisite phrase, talked about "flogging off" assets. From May 1979 to September 1981, 6, 646 dwellings have been sold by new town development corporations, and firm negotiations are in hand for the sale of a further 4, 783 houses. My hon. Friend the Minister has updated the figures that were given to me in a written answer on 8 December 1981. He said that by the end of December nearly 8, 000 dwellings had been sold. The demand for sale continues. It is not a one-off, one-year adventure. It is a continuing rolling programme. My hon. Friend said that 14 per cent. of new town tenants have completed or are firmly negotiating for the purchase of their homes. That is a remarkable achievement.
  In Basildon, which leads the way in the purchase of new town homes, 2, 331 of my constituents have purchased their own homes from the development corporation, and a further 700 applications to buy are being processed. I understand that a further 641 homes have already been sold by the district council and that it has another 260 in the pipeline. That demonstrates clearly that the wish of many of my constituents to purchase the homes of their selection has been translated into practice. The promises made during the 1979 election have been honoured.
  Mr. GrahamI do not dispute the figures, because the hon. Gentleman obviously lives with them and knows them very well. However, will he comment on what has happened to Basildon's housing waiting list over a comparable period?
  Mr. ProctorThere are over 3, 000 on the waiting list in my constituency. There will always be a waiting list for

  775
  an item that is subsidised. There will obviously be a waiting list for anything that is subsidised. That is an example of the law of supply and demand that even Labour Members cannot suspend for their ideological endeavours.
  Mr. John EvansThe Minister has boasted that one-bedroom starter homes are being built for £15, 500 in the North of England and for about £17, 500 in the South of England. Does not the hon. Gentleman consider it immoral that those on the waiting lists should be invited to purchase one-bedroom starter homes at £15, 500 to £17, 500 when others, more fortunate, are able to purchase three-bedroom semi-detached houses for £7, 500 to £8, 000? Does he agree that there is great immorality in that sort of transaction?
  Mr. ProctorThere is a division of opinion between the hon. Gentleman and his right hon. and hon. Friends and myself. I think that most of his right hon. and hon. Friends would prefer to see people in rented accommodation, whereas my right hon. and hon. Friends would prefer to see increasing numbers in their own private accommodation.
  Mr. EvansNo.
  Mr. ProctorThe difference between the parties on this issue is being demonstrated clearly in the debate. The housing departments in Basildon, the development corporation and the district council are to be congratulated on the part that they have played in bringing home ownership within the reach of thousands of my constituents. Similarly, development corporations and district councils throughout the country are to be congratulated. We must add to this achievement the low cost schemes for house purchase, including shared house purchase, joint development with private developers and starter homes which, in my constituency, range from about £17, 000. Basildon has taken the lead in shared purchase, and 30 contracts have already been signed for shared purchase schemes. I understand that 110 homes have been set aside for the schemes and that 300 applications have been received. At present the scheme does not apply to rented accommodation. A great success story is in its initial stages. I hope that there will be more shared purchase schemes in my constituency and in many other constituencies in due course.
  Partnership arrangements, shared ownership and reduction in land prices for those on the waiting lists are the Government's initiatives and represent a success story. The schemes were pioneered by the Government, development corporations, developers and building societies, especially in Basildon. For example, the Abbey National Building Society has provided the funding and lubrication of mortgages for the private sector.
  Of course, there are housing difficulties in new towns, particularly with regard to the elderly and the provision of single person accommodation. A special survey of the elderly in Basildon revealed that there was a shortfall of special old-age pensioner accommodation of about 528 units, of which 414 are of the sheltered housing type. Projections for 1989 are 1, 436 and 896 units, respectively, and for 1994, 1, 804 and 1, 094 units, respectively.
  In common with many new towns, the population of Basildon is growing old. It is growing older at a faster rate than other towns. Nevertheless, the council is experimenting with build-for-sale sheltered housing schemes. Thirty
  776
  units have been provided, with possibly another 30 units if the initial scheme is a success. Already a great deal of interest has been shown, even before the scheme has been marketed.
  I turn to commercial and industrial matters. Housing is not the only success story for new towns and their development corporations. My hon. Friend the Minister referred to the Western Approach road at Basildon, which is provided for and funded by the Bill. That will be very helpful to my constituency. Development corporations, in conjunction with private developers and finance, are expanding the commercial and industrial assets of the new towns.
  My hon. Friend also mentioned that in Basildon, with the aid of Norwich Union, the development corporation is constructing what will become the biggest and best shopping centre in the South-East of England. The second phase development is the logical follow-on of the Government's investment in roads two years ago relating to the town centre development—then at a cost of about £1½ million, which is provided for in the New Towns Act 1980. That has led directly to a £65 million investment, which will provide jobs in my constituency, including jobs in the construction industry. However, as my hon. Friend said, the experience in Basildon is not unique.
  I have a number of questions to put to my hon. Friend who will be replying to this important debate. The hon. Member for Newton (Mr. Evans) asked my hon. Friend about the sale of assets. Clearly the hon. Gentlemen and his hon. Friend the Member for Edmonton were not adept at scrutinising Hansard in the few days just before Christmas. Otherwise, they might have seen a reply I received on 21 December, just before the Christmas haze came upon us. I asked my right hon. Friend the Secretary of State for the Environment
  "what proceeds to the Exchequer have derived from the sale of new town assets; and if he will make a statement."
  My hon. Friend the Minister for Housing and Construction replied:
  "Between 1 April 1979 and 30 September 1981 £212 million had been realised from the sale of industrial and commercial assets in the English new towns. We estimate that about £40 million will have been paid to the Exchequer in tax. A further £21 million has been paid into the national loans fund to redeem debt. The remaining benefit to the Exchequer has been a reduction in the call on the Exchequer to finance the new towns' investment programmes."—[Official Report, 21 December 1981; Vol. 15. c. 318.]
  I hope that that answers some of the questions posed by hon. Members. No doubt those figures will be confirmed by my hon. Friend when he winds up. I should like to ask my hon. Friend whether the sale of assets could proceed faster and make a bigger contribution than at present.
  Mr. Norman HoggThe reason why the Government are unable to sell the assets faster than the development corporations is the recession that the Government's policies have created.
  Mr. ProctorMany of my constituents write to me saying that they want to buy an asset and that the. development corporation is being a little sticky about selling it. The demand is there. A firmer prod might result in a few more assets being sold in the not too distant future.
  It is interesting that Opposition Members seem to be in a quandary about the sale of assets. On the one hand they want nothing to do with it, but on the other they want to make sure that their constituents have their fair slice of the

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  action. I am glad that they are on our side with regard to the sale of assets and that they are rightly defending their constituents who want to buy them.
  Will my hon. Friend say a little about short-term borrowing from the private sector for development corporations? Will he give a little more freedom for them to negotiate with banks and other financial institutions to establish more private funding for new towns? Will he arrange for the limit of about £500, 000 on development corporations to be raised to a more reasonable figure of about £5 million? I should be grateful if my hon. Friend would say whether that it is possible.
  My next question has been touched upon already by a number of hon. Members, including the hon. Member for Harlow and my hon. Friend the Member for Welwyn and Hatfield. The Bill allows for an increase in spending by development corporations, but there will be substantial financial consequences and implications for local authorities and their expenditure. Before Christmas a number of Members of Parliament representing new towns met. They wrote to my right hon. Friend the Secretary of State for the Environment about this point.
  Mr. NewensIt was an all-party letter.
  Mr. ProctorThat is right.
  The seven London ring new towns have come together to demonstrate that decisions made by previous Governments, the present Government and individual development corporations about the sort of places that new towns should be have placed inescapable costs upon the councils concerned. At present those costs are not allowed for in the Government's view of what constitutes acceptable council spending or in the formula for calculating rate support grant. The pressure of population expansion in new towns must also be taken into account.
  I should be grateful if my hon. Friend could answer some of my questions. I assure him of the support of Conservative Members for Ministers in the Department of the Environment for all that they do for new towns and their success and prosperity. Finally, I add a word of thanks to the staff of the development corporations for all the work that they do in our new town constituencies.
  5.50 pm
  Mr. Norman HoggAs has already been made clear, we do not intend to vote against the Bill. We welcome it, but at the same time it must be seen against the background of what the Government are doing to the new towns. I profoundly disagree with almost everything that was said by the hon. Member for Basildon (Mr. Proctor). I cannot see the success story to which he referred. It is not reflected in the Scottish new towns, and certainly not in Cumbernauld.
  Mr. David LambieDoes not my hon. Friend recognise that, according to the unemployment figures published today, my new town of Irvine has an unemployment rate of 24·7 per cent.? One in four of the population is unemployed and one in three of the male population is unemployed. That is not a success story. It is a story of disaster.
  Mr. HoggThe unemployment figures for all Scottish new towns are bad, but for Irvine new town they are particularly bad. My hon. Friend does well to draw
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  attention to them. The story is far from the success story to which we were treated by the hon. Member for Basildon.
  The new towns are a success in one respect. They have brought high quality housing and the garden city concept, which has replaced the urban areas of our great cities of Glasgow and London. The planners have done an excellent job. It was proper of the Labour Government of 1945 to introduce legislation to provide for the new towns.
  The story now is one of contraction. In my constituency, factory after factory has closed. We have redundancies upon redundancies in the factories that remain and many have introduced short-time working. Other factories, where we had hoped for expansion, have at best marked time. Later this week, the official receiver may sell the Lovable company of Cumbernauld, where over 300 women are presently employed. It is the second largest manufacturing industry after the Burrough corporation, which itself has had many redundancies over the past two and a half years. Many of my constituents will view these events with the gravest concern. If the work force at the Lovable factory choose to fight the redundancies it can be certain of my support and that of many of the people who live in Cumbernauld.
  In addition, the Secretary of State for Scotland, who is not noted for dexterity in his handling of Scottish affairs, nor for good timing in dealing with matters of importance, has chosen today to announce that there will be rent increases of 22 per cent. in Scotland. That is against the background of a rate of inflation of 12 per cent. during the last year and an average increase in earnings of 11·3 per cent. As my hon. Friend the Member for Central Ayrshire (Mr. Lambie) said, new towns are facing massive unemployment. What justification is there for rent increases of 22 per cent. when the rate of inflation is considerably less? Why should the Secretary of State direct the new towns to increase rents to that level? It is disgraceful. I shall write to the Secretary of State about it and demand a meeting with him because I am certain that my constituents will be protesting loudly tonight over the imposition of these scurrilous rent increases.
  It is not only local events that concern me. The overall picture is just as worrying. The Government want to undo the achievements of the new towns. Over the last 30 years, two and a half million people have been found homes in new towns, with a range of supporting services such as schools, health services, sporting and recreational facilities. We have heard from the Minister the extent to which industrial space has been provided for about 300, 000 jobs. He said that 12.5 million sq ft of office space has provided 60, 000 jobs and that 15 million sq ft of shopping area has provided 40, 000 jobs. That is funded by £3·2 billion worth of borrowing, and payments on loans are funded from the income on assets.
  I am surprised that the Minister and those hon. Members who have endeavoured to present a success story have not said that the new towns have become profitable. In 1976—the most recent year for which I have been able to obtain figures—they made a profit of £8 million without any significant sale of assets. Assets are the great issue in the new towns at present. They have in hand about £500 million worth of assets, although some claim that the figure is as high as £1, 000 million. The Government, true to their mistaken dogma, insist that the assets should be sold, and the development corporations have been instructed to sell off property to the value of £120 million

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  for 1979–80 and £200 million for 1980–81. The hon. Member for Basildon drew our attention to the latest figures that he obtained in a written answer.
  The Government are asking too much of the new towns. They are creating conditions whereby, if these assets are sold off, the capacity of the new towns to be profitable and self-sufficient will be seriously undermined. That is bad business. The Tory Party has now become the party of bad business. The Government want the new towns to sell off the assets, but if they do so they will be cutting off future income. The hon. Member for Basildon misunderstood my concern that the new towns are selling in a distressed market. I do not believe in selling off the assets, but the matter is made even worse if they are asked to sell them in a depressed market, because then the British taxpayer will get a bad deal.
  The Bill increases the borrowing capability of new towns. I welcome that, but it must be seen against the background of what the Government have done. It is largely irrelevant, given the scale of the problem. There is massive unemployment in our new towns, particularly youth unemployment, which is even more of a problem in communities such as mine, where the average age of the citizens is 30. Now there are to be massive rent increases, a loss of manufacturing capacity, widespread asset-stripping and a conspiracy to cheat the taxpayer on the sale of assets. The Government's record on new towns is disgraceful. There is not the success story that they are attempting to present. I hope that the House will approve the Bill, but that it will do so knowing the Government's record.
  6 pm
  Mr. W. BenyonI apologise to the House for my absence for a short time during the debate. Fashions come and fashions go. New towns, certainly in the official world, appear to have gone out of fashion in favour of inner city renewal. That worries me because the two are complementary. In London and the outer London ring, they go together. The new town of Milton Keynes has been an undoubted success from the social point of view and also commercially and industrially.
  I have made a point of asking industrialists whether, had the infrastructure been available in central London and in docklands, they would have gone there in preference to Milton Keynes. Their answer has been "No". Certain factors influenced their decision to develop on a green field site. There was room for expansion, a whole new setup and good communications.
  In the third generation of new towns, it is essential to keep a strong element of public rented housing. It has been calculated that over 30 per cent. of those going to the new city of Milton Keynes cannot afford a starter home or shared ownership. When they have been there for some time, have managed to get on their feet and are earning the level of wages available, they can look towards buying or other forms of ownership. Initially, to keep this large enterprise going, it is necessary to have a great deal of housing for rent. I hope that this will not be lost sight of in future allocations, particularly in relation to what is happening in the inner cities.
  I was delighted to hear of the study which is being carried out—the results will be announced this summer—on the financing of future developments in new towns. This is excellent news. Hon. Members know of the difficulty faced not only by the present Government but by
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  successive Governments. It is sometimes described as the dead hand of the Treasury. The fact that moneys raised have to go back into the pot and are then reallocated militates against the successful economic and commercially viable development of new town financing.
  It was always my hope, as a Conservative, that we would recreate the Commission for the New Towns as a properly run property company which would roll over its assets for development not only in future new towns but also in the development of the inner cities. However far one looks into the future, the sums of money that will be needed for this purpose will be considerable. If we are constantly to have to measure this element against other elements in public expenditure, we shall not achieve the results for which we all hope.
  I hope it is not too late to reconsider the establishment of a properly based Commission for the New Towns which might be described as an urban renewal company which would continue to roll over the assets into the type of things that have been done so successfully. With the base that it already has in new town assets, it would have great borrowing potential. It could borrow on these assets.
  The commission could also underwrite housing schemes to a greater degree. Some of the most successful operations have been developments of housing for sale that are underwritten by the local authority or the new town development corporations, if the houses cannot be sold. This is impossible under the present arrangements. Above all, it would be able to sell the assets at the time and price at which they should be sold. I remember asking my hon. Friend's predecessor this question in another debate. He assured me that there would be no move to try to sell now town assets against the best commercial advice available. Obviously, during a recession, this becomes difficult advice to give. Assets can always be sold provided the price is right. However, whether this is the right time to continue to sell large amounts of urban properly investments remains to be seen.
  I welcome the increase in the borrowing power. My only regret is that the Bill is necessary. New towns in the future, and the sort of developments that are taking place in the constituency of my hon. Friend the Member for Liverpool, Wavertree (Mr. Steen) and in London can be financed much better by a properly organised and properly run national corporation established for this purpose.
  6.5 pm
  Mr. John EvansThe hon. Member for Buckingham (Mr. Benyon) made a more sensible contribution to the debate than the hon. Member for Basildon (Mr. Proctor), who seemed to involve himself more with rhetoric than with the problems that exist in new towns and the facts of the case. However, I join in the welcome afforded to the Bill. I do not know whether hon. Members of the Social Democratic and Liberal Party alliance welcome the Bill because they obviously take no interest in it. The have not shown their faces during, the debate. They are obviously not interested in the problems that face the great new towns of our country.
  When I picked up the Bill, I thought that it represented either a substantial U-turn in the Government's policy because it increases the borrowing limits of the new towns from £4 billion to a staggering £5 billion, or a monumental piece of incompetence in the Department of the

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  Environment. When I listened to the Minister's opening speech, I came to the conclusion that incompetence was far more involved in the Bill than a U-turn.
  My hon. Friend the Member for Edmonton (Mr. Graham) referred to the fact that there had been a money Bill in June. I did some research on the subject of money Bills because the Minister rather quickly glossed over the fact that this is the third money Bill associated with new towns from the Government since they took office. I checked when last such a money Bill appeared before the House. That is the obvious action to take with a Bill that seeks to allow a major increase in borrowing limits. The answer is that the borrowing limits for the new towns were settled in the New Towns Act 1981 which was, in effect, nodded through the House. It had its Second Reading on October 23, and Committee, Report stage and Third Reading on October 29 and received Royal Assent on October 30. The Act was placed on the Statute Book and fixed the borrowing limits for the new towns as long as three months ago.
  The Minister told the House that he expected that the present borrowing limits would run out in mid-March of this year. Surely, if the limits were fixed as late as October last year and are running out now, this exhibits incompetence by the Department of the Environment. If we are having to increase them by a staggering £1 billion, someone in the Department of the Environment cannot do his sums.
  Another question that arises—it is interesting to consider the debate on the Local Government, Planning and Land (No. 2) Act—is the Government's determination to cut public sector investment in the new towns. It is self-evident, whatever the Government may have said during the debate and subsequently, that they have not succeeded. They are increasing it by a substantial amount. In his statement—it was not so much a statement as a series of planted questions which were taken at the end of Question Time—the Secretary of State, in answer to a question from the hon. Member for Peterborough (Dr. Mawhinney), said:
  "In his first question, if I understood him correctly, my hon. Friend was talking of the consequences of the reduction in public investment. It is my view that there will be a reduction in public investment."—[Official Report, 4 February 1981, Vol. 998, c. 292].
  Of course, the evidence from the Bill is that, far from there being a reduction in public investment, there is, has been and will continue to be a substantial increase. I welcome that increase. That is why I welcome the Bill. But it is essential to point out to the House and particularly to the residents of new towns the rhetoric of Ministers. They say one thing on one occasion but when hard facts are presented to them they have to adopt different tactics.
  Mr. Guy BarnettVery much in character.
  Mr. EvansYes. It is important that the House recognises precisely what is going on. In the rather heated debates on the 1980 Local Government, Planning and Land Bill, there were substantial rows over the parts dealing with the hiving off of new town assets. I am sure that my hon. Friend the Member for Greenwich (Mr. Barnett) will recall the discussion as to whether the Secretary of State for the Environment was acting legally
  782
  in demanding £120 million, I think, from the sale of new town assets. It does not seem that that amount has been paid back to the Treasury. The hon. Member for Basildon gave helpful answers on this; it is a pity the Minister could not supply the answers to me.
  Mr. ProctorAt the beginning of his speech the hon. Member attacked me for using rhetoric. Now he is congratulating me on giving the facts. He cannot have it both ways.
  Mr. EvansIn that case the rhetoric of the hon. Member was factual. I am thanking him for supplying the answers with which the Minister could not supply me at the beginning of the debate. On a Bill of this nature one would have assumed that the Minister who was moving the Second Reading would have had that sort of fact at his finger tips because it was bound to be a question that he would be asked. I do not know whether the Under-Secretary will have further evidence for us when he winds up the debate; I will listen with interest.
  The point I wanted to make was that the Secretary of State for the Environment, throughout the heated rows we had on the Report stage of the Local Government, Planning and Land Bill, insisted that the purpose of the provisions was to reduce the amount of public expenditure in new towns and to ensure that they paid their full whack so that the public sector borrowing requirement might be reduced.
  I suppose that I would be in order if I asked the Minister whether the additional £1 billion will have an impact on the public sector borrowing requirement. I assume I am right when I say that it will have a major impact. Where is the Secretary of State's rhetoric on that? I do not object. I want a substantial part of the increased expenditure to be incurred in my constituency because I have the honour to represent most of Warington new town; most of the designated area is within my constituency.
  Without any shadow of doubt, Warrington is one of the most successful new towns. It has a magnificent record of attracting first-class industry and of providing splendid homes in a good environment for people from all over the North-West. I must say to the hon. Member for Basildon that the people who have lived in Warrington all their lives felt and still feel a sense of unfairness because they have been precluded from obtaining houses to rent. I am sure the hon. Member understands the frustration of those who are desperately anxious for decent homes when they see thousands of splendid homes being erected and are told that they cannot have them because they already live in Warrington and do not come from the designated sending area.
  It was difficult for me to explain to many people that those were the rules by which the new towns were governed. I was not popular when I had to explain that. Now those people are deeply concerned because the newcomers who received rented houses are buying them at attractive prices.
  Mr. ProctorIf I have understood the hon. Member correctly, he seems to be criticising what the hon. Member for Harlow (Mr. Newens) was taking credit for in an earlier speech.
  Mr. EvansI will deal with that in a moment. I am talking about the Government's policy of selling houses which were built to rent. That was the purpose of building

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  houses in new towns. I am trying to explain to the hon. Gentleman—he cannot visit his constituency often or he would get this complaint—is that people resent the fact that others who get preferential treatment are being allowed to buy their rented houses at substantial benefit, whereas those who have always lived in Warrington are told to purchase a house, presumably one of the one-bed starters about which the Minister boasted, at a price of £17, 500.
  I will deal now with the point made by the hon. Member for Basildon. It is a smear to suggest that the Labour Party is opposed to people owning their homes. No doubt on reflection the hon. Member will wish to withdraw that remark. What the Labour Party has always believed in is building homes for people either to buy or to rent. There is a clear recognition in the Labour Party, which obviously does not apply in the Tory Party, that millions of poor people will never be able to afford to purchase houses but will require houses to rent. It is self-evident from the Government's legislation that they have washed their hands of the poorer people by not providing houses for them to rent.
  Mr. MurphyDoes the hon. Gentleman not recognise that the Government have shown their determination to encourage the use of property for renting on shorthold tenure which unfortunately his side of the House has condemned?
  Mr. EvansWe have been down that track many times. I am talking about public expenditure by the Government through local authorities and new towns to provide decent housing for people to rent. That is what the Government have utterly rejected.
  It is right to pay a glowing tribute to the gentleman who has just finished his term as chairman of Warrington and Runcorn development corporation, Mr. Jim Mason, who did a splendid job over four years. He built up an enviable reputation not only in the Labour Party and with the trade union movement but with all political parties, with the local authority, with parish councils, with business and commerce and with almost everyone who came into contact with Warrington new town.
  It was with great regret that the people heard that the Secretary of State did not propose to reappoint Mr. Mason. Many people in the new town have said that the sacking of Mr. Mason was a political decision of the Secretary of State. One Warrington borough councillor, Mr. Mike Hall, has commented on this; I quote from the Warrington Guardian of 22 January 1982:
  "Councillor Hall said he believed Mr. Mason, who was strongly connected with the Labour and Co-operative movement, was sacked for political reasons."
  In the light of this Bill, the letter sent to me by the Under-Secretary on 16 November makes strange reading. He said:
  "We are, of course, aware of the high reputation that Warrington new town enjoys, and appreciate the hard work that James Mason has put into promoting it. The task of the Development Corporation is however changing; the main period of rapid development financed by the Corporation is now drawing to a close, "—
  I will return to that later—
  "and the emphasis over the next few years will increasingly to towards preparing the two towns"—
  Warrington and Runcorn—
  "for the day when the Development Corporation must withdraw, leaving private investment to continue the work the Corporation had started. We have therefore decided, that for the new phase in the towns' development, a fresh approach is required."
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  In the light of that letter and in the light of the speech of the Minister for Housing and Construction, it is difficult to see how any genuine reason could be advanced for not reappointing Mr. Mason as chairman. I do not quarrel with the Secretary of State's appointing his own nominee to the office, but those who are concerned with the well-being and the successful continuation of Warrington new town see it as a political appointment.
  I have some sympathy for the new chairman, Mr. Donald Forster. I shall judge him on his actions over the months and years to come, but I have a great deal of sympathy for him, because he is coming in the wake of a successful and well-liked chairman and with the background that I have mentioned—that his was simply a political appointment and that Mr. Mason's major handicap was that he was a prominent member of the Labour party. I shall give the new chairman every support, and I shall give him every assistance on some of the issues that will arise in Warrington new town over the next few months. I am sure that he will follow Mr. Mason's path in many matters.
  One of the major problems in Warrington new town is the completion of the transportation network. We have spent many millions of pounds on building one of the finest transportation systems to be found in any area. It includes a highly successful new railway station at Birchwood.
  We are left with the terrible problem that at the very heart of Warrington we need a new high-level bridge over the Mersey. The problem has been going on for a long time. It is essential that the new bridge be completed. Lack of it makes nonsense of the tremendous expenditure on the expressway and the links between the M6 and the M62, which are beneficial to Warrington. We desperately need this new high-level link across the Mersey.
  Many business men in the area have complained repeatedly that the problems that arise from time to time are costing them substantial sums. The Warrington Guardian of 22 January said:
  "The 33-year-old managing director of Ardex Fabrications, Mr. David Hughes, described the task of entering and leaving Warrington from the south side as 'a desperate battle'.
  'The moment there is any additional stress caused by an accident or weather conditions, the situation becomes quite impossible. It is costing business and industry time and inconvenience—which is the same as money'."
  I trust that out of the additional £1 billion now available to the new towns we can have some money to build the high-level link across the Mersey. One beneficial effect of that would be to open up the whole southern part of the designated area, where considerable sums of public money have already been spent on the infrastructure—roads, sewers and so on. It is waiting for that link.
  Mr. Guy BarnettMy hon. Friend earlier made some interesting remarks about the retiring chairman of the new town development corporation, Mr. Mason. As I was in the Department of the Environment when the then Secretary of State appointed Mr. Mason, I should like to add to what my hon. Friend said. One of the prime reasons for Mr. Mason's appointment, as I recall, was his tremendous experience in local government. It seemed to us that he had an important contribution to make, and it is clear from what my hon. Friend has said that he has made such a contribution to Warrington's development. I very much hope that the new chairman, whom I do not

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  know, will be able to make a similar contribution. It is very important that the corporation can work in harmony with local authorities in the area.
  Mr. EvansI am extremely grateful to my hon. Friend for what he has said. As the Minister who had so much to do with the new towns, he had to work with Mr. Mason, and over some time got to know Mr. Mason's capabilities.
  As I have said, I shall give the new chairman, who I do not think has a great deal of local government experience, my full support. I appeal to everyone else in the area to support him, because he has a major task, but it is important that Ministers should be aware of the hostility to, and feeling about, their decision not to reappoint Mr. Mason.
  Another important decision that needs to be taken quickly is a decision to speed up development of the Westbrook site in my constituency. Almost every factory that is built in Warrington is quickly snapped up. If we could have the go-ahead to proceed with the Westbrook site—the sewers and roads and the rest of the infrastructure—we should be able to get on with building more houses. Under the Minister's edict, they would all be for sale, and unfortunately none would be available to rent. Nevertheless, we could get on with building them and the factories, which we could then let in order to start employing people. That would also give a shot in the arm to the construction industry in the area. I do not have to tell the Minister for Housing and Construction that the industry is on its knees, or on its back, depending on how one views the industry. We desperately need a decision about that site.
  I want also to mention the tremendous success of the Birchwood science park. It has been so successful that the development corporation has now created an overspill site, known as the Birchwood science boulevard. In the past there was often criticism of the development corporation because so many of the newly attracted firms were in the distribution industry. Indeed, those who were hypercritical used to say that the corporation built nothing but warehouses. I do not know who first thought of the science park. It was certainly a brilliant concept, and it has been a tremendous success. We are there attracting the science-based industries of the future, offering jobs of excellent content, particularly to youngsters. Those jobs will be very important in the future.
  It is with some trepidation that I turn to another matter, as the area concerned is not in my constituency but in the constituency of the right hon. and learned Member for Runcorn (Mr. Carlisle). I shall not go into the pros and cons of the arguments about the site, but I can say that there is a desperate need for a decision on the Pewterspear science park. I do not enter into the controversy over whether it is a good or a bad thing. The issue is on the Minister's desk. A decision is needed so that at least the new town development corporation and the people in the area know what the future holds for them.
  Mr. SteenA little while ago the hon. Gentleman criticised my hon. Friend the Member for Basildon (Mr. Proctor) for what the hon. Gentleman described as his factual rhetoric. The hon. Gentleman has now spoken for one minute longer—22 minutes—and his speech is sheer rhetoric. Will it become more factual?
  Mr. EvansIf the hon. Gentleman had sat through the debate, as the rest of us have, instead of coming in halfway through, as he normally does, he would be in a better position to talk about fact and rhetoric. The length of my speech is a matter for the Chair rather than for a Conservative Back Bencher. The hon. Gentleman may not like what I am saying, but I have dealt with facts both in relation to the Bill and in relation to my constituency, which is affected by the Bill.
  It is important for the Minister to understand that I am not entering into the controversy. I merely ask him to arrive at a conclusion about Petersfield. People in the area need to know what will happen. The proposal will have a major impact on the plans of the new town development corporation.
  Warrington new town, as I said, has been a tremendous success. It is a wonderful comment on the necessary alliance between public and private expenditure. Warrington new town has always been prepared to cooperate in that way.
  In the debate on the Local Government, Planning and Land Bill, I pointed out that for a considerable time Warrington new town had been using the roll-over principle in the sale of its assets. Warrington was quite prepared to enter into agreements with private industry to sell, build and lease. That is the sensible approach. It is not the Government's approach, with its stress on ideology rather than common sense. As my hon. Friend the Member for Dunbartonshire, East (Mr. Hogg) pointed out, if we are to sell assets we must sell them in a more helpful market. We must not sell them in the depressed market created by the Government.
  I only hope that in a few months we shall have an even greater recognition by the Government of the importance of public expenditure, and that they will present another money Bill further to increase the borrowing limits of the new towns.
  6.31 pm
  Mr. Anthony SteenI am sure that the hon. Member for Newton (Mr. Evans) will take my comments in the spirit intended. I take support from his comments. I make no party political point, but merely comment that there are no Social Democrats or Liberals in the Chamber. I entirely support his drawing attention to that fact. [HON. MEMBERS: "Where are they?"] They are not here anyway.
  This is an important Bill, which should be debated. We are increasing the amount that the House gives new towns the power to borrow. It is a sizeable sum. It is so large that it is hard to grasp what the sum is. Furthermore, we shall not be told, by the sound of it, exactly what the money will be used for. No shopping list has been drawn up.
  Although I was out of the Chamber for a while, I heard most of the speeches, which were of a high standard and interesting. The Minister did not give us a shopping list. He merely said that corporations will decide how they want to spend the money. That is a blank cheque to increase their borrowing power. Presumably they will use the money to improve the infrastructure and finish off the work that they want to do. That means they will be more attractive and will be able to continue development and expansion programmes.
  That opportunity is very much at odds with what is happening in the major industrial urban areas. Large industrial cities do not have such powers. While their

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  borrowing of public money is being strangled, the new towns are given opportunities to increase their borrowing. This will put large industrial cities such as Liverpool at a continued disadvantage.
  I support what the hon. Member for Newton said about Warrington being a successful new town, but its success has been at the cost of the decline of Liverpool. A great number of people who lived in Liverpool have moved to Warrington.
  My first concern is that the Bill gives the new towns opportunities to make themselves more attractive—to buy new cosmetics—while the old cities continue to look plain and dowdy. What will the money be used for? It would be helpful if the Minister explained a little more fully exactly what the increased borrowing powers will give to the new towns.
  I shall explain my principal concern. In the 1960s local authorities were encouraged by the Government to borrow increasing amounts of money to extend and develop their most ambitious redevelopment plans. In 1965 local authorities in England borrowed £455 million, in 1966, £546 million, in 1967, £398 million, in 1968, £589 million and in 1969, £556 million. We know what happened. The massive demolition programmes in the principal industrial cities resulted in an enormous loss of population. Glasgow lost 21 per cent. of its population, Liverpool, 22 per cent., Manchester, 18 per cent. and inner London, 16 per cent. This was a direct result of the increased borrowing by the local authorities similar to that which the Bill is now giving to the new towns.
  The money was used for mammoth demolition programmes. Between 1966 and 1976, Liverpool demolished 21, 489 buildings, Birmingham, 19, 715 dwellings, Glasgow, 53, 396 and so on. It was the local authorities' borrowing of public money that allowed them to demolish those houses and that resulted in the people moving out.
  This is not something of the past. In 1967 at the Habitat conference in Vancouver the Secretary of State for the Environment said that Britain had pensioned off the bulldozer. He may now regret having said that. Between 1975 and 1980 Liverpool demolished 6, 446 dwellings, Glasgow, 17, 497 and Sheffield, 11, 130. The pattern is continuing.
  As local authorities borrow more public money, houses are demolished. New towns in the North-West and the Midlands, such as Warrington, benefit from the outflow of population, so they need more public money to pay for the infrastructure to provide for these people. It would be wiser for the Government to realise that they have got these ailing industrial areas—for example, Liverpool, with about 2, 400 empty units of public housing. They are just not being used. They need to be maintained and improved. That would he better than demolishing older housing and pushing people out to the new towns. More public money will then need to be borrowed. The large industrial cities need power for increased borrowing to improve the declining housing stock, which will be demolished in due course.
  A curious factor in a city such as Liverpool is that the bulldozer has demolished the bulk of the private housing in the inner city. The bulldozer is still hungry. It is starting to demolish public housing. In my constituency we are to dispossess 2, 000 people living in a spine block on a council estate that won an architectural award in 1972. It is barely nine years old, yet it is being demolished. A
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  similar thing happened in St. Louis in the United States, where they pulled down eight or nine high-rise blocks because people would not live in them.
  That is just what is happening in my constituency on a public housing estate. Blocks barely a decade old are being pulled down. That is in Belle Vale. In the neighbouring constituency of Garston about 2, 000 units are being pulled down. About 6, 000 people will be dispossessed. The bulldozer has already started to smash vast council estates built only seven or eight years ago.
  What will happen to the people who live there? We should give priority not to extending the new towns, increasing the infrastructure and improving what is there, but to using public money to revitalise inner cities and revitalise, rejuvenate and rehabilitate the existing declining housing stock. Public authorities in industrial cities should be allowed to borrow money for that purpose.
  The Minister would not dream of bringing a Bill to the House that he did not believe was necessary and of great importance. I do not want the new towns to compete with the old, but there is a connection between them. We should revitalise what we have and not continue to extend new towns, successful though they are.
  Let me suggest one or two ways to improve the Bill. It is important to encourage private enterprise, but public funds should be used only as starter finance to persuade private enterprise to come into schemes as partners and encourage it by the use of public money. That was the original concept of the new towns—the public sector would do the essential work and then private enterprise would come in. That has not happened as much as we hoped.
  On the horizon is a similar problem with the urban development corporations in London and Liverpool. Their purpose is to clear the sites, put in the infrastructure and encourage private enterprise to set up industries on the waterfront. We must be careful that we are not asked in a year or two to increase the UDCs' borrowing power because they wish to build the factories that private enterprise should build.
  I am not sure that the proposals in the Bill could not be carried out in a more private enterprise way. The corporations should be encouraged to borrow public money, but on terms. Will the Minister consider a pound for a pound? For every pound borrowed from the public purse the corporation must be satisfied that it can attract one pound from private enterprise.
  If there were problems in getting the money, could we not encourage private investment in a more attractive way? For example, could we not persuade the banks and insurance companies to invest in the new and old towns by giving them tax exempt bonds? They could borrow money tax exempt, without having to pay interest, 2 per cent. or 3 per cent. below the bank rate. The banks could invest in, say, building a road in a new town and would be paid interest 2 or 3 per cent. below the bank rate by the corporation. Such a proposal would increase the rates revenue for the area by attracting new firms, and the rate income could be used to pay the interest on the loan.
  The Minister does not appear to rule out such a proposition. He appears to suggest that the borrowing need not be confined to public funds but could include private funds, although not English capital. Why cannot we not lend money from the banks and insurance companies? The explanatory memorandum states that the new town development corporations

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  "can borrow temporarily, from any person, sums required to perform their functions."
  "in currency other than sterling".
  I do not know whether the Minister feels that sterling is not a good currency to borrow in, but it would be useful to know why sterling is excluded. There must be a good reason.
  These are large sums. I understand why the Opposition are in favour of the proposal. It involves a lot more money from public funds. I support the Bill, but with reservations, unless we know that the large old towns such as Liverpool, Manchester and Birmingham will have the same opportunity to improve their infrastructure. Had the Bill a more private enterprise flavour I should be happier. It is a trend in which we on the Conservative Benches are interested. I should like to see a tax exempt revenue bond or municipal bond similar to those in the United States. Private enterprise should invest in the schemes. It should not be left entirely to the public purse. Subject to those reservations, I support the Bill, but I hope that the Minister can satisfy me that the Government understand the full force of the Bill.
  6.45 pm
  Mr. William HamiltonIt is interesting to hear the churlish welcome for the Bill from the Conservative Benches. It is basically an ideological conflict. Tories believe fundamentally that public enterprise and spending is, by definition, bad and should be minimised, if not eliminated, and that private enterprise, investment and spending, conversely, is always good. They have said that not only today but on the Second Reading of the original Bill—way back in 1946.
  I take a firm view of the matter, based on experience from the day when the new towns were created. Two of the most exciting social experiments in the world since the war have been the National Health Service and the new towns, which are still the envy of the world.
  The new town of Glenrothes is in my constituency. I have watched it grow from green fields. It now has a population of 40, 000 or more. I have watched every brick laid and every factory and house built through conscious and deliberate planning and Government and local authority intervention. The houses and factories have largely replaced the old colliery rows and the mines themselves. Glenrothes new town is now a jewel in a Scotland that is being torn to pieces by the Government.
  I was interested in the comments of my hon. Friend the Member for Dunbartonshire, East (Mr. Hogg) on Cumbernauld and of my hon. Friend the Member for Central Ayrshire (Mr. Lambie) on Irvine. They have stories to tell of devastation, but that is not my experience with Glenrothes, which is a considerable success. The town has largely ridden out the worst effects of the recession and Tory policies since 1979. Glenrothes is visited by people from all over the world. No other social experiment compares with our new towns.
  When I see the new towns I look back with some amusement to the New Towns Bill debate on 8 May 1946. I shall not weary the House too much with the extravagant language used by quite prominent Conservative Members. A former Speaker of the House, Mr. W. S. Morrison, then the Member for Cirencester and Tewkesbury and the
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  official spokesman for the Tory Party, accused Mr. Silkin—the father of my right hon. Friend the Member for Deptford (Mr. Silkin) and my right hon. and learned Friend the Member for Dulwich (Mr. Silkin)—who introduced the Bill, of trying to build Utopia and of creating synthetic communities. That wild man, Viscount Hinchinbrooke, who was never temperate in his language said:
  "The Bill… is frankly totalitarian in form".
  He went on to say that this kind of experiment
  "has never been attempted before in the whole history of this country".
  He said that it had not been tried anywhere else except in Russia and no one knew what profanities were being perpetrated in the Urals. The implication was that we were copying a vicious, nasty, totalitarian experiment. Viscount Hinchinbrooke, referring to the clauses on Scotland, said:
  "Alas, poor Scotland. Another deadly blow; another mighty Empire overthrown."—[Official Report, 8 May 1947; Vol. 422, c. 1153-55.]
  I remember him as quite a card, but nobody in the House took him very seriously.
  I can contrast that prediction with my experience in Glenrothes. In its early days, Lady Balfour and the agricultural communities were antagonistic to the whole concept of new towns. Lady Balfour, who lived in a magnificent country house with hundreds of acres round it, said that it was awful for a corporation to build houses for ordinary people and thereby deprive the country of good agricultural land. She was surrounded by hundreds of acres on her private estate. I told her that when we built high rise flats in the town—if we did—we would save the agricultural land by putting her at the top and taking over her house and estates to grow barley and oats and anything else she cared for. She was not very impressed by that suggestion. I told her that in Glenrothes new town we would produce not oats or barley, but damn good citizens, and that is what we are doing.
  For example, the education system, from the nursery schools through the primary and secondary schools to the technical colleges and the five or six universities almost within spitting distance, has no equal in the world. What we have is a direct consequence of public enterprise, public interest, and public intervention from the beginning.
  Mr. SteenThe hon. Gentleman is making the important point that these were green field sites and that houses were built on virgin land. How does he view the people who were left behind in the large industrial cities of Glasgow, Newcastle and Liverpool? Is he suggesting that all the people in these socially deprived and unhappy areas should be moved out into the new towns and the inner cities grassed over, or does he agree that the old cities should have the same opportunities as the new towns?
  Mr. HamiltonThe old cities were built by people such as the hon. Gentleman and others whom he supports. They were built by private enterprise for a system that exploited the needs of people. After the last war, the Socialist Government of 1945 decided that they would house and educate the people in a better way than they had ever been educated before. As a result, people came to Glenrothes, East Kilbride and elsewhere out of Glasgow.
  There were problems remaining. It would be silly to pretend that all the problems were solved by creating new towns, but they made, and are still making, a considerable

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  contribution to the solution of the social, economic and industrial problems with which this country was faced at the end of the last war. We are not yet out of the wood.
  There is a great deal of jealousy. In Fife there is a love-hate relationship between Kirkcaldy, seven miles away from Glenrothes, and Glenrothes because they and the other languid areas in Fife believe that Glenrothes is getting far more than its fair share of the cash that the Government are providing for the new towns. Kirkcaldy district council and Fife regional council are having to struggle to get anything from the Government. They cannot understand why the Government are giving £1 billion to the new towns while they are having to scrimp and save and get permission to build one or two houses—and no schools. They are feeling the pinch, and I can imagine their reaction to the Bill.
  Another problem in Glenrothes and, no doubt, to a lesser extent, in other new towns is special development area status. Levenmouth, which lies cheek and jowl with Glenrothes, has an unemployment rate far in excess of that in Glenrothes, but the new industry goes to Glenrothes. This problem has to be dealt and lived with. I hope that the Government will take it on board and give back to Levenmouth its special development area status. That might satisfy it and help its relationship with Glenrothes.
  I do not know how Scotland fits into the Bill. There is a global loan figure of £1, 000 million. I do not know whether the Minister will answer the specific Scottish points. For example, what proportion of that money is going to Scottish new towns? We do not know. We have a global sum. The Scottish Minister looks reasonably pretty, but we do not want him just sitting on his bottom. He ought to be playing his part in the debate. We ought to have an official Scottish spokesman to spell out what the Bill means in a Scottish context.
  My hon. Friends who represent Scottish constituencies have made it clear that Scottish new towns, particularly in the west, are in a disastrous state. In Glenrothes it is a different story. The Minister should have insisted. He should have gone to his mistress—I had better not speak in that context in view of what happened to the Scottish Solicitor-General. The Minister should have gone to the lady at the top and said that he wanted to take part in the debate, because active Scottish Members would be taking part and asking Scottish questions which an English Minister was not competent to answer.
  I want to pay tribute to Brigadier Doyle, who died recently. I think he was at the Rothes colliery when it collapsed. The new town concept was built around that colliery. When the colliery collapsed, for geological and other reasons, many people thought that it meant the closure, the final coup de grace, for Glenrothes. However, Brigadier Doyle and others regarded that as a challenge. They went out and brought in industry—electronics industries from the United States, and light engineering industries. Now we have more than 150 new firms, most of them small.
  I believe that small is beautiful. Industrial relations in Glenrothes new town are probably the best in the whole of the United Kingdom, because, by and large, it has small firms with a high technological content. It should be an example of the kind of progress that can be made in regional policy. New towns are an important element in the Government's regional policies and should be pursued more energetically than happens at present. If we combine industrial diversification, new technologically advanced
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  industries, a superlative education system, modern housing, and an environment in which almost everyone has his own house and garden, we shall provide conditions in which ordinary working people can thrive and be happy.
  That does not mean that there are no problems. There is a great deal of hidden poverty in Glenrothes as a direct consequence of what the Government are doing in social security and in other ways. Glenrothes has a problem with the regional road. It is the only new town in Scotland, if not in Britain, that does not have direct access to the motorway system. I hope that my hon. Friend the Member for Central Ayrshire (Mr. Lambie) will take part in the debate and comment on the shortcomings in Irvine. The problems there are far greater than in Glenrothes.
  Labour Members are very proud of the new town concept. For that reason, we are glad that the Government have introduced the Bill. I do not care whether, as my hon. Friend the Member for Newton (Mr. Evans) said, it is a U-turn or any other kind of turn. We shall approve as long as the Government persist in giving good public money to good public causes. In that respect, we welcome the Bill.
  7.2 pm
  Mr. Donald DewarThere has been a fairly strong Scottish input in this debate.
  I start by welcoming back my hon. Friend the Member for Kirkcaldy (Mr. Gourlay), who has been absent for many a long month as a result of a serious accident. I hope that he will soon be fit enough to be here regularly and give us the benefit of his views. He was just in time, I think, to hear the remarks of my hon. Friend the Member for Fife, Central (Mr. Hamilton) who was passing judgment on Kirkcaldy. I hope that my hon. Friend agreed with what he said.
  As I said, there has been a strong Scottish theme in the debate, and the only thing that is missing is a Scottish Minister. I do not complain about the absence of the Under-Secretary of State for Scotland, the hon. Member for Edinburgh, North (Mr. Fletcher), because he told me that he could not be here tonight. I congratulate the Under-Secretary of State for Scotland, the hon. Member for Renfrewshire, East (Mr. Stewart), who stuck doggedly to his task, and heard much of the debate. So when I complain about the absence of a Scottish Minister, I mean a Scottish Minister at the Dispatch Box. I am sure that the hon. Member for Renfrewshire, East is not here as decoration. No doubt he will supply the wants, if there is any want, in the no doubt well-briefed mind of the Under-Secretary of State for the Environment, the hon. Member for Ealing, Acton (Sir G. Young), who I am sure will be able to deal with some of the specific Scottish points that I intend to raise.
  Let us return, first, to the simple question that was asked by my hon. Friend the Member for Fife, Central. We do not want a breakdown for individual new towns; that would be preposterous. However, there is clearly a separate Scottish system. We have five new towns in Scotland. Perhaps I should know, and I hope that I shall be told tonight, how the allocation of total new town finance is broken down between Scotland and England. I do not know whether it is done in that way, whether there is an apportionment in these simple terms, or whether there is an updated Goschen formula. However, I am sure that the Minister will tell us.
  The common ground among those who have spoken tonight—although the hon. Member for Liverpool,

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  Wavertree (Mr. Steen) appeared briefly, he equally promptly disappeared after he spoke—was reservations about the Bill. Most of us welcome it and regard it as an unexceptionable measure. We accept that the borrowing limits for new towns have to be raised, as for many other public authorities. There is nothing controversial in that. When I spoke recently to people in new towns, either living in new towns or living and working in the administration of new towns, I found that they were more worried about the Government's general economic policy and about the economic blizzard that is now blowing in Scotland than about the nuts and bolts of this legislation. It is sad that when 347, 000 people are out of work in Scotland, however successful an individual new town corporation may be, there is no way in which it can insulate its people from such a disaster.
  The reports on the five Scottish new towns are conveniently packaged for consultation. The one for the year to 31 March 81 is the most instantly available. I accept that it deals with the financial year 1980–81, but even at that stage it can be seen that Conservative economic policy, despite the bland optimism of Conservative Members, particularly the hon. Member for Basildon (Mr. Proctor), has been biting severely in the Scottish new towns. Let us take the East Kilbride development corporation about which the combined reports say, on page 49:
  "As a result of the government moratorium on new house construction, the Corporation found itself for the first time in the unfortunate position of having no new housing starts under consideration at the end of the year. This inability to provide housing to meet locally generated needs, both from incoming industry and from second generation families, causes the Corporation considerable concern."
  That concern has not been removed by anything that has happened to housing in East Kilbride since that report was written.
  On Cumbernauld, the report for the year 1980–81 laments the fact that it has been restricted to only 97 completions in the course of the year. Although my hon. Friend the Member for Fife, Central said that Glenrothes was perhaps less immediately hit than those on the West coast, I remind him that the Glenrothes development corporation report says on page 103:
  "One major disappointment during the year has been the virtual cessation of the public sector house building programme. At the time of writing it appears that there will be no significant starts during the year 1981–82. The Corporation fears that a long lasting prohibition on house building will eventually put at risk its ability to sustain its efforts to make the town an industrial and commercial growth point."
  That is the story in three of the five new towns in Scotland, but the story is the same in them all. Opportunities are being cruelly limited there, and their new build programme has come to almost a complete halt. My hon. Friend the Member for Dunbartonshire, East (Mr. Hogg) fairly said that just at the time when the Government are choking off investment in the essential housing stock of new towns, the Secretary of State for Scotland comes along and forces ever-increasing rent bills on tenants.
  It is announced that the rents will go up in the Scottish new towns, by, I think, £2·10p a week on average. According to my calculations, that is over 20 per cent.—and it is not just this year; it was 20 per cent., or close on 20 per cent., the year before, when the rise was
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  £1·90p. Those decisions are taken arbitrarily and entirely by the Minister. It is extraordinary that Ministers—I accept that the Minister who opened the debate is not necessarily, except in constitutional theory, responsible for what the Secretary of State for Scotland does—smoothly suggest that in some cases, the smaller private housing units, it is cheaper to buy than to rent. I do not deny that but it underlines the illusion of the rents policy pursued in new towns in Scotland. No doubt the same applies to England, but I cannot speak with authority about that.
  The hon. Member for Basildon made great play of his dislike of subsidies. However, in the job lot sales policy being pursued in the public sector of housing there is an enormous element of subsidy, both in terms of discount and the support that taxpayers give to mortgages. I do not object to the encouragement of home ownership, but we have an unfortunate, divisive and inefficient way of supporting home ownership, which makes the management of housing stock by new towns and district councils difficult to maintain.
  In the past few years, the picture of investment in the new towns in Scotland has been depressing. In April 1981, Hansard gave figures covering the years 1977-78 and 1981–82 for the provision of gross capital expenditure on housing by new towns. In that period the figures more than halved and they are still falling in real terms. Housing is a story of disaster. I do not wish to labour the point, but the same sad story can be told about employment. It is true that East Kilbride development corporation is a little more cheerful than before, largely because it is struggling to recover and has not faced last year's disaster of the closure of BSR and McDonald Electronics.
  In Cumbernauld there was a net loss of 723 jobs in 1980–81. In the same year, Glenrothes faced a net loss of 1, 200 jobs. That type of economic depression has become worse. My hon. Friend the Member for Central Ayrshire (Mr. Lambie) was right to draw attention to the horrifying fact that in a new town, Irvine—which is supposed to be a growth point and a leader in the recovery under a Conservative Government—unemployment is running at 24·7 per cent. In the march back to economic prosperity, male unemployment is considerably higher than that. That underlines the fact that the Government's impact on new towns, as on everything else in Scotland, has come to a sad pass.
  New towns in Scotland are at a different stage from those south of the border. The Minister referred to new towns drawing to a close. However, the discussion document recently launched in Scotland by the Secretary of State makes it clear that no new towns in Scotland will close before the end of the 1980s. The target for the size of the population in the five new towns is 372, 000. At present, the figure is well short of 250, 000. Therefore, we have a long way to go before we can say that the new town development corporations have met their targets and completed their tasks.
  In paragraph 16 of the Secretary of State's consultative document, he states that development corporations are
  "to continue in the meantime to sell their housing in accordance with the existing legislation and to dispose of other assets as at present in order to finance further development."
  In the latest East Kilbride development corporation report there is a reference to that. In paragraph 32 on page 57, it states:

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  "Negotiations continued for the disposal of a number of the Corporation's commercial assets in accordance with the requirements of the Secretary of State for Scotland."
  Those rather laconic words probably cover up a good deal of disagreement among board members in that new town and in other new towns. I do not know what commercial assets have been alienated and sold in Scotland and I do not know what the targets are. It would be useful if the Minister put us in the picture and told us about the requirements in accordance with which East Kilbride is, probably reluctantly, acting.
  I accept that the document is preliminary and consultative, and that a timetable has not yet been laid down. However, I understand that it is proposed to begin winding up the new towns when the target population is within 5, 000 of the total. Even in East Kilbride—the most advanced new town in terms of meeting its population quotas—that will not be for a good number of years. I do not dissent from the view that at some point there will have to be a phased takeover and that the democratic structure of local government will become responsible for the housing cares of new towns. No doubt the Scottish Development Agency will hold some discussions and negotiations about the industrial assets, factories and sites. To wait until we reach that point, which is near the end of the road, may be a mistake.
  Having listened to hon. Members' comments on the experience in England, the great discontent about the section 10 negotiations and the bickering over terms, I imagine that the run-in may be difficult and that the process may have to take place over a longer time-scale than planned, if it is to be completed in an orderly manner, without the frustrations and difficulties that attended the operation in England. I accept that the Government are consulting, but I hope that they will consider more flexible proposals than those set out in the paper.
  I welcome the Bill. I accept that there are always jealousies and tensions—constructive or otherwise—between new towns and the older urban areas. I know some of the new towns in Scotland very well. I come from Glasgow and no doubt reservations are freely expressed there. I understand them. However, everyone in Scotland admires the skill, perseverance and energy with which the new towns have pursued their aims in difficult circumstances—never more difficult than now—and tried to build a future. I look forward to the day when they will be able to bow out, but that must be a matter of negotiation, arrangement and, above all, co-operation. The timetable must bear that in mind.
  Important as those long-term objectives are and important as it is to get them right and to make an orderly and amicable transfer, the economy in Scotland still shows signs of genuine, long-standing and deep-rooted distress. The people of Glenrothes, Livingston, East Kilbride, Cumbernauld and Irvine are worried by the unemployment figures, the rents forced on them and the lack of investment in the infrastructure. That investment is needed to provide the reasonable standard of living that we expect new towns to offer. Until the Government are prepared to accept that their record in the past two or three years has been lamentable and destructive and until they are prepared to take steps to reverse that downward trend, anxiety and frustration will continue in the new towns, just as they continue to find expression in all the other communities in Scotland and in the United Kingdom as a whole.
  7.18 pm
  The Under-Secretary of State for the Environment (Sir George Young)The debate has been useful and constructive and I shall try to deal with the many points raised during its course.
  I welcome the fact that the hon. Member for Edmonton (Mr. Graham) made it clear that the Opposition would not oppose the Bill's Second Reading. He asked why the borrowing limit had run out earlier than originally envisaged. There are basically two reasons. First, the assumption about the interest rate that was built into the earlier judgment turned out to have been over-optimistic, because interest rates have been higher than expected in the past two years. Secondly, the rate of disposals has taken a little longer to build up than predicted. For those reasons, we are reluctant to be pinned down and to give the prediction that the hon. Gentleman requested about when the current borrowing limits will run out. I cannot add to what has been said, but we expect that they will last for about two years.
  The hon. Member for Edmonton went on to allege that there is a shortage of new town accommodation. He tried to attribute that to our policies for the sale of local authority and development corporation property. The switch to shared ownership and private site provision has not adversely affected the ability of the new towns to meet, needs especially those of the incoming populations. At the end of September 1981 there were about 6, 800 rented dwellings vacant in the English new towns that have kept their housing, which is about 6 per cent. of the total stock. Some of those dwellings were unoccupied for valid reasons, such as the need for repairs. However, there are many vacant dwellings immediately available for rent in nearly all the new towns. For example, there are over 800 at Telford, another 800 at Peterborough and over 480 at Northampton. One cannot sustain the case that the emphasis towards home ownership has resulted in a shortage of houses for rent in the new towns.
  The hon. Member also produced the red herring that we come across time and time again—that 12 council houses must be sold to finance the building of one new house. However, that assumes that the 12 council houses that have been sold would otherwise have become available for renting. That is not the case. It also overlooks the fact that, by selling, one can sustain a higher public investment housing programme than would otherwise have been the case.
  The hon. Member for Edmonton and one or two of his hon. Friends indulged in some hypocrisy by suddenly championing the cause of the small business man arid complaining that we are denying him the opportunity to buy his freehold. The fact is that that opportunity did not exist until the Government came to office. We have extended that freedom to many business men who until now have rented their sites. For the reasons given by my hon. Friend it is not practical to extend that freedom to everyone. If one indulges in widespread pepper-potting, that has an adverse effect upon the value of the development. However, I do not see how Opposition Members can criticise our policy on enfranchising the small business man.
  A number of hon. Members asked me about asset disposals. As my hon. Friend said, by the end of this financial year asset disposals will have realised about £300 million since we came to office. There is no question but

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  that without that sum we could not have maintained new town development activity at the level achieved during the past three years. That is an English figure.
  Perhaps I should make it clear that the statistics that I have given apply to England and Wales. The Scottish position is relevant because the overall borrowing comes within the capacity of the Bill. However, the allocation of money to the new towns in Scotland has nothing to do with Department of the Environment Ministers. It is a matter for the Secretary of State for Scotland, who deals with it as part of his provision.
  Mr. GrahamI am grateful for the information that the Minister has given on that point. However, as to the sale of assets, will he tell us what criteria the Government use periodically to decide how much they will ask the new towns to dispose of? We know that they would rather dispose of nothing. Will the Minister also answer the point made by my hon. Friend the Member for Newton (Mr. Evans) as to how much of the assets that are realised are then rolled over, ploughed back and used to finance either other new towns or urban development corporations?
  Sir George YoungWe are committed to the continuing disposal of new town industrial and commercial assets in order to reduce the public sector borrowing requirement and also to reduce the public sector's role as a large-scale landlord. Sales are proceeding as fast as possible, although not as fast as originally anticipated due largely to the effect of the recession on sitting tenant sales. Disposals are proposed only where the development corporation is satisfied that it is getting the best consideration reasonably obtainable. That includes, in appropriate cases, a fair proportion of marriage value. Sitting tenants are given as good an opportunity to buy the premises that they occupy as is consistent with securing for the taxpayers a proper return on their investment. The figure that the Government assume for disposals is arrived at after consultations with the development corporations and their professional advisers.
  Our policy is that new towns should sell their industrial and commercial assets so that they can become more like other towns. It will also enable the winding-up of the Commission for the New Towns to take place, for which legislation is needed.
  Mr. DewarI do not know English terminology, so perhaps the Minister will tell me what "marriage value" means. We do not have that in Scotland and it is foreign to me. Secondly, if we are selling off assets to help the PSBR, is there any bottom to that? One could sell off 100 per cent., which might be desirable for the PSBR but which would be thoroughly undesirable for the new towns. What is the bottom point at which the wild chase for quick returns will stop? Thirdly, perhaps the Minister can be briefed by the Under-Secretary of State for Scotland, who is responsible in Scotland. Perhaps he can get the Scottish figures from the Under-Secretary now or arrange for him to intervene and give them to the House.
  Sir George YoungThe marriage value is the extra value that would accrue to the tenant if he is entitled to buy the property. It is the difference between the value of the site with a sitting tenant and the value of the site with vacant possession. It is a matter for negotiation, when one
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  sells a site with a sitting tenant, to whom the marriage value accrues—to the sitting tenant or to the landlord. The interests of the taxpayers must be preserved and a proportion of the marriage value must come back to the development corporation.
  I shall deal in a moment with the community-related assets, which is what is left if one disposes of the revenue-earning assets, as we are at the moment.
  As to the last question, I am sure that my hon. Friend the Under-Secretary of State for Scotland made a note of it and will deal with it as best he can.
  Mr. MurphyMay I impress upon my hon. Friend the concern that is still being expressed by many sitting tenants—who wish to purchase commercial or industrial assets—about whether they are given sufficient advantages in the purchase procedure?
  Sir George YoungThe best answer to that is that if my hon. Friend will draw to my attention any problems that affect his constituents I shall do what I can to resolve them.
  I was asked by the hon. Member for Harlow (Mr. Newens) about the position of small tenants. There is no case for giving tenants of commercial and industrial property especially favourable terms for buying their premises. It is important for the taxpayer to get a fair share of the marriage value through the new town corporations. Tenants have an opportunity to buy at a fair price, something that was denied to them by the Labour Administration.
  A number of hon. Members asked me about housing transfers and section 10. We are making progress towards a settlement of authorities' claims for grant under section 51 of the New Towns Act 1977, formerly section 10 of the New Towns (Amdt) Act 1976, and towards the cost of remedial work on former new town houses. We have asked the National Building Agency to advise us on those claims. The work is due to be completed by the end of May by a company established by former staff of the agency. We aim to take a final decision on the extent of assistance to be made available as soon as possible after we have received the report and held any further discussions with the authorities and with the Association of District Councils. If the ADC had not rejected the offer that we made in January 1980, the authorities could have been receiving some grant during the current year. I hope that it will be possible to reach an equitable settlement. In the meantime, we have made it clear to authorities that they can carry out any urgent work without in any way prejudicing their claims.
  Mr. GrahamCan the Minister be categorical and say that, once the NBA report has been received, before the Government finally make up their minds about their action, they will provide the new towns, through the ADC or otherwise, with an opportunity to discuss or challenge the NBA report?
  In a new town that I know the figure that has been calculated by the district council to put right the inherent design defects is about £7 million. I assume that it is possible that the NBA may say to the Minister that the figure should be £4 million. I am not saying that the Minister should accept the figure of £7 million rather than £4 million, but the district councils should have at least an opportunity to challenge or question the report. At the end of the day, the Minister and his colleagues will make up

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  their minds, but there is a great anxiety that the Minister may produce a fait accompli. May the district councils understand that no action will be taken until the people who must spend the money and suffer the consequences have an opportunity to challenge the figures?
  Sir George YoungIt is indeed our intention that the report commissioned by the NBA should be available to the district councils and the ADC and that there should then be a period of consultation so that we can come to an amicable settlement. I hope that that assurance is acceptable to the hon. Gentleman.
  A number of hon. Members raised the question of grant-related expenditure assessments for the authorities in which the new towns find themselves. I do not think that any hon. Member thinks that the GREA gives his constituency a fair deal, but most, although not all, district councils with new towns in their areas are spending at levels well above the GRE assessments that underpin the block grant system. The assessments for those authorities are made on the same basis as for any other authority. To the extent to which they have chosen to provide a higher level of service than the average, it is right that they should be expected to make a larger contribution from their own resources than authorities that have chosen to provide lower levels of service and to levy lower rates. That is what the block grant system achieves using the GRE's as a measure of what it costs each authority to provide a typical level of service.
  I concede that the GRE is a new system and will not be perfect in its first year of operation. There may be factors that affect what authorities need to spend but which are not incorporated in the formula, and others which have not been given enough weight. One change that the Government have made to the GREs for next year will assist a number of new town authorities. We have dropped the assumption incorporated in the 1981–82 GREs that authorities with the potential to make a surplus on the HRA would transfer it to the rate fund. That will certainly reduce the disparity between expenditure by new town authorities and their grant-related expenditures.
  The Government are always ready to consider further proposals for improvement in the GREs so long as they are based on principles that can be applied to all local authorities, which is a legal requirement of the GRE method.
  My hon. Friend the Member for Welwyn and Hatfield (Mr. Murphy) put Government policy in the context of our strategy for inner cities and for harnessing the resources of the private sector in housing, commerce and industry. I was grateful for his strong support for the Government's proposals to put right the imbalance that has arisen in the ownership of assets in new towns. He pressed me and my hon. Friend about the Commission for the New Towns. In September 1979 my right hon. Friend the Secretary of State announced that the commission would be retained for the present, but that it would be wound up in due course. I cannot say when that will be, as legislation is required, but we have given the commission an assurance that it will not be wound up before the end of 1984. In the meantime, however, we have urged it to dispose of its industrial and commercial assets to the private sector and it has played a major part in the disposal of assets programme. The Government have also asked the commission to open negotiations with those local authorities that have commission towns in their area about the transfer of its
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  remaining responsibilities that cannot reasonably be included with the sale of properties to the private sector. Government policy is that the commission should withdraw from those towns in which it has responsibilities as soon as it is practicable for it to do so.
  A couple of weeks ago I visited Harlow and had talks with the leader of the council and the chief executive about section 10 and other matters. It is important to remember that work on urgent repairs can take place. One must send a message to Harlow that properties transferred to it by the development corporation were transferred at outstanding loan value and that if it made slightly quicker progress to sell properties to tenants who wished to buy them it would have more resources to tackle the serious housing problems that it faces.
  Mr. GrahamIn the absence of my hon. Friend the Member for Harlow (Mr. Newens), I must point out that he was concerned at the terms on which the non-industrial and non-housing assets would be transferred. Did I understand the Minister to say that there would be sympathetic discussions between the Government and the authority concerned? If it is proposed that only the unprofitable communally used assets are to be transferred to the authority and the profitable ones are to be given to privateers, the situation will be extremely difficult. Can the Minister give an assurance that sympathetic consideration will be given to the terms on which district councils accept that kind of asset?
  Sir George YoungThat is really a matter for negotiation between the district council and the Commission for the New Towns. Some community-related assets such as club premises are leased by development corporations to private tenants and others, such as playing fields, are leased to parish councils, and we have asked the development corporations to give such tenants the opportunity of buying the freehold. Other assets, such as parks, are the type of community asset normally provided by district councils. We believe that assets of that kind should pass to the local authorities, and we are encouraging the new towns to negotiate the terms of transfer with their own local authorities. We shall be considering with them the kind of terms that provide a fair balance between the interests of the taxpayer and those of the ratepayer.
  A number of hon. Members asked about the totality of cash flowing either from the Government to the new towns or in the reverse direction. The simplest way to put it is to explain briefly what has happened in the three financial years from 1979–80 to 1981–82. Gross capital expenditure for new towns in England and Scotland will be £1, 092 million and capital receipts over the same period will be about £444 million, so net investment by the Government in the new towns will be about £650 million. There is, therefore, no question of the Government asset-stripping the new towns and giving the money to the Treasury. The flow of money is the other way. That is why we need the Bill, to enable the new towns to borrow more money.
  The hon. Member for Edmonton asked about disposals at the behest of the Government. The only directions issued under the Local Government, Planning and Land Act were to the commission concerning £24 million and one to Bracknell development corporation for £7£5 million.
  My hon. Friend the Member for Basildon (Mr. Proctor) made a very thoughtful speech. I cannot go further than

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  what my hon. Friend said about the review of the financial position of the new towns, but I undertake to keep hon. Members informed about the progress of the review. Hon. Members seem to forget that the reason why my hon. Friend represents Basildon and Mr. Eric Moonman is now chairman of an area health authority is that the policy of not selling council houses to tenants was unpopular. Swings against the Labour Government in the new towns were among the largest in the country, and I see that the hon. Member for Harlow is down to his last 1, 400 votes.
  My hon. Friend the Member for Basildon spoke with justifiable pride about the shared ownership and other partnership schemes in Basildon. I have been to see them myself and spoken to young couples who had queued through the night to put down a deposit on a property available to them under the shared ownership scheme, which had brought house purchase within their reach for the first time. I was enormously encouraged by the progress being made in Basildon and other new towns in devising ingenious new methods of making house ownership available to people with average incomes. Instead of posing questions, my hon. Friend answered questions and I have nothing to add to what he said when he referred to a parliamentary question tabled before Christmas.
  My hon. Friend asked about the liberalisation of the regime for getting private finance into the new town programme. If a new town borrows from the private sector to carry out development on its own account, that expenditure counts as public expenditure and must be controlled as such. It is only when the private sector takes a significant share of the risk that the expenditure does not count as public expenditure.
  My hon. Friend referred to a limit on borrowing by the Basildon development corporation of about £500, 000 and asked for it to be increased. I think that he was referring to the limit on its bank overdraft. In fact, the Basildon overdraft limit is £1 million and the development corporation has not asked for it to be increased.
  The hon. Member for Dunbartonshire, East (Mr. Hogg) put the matter in a slightly broader context, relating it to the real problems facing parts of Scotland. The Government will do what they can to help the new towns, but they cannot be totally insulated from economic developments in the country as a whole. The new towns stand to gain perhaps more than any other areas from the upturn in the economy that our policies will secure—[Interruption]—however distasteful the prospect of that success may be to the Opposition.
  The hon. Members for Dunbartonshire, East and Glasgow, Garscadden (Mr. Dewar) tried to tempt me into Scottish local government issues. After 13 years, I think that I understand local government in England. I considered local government in Scotland, and the learning curve seemed rather steep. I shall ask my hon. Friend from the Scottish Office to write to those two hon. Members about some of the issues they raised. I am sure that those letters will be of the highest quality.
  My hon. Friend the Member for Buckingham (Mr. Benyon) urged us to introduce basically publicly owned property companies. We have done that with the urban development corporations in Liverpool and the Docklands.
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  In a lengthy speech, the hon. Member for Newton asked whether the PSBR would be increased by the measures before the House. The Bill increases the statutory limit and that is necessary to enable new towns to carry out the programmes foreseen in the public expenditure White Paper. Those programmes, taken as a whole, determine the PSBR. The hon. Gentleman was muddled about the legislation on new towns. The legislation of three months ago was basically a consolidation measure, and it would not then have been possible to increase the borrowing limit. I was grateful for his support, but the limit on the consolidation measure was fixed earlier and it was impossible to increase it last autumn. I am grateful for the support that he extended to the newly appointed chairman of the Warrington development corporation and I was delighted to hear of the demand for housing land in his constituency.
  The hon. Member for Newton also raised an important local issue about Pewterspear, which I am sure hon. Members should not decry. A three week public inquiry was held last autumn into planning proposals and an associated compulsory purchase order for a science park and high quality residential development on 101 hectares of land at Pewterspear and at the southern end of the new town. The inspector's report is still awaited and the proposals may have implications for the consideration of future infrastructure needs and, particularly, a new high level crossing of the Manchester Ship Canal. They will be considered when we have the inspector's report.
  My hon. Friend the Member for Liverpool, Wavertree (Mr. Steen) asked what the money would be spent on. Basically, the money will enable new towns to carry on with the programmes that are set out in some detail in each new town's annual report. It is not being done at the expense of inner cities. When the Minister of State introduced the Bill, he said that public expenditure is now being concentrated on the inner cities. This means that the resources for the new towns will fall, while the urban programme, including provision for the two urban development corporations, is being increased. I can reassure my hon. Friend for Wavertree on that point.
  My hon. Friend the Member for Wavertree raised many issues that are for the Treasury to deal with rather than me. However, as I understand it, the borrowing in sterling does not preclude borrowing in pounds, but that must be done by the Secretary of State. The provisions governing from whom a new town may borrow were introduced by the Statutory Corporations Financial Provisions Act 1974.
  Successive Governments have taken the view that, in general, public bodies borrowing in long-term sterling should be managed by the Treasury and no use has yet been made of the power to borrow in foreign currencies.
  Mr. SteenI am grateful for my hon. Friend's remarks. However, I urge him to correct one statement in his excellent speech. He said that new town borrowing did not affect inner city investment. Successive Governments have concentrated on the inner cities and neglected the problems of the middle and outer cities.
  Will my hon. Friend say something to reassure the majority of the population living in the middle and outer areas of large, industrial cities that the new town development will not be at their expense?
  Sir George YoungI hope that I can give my hon. Friend that reassurance. However, it would involve a

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  rather lengthy intervention into our policy towards inner cities and those areas just outside, one of which I represent. I can assure my hon. Friend that in deciding how resources are allocated, we have in mind the inner city's problems and the outer ring, on which he has written some imaginative leaflets. He will find that our inner city strategy takes on board some of the points that he has made in his thought-provoking literature over the past two or three years.
  The hon. Member for Fife, Central (Mr. Hamilton) made it clear that he had two prides—the National Health Service and new towns. For the past two and a half years I have listened to his speech about the NHS and, for the first time this afternoon, I heard his very good speech on new towns, which had some remarkable aspects in common with his NHS speech. The hon. Gentleman hankers after a golden age between 1945 and 1950 and turns a fairly blind eye to everything that has happened since. He called for a Scottish Minister to reply and I have heard the same call time and again during debates on the NHS. The hon. Member for Fife, Central did not set about canvassing Lady Balfour's support for his policies in a tactful way. I am not surprised about how she reacted.
  The hon. Member for Garscadden asked what percentage of the money would be available to Scotland. The historical picture is that borrowing in 1980–81 and 1981–82 for Scottish and Welsh new towns was £73 million in the first year and £78 million in the second out of totals of £440 million and £381 million. Therefore, in 1980–81, as I understand it, Scotland received about 16 per cent. and about 18 per cent. in 1981–82.
  There has been unanimity on two points during the debate. First, hon. Members have welcomed the Bill and, secondly, deplored the absence of members of the Social Democratic and Liberal Party alliance. Whether or not the alliance has broken the mould is a matter for debate, but its silence certainly remains intact.
  Anyone concerned about new towns will be grateful for the interest and commitment of those hon. Members representing them who have spoken. The Government share that interest and commitment and the Bill before the House is evidence of that.
  Question put and agreed to.
  Bill accordingly read a Second time.
  Bill committed to a Committee of the whole House.—[Mr. Thompson.]
  Committee tomorrow.

  New Towns Bill

    NEW TOWNS (MONEY)
    Queen's Recommendation having been signified—
    Resolved,
    That, for the purposes of any Act of the present Session to increase the limit imposed by section 60 of the New Towns Act 1981 on the amounts which may be borrowed by development corporations and the Commission for the New Towns, it is expedient to authorise any increase in the sums—

    (a) falling to be paid out of or into the National Loans Fund or the Consolidated Fund, or

    (b) falling to be paid out of money provided by Parliament, being an increase attributable to provisions of the said Act of the present Session increasing to £5, 000 million the limit imposed by the said section 60 on the amounts outstanding in respect of borrowing by the development corporations and the Commission.—[Mr. Thompson.]

Transport (Finance) Bill
Not amended (in the Standing Committee), considered.
Mr. Deputy Speaker (Mr. Ernest Armstrong)Before I call the first amendment, I have been asked whether it will be in order to refer to the current industrial dispute affecting British Railways. Of course, it will be in order to discuss the consequences to British Rail finances of the dispute and the importance that hon. Members attach to a settlement. However, I do not consider that the Bill provides an appropriate opportunity to discuss the details of the dispute.

Transport (Finance) Bill
  Clause 1

    INCREASED BORROWING LIMIT FOR THE BOARD
    7.49 pm
    Mr. Albert BoothI beg to move amendment No. 1, in page 1, line 12, at end insert—
    '(2) Before specifying any greater sum the Secretary or State: shall lay before the House of Commons a statement of the estimated annual External Finance Limit for the British Railways Board over a 10 year period.'.
    Mr. Deputy SpeakerWith this it will be convenient to take amendment No. 2, in page 1, line 12, at end insert—
    '(2) Before specifying any greater sum the Secretary of State shall lay before the House of Commons a statement of the extent of capital debt attributable to British Railways Board's programme of main line electrification.'.
    Mr. BoothOn Second Reading we discussed the British Railways' financial problem. Now that we are or Report, there is a British Railways financial crisis and an acute industrial relations problem. However, the purpose of amendment No. 1 is to require the Secretary of State to lay before the House a statement of an estimated external financing limit for a 10-year period before he specifies increases in the aggregate borrowing of up to £1, 300 million provided for British Rail in clause 1. It is impossible to plan the development of British Rail on a year-to-year basis. It would be impossible to do that at arty time, and it is certainly impossible to do it when a major modernisation programme requiring massive investment has to be carried through. That is not an argument that is necessarily peculiar to British Rail. It may be applied to other major industries both private and public. However, we are now concerned with British Rail and its finances.
    The first amendment concerns the external financing limit and the second relates to the electrification programme. The EFL has become increasingly a restraint on British Rail's investment programme, especially that part of it that is dependent on borrowing. That in itself has proved over the past year or two to be a serious limitation.
    We appreciate why the Minister wishes to have the right to approve individual major investments and discuss them with British Rail. We make no complaint about that. It is right and proper that the Minister should be concerned to that extent in the way in which British Rail's investment programme develops. However, a matter for major concern is that, whatever approvals may be sought for individual investments and investment programmes, the EFL is now becoming the limitation on the effective development of a major long-term programme.
    Although the Government have increased the public service obligation so that British Rail may sustain the parts

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    of the network that are needed for social purposes and that cannot pay their way, there is an element of investment within the PSO. There is also the interest to be paid on the sums which British Rail has had to borrow to carry out part of its investment programme. The PSO increases without there being a commensurate increase in the EFL, but that does not permit any significant increase in the investment programme. The only relief that it gives, arguably, is the extent to which it reduces the interest that would have to be paid if further borrowings were made available. Therefore, the increase in the PSO has added nothing significant to British Rail's ability to invest in a network.
    To be fair to the Government, they never claimed that that was intended. They said that the increase in the PSO was designed to help British Rail to deal with the problem of the fall in its receipts as a result of the recession. That leaves us with a major problem in British Rail's investment programme and the extent to which that is cut by the EFL.
    The Under-Secretary of State does no service to the serious argument about the limitation on the investment programme brought about by the EFL by reiterating, as he so frequently does, that the investment ceiling will be kept the same in real terms. He is saying that at a time when there is not a possibility, without other major changes in British Rail's financing, of the investment ceiling being reached.
    We have arguments about the best way to measure investment expenditure, but I hope that we shall be able to agree tonight that until there is an external financing limit that will allow British Rail to reach the investment ceiling there is little point in arguing about that ceiling. Railway investment has fallen when it should be rising to cope with a specified need to develop the railways.
    About £20 million less was spent by British Rail in 1981 on specific railway investment than was spent in 1979. If we consider British Rail's entire investment on services other than rail services, the reduction was much more acute. It is crucial that the Government respond to the major proposition that has been advanced by British Rail.
    What is to be the investment pattern for the next 10 years or even for the next five years? In the corporate plan a five-year investment programme was put before the Government. In March 1981 the British Railways Board decided to make public the investment proposals that it had submitted to the Government. Since then it has been possible for everyone who is interested in these matters to examine the way in which British Rail proposes to sustain and develop our railway network.
    British Rail said that the implementation of its corporate plan for 1981–85 would require average investment expenditure of about £441 million a year. It said that the implementation of its full rail policy proposals for the decade would involve an average investment of £567 million a year.
    The British Railways Board made it clear that the existing programme, which was costing about £306 million a year, was not adequate even to sustain the existing network, let alone to carry through any of the major modernisation programmes that it considered necessary or desirable. It proposed in the policy document that another £72 million a year would be needed for the renewal of assets and recovery against a backlog of deterioration in the system.
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    British Rail included in the estimates £36 million a year for the electrification programme. The exact figure would have depended on which of the five electrification options the Government decided upon. My hon. Friend the Member for Aberdeen, North (Mr. Hughes) will be seeking to catch your eye, Mr. Deputy Speaker, so that he may deal with the specific electrification issues that are referred to in amendment No. 2.
    The crucial issue is not so much the sum involved—£36 million is a relatively small proportion of the £567 million a year which British Rail is discussing—as the efficient implementation of many other parts of the programme. Beyond those proposals was investment in the London and South-East network. I refer to the improvement of the commuter services which I understand the Government have since rejected, the enhancement of the Gatwick and Stansted services and the Government's Channel tunnel proposal.
    At that time the British Railways Board believed that it would be possible to persuade the Government to allow it to seek private finance for a number of the elements within the programme—for example, for main line electrification, the enhancement of the Gatwick-Stansted services and the fulfilment of the Channel tunnel proposals. It believed that each element offered prospects of returning real rates of return on investment of more than 10 per cent. That is still undecided.
    Although from my political standpoint I would prefer public investment in those elements of the railway service which could make a real return of over 10 per cent., I do not take a doctrinaire view that those decisions should stand still until there is a Government of my persuasion. If those decisions are necessary for the development of the rail service, I would prefer to see them made under financial arrangements that the Government might reach with British Railways than that they should remain at a standstill, as they are now. All those elements of the investment programme, curtailed by the way in which the external financing limit is operated, are being stultified and stopped when it is important that decisions should be taken.
    8 pm
    The financial stranglehold on that development by British Rail, of which that restriction is so important a part, has contributed considerably to the current industrial dispute. It has considerable ramifications for the immediate financing of British Rail and the way in which the PSO is used in the present year. There is a likelihood that the board will call earlier than otherwise on the borrowing that could be provided under clause 1.
    That financial stranglehold influenced the British Railways Board to refuse to pay the original Railway Staff National Tribunal award, which led to British Rail and the rail unions going to the Advisory, Conciliation and Arbitration Service. As a condition of the tribunal award British Rail pressed the unions to give considerable undertakings about productivity in circumstances that, even on the most favourable assumptions, were highly unlikely to produce the results that British Rail wanted.
    The people who work in British Rail are a committed work force. They are more concerned than most people that there should be a future for British Rail and a sensible investment programme. They see the contribution that

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    they can make through productivity agreements to the success of British Rail, and to improving its overall services and productivity.
    However, those people are sensible and knowledgeable enough about the British Rail system to know that major productivity improvements over the next decade to give Britain a modern and efficient railway service also require as an essential corollary of their productivity arrangements a sensible and major investment programme. In unfavourable circumstances, brought about by the Government not being prepared to make investment commitments, the unions were pressed to make productivity commitments. The British Raiways Board was also not prepared to honour the tribunal award without additional undertakings. That led to a difficult situation.
    The unfavourable financial circumstances arose partly because of the massive manpower savings that had been made in the productivity negotiations of British Rail. Between 1970 and 1979 the railway staff had been reduced by negotiation and productivity arrangements—some small and some larger—by 30, 200. That was a considerable achievement. The corporate plan for 1981–85 which the British Railways Board put to the Government and the unions would have involved a reduction of a further 38, 300 posts over that 5-year period. It also involved investment. Understandably the unions were prepared to continue that pace of manpower reduction only with the investment proposed. In fact, the proposed pace was much faster. Twice the previous pace of cutting manpower was called for.
    Therefore, the current dispute not only jeopardises what is, by any fair test, the precarious financial position of British Rail, but, more inportantly, what has been a priceless asset, which is the commitment to work well and provide a good service, which has produced a good industrial relations record in British Rail.
    The British Railways Board, by refusing to meet the obligations to pay the award, which has been due since the beginning of this month, has faced enormous financial implications. The loss of income to British Rail as a result of the dispute will have to be counted when it draws finance from the PSO. It will not draw finance from industrialists sending freight or from passengers who are trying to travel on British Rail services during the dispute.
    Mr. Robert AdleyThe right hon. Gentleman has referred to the refusal of the British Railways Board to meet its obligations. Is he suggesting that the unions have no obligations, or that if they do they should not meet them? Will he share his thoughts with us? It is important to know what he feels.
    Mr. BoothThat is an important matter. I understand that the British Railways Board was informed by the general secretary of the Trades Union Congress that he was assured by the railway unions concerned that they would resume negotiations immediately, within the rail industries negotiating machinery, on all the outstanding productivity issues, provided that British Rail met its obligation to pay the outstanding balance of the pay awards. Therefore, the two matters are closely connected.
    It is my judgment—for what it is worth—as a life-time trade unionist and an ex-Secretary of State for Employment and having read the agreements, that in the last analysis the productivity aims identified in the ACAS talks following the refusal of British Rail to pay the initial
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    tribunal award will have to be settled in the established machinery of British Rail. Such is their complex nature and their implications that they can be handled only by people who are experienced in the industry and with the industry's machinery.
    If the dispute is settled with that machinery later rather than sooner, it will be at the cost of damage to the industry when its maximum development is crucial. The industry is coming to a watershed in its investment programme. If major expenditure on replacement is not started by next year, the only alternative will be a rapid rundown of the railway system.
    What is needed now from the Government is a commitment not only to maintain the existing network and services, but greatly to improve them. Major investment decisions should be made, certainly the central decision on electrification. Above all we need a programme, not on a year-to-year or line-by-line basis, but for a decade.
    The purpose of the amendment is to call upon the Government to lay before the House, before we proceed to use the financial provisions of clause 1, an external financing limit that is based on the concept of a programme for a decade in the development of British Rail.
    Mr. AdleyAs the right hon. Member for Barrow-in-Furness (Mr. Booth) said, this is a difficult time for the railway industry. I hope that he and the House will accept that I am a friend of the railways. I am a passionate believer that a railway is an essential component of a civilised society. I am also conscious, Mr. Deputy Speaker, of your ruling, which I believe is right. There can be no doubt that the current dispute, to which the right hon. Gentleman referred—not quite even-handedly—must inevitably jeopardise the investment programme of British Rail. The 1980 annual report and accounts, under the heading "Managing Change", puts it succinctly. It states:
    "The plan is explicit about BR's commitment to managing change, tailoring resources to business needs and negotiation changes in working practices. Higher investment will also lead to improved productivity."
    On that basis, Mr. Deputy Speaker, we must be allowed to touch on the background to the dispute, but, of course, not to enter into the details of what was said, by whom, to whom. It is a matter of judgment and we shall have to rely on your judgment.
    This is a sad strike. I hope very much that it will not become a party political issue, and I am sure that the right hon. Member for Barrow-in-Furness would join me in that. There is nothing that he has said recently that could be construed to be provocative, but I understand the pressures that he is under, both from within his party and from within the trade union movement.
    The words that I have written down in my notes are similar to those of the right hon. Member for Barrow-in-Furness. I believe, as he does, that if anything jeopardises or influences the future financing of British Rail, we must discuss it tonight. There is no doubt in my mind that this current dispute is jeopardising British Rail's financing programme. The Government and every hon. Member realise that and British Rail realises it best of all. If the strike drags on much longer it will inevitably have a damaging influence on the attitude of Government towards investment in the railway system.
    The railways have enough enemies as it is, without having to cope with the problems of a vicious and damaging inter-union dispute. That is what is at the heart of the present problem. As the right hon. Gentleman said,

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    British Rail has a good record on industrial relations. The unions have supported major changes in the structure of the railways, but, as those words that I quoted from the annual report and accounts clearly indicate, the process of investment and the process of managing change, and changes in working practices, go hand in hand.
    Understandably, we heard a great deal earlier this afternoon of concern about jobs. We are all concerned about jobs and unemployment. Those of us who look to the railways to provide increasing secure employment in the future in a modern railway system cannot but be immeasurably saddened by the effects that the dispute must inevitably have upon the prospects of secure, longterm employment in the railway industry. ASLEF's action will affect investment, and the Government, who are also the guardian of the taxpayer, are inevitably bound up in investment decisions because they have to assess how much taxpayers' money to make available for major new programmes such as electrification.
    The spirit of the amendment moved by the right hon. Member for Barrow-in-Furness is one that I support. The Government have talked about a 10-year electrification programme. Therefore, if one is discussing the external financing limits of British Rail and a 10-year rolling electrification programme, the two go hand in hand and it makes sense to recognise that fact in the legislation that we pass in the House.
    I repeat, en passant, a comment that I have made in the past about electrification. The railways have enough enemies. We are constantly told by the road lobby that investment in the railways is unnecessary and overgenerous, but no one, in the House or elsewhere, asks how much profit or loss the M4 motorway made this year. We have never had to see an annual report on the motorway system. The benefits of electrification of the west coast main line are self-evident, and are a self-evident advertisement sufficient for the Government to recognise the importance of electrification in providing this country with a modern and efficient railway system with all the industrial benefits that flow from a modern transport infrastructural system.
    8.15 pm
    This dispute undoubtedly is threatening the electrification programme. We must face up to that and we must discuss the effects of the dispute upon the electrification programme. I understand that the current dispute is costing British Rail about £6 million a day. I do not know what the Government's view of that is when they assess the external financing limits of British Rail in the current year. I do not know what the Treasury will say. I am sure that the hon. Member for Nuneaton (Mr. Huckfield) will pick me up on this, but I say it because it is self-evidently true: the Government are bent on a policy of encouraging industry to modernise. Modernisation and efficiency should go hand in hand. The British Railways Board is trying desperately to modernise the railway system and to make it more efficient. Included in that is the modernisation of working practices. Therefore, if Sir Peter Parker and his board regard that as an essential component in the modernisation programme, if the Government want industrial modernisation generally, and if the British Railways Board is forced to suffer the effects of the current
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    dispute on its finances, I suggest that that is not a matter that the Treasury can honestly ignore when it assesses British Rail's external financing limits in the current year.
    You will tell me that I am out of order, Mr. Deputy Speaker, if I go too deeply into the current dispute. I feel sorry for Mr. Buckton because he is being pushed from behind by people such as Mr. Ronksley and Mr. Fullick, who have a long history of militant action in the railway industry. The railwaymen themselves have had no ballot to decide whether they want to be bulldozed into a strike, and it is now far too late to consider a ballot. I ask myself one simple question. Four people signed an agreement. Did they know what they were signing?
    Mr. Deputy SpeakerThe hon. Gentleman must not go into what was behind the signing. He can discuss the consequences of the dispute on the finances of British Rail but he must not drift into an argument about what was or was not signed, otherwise he will be out of order.
    Mr. AdleyI accept your ruling, Mr. Deputy Speaker and I shall sincerely try to keep within it.
    If the two other unions have signed an agreement that they understand, it is essential that the third—
    Mr. Deputy SpeakerOrder. The hon. Gentleman is straying again. He is out of order and he must not continue to discuss that point.
    Mr. AdleyI shall content myself with saying that it is in the interests of those who have the welfare of the railways at heart to see the dispute ended as quickly as possible. It behoves those of us who feel as I do about the dispute to take opportunities when presented—which appears not to be the case tonight—to say what they can to try to encourage ASLEF to realise the damage that it is doing to future investment in the railways.
    I am sorry that we shall not have the opportunity of hearing any words of wisdom from members of the Social Democratic Party this evening. They are gracing us with their usual absence. They include among their numbers a former Secretary of State for Transport and a former president of the Transport and Salaried Staffs Association. I hope that it is not too much to expect that at some time they will break their vows of silence and tell us what they think about the dispute.
    On a completely different issue, but still related to finance, I should like to ask whether my hon. and learned Friend the Under-Secretary has yet had a chance to discuss with Sir Peter Parker the question of the Ribblehead viaduct. This is a question of £6 million that British Rail could be asked to find to keep a main line railway open. The amount is just part of the costs that British Rail has to bear.
    The general manager of Western region informed me today of the huge sum that will have to be spent on the station at Frome because a preservation order has been slapped on it. I do not believe that people always give British Rail a fair deal. They do not realise the enormous sums that it has to pay, year in and year out, to fulfil tasks that are environmentally attractive but that have no bearing on the financing of a modern rail system. I should like to see included, at some stage, within the financing structure of British Rail, sums provided by the taxpayer to do not what British Rail wants to do but what we, in this country, demand of it for environmental and other reasons.
    I apologise, Mr. Deputy Speaker, if I have tested your patience and strayed too far into controversial matters. I

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    hope that the investment programme will go ahead, that electrification will proceed and that the 10-year programme that the Government have outlined will become a definite 10-year programme and that it will not keep appearing in dribs and drabs, which is an inefficient way to run a railway modernisation programme.
    Mr. Les HuckfieldI hope that the hon. Member for Christchurch and Lymington (Mr. Adley) will excuse me if I do not attempt to take up his remarks. I am sure that he will understand that I am genuine in saying that the ability to write books on steam engines does not make him a railway man. Although the hon. Gentleman undeniably has an interest in railway matters, I suggest that he should acclimatise himself with more of the actual workings of current practice on the railways before making some of the statements that he has uttered in the debate.
    Mr. AdleyWill the hon. Gentleman give way?
    Mr. HuckfieldI do not intend to trespass on your generosity, Mr. Deputy Speaker. I recognise what you said about any reference to the current dispute so far as it affects the Opposition amendment on the external financing limit. As my right hon. Friend the Member for Barrow-in-Furness (Mr. Booth) so ably stated, the Government have tried to attach productivity conditions to the determination of the external financing limit. I hope, therefore, that any references that I make to productivity mean that I shall be within the bounds governed by a discussion on the external financing limit.
    Mr. AdleyWill the hon. Gentleman give way?
    Mr. HuckfieldAs the hon. Gentleman is bound to continue getting up and down like a jack-in-the-box, I shall give way.
    Mr. AdleyThe hon. Gentleman alleges that I am not in touch with current railway practice. How many motive power depots has he visited in the last three months? Does he know what they are?
    Mr. HuckfieldI was practically brought up in one. Anyone who has studied the present dispute and the references made to it by my right hon. Friend must have recognised that the British Rail board is operating within tight financial constraints determined by the Government. The corporate programme of the board for 1982–83 asked for an external financing limit of at least £1, 100 million. If it were to carry out the full range of the policy options in the document "Rail Policy", it could ask for £1, 250 million. I understand that the Government have set an external financing limit of £950 million which, although a £30 million increase on last year, represents about a 10 per cent. real cut, taking account of a 12 per cent. rate of inflation, if one accepts the Government's most optimistic figures. I hope that the Government recognise that it is the reduction in the real external financing limit that lies behind a great deal of the dispute.
    The board forecasts a planned overshoot on EFL of £200 million in 1982–83 together with a planned overshoot on the public service obligation grant of £202 million. The board forecasts a group loss, after interest paid, of £197 million. Those are worrying figures. The board is saying that, with the reduction in EFL and PSO received from the Government, in real terms, it still plans an overshoot. It will be understood that the board's PSO bid was increased from £644 million to £674 million. Although there has been a recent increase of £80 million to £754 million and
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    although a further increase of £30 million is planned, we are still talking of about a 10 per cent. decrease in real terms.
    The Minister will make reference to the fact that the external financing limit is being raised. It does not matter whether he uses 1980 prices or outturn prices. The hon. and learned Gentleman will recognise that in real terms he is talking about a decrease in both EFL and PSO limits. That is the outline of the present dispute. It is the outline to which I wish, in deference to your words, Mr. Deputy Speaker, to tailor my remarks about productivity and some of the current issues.
    The Government talk about the need for productivity. They talk in terms of the ability of the board to accommodate itself within these limits if there is increased productivity. I am bound to say that I do not find the board doing much to increase productivity. Most of its actions over recent weeks seem deliberately designed to ensure no productivity at all. If the board sincerely wants to increase productivity, there is plenty that the board can do to ensure that this happens.
    I should like to refer to some of the board's statements about the external financing and PSO limits that have been fixed. The rail policy document stated that, within 10 years, 3, 000 miles of track would be unsafe to use and 800 miles would carry speed restrictions. Those are the hoard's own forecasts. I support my right hon. Friend's amendment stating the need for hon. Members to know the EFL constraints that will operate over the next 10 years. Is it the Government's intention continually to decrease EFL and PSO in real terms? If that is the longer term policy, there will be even more difficulty on the railways, particularly if the board takes the attitude that it has adopted recently towards productivity talks. It is, of course, within those limits that I have described that the current arguments about productivity, or what are alleged to be arguments about productivity, are taking place.
    I speak in the House as the parliamentary spokesman for the Associated Society of Locomotive Engineers and Firemen. I am sponsored not by that union, but by the Transport and General Workers Union; under an agreement between the two unions I speak on behalf of ASLEF in the House because it does not have a sponsored Member. That understanding is registered in the Register of Members' Interests. [Interruption.] That is the interest that I have. Of course, I speak on behalf of my constituents as well.
    If the hon. Gentleman wants to talk about productivity, he must recognise that there is machinery for that productivity and that there is an environment in which that productivity is to be discussed. For example, the pay situation has to be determined within the external financing limit. When the ASLEF case, again bounded by the constraints of the external financing limit, was submitted to the Railway Staff National Council in March of last year, the general secretary of ASLEF, Mr. Ray Buckton, said that to restore the purchasing power of footplate staff to its 1975 level there would need to be an increase of 29·2 per cent. in basic pay. If we look at the pay of footplate staff and exclude the unsocial hours payment, we see that they have slipped to about 68th place in the league table, which puts them £72 behind the front runners.
    Mr. Matthew ParrisOn a point of order, Mr. Deputy Speaker. The hon. Gentleman is

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    speaking about the current railway dispute. I imagine every hon. Member has a speech about the current dispute. I listened to your ruling, Mr. Deputy Speaker, on what was said by my hon. Friend the Member for Christchurch and Lymington (Mr. Adley). If we are talking about the dispute, other hon. Members and I are willing to make our contributions, but it is not clear to me what the debate is about.
    Mr. Deputy SpeakerIt ought to be. I am listening carefully to what hon. Members are saying. As I said, it is in order to discuss the consequences for the finances of British Rail of the present dispute, but not to go into the merits and demerits of what was signed and so on. I am listening very carefully.
    Mr. HuckfieldI hope I have not trespassed beyond your ruling, Mr. Deputy Speaker. The point I seek to make—I hope the hon. Member for Derbyshire, West (Mr. Parris) will follow me carefully—is that by 1988 about one-third of footplate staff will have retired. That means that they will have to be replaced in one way or another. That is why we put down the amendment. The British Railways Board will need to know what external financing limits will be set for it for the next 10 years. Obviously the external financing limit will have a great influence on the ability of the board to replace those staff. That is why I gave the figure which I did. I hope the hon. Gentleman will follow me carefully, because I am trying to put a case about the need to know on the part of the trade unions and of the British Railways Board.
    Mr. AdleyWill the hon. Gentleman allow me to make a point?
    Mr. HuckfieldIf the hon. Gentleman wants to make a helpful point, yes.
    Mr. AdleyWill the hon. Gentleman remind the House how many locomotives British Rail has and how many members of ASLEF there are?
    Mr. HuckfieldNo doubt the hon. Gentleman wants to prolong the debate in his own way. If he wants to quote the Richard Hope figures—we all know the Richard Hope figures and we all know Richard Hope's anti-union views—he may divide the total number of staff by the total number of locomotives; he may do all sorts of calculations and no doubt he will come up with all sorts of unfavourable figures. We could come up with favourable figures as well. If the British Railways Board wants to talk about productivity and to discuss some of the figures to which the hon. Gentleman is referring, there is adequate machinery to do it. It is from that machinery that the British Railways Board has extracted the current productivity discussions.
    Mr. Robert HughesWill my hon. Friend also point out that in the bus industry there are many more bus drivers than there are buses, because the buses are on the roads a long time but the drivers have to work a shift system? Similar figures could probably be produced for the road haulage industry if the lorries are being used with different crews driving them.
    Mr. Deputy Speaker (Mr. Bernard Weatherill)I am sorry to interrupt so soon after taking the Chair. I heard what my predecessor in the Chair said. We must not go into the details of this dispute.
    Mr. HuckfieldObviously I bow to your ruling, Mr. Deputy Speaker, as I bowed with great deference to the ruling of your predecessor. I was simply referring to the fact that over the next 10 years—this is what amendment No. 1 is all about—the British Railways Board will need to know the external financing limits to be set by the Government because it will need to assess the effect of those limits on recruitment policy and on the wages that it may pay. That is why I made the point that evidence was presented by ASLEF that to restore the 1975 purchasing power an increase of 29·2 per cent. was needed. Even according to the board's unpublished part of its corporate review document in 1980 it admits that real earnings have fallen 8 to 12 per cent. below the national average.
    That is the position that the board finds itself in now. If it has to replace about one-third of its footplate staff by 1988, of course it will want to know within what kind of external financing limits it will have to operate its recruitment policy.
    The vice-chairman of the board has argued before a Select Committee that there are already recruitment and retention difficulties at the present level of salaries. The Leeds university study of British Rail in 1977 conclusively showed that on British Rail there are the longest hours and the lowest wages in the whole of Europe. That is the present wage pattern. That is why the board and the unions need to know the external financing constraints within which they will have to operate over the next 10 years. That will clearly affect recruitment.
    In that context I was pleased to note what was said in Decision No. 75 of the Railway Staff National Tribunal of July 1981, when the tribunal awarded the 8 per cent. and the additional 3 per cent. currently the subject of some contention. The tribunal, which is part of the railways' machinery for settling disputes, at paragraph 190, said:
    "Moreover, all parties have pointed out that already substantial progress has been made as a result of negotiations last year".
    It was talking about negotiations on productivity.
    "We welcome this development and hope that if our decision gains acceptance further and more substantial progress will be achieved."
    If the hon. Gentleman wants to refer to productivity within the external financing limits, I point out that the tribunal has already referred to the increase in productivity and has already given its blessing to the improvement, which it hopes will continue.
    Increased productivity within the external financing limits was part and parcel of the ACAS understandings that were achieved—
    Mr. Deputy SpeakerOrder. The hon. Gentleman is now beginning to discuss the details of the dispute. Other hon. Members have not been able to do that, and I must ask the hon. Gentleman to bow to the ruling given before I took the Chair.
    Mr. Stuart HollandTwo main varieties of costs are involved in an enterprise such as British Rail. One is capital costs and the other is variable costs. It is very difficult for the House seriously to consider any of the provisions of the Bill relating to finance unless it is valid for it to consider variable costs, which involve wages and manning. Otherwise, with due respect to you, Mr. Deputy Speaker, much of the discussion of the Bill becomes meaningless.
    Mr. Deputy SpeakerThe hon. Gentleman may not have been present when my predecessor in the Chair gave his ruling. It may be wise for me to read out again what he said:
    "it will be in order to discuss the consequences to British Rail finances of the dispute and the importance that hon. Members attach to a settlement. However, I do not consider that the Bill provides an appropriate opportunity to discuss the details of the dispute."
    That is the point that I was making—that the House must not discuss the details.
    Mr. HuckfieldI am struggling manfully, and I thought successfully, to keep within the bounds of that ruling, Mr. Deputy Speaker. I do not want to trespass on your generosity. I simply want to say that the productivity discussions clearly will have to take place within the confines and constraints imposed by an external financing limit. That is why we have suggested in the amendment that we need to know what kind of external financing limit that will be over the next 10 years.
    The difficulty is that if the external financing limit is to be constrained by cash limits, as the public service obligations grant will be, it is difficult for the board or anybody else involved in negotiations to know what the policy will be. It is because we need to inject longer-term certainty into the negotiations that I have referred to a few of the difficult issues, trying to show how we can best inject some certainty into discussions on some of those issues if we know over a longer term of years what the external financing limit will be.
    The ACAS understanding was written in that spirit, because the productivity part was entirely separate from the pay part. The ACAS part of the understanding makes specific mention of the fact that, if agreements are reached on certain productivity items, there will be specific payments made within the EFL for them.
    Mr. Deputy SpeakerOrder. The hon. Gentleman is getting into the detail of the matter again. I must ask him, please, to stick to the ruling that has been given. It is only fair to other hon. Members who have done so.
    Mr. HuckfieldI have tried to set the scene in which this set of negotiations and the further series of negotiations will take place.
    I should like to refer to the impact of productivity items on the board's financial position. I am sure that the Minister will recognise that it is the impact of productivity discussions on the railways' overall financial situation that will affect the board's longer term borrowing needs and, consequently, the demands that it will make upon the Government.
    Because of the comparatively low wages on the railways, including those for footplate staff, and because of the need for a substantial replacement of staff over the next five years, I can see the board's external financing limit needing to be raised, as a large amount of recruitment will be needed. That, again, is why we need to have some certainty injected into our knowledge of the external financing limit over the next 10 years.
    Hon. Members who have studied the productivity discussions which have been taking place recognise what the Government have been saying about the need to achieve productivity. If we are to achieve productivity increases to fit in with the external financing limit set, there is much discussion that the board could have which would bring about substantially larger increases in
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    productivity and reductions in costs than in the current discussions on some of the items at present. That is why many of us cannot understand why attention should have been concentrated on one particular productivity item. Far bigger savings and increases in productivity could have been attained from discussion elsewhere.
    Perhaps the board has an inkling of what the EFL might be over the next two or three years. That may be why it has chosen to concentrate on this particular item. I repeat that there are certainly items of negotiation that would lead to far bigger increases in productivity and cost saving than this particular item. If the board wants to discuss any of these items to fit in with the EFL restraints there is a perfectly adequate, tried and tested machinery through which discussion can take place.
    In the context of the need to know what the external financing limit will be, it is obvious that the dispute will not be settled easily. If it is not settled quickly, I can see the board needing to come back to the Minister for an even larger EFL. That is why many of us cannot understand why, when an award has been made at the Railways Staff National Tribunal and an award and understanding has been achieved through ACAS—having gone through two sets of arbitration already on the productivity item—there needs to be an even further set of arbitration procedures. If the board genuinely wants to talk about productivity increases, there is adequate machinery to do so.
    8.45 pm
    Mr. AdleyOn a point of order, Mr. Deputy Speaker. I was forbidden to finish a sentence when I was asking why, when four people had signed an agreement—three unions and the British Railways Board—three understood it and one did not. Why does there appear to be one rule for hon. Members on one side of the House and another for those on the other?
    Mr. Deputy SpeakerOrder. The hon. Gentleman might rephrase his point of order.
    I made it plain to the hon. Member for Nuneaton (Mr. Huckfield) that it was not in order to refer to the detail of the dispute. I said that it was unfair to other hon. Members who had been stopped from doing just that. I ask the hon. Gentleman to refrain from doing so. We have had enough of the dispute. Let us get on with the subject of the amendment.
    Mr. HuckfieldThat is what I thought I had been trying to talk about. I was trying to talk about the need for certainty in forecasting and assessing—not least, fixing—the external financing limit over the next 10 years. Partly because the board has had to operate with a short-term time horizon, it has been forced to take the attitude that it has.
    The Under-Secretary of State for Transport (Mr. Kenneth Clarke)May I assist the hon. Gentleman, who is having difficulty in keeping his argument in order? The case from the Opposition Front Bench was that the external financing limit may need readjustments to cope with capital investment and the need to modernise the railway. The hon. Gentleman appears to be making a case in addition to that. Without a commitment to productivity on their part, he wants the EFL increased to provide higher wages for the members of the union on whose behalf he happens to be speaking. Is that right?
    Mr. HuckfieldI hope that I can answer the question within the rules of order.
    Mr. AdleyThe hon. Gentleman need only say "Yes" or "No".
    Mr. HuckfieldThe Minister makes the classic mistake that all his colleagues and most members of the press and others who have tied to assess the dispute make. The dispute is not about productivity. The hon. and learned Gentleman has chosen tonight once more to link pay and productivity. I am sure that his officials brief him daily, so he should know that the dispute is simply about the fact that the British Railways Board made an agreement to pay an additional 3 per cent. and has now ratted on the agreement.
    Mr. Deputy SpeakerThe House has taken the point. The hon. Gentleman is again getting back to the detail of the dispute. Let us move on to British Rail's external financing limit.
    Mr. HuckfieldI have got that point off my chest and into Hansard. I hope, too, that the Minister has understood it. It is most pertinent to the dispute.
    The Minister asks whether I am venturing to suggest an external financing limit increase to pay wage increases. The hon. and learned Gentleman should know that the unions will not force that necessity on the Government; the board's behaviour will do so. Because of its completely intransigent attitude—not to mention telling lies on television—and the loss of about £6 million a day, the board will need to ask the Government for an increased EFL. The trades unions will not necessitate the increase.
    I finish where I tried to come in. Many of us who take an interest in railway matters genuinely want to know what the Government mean by productivity discussions within the external financing limit. If they mean to bring about the increase in productivity that they say they wish to see on the railways and to keep it within the proposed EFL, perhaps the Minister should intervene and tell the board that it can get the productivity increases only if it is prepared to discuss them through the established machinery. If it is to do that, it will need to know what the external financing limit will be over the next 10 years, and if it is not to be increased, and if there is to be no increase in the request for another EFL estimation, perhaps the board might start by paying the 3 per cent.
    Mr. Stephen RossI apologise to the right hon. Member for Barrow-in-Furness (Mr. Booth) for not being here when he spoke on his first amendment, which I support. Anything that enables British Rail to plan its future activities and thus make more realistic budgets should promote more efficient railways. Since my party gave me the task of speaking on transport affairs I have tried to press the Government into doing rather more rather more speedily to provide more financing for modernisation, particularly for electrification.
    This is a difficult time to discuss the future of British Rail because of the dispute. I do not agree with the hon. Member for Nuneaton (Mr. Huckfield). I can read agreements. I accept that British Rail has been at fault—it should have faced some of these difficulties a long time ago. My reading of the dispute does not accord with that of the hon. Member for Nuneaton, but neither does it accord with that of the secretary of the National Union of Railwaymen. My one qualification on this subject is that my son is a member of the NUR.
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    I am a supporter of the railways. I want them to succeed and I feel that the present Government have not done enough to help British Rail in the last two and a half years, and certainly not in the last six months, since the change of Secretary of State. It took a great deal of pressing from the House to obtain the East Anglian consent from the Government, who denied that they were even considering it. However, my patience as a travelling member of the public is exhausted by what is now happening. One can see the finances of British Rail disappearing overnight. What is happening is suicidal and must be settled, and settled quickly.
    I have twice travelled back to my constituency in a fast coach. I was surprised to find that the journey takes only two hours from Victoria coach station. The journey costs £4 or £2·50 if one has not booked. The general public will be frustrated and thoroughly brassed off with British Rail if the dispute goes on for much longer. What is worse, it has occurred during the worst winter in living memory. If there was a real dispute, surely the union could have waited for a fortnight. The public will say that they have had enough and they will not have any more—they will use the other options.
    The Government will, quite fairly, say that the money cannot be made available. It is difficult to stand on this pitch and plead for the railways as I do, but it is common sense that we should be travelling more on public transport and that we should be putting more on the railways. For that reason, I agree with the GLC. What is happening on London Transport is mad and many Conservatives take that view.
    Mr. HuckfieldThe hon. Gentleman voted against the GLC policy.
    Mr. RossI voted against it because it was breaking the law.
    I support the GLC's policy. I paid my supplementary rate of £60 and I travel on public transport.
    Mr. Deputy SpeakerOrder. That has nothing to do with the Bill.
    Mr. RossI wanted to put my support on record.
    It is difficult for one who wishes to support the railways and see them succeed to plead for a higher external financing limit for a longer period when the dispute is continuing. It is in our midst at a time when many of us are in despair at the future of the railways.
    Mr. Robert HughesI intervene at this stage, unusually, not to wind up for the Opposition, but to deal specifically with amendment No. 2 on electrification.
    However, first, I want to take the Under-Secretary to task for not fulfilling the undertakings that he gave in Committee. He told us at column 99 of the Committee proceedings that he would write to me about the issue of section 8 grants for sidings and planning permission. He has not yet done so. Perhaps he has been otherwise occupied. Moreover, at column 186 he promised to write to me about the criteria to be used to allow section 36 grants for waterways. That is a more serious matter. He confessed in Committee that he had forgotten that his right hon. Friend the previous Secretary of State for Transport had promised in July to write to my right hon. Friend the Member for Barrow-in-Furness (Mr. Booth) about the extension of these special grants for freight transport. He has still not written to me either. I hope, therefore, that he will fulfil the undertakings that were given in Committee.

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    I come now to electrification. I am sure that the time for a decision by the Government on the amount of investment to be made available to British Rail for its electrification programme is long overdue. There is common agreement in the industry and between the British Rail Board and the unions that the current rolling stock and equipment that are available to British Rail is inadequate. There is also general agreement in all quarters of the House in this connection.
    British Rail is quite clear on the subject of maintaining and raising the standard of service. It says in its rail policy document, paragraph 4.12:
    "The greatest danger facing the industry is therefore that funds would be insufficient to sustain even the present inadequate investment programme, and that the critical year 1981 will be passed without the necessary commitment to replacement. None of us in British Rail would derive satisfaction from operating a railway which provides quality standards becoming steadily less and less acceptable to our customers. Bare survival may be the lowest objective which an organisation can adopt but it is an insufficient diet for a great national industry".
    The document goes on to say, in paragraph 4.13:
    "The single most significant decision is Electrification. A favourable decision covering how quickly to proceed and when to start would give hope to all of us in BR, would point us in the right direction for all of the preliminary planning and design work, would enable us to place long lead time orders, would encourage many manufacturers and contractors to make preparations and would give hope to some of the areas worst hit by unemployment. It is moreover a watershed decision—whichever way it goes it would be extremely costly to reverse".
    It is astonishing that we are no further forward. We are no nearer getting a decision today than we were when the rail policy document was produced in March last year. So far, we have had the decision, which I welcome, for the go-ahead of the line to Norwich, the Anglia electrification. That decision was with the Government for over 18 months. As the Under-Secretary reminded us in Committee, that proposition slightly pre-dates the main electrification programme. It is not as though the electrification programme was first projected into the decision-making process in March 1981. In fact, the discussion began well before then. In May 1978 it was necessary for the then Secretary of State for Transport and the then chairman of the British Rail Board to appoint co-chairmen of a group with the following terms of reference:
    "To review the case for a programme of mainline electrification, to analyse the various relevant considerations and formulate the issues for discussion".
    The review was carried out jointly by the Department of Transport and the British Rail Board, and the final report was published last year. The technicalities, finances, and the advantages were all considered in great detail. Indeed, the report makes it clear in paragraph 3:
    "We are satisfied that the work done, which was scrutinised in detail by both the Department of Transport and the Railways Board, gives results that are reliable; further refinement would not alter the conclusions to be drawn".
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    Clearly, the Government's hesitancy in committing capital investment is holding up the decision. Everyone understands that major investments must be justified. No one is suggesting that the British Rail Board should simply ask the Government for X million pounds, that the Government should say "Yes" and that that should be the end of the matter. Of course such investment must be justified. On any test, electrification merits investment. It would reduce dependency on oil—the railways use 3 per cent. of the oil consumed by transport—it would assist the
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    United Kingdom's manufacturing industry in winning orders overseas in an expanding market and would be in keeping with the Government's policy of purchasing locally and more effectively to enhance the competitiveness of British industry.
    A decision on electrification would raise morale in the industry and the standard of service. It is to everyone's advantage to proceed quickly, yet we are still wasting time. The Government are not coming clean. When the joint working group was set up, there was a clear understanding that when it reported on the general strategic principles—and if there was agreement between the Department and the board of British Rail—the board would not have to provide a line-by-line financial appraisal in justification. However, the Government have gone back on that and are demanding a line-by-line appraisal.
    Paragraph 11(i) of the joint report states:
    "A programme of electrification would require commitments, from the supply industry and the workforce as well as railway management, which the ad hoc approval of individual projects could not command."
    That is a clear sign that we should not proceed on an ad hoc basis. However, in June the then Secretary of State for Transport made the worst possible choice of those available to him. The report on electrification made it clear that the best course was to go for the largest and fastest programme, to be completed in 20 years. That is detailed in paragraph 13. At the other end of the scale, in paragraph 14, a programme was suggested that could be completed in 15 years. The report also suggested—as almost all reports do—a middle position of a medium-sized programme. The scale of the programme to be adopted depends on finance and the number of electrification teams available.
    The previous Secretary of State seems to have totally ignored the three years' work that went into the report. In June, he said:
    "I am therefore inviting British Rail to prepare and submit a 10-year programme of schemes for electrification only of those potentially profitable main line routes where it is clear that the benefits could justify the investment. These should be presented together with the new commercial plans that are now required for the businesses. The approval of each successive electrifcation project will be conditional on the profitability of the investment in question and on the achievement of necessary improvements in productivity."—[Official Report, 22 June 1981; Vol. 7, c. 22.]
    The then Secretary of State took the opposite view to that adopted by the report of the Department of Transport and British Rail. He went against the report and compounded his felony by insisting that the inter-city businesses should achieve full commercial performance by 1985. However, as the Minister knows, as a result of the recession—for which the Government are responsible—the public service obligation has had to be subtantially increased this year. I do not know how on earth those inter-city businesses can be expected to become commercially viable within the next three years. There is an urgent need for decisions and I cannot understand why the Government are delaying matters.
    Paragraph 10 of the joint review of main line electrification refers to the importance of decisions. It states:
    "Such a strategic decision would give a base for the many individual decisions, for example, on the plans for designing new rolling stock, on renewing and modifying the track and signalling, on the disposition of depots, and on the traffic which the railways should aim to secure, all of which can be affected by the form of traction envisaged."

    821
    It is clear that the decision on electrification goes much wider than simply replacing stock.
    Secondly, the British Rail document "Rail Policy, " says at paragraph 4.4:
    "The watershed year is 1983. If major expenditure on replacement is not started by then the inevitable consequence will be a rapid rundown of the whole railway system. We could postpone until that date, continuing with some replacement and with much 'make do and mend' at present investment levels, but not beyond. In 1981 we must have started the design and planning work and have placed orders for materials if major re-equipment is to commence in 1983—so the year for decision is 1981."
    Yet here we are in 1982 with no major long-term decisions taken.
    British Rail is in no doubt that if it is to achieve its main policy objective, the Government should approve its full electrification proposals as soon as possible. It is not as though the sums of money are unreasonable or beyond the Government's capacity to bear. As the Minister will know, from 1981 to 1991 British Rail estimates that £36 million per annum is required for electrification. In my view that is too modest a programme. It is a fraction of what we now spend on unemployment. That sum is about £13·5 billion, yet we cannot give British Rail £36 million a year to invest in electrification. We can and we must afford £36 million a year. However, all that we got from the Under-Secretary of State during a brief discussion in Committee was that proposals were put to British Rail in June and a reply is awaited.
    That is not good enough. The Government must show a much greater sense of urgency and commitment. If there is widespread cynicism or low morale among British Rail staff today, the prime responsibility rests with the Government. If staff are resistant to change in work practices, that is due to the Government's insistence that they will release money only if British Rail sheds much of its work force. British Rail employees have heard that since the days of Dr. Beeching. The argument is that a more compact railway system and a smaller work force will mean more secure and better paid employees. That has not happened. We hear the same demands years later and the same promises from the Government. With over three million unemployed no one could blame railway staff if they were to say that enough is enough.
    The only way in which we can begin to restore morale and to prove that railways have a future is to approve the electrification proposals soon and to commit the Government to further electrification projects. I cannot speak for any other hon. Member, but my constituents will not be satisfied if the east line electrification system terminates at Edinburgh.
    I can best sum up the present position on electrification if I quote a leader in The Guardian of 23 June 1981, which said:
    "In the event, the statement made yesterday in the House by Mr. Howell, the Transport Minister, has turned out to be little more than an agreement in principle. British Rail will now be required to put up proposals again in a new form, after which the Government will decide case by case and electric line by electric line whether public investment is justified.
    This leaves British Rail and the companies that would expect to do the electrification work in the worst of all possible positions. Major industrial decisions, like a motorway programme, or power station building, or railway electrification need a reasonable element of certainty over a period of several years if they are to have any chance of being completed with even modest efficiency."
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    The leader went on to say:
    "The unpublished No. 10 Think Tank's report on electrification and Professor Walters, the Prime Minister's economic adviser, are both reported to be highly critical of the assumptions on which the electrification proposals are based. But strategic industrial decisions cannot be made on the basis of short-term analysis. It is a grave weakness of our system that, in marked contrast, say, to France or Japan, we seem congenitally unable to set a long-term strategy and stick to it."
    It is the Government's failure to have any long-term strategy that is condemning British Rail and undermining a system that is a vital part of our nation's infrastructure, and it is the Government's grave weakness that is contributing to the total collapse of British industry and preventing recovery.
    A start can be made on electrification if only the Government will cease to be so obstinate in their adherence to monetarism. The need for electrification, the financial advantages to British Rail and the benefits to industry and the economy are amply demonstrated. It is time that the Government made a start, gave their commitment and approved at least the 10-year rolling programme for British Rail electrification.
    Mr. Bob CryerI wish to speak briefly in support of both amendments but particularly in support of amendment No. 1, to which my hon. Friend the Member for Aberdeen, North (Mr. Robert Hughes) has just spoken. The idea of a 10-year rolling programme is excellent. It gives British Rail much greater certainty and allows it to plan. It also enables the workers of British Rail to see that the management can look ahead instead of living from hand to mouth as it is doing at the moment. It also removes the suspicion which has been engendered that British Rail management has been informed by the Government by means of a nod and a wink that to have increased investment for electrification it must achieve some significant "productivity" improvement. That, I believe, lies behind the present industrial conflict between British Rail and ASLEF.
    It is remarkable how the board has plucked one from 19 productivity areas in front of the two sides for discussion and chosen to make an issue of it. There is no doubt that this sort of 10-year rolling programme is a possibility because the railway industry until the immediate present has had an excellent record of understanding and working together. That understanding is being destroyed by the attitude of the Government which is being inflicted on the management. I suspect that, in spite of its harsh words, the management has undertaken the task of attacking ASLEF with some reluctance, although its present attitude shows little sign of that.
    The Minister must know that over the past 20 or 30 years there has been a marked increase in productivity by British Rail and a marked loss of jobs. If British Rail really wants to demonstrate an increase in productivity associated with the electrification programme, it must demonstrate to people who work for it that the money is forthcoming, for example, to replace all the unfitted goods wagons which still run around the British Rail network.
    If electrification is to be introduced, that must involve higher running speeds, but the running speed on electrified or non-electrified railways is not governed by tractive effort when there are unfitted wagons. It is governed by the fact that wagons do not have continuous brakes, and that lack of a continuous braking system has existed since the 1830s and the development of the British railways

    823
    network. That sort of investment is vital if the benefits of electrification, with higher track speeds and therefore greater track capacity, are to be available to British Rail.
    British Rail workers must know that the Government are prepared to invest that sort of money, not directly for electrification but for the consequences of it, arising from the claims for an increased track capacity. Yet that has simply not been forthcoming.
    9.15 pm
    British Rail cannot manage the upkeep of track, let alone embark on the replacement of unfitted goods wagons with those fitted with brakes which operate continuously, changing from the vacuum to the air-braking system which is more efficient. There must be a programme that it can look ahead to.
    The Government have simply been using investment as a cats-paw to play with the railways and influence the board in trying to obtain the sort of conditions that are now wreaking great havoc on the railways. ASLEF is not prepared to make massive concessions after a unilateral decision of the British Railways Board to seek the destruction of the eight-hour day. The board unilaterally decided on that issue to put the travelling public to great inconvenience. ASLEF does not want to strike. The intransigence of the board occurred unfortunately because of the Government's attitude in laying down conditions for investment and that brought about the conflict.
    This sort of rolling programme would give confidence to an ailing industry. From the 1955 modernisation programme, railwaymen have been told year after year to accept productivity improvements. The drivers accepted a guard in the rear cab and the removal of guards' vans. There are still guards' vans on trains because the Government have not provided sufficient investment to get rid of unfitted trains. They accepted alterations in working practices over many areas, saw the closure of thousands of miles of track and were told time and again to accept the conditions and then have a viable and confident industry which would maintain future jobs.
    What has happened? In the past two and a half years particularly, the investment programme has been subject to a number of conditions. Electrification was first to be on a broad programme and then on individual routes which had to establish a criterion of profitability. Therefore, the board had to reassess all the schemes it had drawn up at the Government's request for a broad planning programme. The result is uncertainty which would be met, to some degree, by the amendment so that British Rail was given certainty over 10 years. The railwaymen have been told that BR's future is certain if they accept productivity demands, demanning and so on, but that has not been shown to be the case.
    The Minister knows that the British Railways Board appears to be moving back to its old habits. I refer not to the industrial front but the closure front where it is proposing diversions of inter-city trains from the Settle to Carlisle line because the Ribblehead viaduct needs massive sums of money spent on it. Apparently, that has just been brought to its attention. Although that railway has been maintained since its opening in 1884, BR has suddenly discovered that a massive sum of money is required.
    It is suggested that that is a means of closing that line by the back door. Although British Rail denies that, one knows that behind it the Government are holding tight to
    824
    the purse strings. We are not simply asking for a block grant to be handed over without any criteria, as happened with De Lorean in Northern Ireland. Some of us are critical on how that situation was handled. We simply ask for a sensible approach by the Government to encourage investment in much-needed areas of British Rail. There is no doubt that the money would be spent usefully. It would improve an important national asset, give confidence to railwaymen who lack it now, because of the criteria laid down, create more jobs and develop a technology that we could sell abroad. Britain is ahead of many other countries on railway technology.
    In the 1960s some said that the railways should take second place in the queue. They argued that we should switch to motorways and to road haulage. Those arguments have not been borne out. Other countries are extending railway transport and we have been able to extend our exports of railway technology. There is potential for the future but that depends on the Government saying to British Rail "We shall give you the confidence that you need by supporting a 10-year programme." If the Government took that approach, I am sure that further developments in productivity talks would be possible.
    The Government's harsh attitude has led to confrontation, and ASLEF is rightly taking the view that the British Railways Board has unilaterally and unjustifiably decided to adopt confrontation. That is not what ASLEF required. It was prepared to continue to discuss productivity and manning among the other items included in the list of 19 to which I referred earlier. Unfortunately the Government's attitude has been inflicted on a management that has been shown to be too supine.
    I hope that the Minister will accept the amendment because I feel that it will give confidence and certainty to a network that we all wish—some perhaps academically—to support. In 20 or 30 years we shall probably be saying "We shall need the railways and we shall need them more than ever." If we do not give them the certainty of investment that they require, the present erosion will increase. About 10 years ago some of the bridges on the Settle-Carlisle line were raised when they were modernised for electrification. That is a sorry comment to make because electrification is hardly a possibility. The line seems to be facing a rundown. We shall very much regret any further rundowns. The railways need development and a buoyant future and the amendments seek to achieve that objective.
    Mr. HollandI too speak in support of the amendments introduced by my right hon. Friend the Member for Barrow-in-Furness (Mr. Booth), particularly that with regard to comparative long-term planning and electrification.
    The importance of long-term investment planning, as opposed to short-term reaction to events, lies partly in two effects, one the direct benefits to the rail service in efficiency, in speed, in reliability, especially in the commercial goods sector, and also the indirect benefits to the rest of the economy, of which the Government do not appear to be aware.
    If an investment programme were to proceed and were to proceed over a specified 10-year programme, several of our industrial producers which otherwise would be in difficulty would be able to benefit from the certainty of contractual arrangements to supply the electrification

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    programme. One is talking here of specific companies, of the GECs and the BICCs which have faced considerable difficulties in the heavy engineering area of their companies precisely because of the uncertainty that has been introduced by the current economic crisis for their long-term planning.
    What the Government have not in general appreciated—it is typified by their attitude towards transport policy—is that short-term policies of demand management aiming, for example, to wring inflation out of the system, as they claim they are able to do by monetarist policies, do not cope with the underlying structural causes of an economic crisis, and do not cope with the difficulties for companies of undertaking investment where frequently this has to be paid off over not only a 10-year period but a 20-year period.
    Large companies with long-term planning horizons cannot adjust either to the short-term demand management imperative of a passing monetarist Chancellor, nor even to the views given on a short-term demand management by a Government during a whole parliamentary lifetime. Forward planning of investment frequently involves five to seven years elapsing between a project being a gleam in the designer's eye and actually entering into production.
    In the mid-1970s we found that a company such as GEC, which we were led to believe was opposed to planning agreement relationships with the previous Labour Administration, in effect was opening itself up to the prospect of a planning agreement precisely because the heavy electrical end of the company needed greater certainty of future sales to modernise and invest in equipment.
    That is quite apart from the general external effect of an investment programme on the real economic side and on the financial side spanning more than the short term. For example, in the early 1960s it was commonplace, and taught almost without question in economic courses throughout the country, that the direct costs of running a public transport system did not measure the indirect benefits to society as a whole.
    Those costs and benefits have to be evaluated and measured. If we are to run our railway system at a loss, as every major country is doing, and if we are to introduce some kind of rationale and justification for that loss, we need to be able to trace some of the indirect advantages to the economy from the direct loss registered in the system. That is directly relevant to the amendment and to the external borrowing requirements of British Rail.
    In view of these arguments I do not accept that the House is in a position to evaluate the proper external benefits relating to the Bill without knowing what role the Government anticipate British Rail will play in the transport system and the economy as a whole. If we are unable to make forward estimates of, for example, the volume of freight that will be carried by British Rail, apart from inter-city passenger transport, no rational policy can be made for justifying a deficit in relation to the external advantages to other sectors of the economy or to society.
    That is one of the limits of the Government's present approach. The Government appear to have ruled out any long term financial planning while at the same time insisting on what amounts to a Mafia type relationship with the British Railways Board and with the railway
    826
    unions—that is, unless they accept a reduction in variable costs in the short term, in effect wages, there will be no long-term investment programme.
    But there are two ways of approaching the role of labour and of labour and the wage bill in running a transport service. One is, broadly, that adopted by the present Government, to undertake a policy against labour and the trade unions. The other is to involve labour and the trade unions in the forward planning over the 10-year period of the transport service itself.
    That suggestion is hardly illusory. In other debates Ministers have frequently referred to the economic successes of some of our main competitors abroad, one of which is Japan. What seems to be lacking in the general monetarist reasoning of the Government, which is reflected in their attitude towards wage bargaining in the public transport sector, is that in an economy such as Japan's the workers are, in effect, guaranteed lifetime employment. Instead of the bludgeon of unemployment and redundancy designed in the short term to rationalise the structure, the work force is brought into the forward planning of the transport system. That is also the case in France where it relates both to the electrification programme and to the issue of a 10-year planning forecast. The French have a programme contract system, which is similar to the planning agreement system proposed by the Labour Party of which I am proud to be a member. The programme contract system sets long-term objectives for the role of transport in the French economy and society. It sets that role not behind closed doors but so that terms of reference of the debate and the prospects for the rail services in France are publicly debated and become a subject of public discussion. In France, for example, one can hear of the programme contract for—
    9.30 pm
    Mr. Deputy SpeakerI am sorry to interrupt the hon. Gentleman, but he seems to be straying from discussing the amendment, which is concerned with the annual external financing limits for British Rail.
    Mr. HollandWith due and unqualified respect, although I am subject to correction, I understand that this country happens to be a member of the EEC, that the EEC happens to have a transport policy and that transport policy is affected by what happens in the member States. The amendments relate to a 10-year financing programme, enabling direct projects such as electrification and indirect benefits to be registered.
    This matter is directly relevant to the external borrowing of British Rail. Recently in this country we have seen two major confrontations on transport policy. The first is the case of London Transport and the second is the dispute with the Associated Society of Locomotive Engineers and Firemen.
    In France, the transport of the equivalent capital city, Paris, is intimately integrated with the transport of the surrounding national railway network. I beg your tolerance, Mr. Deputy Speaker, to develop this point, which is concerned with finance and financial limits. Passengers in Paris are able to travel with one card on the equivalent of British Rail and London Transport. The subsidy undertaken by the French Government, not simply by Paris Transport, is equivalent to 85 per cent. of the total costs.
    That cost has been introduced as a negotiated cost, merited to be borne by the national exchequer in view of

    827
    the estimated benefits in an efficient public transport system, which thereby reduces the necessity of carrying passengers or goods by road. The external financing requirement is made an open subject for public debate. One can hear about that debate by turning on the radio or reading about it in the newspapers and in the declarations made by the interested parties in the debate.
    The contrast with the discussion that we are having here in the mother of parliaments on the external financing limits is staggering. The Government are coming forward with a figure that appears to be plucked from the air, made on their guesstimate of what the short-term situation may be rather than informing the House adequately what the direct and indirect benefits of such finance would be. The amendments are directly relevant in demanding that the country has a right to know the Government's perspective for both national and urban transport planning over at least a 10-year period.
    I strongly recommend that, if they are unaware of this, Ministers should instruct their officials to inform them further on what happens in France. It would be of interest to many hon. Members if Ministers made a further statement about the external borrowing requirement and made a comparison with what happens in another EEC country, which at least has a rational approach to transport planning rather than the ad hoc and reactive groping in the dark that passes as a substitute for transport policy in the Government's approach.
    The variable costs in planning cannot possibly be estimated with any accuracy over the medium term in relation to the real financial needs of any transport service—urban, such as London Transport, or national, such as British Rail—unless those who are concerned in the management of the enterprise have some idea of what they will be over the medium term. It is clear that no trade union would wish to commit itself indefinitely to a particular target rate or norm, irrespective of the rise in the cost of living and a possible decline in the standard of living.
    It is consistent with Labour Party policy that trade unionists should be brought into the negotiation of planning agreements in the transport sector with, for example, British Rail, as with London Transport. Again, it is one of the features of democratic forward planning that I strongly recommend to the House. In that context, we would introduce a degree of rationality into the debate. There is no formula for automatically solving the problem. There are different interests, and there are bound to be conflicts of interest. But, instead of a short-term reactive position—where we are offered either some unemployment now or more unemployment in the future unless there are wage and manning reductions without any regard to improvements in investment in the service—it would enable the transport system in this country to be run in a framework that could be negotiated with the active participation of the labour force in the planning process itself, which would certainly benefit the public and the consumer.
    Mr. Kenneth ClarkeOne theme that unites all the speakers in the debate, and with which the Government wholly concur, is that most of us are looking towards the future of the railways and we all have certain common aims in view. Every hon. Member—and certainly the Government—believes that the long-term aim is to have a modern and efficient railway system, able to provide the
    828
    best possible service to the public at reasonable cost and able to play a leading part in the rational transport policy towards which it is possible for the country to go. Every hon. Member was united in that and I believe that, allowing for the fact that the hon. Member for Nuneaton (Mr. Huckfield) is obsessed with the short-term problem of acting as the spokesman for ASLEF in the current dispute, he—when he lifts his horizons a little higher—will be committed to the long-term future of a sound, healthy, modern and efficient railway system.
    The Government's broad approach to the railways, which is highly relevant to the amendment and to the 10-year future referred to in it, is that it will require a commitment from all the parties involved to keep the railways healthy and serving their transport purpose. It will require a commitment from the British Railways Board and management to improving the business performance of the industry and achieving the highest management standards; a commitment from the trade unions and work force to reducing overmanning, improving productivity and helping to reduce the avoidable costs of the railway; and a commitment from the Government on a proper basis of financial support and essential investment in the railway system, matching its needs with the need to assure value for money for the public.
    It is the Government's view that those commitments need to be honoured by all three parties if we are to have a modern railway system. We should synchronise our progress on those three fronts to the extent that British Rail improves its business performance, the trade unions improve productivity and working practices, and the Government honour their commitment on financial support and investment.
    Despite the difficulties under which everyone is labouring, there has been some worthwhile progress in the last few years. British Rail is, of course, operating under difficult constraints and against a background of a serious recession. So, too, are many private industries, but I appreciate that the railways are acting under financial constraints and that times have not been easy over the last two years.
    Trade unions must face up to the need to change long cherished practices and manning arrangements. They have made good progress over the last 12 months. British. Rail has made progress on productivity and all trades unions involved will have to accept eventually that steam engine practices have no part in the modern railway of the future. The Government have honoured their commitment of financial support, again against a difficult background of an economic recession and severe restraints on the public purse.
    I should like to deal with the main thrust of the amendment so far as I can understand it. It is based apparently on the belief that the railways are starved of finance and that they have an uncertain financial future. It can be demonstrated, I believe, that, despite the difficulties of the last two years, the Government have dealt with the railways generously and fairly. It is mythology that financial constraints over the last two years have been tighter than those that the railways previously suffered. References to monetarism are mere use of a shibboleth introduced into debates on all subjects Despite the financial constraints, the railways have been treated generously. It is not true that they have been, or that they are likely to be, deprived of the money that they need to

    829
    run a modern railway if, for their part, they can improve business performance, raise productivity and make their contribution to dealing with the problems.
    I should like to refer to the main control that all Governments have exercised over nationalised industries, including British Rail—the overall control of the external financing limit on the total level of public sector borrowing and grants. The Government did not invent this system. The Labour Government also exercised it. I do not believe that any responsible Government will be able to abandon all controls on the external borrowing requirements of a major nationalised industry.
    In looking 10 years ahead, one has also to look back to the last two years. Under this Government, the external financing limit has been adjusted in each of the last two years in order to compensate the railways for sudden and unexpected falls in traffic that they suffered because of the economic recession. In September 1980, the external financing limit then set by the Government was raised by £40 million to £790 million to compensate the railways for the first losses of traffic they suffered, particularly in freight business. In the last year, the Government adjusted the external financing limit from £867 million to £920 million, again to compensate the railways for the loss of revenue that they were suffering because of the recession.
    Having set external financing limits, the Government adjusted them in each of the last two years precisely because we accepted the need for adjustment as revenues had been lost for reasons outside the railways' immediate ability to adjust costs downwards to compensate for what had happened. We have been flexible in compensating for the unavoidable cost of the recession. Apart from the adjustment of the external financing limit in each of the last two years, the overall level of the EFL also compares favourably with the external financing limit imposed on British Rail by the previous Government. There has been an easing of financial constraints under this Government.
    I should like to give comparative figures expressed in real terms allowing for inflation. At average 1981 prices, the EFL for 1977–78 was £687 million, for 1978–79, £785 million, for 1979–80, £743 million, for 1980–81, £847 million, for 1981–82, £895 million and for 1982–83, £848 million.
    The hon. Member for Nuneaton claimed to detect a cut in the figures for the last two years. I have already stated that last year's EFL was raised from £867 million to £920 million because of lost revenue during the year when British Rail was unable to cut costs as rapidly as was necessary to compensate. Next year, the figure we have set—I now move to current prices—is £950 million which is roughly the same, allowing for inflation, as the figure set for last year. There is no cut at all. It is 9·5 per cent. above the EFL for last year. The hon. Gentleman is wrong to say that there has been a cut.
    Mr. Les HuckfieldI am grateful to the Minister. It depends which price one uses as to which figure comes out. Is the hon. and learned Gentleman saying that in all those cases he excludes the specific allocation for the closure of collection and delivery services? Or is that included in the figures?
    Mr. ClarkeThe figures include that. Last year we made a special provision towards the cost of the closure of the collection and delivery of parcels service. That was
    830
    not, in the event, required by British Rail. The increase from £867 million to £920 million last year was for the purpose of compensating for loss of revenue. The railways did not need the sum provisionally allocated to them for the closure of the collection and delivery of parcels service.
    9.45 pm
    The hon. Member for Nuneaton said that it depends on the price base used. That is why I was specific throughout. I realise the figures that I have put on the record are complicated; they require study. I heard the hon. Gentleman today earlier splitting hairs in an ingenious way on behalf of ASLEF to get it out of its broken understandings that have caused the present dispute. I am not going to accept what he says. I shall draw the general conclusions that I insist can be drawn from any anlysis of the external finance limit figures for the last two years.
    The limits are higher in real terms under this Government than under the last Government; they have been adjusted by the Government because we accept that special, unexpected problems have hit the railways because of the recession. It is mythology to claim that the external finance limits have been squeezed vicelike on the railways to deprive them of finance. At a time of overall crisis and reduction of external finance limits for nationalised industries as a whole quite rightly, whilst I am defending the decisions we take—I am not criticising them—we have been generous to British Rail and eased, so far as was practicable and consistent with our duty to the taxpayer, the constraints it has been under at a time of difficult recession.
    Mr. Robert HughesWould the hon. and learned Gentleman answer this question? He made the case that the external financing limit has been increased over the last couple of years to take account of the loss of revenue because of the recession. What about the part of the external financing limit that is available for investment? How much has that been increased? It is not a question simply of extending the external financing limit to suit conditions. It is the real money available for investment that counts.
    Mr. ClarkeI shall come to the investment ceiling last. I would like to deal with another matter that has been raised and which is relevant to finances—the public service obligation for the passenger services. That bears on many of the points made, particularly by the hon. Member for Vauxhall (Mr. Holland), about the fact that many passenger railways throughout the world are run at a loss.
    The Government accept that a great part of the noncommercial railway, including rural lines and the commuter lines in London, are not under any commercial remit and require a realistic level of subsidy from the taxpayer because there are broader reasons for supporting them than just the narrow commercial return from those lines. Again, the public service obligation paid to the railways has been increased by the Government. It was recently raised—I think the announcement was on the occasion of the Second Reading of the Bill—in mid-year for the first time since the system was introduced in response to European Community regulations in the early 1970s. The Government raised the public service obligation by £110 million in one fell swoop to £755 million for 1981.

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    I shall not bore the House with more comparative figures. I shall merely say—and it can be checked—that this is by far the highest ever public service obligation payment in real terms that British Rail has received. What it amounts to is that the Government are paying over £2 million each day in subsidy for the passenger services of British Rail. That is not an ungenerous amount. Not only is it the highest ever, but it shows our support for the railways.
    Going on to investment the right hon. Member for Barrow-in-Furness (Mr. Booth) objected to the first point he knows I always make but it remains a valid point and I am still at a loss to know what his answer to it is. The only cash ceiling on investment that successive Governments have imposed is the so-called investment ceiling. In 1981–82 that works out at the staggering sum of £427 million at outturn prices, which in real terms is exactly the same investment ceiling as that imposed on the board by previous Governments, including our immediate predecessor.
    It is true that the business performance of the railways is such that they are being squeezed within their external finance limit by the business losses that they are making on freight in particular, on inter-city and on their noncommercial railway business, and that they are having difficulty in investing up to that investment ceiling within the terms of the external finance limit.
    I have already described what the Government have done to expand that external financing limit. We have been flexible on it to compensate particularly for unexpected losses of revenue, for which it is impossible to cut costs in time. We do not compensate British Rail for unexpected increases in cost, which it is its management duty to restrain and which it is trying to restrain, although unfortunately its costs continue to rise steadily on its intercity business.
    It is certainly not the Government's business to start extending the external financing limit to finance pay settlements in a way that was urged upon us by the hon. Member for Nuneaton. We have responded by easing some of the financial constraints on British Rail. We should like to see it invest up to the levels required. If the business performance can be improved and the losses contained, if less can be drained away, if losses on freight and inter-city can be reduced, and if the performance even of the non-commercial services can be improved, the more able British Rail will be to invest up to its investment ceiling within its present external financing limits.
    That is true of any business. It is not unique to the nationalised industries. Any industry that goes through trading difficulties needs a generous bank manager, which British Rail has in the form of the Government. Secondly, there is a limit to the extent to which it can continue to do various things, such as investing to the level that it would like, until it can reduce its losses and improve its business performance. Like any other business, British Rail has a duty to generate some of the sums that it needs for investment out of its own resources.
    Mr. Stuart HollandThe Minister said that his argument bore no relation to monetarism. He is apparently unaware that he has just given the classic monetarist argument: run a public service despite the externalities, despite the impact on the rest of the economy, as one runs a private firm; run it in a recession by cutting back. It is precisely that which is dragging this country down an
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    almost bottomless pit of monetarism. The case for electrifying the railways is precisely that it would stimulate industry as well as improve the service.
    Mr. ClarkeI know of no private business that can have a subsidy of £2 million a day to run its socially necessary services in London, including the area represented by the hon. Gentleman, as well as in the rural parts of the country. I know of no private business in the financial state that British Rail is in that could have had the easing of its financial constraints in the past 12 months that I have described. It is because the Government realise that there are long-term transport needs that we wish to see the railways go towards the future that I have described, and that is why we have eased the constraints in the way that we have.
    The hon. Gentleman cannot argue that we should go all the way in the other direction. If we suspend or relieve some of the financial constraints that would otherwise fall on British Rail, because we believe that there is a general public benefit, the hon. Gentleman cannot interpret that to mean that we should abandon all financial discipline, that the cost is no object and that £2 million a day is not enough, that investment should not be appraised and that investment ceilings should be exceeded. The hon. Gentleman cannot interpret it to mean that the external financing limit should be lifted to such a level that it can accommodate the necessary investment demanded by British Rail, the services and the kind of attitudes expounded by the hon. Member for Nuneaton, which is "Incidentally, we also want the pay increases, without being able to deliver the productivity that we promised last August."
    Mr. Les HuckfieldThe Minister keeps referring to pay increases. It is not pay increases that I am asking for or that ASLEF is asking for, particularly. It is pay increases as recommended by the Railway Staff National Tribunal, which includes a British Railways Board member as an assessor. In other words, the board's own contribution has been made to that arbitration. That is who is saying "Give them the increase", not I.
    Mr. ClarkeThe approach to the pay increases over and above the 8 per cent. that everybody received last year, the increases that should apply in the future and matters such as the 39-hour week and the extra 3 per cent. is that they should be paid for by improved productivity so far as possible. That was the understanding of British Rail, of the National Union of Railwaymen and of the Transport Salaried Staffs Association. It was the understanding that ASLEF left everybody else thinking it had reached, but on which it is now attempting to renege.
    Several Hon. Members rose—
    Mr. Deputy SpeakerOrder. We must not go too far down that line.
    Mr. ClarkeIt was with order in mind that I was proposing to progress a little further on the finances and withdraw from the current dispute. I apologise to the hon. Gentleman. We shall lead each other astray again outside the terms of order and of this debate and into the current dispute, which we should not do.
    A great deal has been said this evening and throughout our Committee proceedings about the effect of the supposed excessive constraints that our present arrangements—the EFL, the PSO and the investment

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    ceiling—are imposing on maintenance, renewal and investment in the British Rail system. Many of the arguments do not appreciate that much of the maintenance and renewal of the network does not count as investment at all. Certainly the arguments about investment ceilings and so on do not bear on track renewal and signalling maintenance, which matter so much to keeping a modern railway and stopping the service declining.
    In 1981 alone about £500 million was spent on those items. They are not at the moment being excessively confined. It is also not always appreciated that by no means all the investment of British Rail is financed by borrowing. Half the point of the amendments that are being tabled to the Bill is that it is believed that the borrowing ceilings are in some way directly related to the level of investment, whereas a lot of the investment is supported by grant. That bears on fears about the Settle—Carlisle line and so on.
    Investment in the non-commercial railway is covered by the public service obligation grant that we already give. Again, there is no question of our imposing monetarist, artificial financial rules on the investment in the noncommercial railway. The public service obligation grant contains an element known as the replacement allowance for the renewal of assets in the non-commercial railway business. That, again, amounted to no less than £80·3 million in 1981. That reduces the railways' need to borrow.
    I shall not enter into the details of the Ribblehead viaduct with my hon. Friend the Member for Christchurch and Lymington (Mr. Adley) and the hon. Member for Keighley (Mr. Cryer). They are partly concerned because of the great railway history of the line. I believe, as British Rail has assured us, that the decision to switch inter-city traffic from there has nothing to do with the condition of the viaduct. It is—as British Rail has made clear publicly—because it believes that it will improve the return on the inter-city services by taking them by Manchester and the alternative route.
    In so far as there is a need to maintain the Ribblehead viaduct, the need to maintain the investment, structures and so on is entirely covered by the enormous public service obligation grant that we give to British Rail—£755 million, or £2 million a day. Within that British Rail has to finance the non-commercial services that we oblige it to run.
    Mr. Stuart HollandThe Minister cannot have it both ways. On the one hand, he is saying that the Government are paying out on what amount to cost benefit terms. On the other hand, he is saying that the industry must cut back and be run like a commercial operation. This is the basic premise of the monetarist reasoning. Would he care to answer the points that I was making—for example, concerning the benefits that electrification would have on the private sector, because there is no public enterprise supplying the electrification equipment? In practice, that will mean that 100 per cent. of all public expenditure in that sector would go straight to the private sector.
    Mr. ClarkeWhat I have just said applies to the noncommercial railway. Successive Governments—the Labour Government as well as our own—have accepted that inter-city and freight should be commercial businesses and should achieve agreed business performances and commercial targets over a period of time. Of course, we accept that in a time of recession it has proved more difficult for British Rail to attain those commercial targets. Nevertheless, for the commercial railway different rules have always operated.
    Successive Governments have set commercial targets for British Rail. I have explained that the public service obligation covers the non-commercial railway. We do not take a commercial view of the commuter and rural services and the essential social links. But we are following the same policy as our predecessors on the commercial railway. We have eased the financial restraints on them and thereby given them more time, because of the difficulties that they are having in coming through the recession. But the commercial railway will eventually achieve health only if it can improve its business performance and productivity and thereby get the investment that we are all talking about.
    Perhaps that would be a convenient time, therefore, to turn to electrification and the points made by the hon. Member for Aberdeen, North (Mr. Hughes).
    It being Ten o'clock, the debate stood adjourned.

    INCREASED BORROWING LIMIT FOR THE BOARD

      BUSINESS OF THE HOUSE
      Ordered,
      That at this day's sitting, the Transport (Finance) Bill may be proceeded with, though opposed, until any hour.—[Mr. David Hunt.]

Transport (Finance Bill)
Question again proposed.
Mr. ClarkeI apologise to the hon. Member for Aberdeen, North for not sending him the two letters to which he referred. I recall working on drafts of them, so I apologise for what must be a complete breakdown in the system. It will be remedied immediately.
The substantial point about which the hon. Gentleman was concerned this evening was the question of electrification. I can only reiterate what I said last time. Contrary to belief in the railway community, the Government have not changed their position and nor has their commitment to the principle of a 10-year programme of electrification changed since the announcement was made last June.
This evening we touched again on the arguments about whether the announcement of my right hon. Friend the then Secretary of State in June last year involved a shift away from the programme considered earlier in the year. A joint study was undertaken and the results published by the Government on work carried out in our Department and by British Rail. The report has been quoted this evening. The estimates in it were based on estimated performance by the commercial railway—inter-city and freight—which already, by the time that the report appeared, the railway was not achieving in practice.
The Government were under a duty to the taxpayer to review the document. In June we nevertheless made a statement that accepted the principle of a 10-year programme of electrification of potentially profitable main line routes. Therefore, our policy declared in June and adhered to now accepts the points made by the hon. Members for Keighley and for Vauxhall about the need to take a continuous and developing view of a major investment project.
We accept the principle of a programme of electrification for potentially profitable main line routes. Because we were talking about potentially profitable main line routes on what are commercial businesses—inter-city and freight—we asked for new business plans to be produced for inter-city and freight. We also asked for a programme setting out the particular routes and indicating their order of priority based on their profitability. We also said that we expected to see progress on productivity and that we determined investment decisions on electrification in line with progress on productivity.
We did not set unreal targets. We took the targets for productivity that we indicated out of the board's corporate plan and what it hoped to achieve over the next five years by reductions in overmanning. Since that time the Government have been as disappointed as British Rail. We have not reached a stage where we have all the ingredients we asked for when we set out the policy in June.
It does not help to get bogged down in nit-picking arguments about who owes who a letter or whose fault the delay is. I can update matters a little from the Second Reading debate. We have now received the business plan for inter-city. We expect to receive the business plan for freight shortly. We still have not received the 10-year programme for electrification of routes, so we are in no position to assess the first routes. We expect British Rail's chosen first priority to be the east coast main line, but British Rail and the Government are anxious to make progress. We hope soon to have all the documents for the Government to take decisions.
836
The background remains the question of progress and productivity. As I said, this has been reasonably good over the past year. The agreements last August were particularly encouraging, although they are by no means the whole process that has to be gone through to achieve a modern railway. If British Rail continues to make progress on productivity it will be much easier for us to consider the programmes put up for investment. In the interests of the taxpayer and the cost benefit analysis that has to be done on all major investment we could not start to consider making rapid progress on new investment projects if, for some reason, all productivity progress is halted because of a belief in sacrosanct but out-of-date productivity agreements.
The Government have not been inflexible. We had an application before us that predated the main electrification studies—the East Anglian main line proposal was awaiting a decision. My right hon. Friend repeatedly had to explain that we could not divorce a decision on the East Anglian plan from the overall business performance of the railway, progress on productivity, and other advances.
Nevertheless, on 22 December 1981 the Government were able to say that the business performance was understandable in the light of the recession, that progress on productivity was being made—the NUR had just honoured the productivity agreement entered into by all three unions in August 1981—and that we approved the electrification to Norwich and Harwich.
Mr. Robert HughesThree years' hard work was done by British transport and British Rail on electrification. The study on electrification and profitability spoke of 11 per cent. financial returns. It looked at productivity and all the aspects mentioned by the hon. and learned Gentleman tonight. The Labour Party finds it difficult to understand what new proposals are now affecting the Government's decision. They seem to be injecting some new productivity proposals into the discussions on the basis of the decision. If that is what the hon. and learned Gentleman is saying, it sets aside the whole of that study on electrification. I cannot understand why the hon. and learned Gentleman has gone back to the board and why we are discussing virtually a new set of proposals.
Will the hon. and learned Gentleman make it clear that, when he is speaking about productivity, he is speaking about productivity and not demanning? What has soured the relations in the railways industry is the equation of productivity with demanning, and that is a prostitution of productivity agreements.
Mr. ClarkeI am not saying that anything is to be set aside. The policy is building on the electrification study that was carried out. The study was carried out at a time when the Government were agreeing financial targets for inter-city and freight, based on expectations of improving business performance. The economic analysis of electrification in the study made assumptions about improving performance of inter-city and freight.
Unfortunately, by early 1981 it was obvious to everybody that the business performance of British Rail no longer matched those expectations. It was getting into difficulties and the time had come to look into the business to decide what the business prospects now were and also, as British Rail had been trying to do, to get down costs, adjust services and demand and bring back a sound business basis for the railways.

837
It was in the light of the changed circumstances that the Government asked for the new business plans for inter-city and freight. At the same time, we committed ourselves to the 10-year programme. We rapidly agreed with British Rail on the methodology on which to assess individual projects. We also said that productivity had to play a part.
I agree that productivity does not simply mean demanning. In an overmanned industry there is some room for reduction in manning. There have been spectacular reductions in the past in manning in the railways. Those reductions, and improvements in productivity, came to a halt for a long time in the 1970s. There have been welcome advances in the past 12 months. With continued commitment by the railway community, I am sure that advances will continue and the public and the Government will be given faith in a long-term railway system that justifies investment.
There has been much talk of the next 10 years, but I suggest that the amendments are impracticable. No Government can forecast the external financing limits for the next 10 years. The previous Government did not try to and neither will this Government. An external financing limit depends on a whole range of variables—training, climate, business performance and other factors. It is unreal to plan for 10 years.
The second amendment links borrowing to electrification. I have already explained that not all investment comes out of borrowing, although I was largely talking about the non-commercial railways. The need for British Rail's borrowing is not confined to investment. It has to borrow for many other purposes. It is impossible to earmark a particular sum out of the overall borrowing of British Rail for any particular investment project. Thus, neither of the amendments is practicable or necessary.
The House asked us to take a longer-term view of the financial problems and constraints on the railways. We propose to do that in the review of British Rail finances which my right hon. Friend the Secretary of State has already announced and which he is anxious to set up. That review was suggested by Sir Peter Parker and the board. It is quite wrong to say that it is another Beeching review. In fact, it has been generally welcomed by most people in the railway community and by the Government. The Government accept the need for a review of British Rail finances and policy objectives, which will include looking at the prospects of improving the business performance of the railways. We hope that we shall soon give details of the terms of reference and composition of the review.
The Government are not taking a short-term view. We are not running away from the necessity to keep looking at the policy objectives and financial constraints. We propose to set up the review to assist ourselves and British Rail to study them. The background is not one of tightening financial constraint or of meanness; it is a response to the problems of recession. The Government have given their response, and we expect a response from the management and trade unions. If everyone were to honour their agreements and look to the long-term future of a modern railway, and stopped retreating into the past—1919, the day when railways were dominated by steam engines—we should all make better progress.
I therefore ask the House to reject the amendment on the basis that there is a better way of getting the kind of future that we want for the railways.
Question put, That the amendment be made:-
The House divided: Ayes 62, Noes 108.

Division No. 49]

[4.05 pm

AYES

Alton, David

Penhaligon, David

Ashton, Joe

Ross, Stephen (Isle of Wight)

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

Sandelson, Neville

Ford, Ben

Steel, Rt Hon David

Freud, Clement

Wainwright, R.(ColneV)

Grimond, Rt Hon J.

Hawksley, Warren

Tellers for the Ayes:

Janner, HonGreville

Mr. A. J. Beith and

Johnston, Russell(Inverness)

Mr. William Pitt.

McNally.Thomas

NOES

Adley, Robert

Canavan, Dennis

Aitken, Jonathan

Carlisle, John (Luton West)

Alexander, Richard

Carlisle, Kenneth (Lincoln)

Alison, RtHonMichael

Carter-Jones, Lewis

Allaun, Frank

Channon, Rt. Hon. Paul

Ancram, Michael

Chapman, Sydney

Archer, Rt Hon Peter

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

Aspinwall, Jack

Clark, Dr David (S Shields)

Atkins, Robert(PrestonN)

Clark, Sir W.(Croydon S)

Barnett, Guy (Greenwich)

Clarke, Kenneth (Rushcliffe)

Beaumont-Dark, Anthony

Clegg, Sir Walter

Bennett, Andrew(St'kp'tN)

Cockeram, Eric

Benyon, W. (Buckingham)

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

Berry, HonAnthony

Cope, John

Best, Keith

Corrie, John

Bevan, David Gilroy

Cranborne, Viscount

Biggs-Davison, SirJohn

Cryer, Bob

Blackburn, John

Cunliffe, Lawrence

Blaker, Peter

Cunningham, G.(lslingtonS)

Booth, RtHonAlbert

Cunningham, DrJ.(W'h'n)

Boothroyd, MissBetty

Davis, Terry (B'ham, Stechf'd)

Boscawen, HonRobert

Dean, Joseph (Leeds West)

Bottomley, Peter(W'wich W)

Dewar, Donald

Boyson, DrRhodes

Dixon, Donald

Brooke, Hon Peter

Dobson, Frank

Brotherton, Michael

Dormand, Jack

Brown, Michael(Brigg&Sc'n)

Douglas-Hamilton, LordJ.

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

Dubs, Alfred

Browrne, John(Winchester)

Dunwoody, Hon Mrs G.

Bryan, SirPaul

Eadie, Alex

Buck, Antony

Elliott, SirWilliam

Budgen, Nick

Emery, Sir Peter

Campbell-Savours, Dale

English, Michael

755

Ennals, Rt Hon David

Hunt, David (Wirral)

Evans, loan (Aberdare)

Jenkin, RtHon Patrick

Evans, John (Newton)

John, Brynmor

Ewing, Harry

Johnson, James (Hull West)

Eyre, Reginald

JohnsonSmith, Geoffrey

Fairgrieve, SirRussell

Jones, Barry (East Flint)

Farr, John

Jopling, RtHon Michael

Faulds, Andrew

Kaufman, RtHon Gerald

Fenner, Mrs Peggy

Kerr, Russell

Finsberg, Geoffrey

Kershaw, SirAnthony

Fisher, SirNigel

Kilroy-Silk, Robert

Fitt, Gerard

King, RtHon Tom

Flannery, Martin

Lamond, James

Fletcher, A. (Ed'nb'ghN)

Lang, Ian

Fookes, Miss Janet

Leighton, Ronald

Forrester, John

LeMarchant, Spencer

Foster, Derek

Lennox-Boyd, HonMark

Fowler, Rt Hon Norman

Lestor, MissJoan

Fox, Marcus

Lewis, Arthur (N'ham NW)

Gardiner, George (Reigate)

Lewis, Ron (Carlisle)

Garel-Jones, Tristan

Litherland, Robert

Garrett, John (NorwichS)

Lofthouse, Geoffrey

Glyn, Dr Alan

Luce, Richard

Golding, John

McCartney, Hugh

Goodhew, SirVictor

McCrindle, Robert

Goodlad, Alastair

McDonald, DrOonagh

Gow, Ian

Macfarlane, Neil

Graham, Ted

McKay, Allen (Penistone)

Grant, George (Morpeth)

MacKay, John (Argyll)

Greenway, Harry

McNamara, Kevin

Gummer, JohnSelwyn

McQuarrie, Albert

Hamilton, James (Bothwell)

Marks, Kenneth

Hamilton, Michael (Salisbury)

Marlow. Antony

Hampson, DrKeith

Marshall, D(G'gowS'ton)

Harrison, RtHon Walter

Marshall, DrEdmund (Goole)

Havers, Rt Hon Sir Michael

Marten, RtHon Neil

Hayhoe, Barney

Martin, M(G'gowS'burn)

Haynes, Frank

Maxwell-Hyslop, Robin

Heffer, Eric S.

Mayhew, Patrick

Henderson, Barry

Maynard, Miss Joan

Hogg, N. (EDunb't'nshire)

Meacher, Michael

Holland, Philip (Carlton)

Miller, Hal(B'grove)

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

Mills, lain(Meriden)

HomeRobertson, John

Miscampbell, Norman

Hoyle, Douglas

Mitchell, David(Basingstoke)

Huckfield, Les

Mitchell, R.C. (Soton Itchen)

Hughes, Mark (Durham)

Molyneaux, James

Hughes, Robert (Aberdeen N)

Monro, SirHector

Hughes, Roy (Newport)

Morris, Rt Hon A. (W'shawe)

Morrison, Hon C. (Devizes)

Sims, Roger

Morrison, Hon P. (Chester)

Skinner, Dennis

Morton, George

Snape, Peter

Murphy, Christopher

Spearing, Nigel

Neale, Gerrard

Speed, Keith

Needham, Richard

Spence, John

Nelson, Anthony

Stanbrook, Ivor

Neubert, Michael

Stanley, John

Newens, Stanley

Steen, Anthony

Newton, Tony

Stewart, A. (ERenfrewshire)

Nott, Rt Hon John

Stewart, Rt Hon D. (W Isles)

Ogden, Eric

Stewart, Ian (Hitchin)

Onslow, Cranley

Stokes, John

Oppenheim, Rt Hon Mrs S.

Stott, Roger

Orme, Rt Hon Stanley

Stradling Thomas, J.

Palmer, Arthur

Straw, Jack

Park, George

Summerskill, HonDrShirley

Parker, John

Tapsell, Peter

Pattie, Geoffrey

Taylor, Mrs Ann (Bolton W)

Percival, Sir lan

Thomas, Rt Hon Peter

Prentice, Rt Hon Reg

Thompson, Donald

Price, C. (Lewisham W)

Thorne, Stan (Preston South)

Proctor, K. Harvey

Thornton, Malcolm

Pym, Rt Hon Francis

Torney, Tom

Radice, Giles

Townsend, Cyril D, (B'heath)

Raison, Timothy

Trippier, David

Rathbone, Tim

Trotter, Neville

Rees-Davies, W. R.

Varley, Rt Hon Eric G.

Rhodes James, Robert

Viggers, Peter

Ridley, HonNicholas

Wakeham, John

Rifkind, Malcolm

Waldeg rave, HonWilliam

Roberts, Albert (Normanton)

Ward, John

Roberts, Ernest (Hackney N)

Wells.John (Maidstone)

Roberts, Wyn (Conway)

Welsh, Michael

Ross, Ernest (Dundee West)

White, Frank R.

Sainsbury.HonTimothy

Wilkinson, John

St. John-Stevas, Rt Hon N.

Wilson, Gordon (DundeeE)

Scott, Nicholas

Winterton, Nicholas

Sever, John

Wolfson, Mark

Shaw, Giles (Pudsey)

Woolmer, Kenneth

Shaw, Michael (Scarborough)

Young, David (BoltonE)

Sheerman, Barry

Young, SirGeorge (Acton)

Sheldon, Rt Hon R.

Shelton, William (Streatham)

Tellers for the Noes:

Silkin, Rt Hon J. (Deptford)

Mr. Frank Hooley and

Silvester, Fred

Mr. David Stoddart.

Division No. 50]

[10.12 pm

AYES

Allaun, Frank

Hughes, Robert(Aberdeen N)

Alton, David

Jones, Dan(Burnley)

Atkinson, N.(H'gey)

Leighton, Ronald

Beith, A.J.

Lewis, Arthur(N'ham NW)

Bennett, Andrew(St'kp'tN)

Lewis, Ron(Carlisle)

Booth, RtHon Albert

Litherland, Robert

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

McElhone, Frank

Campbell-Savours, Dale

McKay, Allen(Penistone)

Clark, Dr David (S Shields)

Marks, Kenneth

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

Marshall, D(G'gowS'ton)

Concannon, Rt Hon J. D.

Morton, George

Cook, Robin F.

Palmer, Arthur

Cryer, Bob

Penhaligon, David

Cunliffe, Lawrence

Powell, Raymond(Ogmore)

Cunningham, DrJ.(W'h'n)

Prescott, John

Dalyell, Tam

Robertson, George

Davidson, Arthur

Ross, Stephen (Isle of Wight)

Davis, Terry (B'ham, Stechf'd)

Skinner, Dennis

Dewar, Donald

Smith, Cyril(Rochdale)

Dixon, Donald

Snape, Peter

Dobson, Frank

Steel, Rt Hon David

Dormand. Jack

Stoddart, David

Evans, John (Newton)

Stott, Roger

Grimond, Rt Hon J.

Wainwright, E.(Dearne V)

Hamilton, James(Bothwell)

Walker, Rt Hon H.(D'caster)

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

Welsh, Michael

Harrison, Rt Hon Walter

White, Frank R.

Haynes, Frank

Whitlock, William

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

Woolmer, Kenneth

HomeRobertson, John

Hooley, Frank

Tellers for the Ayes:

Howells, Geraint

Mr. James Tinn and

Huckfield, Les

Mr. Hugh McCartney.

NOES

Alexander, Richard

Hamilton, HonA.

Ancram, Michael

Hawksley, Warren

Aspinwall, Jack

Hogg, HonDouglas(Gr'th'm)

Baker, Nicholas (N Dorset)

Holland, Philip(Carlton)

Beaumont-Dark, Anthony

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

Benyon, W.(Buckingham)

Hunt, John(Ravensbourne)

Berry, HonAnthony

Jopling, RtHonMichael

Biggs-Davison, SirJohn

Lang, Ian

Blackburn, John

LeMarchant, Spencer

Boscawen, HonRobert

Lester, Jim (Beeston)

Boyson, Dr Rhodes

Lyell, Nicholas

Bright, Graham

Macfarlane, Neil

Brinton, Tim

MacGregor, John

Brooke, Hon Peter

MacKay, John(Argyll)

Brown, Michael(Brigg&Sc'n)

McNair-Wilson, M.(N'bury)

Bruce-Gardyne, John

Major, John

Budgen, Nick

Marlow, Antony

Cadbury, Jocelyn

Marshall, Michael(Arundel)

Carlisle, John (Luton West)

Mates, Michael

Carlisle, Kenneth(Lincoln)

Maude, Rt Hon Sir Angus

Chapman, Sydney

Maxwell-Hyslop, Robin

Churchill, W.S.

Mayhew, Patrick

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

Mellor, David

Clarke, Kenneth(Rushcliffe)

Meyer, Sir Anthony

Cockeram, Eric

Mills, lain (Meriden)

Cope, John

Mitchell, David(Basingstoke)

Cranborne, Viscount

Molyneaux, James

Dean, Paul (North Somerset)

Murphy, Christopher

Douglas-Hamilton, LordJ.

Myles, David

Dykes, Hugh

Neale, Gerrard

Elliott, SirWilliam

Nelson, Anthony

Faith, Mrs Sheila

Newton, Tony

Fenner, Mrs Peggy

Onslow, Cranley

Fletcher-Cooke, SirCharles

Parris, Matthew

Garel-Jones, Tristan

Pattie, Geoffrey

Goodhew, SirVictor

Pawsey, James

Goodlad, Alastair

Percival, Sir lan

Gorst, John

Proctor, K. Harvey

Greenway, Harry

Rathbone, Tim

Griffiths, Peter Portsm'thN)

Renton, Tim

839

Rhys Williams, Sir Brandon

Stevens, Martin

Roberts, M. (Cardiff NW)

Stradling Thomas, J.

Rossi, Hugh

Taylor, Teddy (S'end E)

Shaw, Giles (Pudsey)

Tebbit, Rt Hon Norman

Silvester, Fred

Thomas, Rt Hon Peter

Speller, Tony

Thompson, Donald

Spicer, Jim (West Dorset)

Thorne, Neil (llfordSouth)

Squire, Robin

Thornton, Malcolm

Stanbrook, lvor

Townend, John(Bridlington)

Trippier, David

Wheeler, John

Viggers, Peter

Winterton, Nicholas

Waddington, David

Wolfson, Mark

Waldegrave, Hon William

Walker-Smith, Rt Hon Sir D.

Tellers for the Noes:

Watson, John

Mr. Selwyn Gummer and

Wells, John(Maidstone)

Mr. David Hunt.

Question accordingly negatived.

Clause 4

  INCREASED BORROWING LIMIT FOR NATIONAL Bus COMPANY
  Mr. Roger StottI beg to move amendment No. 3, in page 3, line 9 at end add
  'This draft order shall show the extent to which the increase in the borrowing arises from the National Bus Company having to service those debts attributable to additional mileage operated during 1975, and to London Country Bus Services Co. Ltd. and the interest charges on commencing capital debt being imposed on individual subsidiary companies or counties'.
  The Bill makes provision to increase the National Bus Company's external financing limit on aggregate borrowing from £200 million to £250 million with an upper limit of £275 million, subject to the Secretary of State's approval. While we are grateful for small mercies, it should be made clear that the National Bus Company, through the provisions of the Bill, will not receive a penny more from the Government to help it to offset its operating costs or to reduce the interest charges that the company must pay on its essential borrowing both past and present.
  The Opposition did not try to amend the clause in Committee. Instead, we decided to probe the Government on key issues during the stand part debate. However, I must inform the House that the Under-Secretary of State's reply was far from satisfactory. Consequently, my right hon. Friend, my hon. Friend and I have decided to table this eminently reasonable amendment to restore some justice to the National Bus Company.
  When the National Bus Company was formed in 1969, its financial structure was established on the basis of capital debt, which must be almost unique in contrast with the financial structure of a private company. Private companies are usually launched with a mixture of equity capital, ordinary shares and fixed interest loans, but the capital debt incurred by the National Bus Company in 1969 was regarded as an entirely repayable debt, rather than a sum invested in a business on which dividends would be paid, as would be the case in most private and some public businesses. Because the company structure was conceived in what I consider to be an inequitable way, two serious problems have arisen as a direct consequence.
  First, there is no flexibility in the structure to enable less interest to be paid in a poor trading year. Instead, further loans must be obtained to cover losses, thus adding to future problems, or further fare increases and service cuts must be made at short notice, with all the attendant problems of trying to get the changes approved by the appropriate traffic commissioners.
  Secondly, not only must the fixed interest be paid. In theory, the commencing capital debt must also be paid. Only in a highly profitable situation could that be possible. In practice, to meet the ongoing demand, further loans had to be obtained at far higher interest rates than those applying in 1969.
  As if that were not sufficient financial impediment, the position was further exacerbated by the need to obtain further loans to cover the operating losses incurred by London Country Bus Services Limited, which the National Bus Company inherited from London Transport in 1970. The establishment of LCBS as a separate entity results from the Transport (London) Act 1969 about which we have heard recently.
  842
  The country division of London Transport had lost £2 million in the two years prior to the transfer. That unprofitability, together with the provisions of the 1969 Act, forced LCBS to start life in an extraordinarily impoverished position. A substantial fleet was inherited by the National Bus Company, with an average age of 18½ years and some vehicles 25 years old. That situation continued until 1973. Buildings were also outdated and had deteriorated considerably due to the lack of earlier investment, and the company started out with no head office and no central repair works.
  Financially, the company was formed with £2 share capital and £2, 500 in petty cash, which did not go far to meet the ongoing losses and an inherited deficiency of £750, 000 per year from agreements on matters such as welfare and pensions. To remain operational, the company had no alternative but to borrow heavily. No depreciation reserves were transferred, although in London Transport's books they stood at £5·5 million on vesting day.
  Despite the company's impoverished birth, the financial objectives laid down in the 1969 Act were extremely stringent. They were
  "to secure that the revenues are not less than sufficient to meet the charges properly chargeable to revenue account, taking one year with another, "
  and including, in particular, proper provision for the replacement of assets. All of that resulted in a financial deficit on the 1975 management accounts of £5·2 million with losses being repetitive and increasing. They are still being paid off.
  10.30 pm
  Most unbiased observers would conclude that that was a substantial burden to hang around any company's neck, but the story gets even worse for the National Bus Company. In 1975, it continued to operate a considerable mileage which, on any objective financial grounds, would have been cut because of substantial operational losses. However, it did not cut that mileage because of a specific request from the then Minister of Transport to continue operating it while local authorities made up their minds what level of financial support they would provide.
  Ordinarily, such action would merit specific compensation to be paid to the National Bus Company by the Government. However, no such compensation was paid, so the poor old company had to pay interest on the extra debts incurred in carrying out a ministerial instruction. Even today, repayment of that debt continues to form a burden on the travelling passengers who use National Bus services and on the counties that pay transport supplementary grants.
  The Select Committee on Nationalised Industries 1977–78, when examining that aspect of National Bus Company's finances, said:
  "For any business, this burden would be considerable, for one with a market which has contracted, and which is in any case expected to receive supporting grants from public funds it is almost unworkable. In practice, NBC has met its 'obligations' in this respect, but only by a willingness to cut services, raise fares and make other economies."
  A more direct comparison with the company could be drawn by considering London Transport. Its debts were entirely written off in 1969 and its current investment in buses has been entirely met by central Government and GLC grants.

  843
  The Select Committee on Nationalised Industries 1977–78 report, reflecting on what would have happened had those rules been applied to the National Bus Company, said:
  "Were NBC to have this arrangement, it would be able to operate the levels of service and fares applying in 1977 without the need of any further revenue support from local authorities."
  The local authority grants amounted to £26 million, interest payments to £12 million and the net cost for bus grants to £15 million. Therefore, it is important that the House should recognise that the company faces a real difficulty in repaying the interest on money it has had to borrow, as I have endeavoured to show.
  However, regrettably, there is a belief in some quarters that the interest charged on that borrowing represents a very small amount of the National Bus Company's costs. I fear that that view is taken by the Department of Transport which does not appear to have a destruct button anywhere.
  When replying to me in Standing Committee, the Minister said:
  "The facts behind the debate are not as the hon. Member for Westhoughton (Mr. Stott) seems to believe. The burden of interest charges on the commencing capital debt has actually dropped, and represents a very small proportion of the NBC's costs."—[Official Report, Standing Committee D, 17 December, 1981, c. 143.]
  The Minister's view ignored the narrow margins on turnover to which the group must work.
  When the interest burden is related to the action that is being taken to sustain the group's financial position, it becomes a significant factor. The National Bus Company has stated that the action that it took in 1981 was designed to reduce its stage carriage services to achieve a saving of £25 million. The interest payments during that year amounted to £18 million. Nearly three quarters of the action that has been taken by the company has been carried out to enable it to service its commencing capital debt—in other words, to pay a dividend in a bad year. It is no good the Under-Secretary of State trying to dodge that fundamental and incontestable fact.
  If the company's position were not bad enough, the Government have added further to its problems. Its problems have been compounded by the provisions in the Transport (Finance) Act 1980. The company is now having to operate in free market competition with private bus operators that do not have such financial impediments placed upon them. No bus operators, whether they be the shire counties, the PTEs or private operators, have to operate with such a financial impediment.
  The Minister said in Committee on the Transport (Finance) Bill 1980 that free enterprise is a good thing and that fair competition is proper. If I accept what he says on this issue, which I do not, he must recognise that the company is not operating in a market in which it can compete effectively if it has to pay the interest charges that I have described.
  The amendment seeks nothing other than to obtain for the company a measure of natural justice. In its conclusion the Select Committee on Nationalised Industries reported:
  "For all these reasons"—
  for the reasons that I have been deploying for the past quarter of an hour—
  "your committee consider that a change should be made. They recommend: (a) that the Government should write-off entirely those debts of NBC attributable to additional mileage operated during 1975 and to London Country Bus Services Ltd.; (b) that
  844
  the interest charges on commencing capital debt should be met directly by the Government by direct grant to NBC, and licit imposed on individual subsidiary companies or counties."
  That is what the Select Committee recommended in 1977–78. I regret that the previous Labour Government took no notice of those recommendations. I am prepared to defend that Government's marvellous record, but it is legitimate to say that in some areas they had blind spots.
  We have a new system of Select Committees operating under this Government and the Select Committee on Transport recommended:
  "the Government should now reconsider their attitude to the earlier recommendations of the Nationalised Industries Committee and should consider a possible restructuring of the finances of the National Bus Company by conversion of the original and subsequent capital debts into Government-held dividend shares in the Company."
  That is a fairly recent recommendation.
  I am asking the House to consider the eminently reasonable arguments that have been advanced by Lord Shepherd as chairman of the National Bus Company. If we seek to maintain the levels of public transport that we now have and if we wish to see levels of public transport maintained in rural areas, the company must stop operating with one of its arms twisted up its back. That could happen if the Government showed a little sense, by accepting a reasonable amendment that is totally non-political. It makes the point succinctly. I hope that we will receive a better response than we did in Committee.
  Mr. Kenneth ClarkeMy starting point is that I agree with the aim expounded by the hon. Member for Westhoughton (Mr. Stott), which is that there should be fair competition between different bus operators. It lay behind our Transport Act 1980 that we were opening up more routes to competition, but we accept that the competition should be fairly based between the various parties, and that there should be no unfair discrimination between the public sector and the private sector operators, favouring either the one or the other. That means that in dealing with any company, one has to look at what its costs are. Any company must seek to service its capital, which means operating costs one way or another.
  It underlies the Government's approach to such businesses that the costs of servicing the capital required in the capital creation of the company are as much costs of a business as are the costs of labour and the costs of fuel. That is true of private and public sector business. That has been acknowledged by successive Governments in dealing with the financing of nationalised industries.
  The hon. Gentleman is asking that we should write off a substantial part of the capital debt of the National Bus Company to give a new form of subsidy to it from the taxpayer, leaving the taxpayer to bear the costs of the capital structure of the National Bus Company, thereby giving it an unfair advantage vis-à-vis its private sector competitors. That view was not taken by the previous Government, and is not likely to commend itself to the present Government. It cannot be supported on an analysis of the past events that the hon. Gentleman went over. He mentioned 1970, when the London Country Bus Service was formed and 1975 when the then Labour Minister stepped in with instructions about the way in which it was to respond to a short-term financial crisis.
  It is true that the capital structure of the National Bus Company is different from that of many of its private sector competitors. Being a nationalised industry, it is entirely financed by fixed interest debt. In bad years there

  845
  is the disadvantage that it cannot reduce its interest payments, whereas, if it were a private sector company, it would withhold payments of dividend. However, that applies in bad years. In good years a private sector company has to distribute its profits, and in good years the National Bus Company is tied to the same payment of fixed interest on its debt.
  If a private sector company considered that, if it got into trading difficulties, it would suspend the payment of dividend and would carry on not paying dividends to those servicing its capital for as long as it was necessary because of its financial constraints. Eventually it would run out of the ability to raise fresh investment to finance its activities and would suffer penalties. To leave the National Bus Company in the position required by the hon. Gentleman—its commencing capital debts would be written off, it would have no interest payments, presumably it would have no equity and no dividends to pay and its capital would be provided free by the taxpayer—would be to give it a novel form of subsidy.
  I do not want to go over the history of the two previous matters that persuaded the Select Committee to make its report to the House and which persuaded people to put the argument that the hon. Gentleman has put to the previous Government and this Government. It is pointless to look back to 1970 when the London Country Bus Service was created. It received the assets debt free on transfer in 1970. It had to borrow money to get through the short-term crises, but other companies, including other National Bus Company subsidiaries, had to borrow to build up the capital structure of the business. It would not be fair to treat the London Country Bus Service differently from other NBC subsidiaries or other companies.
  I shall not rehearse the arguments about 1975. I would be repeating arguments used by Ministers at the time to explain actions taken by the previous Labour Government. It was never accepted by the previous Government, as is usually argued, that enormous sums of borrowing were forced upon the NBC by the decision to make it run additional services. It is true that the previous Government stepped in and asked the NBC not to cut back services at a time when the new revenue support system was being built up. The argument that all the borrowing incurred in 1975 should therefore be written off by the Government pre-supposes that but for that Government instruction no borrowing of any kind would have been carried out by the NBC in that year or that it would have been able to cut services to the degree necessary to avoid new borrowing within the time that was necessary in 1975 and thereby avoid any of the present debt payments.
  10.45 pm
  I can hardly claim to have been party to what happened. The previous Government made the decision in 1975. The previous Government insisted that it gave no ground for wiping off that part of NBC's capital debt. We are not likely to be able to change that policy now.
  The Government appreciate, as I have already remarked in relation to British Rail, that the NBC operates in difficult circumstances. The Government have set a stiff financial target that it is endeavouring to meet. The NBC is under external financing limits but succeeds in keeping within them. It is steadily improving the performance of the business. It is reducing costs, matching services to
  846
  demand and improving productivity at an impressive rate. It is improving performance within the imposed constraints.
  The Government would not wish to add an unfair or impossible interest debt. I have pointed out in Committee that the burden of capital debt does not seem to us overwhelming. It is reducing somewhat. I stated:
  "The burden of interest charges on the commencing capital debt has actually dropped, and represents a very small proportion of NBC's costs."
  The hon. Member for Westhoughton reacted to my remark but did not deny the truth of it. Both statements are accurate. I told the Standing Committee that the total burden of interest paid by the NBC has dropped markedly over the years. I stated:
  "In constant mid-1981 prices, the total interest paid by the NBC in 1970 was £19–7 million; in 1976, £21·1 million, and in 1980 it dropped to £19·3 million. The interest paid on the commencing capital debt"
  which is meant to be the basic subject of the amendment
  "at mid-1981 prices, dropped from £19·7 million in 1970 to £11·2 million in 1980."—[Official Report, Standing Committee D, 17 December 1981, c. 143–4.]
  The case that interest charges should be wiped off is an old battle, rejected by the previous Government and rejected still by the present Government. It is a burden that represents only 3 per cent. or so of NBC's total operating cost. It is a burden that is reducing over the years. One area remains where the Government has acknowledged to the NBC that difficulties occur. This is that the distribution of the debt between the different subsidiary companies is not readily justified. The burden of debt between individual National Bus Company subsidiary companies is rather a matter of historical accident than present realties.
  Because the Government believed that there might be a problem, Touche Ross was asked by the Government and the NBC to report on the distribution of the debt between the companies and the relationship between the debt and interest charges and the earning capacity of the individual companies, how the present arrangements affect their operations and financial decision-making and the prospects for the companies in the present financial regime.
  The report is not yet to hand. There will no doubt be recommendations made that shed some light upon the way the burden of capital debt and interest charges is distributed within the company. I do not believe that anything from Touche Ross is likely to support the contention that the capital debt of the NBC should be written off and borne by the taxpayer. This is equivalent to the burden shared by similar businesses and by their private sector competitors. It is not an onerous burden. I congratulate National Bus on the success it is achieving in difficult trading conditions in modernising its business and improving its commercial performance. I know that some if its managers feel strongly about this. I am afraid they are mistaken. National Bus will have to live with the reality, as every other business does, of servicing its capital while coping with the problems that other business management has to tackle.
  Mr. StottI shall not detain the House much longer. I do not agree with a substantial part of the Minister's reply. It is merely a repeat of his reply to me in Standing Committee. I thought that I would try to approach the matter differently and allow the Minister to consider in detail what I said.

  847
  The Minister said that it is pointless to look back to 1970. That may be so, but the National Bus Company still has to pay interest on the money that it borrowed in 1970. It had to borrow the money then because it was told to take over an ailing and virtually bankrupt subsidiary company. Therefore, it was something it did reluctantly.
  In 1975 the Minister asked the National Bus Company to carry on operating routes that it would ordinarily not have operated on. Therefore I do not think he should say that it is impossible to quantify the cost of keeping those routes going. The National Bus Company has informed me that in its best judgment it costs it £23 million, on which it is continuing to pay interest. We are talking not about any company but about a company that was given specific obligations: one, to take over the London country bus services and the other to keep routes open that it would not otherwise have kept going. If the Government would at least consider those two aspects of the problem and try to do something about them they might be able to get away with the argument that it is not incumbent on them to pay the interest charges on the initial capital debt.
  I am thoroughly disappointed with the reply of the Secretary of State. We have tried to make the case as best we can. The National Bus Company has got a good case. I hope that the Select Committee on Transport, on which Members from both sides of the House sit, will continue to make recommendations in the National Bus Company's favour, and that at some stage, when my right hon. Friend the Member for Barrow-in-Furness (Mr. Booth) is Secretary of State for Transport, we may reverse the Government's decision.
  I am conscious of the time and I would no doubt incur the wrath of the House if I were to push this amendment to a Division. Having said that I am disappointed with the reply of the Secretary of State. I beg to ask leave to withdraw the amendment.
  Amendment, by leave, withdrawn.
  Motion made and Question proposed, That the Bill be now read the Third time.—[Mr. Kenneth Clarke.]
  10.59 pm
  Mr. Arthur PalmerThis Bill, on which we have had a long and interesting debate, dealing principally with railways and for a shorter period buses, also contains clause 5, which deals with ports. This is headed
  "Port of London Authority and Mersey Docks and Harbour Company."
  The intention of that clause, as I understand it, is to advance more Treasury money to the ports of London and Liverpool for employee severance payments.
  On Third Reading of the Ports (Financial Assistance) Act last year I spoke about its effect on other ports than London and Liverpool, which it was designed to assist. The Under-Secretary said at one stage that it would have no effect, or only a small effect, on their financial situation. I disputed that, with the port of Bristol particularly in mind. That ancient port is municipally owned. I think that it is the largest surviving municipal trading undertaking in the country, funded on the security of the local government rates. It is losing money, under present conditions, and will go on doing so increasingly rapidly unless there is remedial financial action.
  In the past few months a new radical financial plan has been drawn up, with the assistance of outside experts, and it is now before the Department of Transport and the
  848
  Department of the Environment. A response is hoped for fairly soon. In Bristol we have been waiting for quite a time for the response.
  However, I am not dealing with that aspect now. I want to confine myself to the special point of the Bill's indirect effect added to that of last year's Act. The problem is particularly acute in Bristol, but other ports are also affected, I am sure.
  There seems to be a widely held belief, which the Government do little to correct, that the cost of the special voluntary severance scheme for registered dock workers in London and Liverpool is met wholly from Government funds. That is not so. I understand that the Government have financed severance compensation up to a maximum only of £5, 500 per man, and that the basic cost of up to £10, 500 per man has been met by the port employers' national voluntary scheme, funded by all the scheme employers, including, of course, Bristol. I am told that 60 per cent. of the scheme payments are applied locally and that 40 per cent. come from the national voluntary fund supported by all the ports.
  Because of the numbers involved, varying from port to port, already hard-pressed ports such as Bristol have to put their hands in their pockets to help reduce the labour force in Liverpool and London. These other ports that have had to help the successful working of redundancy in London and Liverpool receive no Government help. That is wrong and unfair. The position was bad enough under the provisions of last year's Act. The offence against justice and equity has now been compounded by the present Bill.
  I do not know whether it was said during the debates on last year's Act, but it has been said by the Department of Transport and its officials in conversations with the port of Bristol and the city council that Bristol does not qualify for special national help as it can always draw on the rates. Bristol does not need to be told that it can always draw on the rates. It is doing so. Every local industry and old age pensioner makes a greater or lesser contribution and the subsidy from the rates helps not only the port of Bristol but London and Liverpool indirectly.
  Bristol is an economical local authority. It is forced to be economical. Anyone who drives on the roads or walks on the pavements in Bristol will feel and know the economies that have been made.
  Because of the subsidy that Bristol gives to the port, it has become, in the Government's eyes, an overspender, so the Secretary of State for the Environment further penalises Bristol by withdrawing a portion of the rate support grant. One Minister tells Bristol to milk the rates and another says that the Government will hit Bristol hard if it does so.
  I end by quoting Mr. Stanley Turner, the general manager of the port of Bristol. In a recent letter to me he stated:
  "The treatment of the Port of Bristol, which is experiencing financial difficulties comparable with those of London and Liverpool, compares starkly with that afforded to these two Ports, to the point where one begins to speculate as to whether, in fact, the Government would not be unhappy to see a closure of the Port of Bristol, in spite of the extremely serious economic and social consequences"—
  I believe that he means locally—
  "together with the loss of what I regard as an important national asset."
  Potentially the new Royal Portbury dock is certainly one of the finest in Western Europe.
  Mr. Turner continues:

  849
  "I sincerely trust that such a thought is unjustified."
  I am not as charitable as he is towards the Government. From time to time the hard thought passes through my mind that they have little interest in the port of Bristol or the ratepayers who are asked to sustain it.
  11.3 pm
  Mr. Nigel SpearingI, too, wish briefly to refer to clause 5. It gives further authorisation of £200 million to the ports of London and Liverpool, as my hon. Friend the Member for Bristol, North-East (Mr. Palmer) said. However, I do not share his views about the help that the money will give, certainly to the port of London, in the long run.
  The limits in the Ports (Financial Assistance) Act 1981 can be raised, and that lies behind this measure. The object of the Act was to assist the ports of London and Liverpool to become financially viable, largely by reducing manpower. But that is not the only way in which a port can become more financially balanced. At the eighth sitting of the Committee on 28 December I made known why I thought that the Government's analysis was wrong. Far from the money assisting the port of London in the long run, in effect, I said that it could hasten its decline. I shall not repeat that warning tonight. It has been made on a number of occasions in the House.
  The second part of that debate related to the Government's accountability. It would be quite proper for us to differ on the analysis that I have just mentioned, But I question whether it is proper for this money to be voted without the Government giving an undertaking that the corporate plan for the Port of London Authority is to be published. In Committee, the Minister made it quite clear that that plan would not be published. Moreover, he did not see fit voluntarily to state that he would lay before Parliament a statement showing the purposes of guarantees and items of expenditure made under the Act, and the conditions, if any, made by the Secretary of State in respect of payment of those sums.
  For reasons that are best known to you Mr. Deputy Speaker, my amendment No. 8, which would have produced a debate on this subject, was not selected. I deplore the fact that the Government have not put this in the Bill. A Government who pride themselves on their husbanding of public resources have chosen not to do so. They have chosen not to publish, or even to give an indication, apart from the commercial matters, of the plan that the Port of London Authority will impose on its work force, and which will have implications for the local authorities and many other persons in the port. I deplore that fact. I am sorry that we have not been able to write in that condition. We should have had a much better Bill if that condition had applied to section 5.
  I hope that my forebodings about the use of the money will not be correct, but unless and until we have more information about how the money is spent and the way in which the Port of London Authority sees its way towards future financial viability, my doubts will remain. I fear, too, that we shall have a third Bill dealing with the problems, perhaps not only of London but of other ports. This Government are not concerned with considering a proper ports policy for the nation; rather, they take each port individually. We see each port decline in its own area.
  11.8 pm
  Mr. Kenneth ClarkeI shall confine my remarks on Third Reading to clause 5, and I shall reply to the fears that have been raised.
  First, I shall deal with London, the port which is directly affected by clause 5. The purpose of the Bill is to assist the port of London, with which the hon. Member for Newham, South (Mr. Spearing) so closely identifies, and in which he shows great concern. The Bill seeks to extend the limits imposed on the 1981 Act to an additional ceiling of £200 million. That will enable us to continue to help the port of London to get back to viability and profitability. We made it clear that unfortunately the problem is still a surplus of manpower, so some of this money will undoubtedly go towards reductions in manpower in the port. However, we shall continue to pay operating losses in the transitional period while changes still have to be made.
  Again, we have made it clear that support for continuing losses will not continue beyond the end of 1982. That rather stiff target has to be met by London, and incidentally by Liverpool, because those ports cannot expect continued deficit financing beyond then. Meanwhile, we shall maintain the ports to whatever extent is necessary to keep them going, including some assistance with essential capital investment, which is required by both of them if they are to have a good long-term future.
  The hon. Gentleman does not oppose the additional support for his port, but he says that he wants more information to be laid before the House about the way in which it is being disbursed and about the unfolding of the policy. I assure him again, as I did in Committee, that the Government have no desire to withhold essential information from the House pointlessly. We shall continue to answer parliamentary questions and correspondence, and to reveal the rate at which the money is being disbursed and the broad purposes for which it is being disbursed. Our only reticence on the subject of disclosure is that we do not wish to disclose documents which contain commercially confidential matter which could be of assistance to the ports' competitors.
  The ports industry is fiercely competitive. Shippers can move their business from point to point and there is much fierce fighting between the ports to get trade. There is excess capacity at present and that is all to the benefit of shippers and to many exporters and importers. However, London and Liverpool will be placed at a severe disadvantage if, because of their relationships with the Government, documents have to be published that contain information that may be of considerable assistance to their competitors. That is the case with the two corporate plans. They were produced earlier this year and contain much commercially confidential information. If they were edited and if the confidential information was removed, the documents would be bowdlerised and useless, and would not give any clear impression of the subject matter.
  The policy is not based directly on the corporate plans. We asked for the corporate plans to be produced and also had the advice of accountants. In the light of information received, we used our own judgment to come up with the present policy and the financial provisions that we think are required. Therefore, no great guidance would be given to the Government if the corporate plans were produced.
  We are waiting for action plans from the two ports. We shall not be able to publish them, because those plans,

  851
  which will show how the ports attempt to live within the restraints imposed on them and how they will use the money to meet the target of no further deficits by the end of 1982, will inevitably contain commercially confidential information. We should defeat the object of the Bill if we exposed the ports to unfair competition by making that commercial information available to their competitors.
  In the previous debate I was not very forthcoming and I repeated a refusal to move that I had given in Committee. I must repeat the reasons that I gave in Committee for not accepting those arguments for greater disclosures of information. As we cannot disclose such matters, we shall endeavour to be as forthcoming as possible in such other information as we can give the House as the policy unfolds and as we disburse public money.
  The hon. Member for Bristol, North-East (Mr. Palmer) fears that the Bill may—like the 1981 Act—contain more difficulties for the port of Bristol. I do not minimise the problems faced by the port of Bristol and the ratepayers of Bristol. Things are very difficult. Portbury has been an extremely unsuccessful investment so far. The port has passed through difficult times and fairly radical readjustments are required in Bristol. I hope that ratepayers, councillors and others involved in the port of Bristol do not think that we are giving London and Liverpool an easy ride. In the past 12 months, London has witnessed the closure of the old Royal docks to cargo handling by the Port of London. We hope that London's future in cargo handling lies at Tilbury.
  The profitability plans produced by the port of Mersey involve drastic changes in the shape of the port, with a concentration on the Seaforth grain terminal and on modern facilities at the northern end of the port. Bristol is being driven to bring in consultants—Cooper Lybrand is assisting Bristol—and is contemplating severance for dockers, the disposal of land to reduce the capital debt and so on. Those are difficult steps, but Bristol does not have to labour under those difficulties while believing that the Government are somehow bailing out London and Liverpool in a soft option that involves reconstruction.
  Mr. PalmerThe point that I sought to make was that under the Bill, which allows for severance payments, Bristol has not only to deal with its difficulties—which are real enough—but indirectly to subsidise Liverpool and London through the voluntary scheme.
  Mr. ClarkeThe National Association of Port Employers has a voluntary severance scheme to which all ports contribute. There is an agreed sum of voluntary severance available to registered dock workers, to which all ports contribute a levy. London, Liverpool and Bristol all contribute. The special severance scheme run by NAPE in the autumn of last year is one from which Bristol, in particular, benefited. I believe that 400 dockers in Bristol
  852
  took voluntary severance payments. Of course Bristol and its ratepayers contributed to the levy in addition to all the other ports, including London and Liverpool.
  To deal with London's and Liverpool's special problems, the Government financed enhanced severance for the enormous surpluses of dockers in those ports. That took a liability off NAPE generally and off the two ports, because they were insolvent and could not deal with the extra severances required. They had no prospects of returning to viability unless some special effort was made to reduce the numbers, which we did.
  I do not believe that we have discriminated unfairly against the ports. They all belong to the NAPE voluntary severance scheme. They all impose a pay levy on a basis agreed by the dock workers. They have been assisted by the Government in the past with borrowing arrangements, which are the responsibility of my right hon. Friend the Secretary of State for Employment.
  There is no unfair discrimination against Bristol in the Bill. The Government have before them the latest submissions from Bristol, prepared by Cooper Lybrand, which are still being considered by Ministers and especially by my right hon. Friends the Secretary of State for Transport and the Secretary of State for the Environment. We shall respond to those submissions soon. We are not unappreciative of the problems of Bristol. On the other hand, I must enter a few notes of caution. If we were to give special help to Bristol, we should face allegations that other ports also facing difficulties were being discriminated against and that we were bailing out Bristol from trading difficulties. I must also add a note of caution about local authority trading. The port of Bristol was developed by the local authority. When it received Government approval it was expressly agreed that the port was the responsibility of the local authority in all ways. Now many local authorities are talking vaguely about engaging in trading activities of one sort or another. It cannot be a sound basis for such activity that a local authority can incur, on its own account and responsibility, a major capital investment and trading responsibility and, if the matter goes wrong, expect the national taxpayer to step in and relieve it of the liability.
  I say that only in general terms. The submission that has come from Bristol is not so crude. Complications and real difficulties are being faced by the ratepayers. However, the hon. Member for Bristol, North-East knows that. Ministers in any Government must face up to general issues of policy. Therefore, we shall consider the proposal sympathetically, but I do not wish to be too encouraging. In the last resort, it is Bristol's responsibility to take the difficult steps that I commend to try to get the port out of its present mess and back on a more sound financial footing.
  Question put and agreed to.
  Bill accordingly read the Third time and passed.

Northern Ireland
11.18 pm
The Under-Secretary of State for Northern Ireland (Mr. David Mitchell)I beg to move,
That the draft Rates Amendment (Northern Ireland) Order 1981, which was laid before this House on 17 December, be approved.
The order, which is short and straightforward, tries to do two things—to permit of the valuation and rating as a single hereditament, in suitable cases, of caravan sites or portions of sites and, secondly, to enable the rating authority for Northern Ireland, in reckoning rate liability, to disregard minor valuation changes until the next rating year.
The permissive power sought in article 3 in relation to the valuation and rating of leisure caravans has become necessary because over a period of years patterns of occupancy have evolved so that many have achieved the status of hereditaments within rating law. In short, they have become a sort of weekend cottage. That has faced the valuation office with a statutory duty to initiate action for inclusion of such caravans in the valuation list. It will readily be seen, however, that the collection of rates from individual caravan owners, whose normal domicile could be dispersed throughout the length and breadth of Northern Ireland and beyond, would be troublesome to the ratepayers and extremely difficult to administer by the rating authority. For example, many caravans do not have letter boxes. The caravanners are not happy with the system.
A precisely similar situation arose in Great Britain about six or seven years ago and it was dealt with by the Rating (Caravan Sites) Act, which was enacted on 13 April 1976. That parallel legislation in Northern Ireland has not until now become necessary is a reflection of the fact that the developments in leisure caravanning that gave rise to the 1976 change in Great Britain have been slower to occur in the Province. Therefore, the present proposals represent the extension to Northern Ireland of provisions that have operated very satisfactorily in Great Britain since April 1976, and will have the effect of placing the Province on all fours in the matter with the rest of the United Kingdom.
I should make it clear that article 3 would not increase the liability for rates that would otherwise accrue in respect of any leisure caravan. In the past some people have escaped the net, but from April 1982 they will be drawn in.
The order essentially is concerned with the unit for assessment of rateable valuation and the locus of liability for rates. The criteria that determine rateability are exactly the same in Northern Ireland as in other parts of the United Kingdom and these criteria are unaffected by article 3.
The proposal in article 4 is designed to enable postponement of the rating effect of minor valuation changes that extend to Northern Ireland, with some modification—a change in the law brought into effect in England and Wales by section 21 of the Local Government Act 1974. It differs slightly from that Act because it takes account of experience of the operation of the legislation in this part of the Kingdom and seeks to avoid certain anomalies that have arisen in the operation of the law in England and Wales.
Under Northern Ireland law as it stands, changes in the net annual value of hereditaments are effective from the
854
date on which the changes take place. Thus, for example, if an extension to a dwelling valued at £30 is occupied on 1 July, for example, the increased rates are payable from that date. But a very significant amount of administrative effort is expended by the rating authority in establishing the effective dates of occupancy in such cases, at considerable cost to public funds, and it has been concluded that any temporary loss of revenue from postponement of the rate effect of minor changes will be more than offset by the savings.
Article 4 of the order therefore provides that an alteration in the net annual value of any hereditament, provided that such alteration does not exceed £30, or such other amount as may be specified by order, will not be taken into account in assessment of the rate liability until the following rating year. Thus, in the example that I referred to, the extension occupied on 1 July would not become liable for rates until the following 1 April.
The postponement applies to both increases and decreases. That is logical, since we are dealing with the savings of administrative costs and a valuation difference of £30. The limit is the same as it is in Great Britain.
The order was published as a proposal for consultation and contained a provision the effect of which would have been to discontinue the small discount allowed for prompt payment of domestic rates. I am pleased to be able to assure the House that this has been dropped in view of the virtually unanimous opposition from Northern Ireland representatives in Parliament, and from local authorities, many of which I have spoken to in my visits to the Province. Many people, including private householders have raised the subject with me. Because of that the Government have decided, without prejudice to any future decision, to drop the proposal from the order as laid and to give the matter further consideration in the light of the views and advice received.
The order is modest in length and its objectives are of no particular complexity. Its general objective is to bring Northern Ireland law closer to that of Great Britain. I commend the order to the House.
11.24 pm
Mr. Clive SoleyThe Opposition have no objection in principle to the order, but we wish to raise one or two points. Perhaps the Minister will be good enough to respond in due course.
Caravanners, I suppose, like boat owners, are frequently in an anomalous position in relation to tenants of one type or another. Under the order, as the Minister has said, the district valuer will levy the rate on the site itself and the owner will then divide it up. The owner's responsibility appears to be confined largely to putting up a notice showing the overall rate and then arranging for collection and payment to the local authority.
The House should note that the caravan owner pays a fee for a licence that does not give him any security of tenure, so the site owner is already in a considerably more powerful position than the person who rents the site from him. To give the site owner the power to divide up and collect the rates without safeguards adds to that difference in the power relationship between the two.
Many site owners may use that power properly and responsibly, but the fact that the Monopolies and Mergers Commission is to investigate the supply of pitches for holiday caravans in Northern Ireland suggests that there is a problem. I gather that not the least aspect of that problem

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is that the renting of a site may be linked with the sale and purchase of caravans. A person wishing to rent a site may be told that he must buy a caravan from the site owner or sell the caravan back to that person. I understand that the Monopolies and Mergers Commission will be investigating the supply of pitches and I hope that it will take these matters into consideration, but I note that it is not expected to report for at least another year.
Given that caravanners are now to pay rates, there is a strong case for people renting sites to have either security of tenure or some form of enforceable—I emphasise the word "enforceable"—code of practice. Perhaps the Minister can give an undertaking that, following anything that the Monopolies Commission may recommend in a year's time, he will come back to the House on this subject and that he is prepared to ensure that those renting caravan sites receive some degree of protection either through security of tenure or through a code of practice that is enforced. If people are to pay rates on the site, they should have some security.
One must also ask what rights the caravan owner obtains by paying rates. Is his rubbish collected? Is a water supply provided? Or is this solely a matter for the site owner? If it is a matter for the site owner only, what is the position if the person renting the site receives no services? If he is simply given a patch of ground on the site, with no water supply, no rubbish collection, no toilets, and so on, will he pay no rates or just a very low rate? That is a pertinent question for anyone considering renting a site.
Disputes might also occur between the site owner and the caravan owner. If it is left to the site owner to decide how the rates are to be divided up, many differences might occur. The size of caravan is important. Would a small van be rated the same as a large van? The provision of services is also relevant. One person's caravan may be close to all the services while another is on the other side of the field with little access to services. If both have to pay the same rate there may be a feeling of unfairness.
What will happen if such differences arise? So far as I can see, there is no provision of any kind to deal with them. It seems to be simply a matter of the caravan owner arguing his case with the site owner. That seems to leave the position wide open to potential abuse and possible conflict.
I also note that there is no possibility of rate rebates. I do not expect that to be an immense problem, but some people who own leisure caravans do not have high incomes. They may have bought the van many years ago and now be receiving a pension. If there is a high site value and the site owner imposes a high charge on those people, to whom can they appeal?
Will a person who sells a caravan halfway through the year pay the whole year's rate or will he get a rebate, with the new owner paying rates for the rest of the year? If the van is moved off a site will the site owner keep the rate money?
I do not expect the Minister to reply to all my questions tonight, but I ask him to give serious attention to the question of security of tenure or a code of conduct. That would be a way of checking some of the abuses that could develop. Obviously, I shall be interested to hear any answers that the hon. Gentleman can give.
There has been relatively little—I put the matter as cautiously as I can—consultation with the Northern Ireland Caravan Owners Association or, at least, its submissions do not seem to have been taken into account
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in the legislation. The association voices the concern of not only the consumer, but the ratepayer and it deserves to be consulted carefully. I do not suggest that the association is the only representative of the consumer and the ratepayer, but it should have been listened to, particularly in regard to security of tenure and a code of conduct. I hope that the Minister will consider those matters in due course.
11.31 pm
Mr. James MolyneauxI thank the Minister and his noble Friend Lord Gowrie for responding to my letter of 30 September 1981 in which I expressed opposition to article 5 in the original draft order. My panty expressed the view that, although the practice of discounts for prompt payment of rates may be diminishing in Great Britain, it was inappropriate to abolish the discount provision at a time when interest rates for local authorities were well over 15 per cent. The Ministers have acted in the best interests of the Treasury, local authorities and individual ratepayers by withdrawing article 5.
We welcome the provision in article 4 for changes in valuations not exceeding £30. As the changes would mostly be upwards, I am sure that the deferment will be welcomed. They are to be delayed until the beginning of the rating year following that in which the changes take place. That will make for much tidier administration and is a sensible improvement.
The main part of what is left in the order concerns the valuation and rating of caravans. Like the hon. Member for Hammersmith, North (Mr. Soley), I hope that the rates will be modest. It would be a mistake to imagine that caravanners are well-off people who can afford a second home. For many, a caravan is a modest luxury and, in many cases, an alternative to the type of holiday that owners would like to take if they could afford it.
May we take it that there is no change in the position of the other two categories? Presumably, permanent residential caravans will continue to be separately rated, and caravans used for touring and not permanently sited on any pitch will presumably continue to be exempt from rating, as they are in the rest of the United Kingdom.
There has been some confusion about the proposed method of assessment. Paragraph 3 of the explanatory document starts fairly clearly, but in the second line complicates matters by the phrase
"taking full account of the assessments attributable to individual caravanners".
Do those words mean that the valuation officer will have regard to the standard, type and amenities of individual caravans and then total his sums to arrive at the valuation for the whole site?
Paragraph 3 goes on to state that
"the site operator would then be responsible to the rating authority for payment of rate on the entirety of the site".
I understand that to mean that the site owner will collect and pay rates for the whole site. Does it also mean that the site operator will subdivide the total rate? Can he be prevented from, say, quartering the site before apportioning the rate on individual caravans? There could be a vast difference in the numbers of pitches in each quarter, with dramatic variations in the rate demanded from caravan owners. If the operator strikes an average, will it be the average for the whole site?
In fairness to site operators, it must be admitted that the order places them in difficulty. A site owner will be the

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allocator as well as the rate collector. There would appear to be no way of appealing against his allocation. Admittedly, each caravan owner has the right to apply to be valued and rated separately, but there is more than a suggestion that he may end up paying more than the average for the site. I doubt whether that will be regarded as satisfactory.
The question that then arises—it featured prominently in our debates in 1976 when the Great Britain legislation passed through the House—is: will there be a flat rate irrespective of the size of caravans? Will account be taken of those connected to mains water supplies? Incidentally, connection can cost up to £176. Will caravans parked on a pitch with a sewerage system be rated at a higher level?
When will payment be due? Can a site operator force occupiers to pay as soon as the demand is received, having been broken down and furnished by him to the occupiers as a secondary or delegated rate demand?
If an operator wishes to get rid of an occupier, will he be able to use the significant power given to him under the terms of the order as a powerful lever? If so, what safeguards can be devised and provided?
I understand that any instalment scheme would have to be worked out between the operator and the occupiers. Would it be possible for an operator to demand and obtain immediate payment from occupiers and then to use the instalment plan to make his payments to the Department of Finance?
I notice from the note dated 26 October 1981 that a site operator would have no entitlement to discount. Has the payment of rates on caravans been altered by the dropping of article 5 from the original draft order? If so, will a site operator benefit from the discount arrangement? More importantly, will a site operator pass on such benefit to caravan occupiers?
I support the plea made by the hon. Member for Hammersmith, North (Mr. Soley) that, in return for this significant imposition of rates on caravan owners, the Government should seriously consider providing security of tenure and an effective code of practice.
I note that the order follows closely the Rating (Caravan Sites) Act 1976. That legislation was made necessary because certain decisions of the Court of Appeal in 1966 threw the then legislation into something approaching chaos. In 1976, English Members put many of the questions we are discussing. Can the Minister say how the 1976 Act is working out in practice?
We need to be assured that we are not enacting legislation which is proving defective and unworkable in the rest of the United Kingdom.
11.36 pm
Mr. David MitchellWe have had a short but probing debate on the order and, as I said at the outset, it has become clear that the order's objects are modest and its general purpose uncomplicated. The main effect of the provision will be to bring Northern Ireland law, on these matters, into closer alignment with that of Great Britain and confer benefits on Northern Ireland ratepayers which they do not presently enjoy.
I can assure the hon. Member for Antrim, South (Mr. Molyneaux), who leads for the Official Unionist Party,
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that the law in that respect is operating perfectly satisfactorily on the mainland and, therefore, we are content in seeking to follow it.
The hon. Member for Antrim, South was pleased with many aspects of the order and particularly welcomed the delay in implementing the £30 rateable value changes. I am glad that that and the dropping of the discount proposal have met with his approval.
We have tried to make our consultations genuine in these matters and to take account of what the hon. Gentleman and other hon. Members said, as well as the views of elected industrial councillors.
I was particularly asked whether the touring caravans continued to be exempt and I can assure the hon. Member for Antrim, South that they do. I was then asked whether the sites were all considered individually by the valuation office in arriving at the totality for whole site. I can give that assurance; it operates in that way. I was then asked about the protection for the occupier if the site operator shares out the amount assessed on him in a disproportionate way. The hon. Member for Antrim, South talked of quartering the site with different proportions of caravans on the quarters.
Since every occupier has the right to seek to have a separate valuation for his site and, indeed, to pay his rates individually if he so wishes, there is an absolute safeguard against the site operator behaving in an unscrupulous manner or, by chance, inadvertently treating an occupier unfairly.
The hon. Member for Antrim, South probed for more assurance about that. He particularly asked me whether there would be a flat-rate assessment regardless of a caravan's size. For example, a site might contain 100 caravans, 20 or 30 of them four-berth or 40 or 50 six-berths adn some two-berth. That factor is considered by the valuation officer when he makes his valuation because he is valuing on the normal basis of what a caravan would let for.
The hon. Gentleman asked me whether there would be higher rateable values for caravans with sewerage and mains water facilities. The answer is, "Yes, of course". That is one of the factors to be taken into account in assessing rateable value. The hon. Gentleman is right in suggesting that the operator acts in the course of fulfilment of the order as a subsidiary rate collector. That is for the convenience of the Government and individual caravaners, who may often leave their caravans for considerable periods at the site without being in occupation, who may not have letterboxes and who often have great difficulty in being able to receive individually posted rate demands at the sites of the caravans, as opposed to demands being sent by operators to their homes together with rent demands.
I was asked whether an operator can demand payment immediately and then pay by instalments. Yes, he can. Before the hon. Member for Antrim, South says that that is unfair, may I say that those who will operate the system will no doubt assure the hon. Gentleman that any operator who was paid immediately he demanded payment would be a surprised man? That certainly applies to some occupants.
Can a discount be obtained by the operator? Yes, it can. Whether he passes on the discount is a matter between him and his tenant. For the reason that I have given I doubt whether he would receive the money in full.

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The hon. Member for Antrim, South, together with the hon. Member for Hammersmith, North (Mr. Soley), referred to the Monopolies and Mergers Commission's report and a desire for a code of practice. The hon. Member for Hammersmith, North fairly referred to the powerful position in which site owners find themselves, the need for some safeguards, and the strong case, as he saw it, for an enforceable code of practice or security of tenure. We must await the commission's report, but that will not be relevant to the order. I can give him the assurance that he implied he would like, and that is that we shall consult the caravaners' representatives in considering the results of the report.
I have been asked about rates payable for local government services. Rates are not to be seen as payments for services, as they are a tax. The absence of services will be taken into account in the assessment of the net annual value. Some sites are, of course, better than others, and I have been asked about rights of appeal. It is important that built into the order is the right of the individual to seek his own assessment. He has a statutory right to be assessed separately and to pay separately, but he does not have a statutory right to say, "If I were to seek to use my statutory right, what would it cost me?"
I can give the House the assurance that by administrative action we shall make it possible for any individual tenant who fears that the site operator has been unfair in his distribution of the burden to ascertain what it would cost if he paid direct. In most instances it should be very slightly more profitable for him to pay through the site operator rather than individually. If he finds that it is cheaper for him to pay individually, he should take up that right.
I believe that I have covered the issues that have been raised in this short but probing debate on what we intend to do and how we intend to operate the order. I commend the order to the House. In its administration I shall take into account the issues that have been raised so cogently by hon. Members.
Question put and agreed to.
Resolved,
That the draft Rates Amendment (Northern Ireland) Order 1981, which was laid before this House on 17 December, be approved.

Dorset (Educational Reorganisation)
Motion made, and Question proposed, That this House do now adjourn.—[Mr. Gummer.]
11.49 pm
Mr. John WardI am grateful to the House and to my hon. Friend the Under-Secretary for giving me this opportunity to initiate a short debate on educational reorganisation in the county of Dorset.
It is not too much of an exaggeration to say that, with regard to education, the county of Dorset is in turmoil. The matters of great concern can be easily divided. On the one hand there are the plans prepared by local education committees for the probable closure of many rural schools and on the other hand there are the outlined plans for the reorganisation of education in the urban conurbation, which covers Christchurch, Bournemouth and my constituency of Poole.
Of the rural school argument I wish to say little because it does not directly affect my constituency. One cannot help but observe the real concern and distress that has been caused to those who are affected. Those responsible at county hall seem unable to understand that the village school is usually the heart of any small rural community. The removal of a well-loved and well-run school can bring harm to the community well beyond the inconvenience caused to parents in transporting their young children to a more distant school. Even if small schools have limits to what they can provide beyond the three "Rs'' in academic matters, few would argue that they offer a quality of life to their pupils that must be set in the scale when their smallness, which enables them to give a personal service, is used as an argument for their destruction.
However, it is on the proposals for schools in my constituency that I wish to concentrate. We can all understand the need to reduce surplus school places, as school rolls fall. Provided that that is done after meaningful consultation and with compassion, such a reduction can be achieved, but some caution is needed, firstly, because the reduction in demand for school places in Dorset is well below the national average. Secondly, Poole is a rapidly expanding town, with a relatively young population. The removal of places will be uneconomic if they have to be restored in a few years' time. Thirdly, the costings of the various schemes must be examined objectively.
Some of the unit costs quoted locally make me wonder whether some costs have been exaggerated. The reasoning is difficult to follow. Many of us also cannot see the logic of reducing the size of the grammar schools, or of combining them to reduce their total intake. If the school rolls are falling—in Poole that is increasingly doubtful—there is an opportunity to give more of those who wish to take it, the advantage of a grammar school education.
At the centre of my plea to the House is the point that we do not wish to see wholesale change in the education system in Poole. We are served by many good schools run by dedicated staff. At the centre of our schools are the two grammar schools. Parkstone grammar school provides for girls and Poole grammar school for Boys. They have a record of academic excellence that is the envy of many an education authority.

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The Parkstone grammar school was founded 76 years ago, with 14 pupils. It now has nearly 800 girls, including a sixth form of 276, which includes 54 girls transferred at sixth form stage to the grammar school from other secondary schools. At the grammar school, advantage is taken of the greater range of O and A-level courses run at Parkstone. The pass rate for both O and A-levels is generally well over 80 per cent. The school raises large sums of money for charity. It has representatives in several England schoolgirl sporting events and has a record of success ranging from music to safe cycling contests.
Three girls have gained places at Oxford university, another has secured a Plessey scholarship for a degree in computer studies and yet another has secured one of the national engineering training board awards for her degree in mechanical engineering at Loughborough university.
Poole grammar school caters for 770 boys, including 283 sixth formers, one-third of whom have joined the sixth form from other secondary schools. The pass level in both A and O-levels was over 80 per cent. last year. All O-level candidates sit at least eight subjects. There is a full range of extra-curricular activities. In sport the school has several internationals among its present pupils. For the second year in succession the school has gained the three top prizes in the sixth form section of the Abbey Life essay competition. Thirteen of the present sixth form can be expected to gain places at Oxford or Cambridge universities this year. Our grammar schools are centres of excellence. We are proud of them. Both schools enjoy good relations with the other secondary schools in the borough, which send increasing numbers of their students to take advantage of the additional facilities at sixth form level.
This is an education system that is working well. It is not surprising that many of my constituents have made representations to me that it should be allowed to continue in its present form. Like many parents, I feel that there have been too many changes and experiments in education over recent years. Scarcely have parents and pupils adapted to one scheme than another trendy idea is thrust upon them. This makes interesting material no doubt for the educational psychologists, but we parents can perhaps be forgiven if we prefer the trusted and tried methods of some years ago. There is little evidence that better results in basic education have been achieved by all the experimentation.
Although Dorset county council was one of the first, in 1979, to withdraw the proposals for comprehensive education that it was forced to submit under the Education Act 1976, there is a feeling in Dorset that a group at county hall is determined to see the ending of grammar school education in the county. Little by little, the grammar schools have been whittled away until only the four in Bournemouth and Poole remain. I sympathise with a Poole representative on the county council who said that
"there was a strong feeling in Poole that the very elaborate and careful consultation exercise which had been carried out was just a cosmetic exercise."
I believe that the councillor had cause for concern. It was an exercise that largely ignored those who do not yet have children at school and moved the Poole borough council to pass a resolution stating that:
"this Council instructs the Town Clerk to write to the Clerk of the Dorset County Council pointing out that the consultation exercise in respect of the proposed reorganisation of secondary
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education in Poole has been directed solely to governors and managers of schools, teachers and parents of children in the school system but that no comprehensive attempt has been made to obtain the views of the people who are most likely to be affected by any reorganisation, namely the parents of children not yet in school. This Council appreciates the difficulty the Dorset County Council would have in extending the consultation exercise to embrace all persons likely to be affected in the near and medium term future, but in view of the fact that all members of the District Council have, in one capacity or another, been loosely involved in the consultation exercise, and that they are all familiar with the many points of view being currently expressed, the County Council is invited to request the District Council to express a view on the current proposals on behalf of the large number of people in Poole who have not yet had any opportunity of expressing their views."
The House may find it surprising that the county council had to be reminded by Poole borough council of such an elementary matter. My hon. Friend, the Minister and I both campaigned at the last general election on the need for parental choice in education, and I am sure that we are both agreed that no nation can afford to hold back its brightest young people.
The attitude of many of my constituents to the proposal to remove or reduce in size the grammar schools is illustrated by one who wrote to me saying:
"It is in utter disbelief that I write this letter after reading, not once but three times, the report in the Evening Echo concerning the last meeting of the Education Committee. Are you really contemplating abolishing our Grammar School? Surely, a Conservative controlled Council is not going to do what a Labour Government failed to do."
Or again:
"One of the considerations which made me vote Conservative at the last General Election was that 1 understood Mrs. Thatcher did not agree with a wholly comprehensive education system and wanted to give parents as much choice as possible in the type of education required for their children."
I agree with both of those constituents. It is generally accepted that the effective decision regarding the future of education in the Poole and Bournemouth area will be taken at a schools sub-committee of the county education committee meeting on 22 February. I very much regret that, in spite of the efforts of some councillors, the decision will be taken at a meeting that will be held in private. I very much agree with those councillors who believe that this meeting should be held in public.
As I have shown, this is an emotive subject and there is real concern that administrative convenience and education theory will over-rule the wishes of those who showed by their votes at the last general election that they wanted choice in education.
If there is a good argument for all this potential upheaval and uncertainty and a good case for destroying good and proven grammar schools, it will stand up to the most searching examination in public. If decisions are made behind closed doors, it will feed the suspicion that there is a group that is determined to impose its will on the electorate and introduce a comprehensive system.
The headmistress of Parkstone grammar school said it all so much better than I am able to in one of her speech day reports:
"In view of the discussion now taking place in the area with the possibility of altering the whole system of secondary education we should consider what will be lost.
Both grammar schools are of high quality—the results you have heard about today reflect this—both schools enjoy exceptionally good relations with the other secondary schools in the Borough. They are happy to send increasing numbers of their students to us at Sixth Form level. Because boys and girls of ability in significant numbers come to them they can offer a full range of O and C.S.E. courses and the results achieved in our

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general secondary schools complement those achieved in the grammar schools and enable these students to proceed to further education here or elsewhere.
I have very much admired the remedial work done in our general secondary schools with less able pupils—it is a special skill calling for patience and expertise—it is a skill I do not have, nor do many of my colleagues here, and we are very ready to acknowledge this. What I find more difficult to get others to acknowledge is that there is also an expertise associated with educating the most able of our students. It is a skill that we have here, associated with highly qualified, academic staff and with their experience gained often over years teaching able girls, of what is required in encouraging habits of hard work, persuading girls of this level of ability to realise their potential.
I hope I do not sound complacent—our success rate is not 100 per cent. in examinations, not every girl is totally enthusiastic about what the school has to offer or what it stands for, we do not always find the right approach to every one of our students—what institution could claim that it is always successful? Yet the thanks we receive from parents and girls, the letters that come from many after they leave do encourage us to feel that a tremendous amount of good work is done here. I hope we shall be able to continue this."
In a recent debate initiated by my right hon. Friend the Member for Bournemouth, West (Sir J. Eden) and my hon. Friend the Member for Bournemouth, East (Mr. Atkinson), the Under-Secretary of State indicated that one of the most prominent factors that the Secretary of State would consider if an appeal were to be made to him was the need to retain what had proved its worth in the existing system of secondary education. He went on to say that the Secretary of State would not normally approve proposals that would result in the closure or a significant change in the character of schools that had demonstrated their success in providing for sixth form education and which, in his judgment, should continue to do so.
The attention that this debate will receive and the representations made earlier by my right hon. and hon. Friends may yet persuade Dorset county council that, in even considering the closure of the remaining grammar schools in Dorset, it has embarked on a course that is unacceptable to the people of Bournemouth and Poole and that there are better methods of effecting any necessary economies.
Finally, should the county council attempt to close the grammar schools in Poole, we shall seek the protection of the Secretary of State and are confident that he will not see an excellent education system destroyed.
12.3 am
The Under-Secretary of State for Education and Science (Dr. Rhodes Boyson)I am grateful to my hon. Friend the Member for Poole (Mr. Ward) for raising this subject, not only because the way in which schools are organised in any area is a matter of considerable importance, but also because it raises matters of importance throughout the rest of the country.
I realise from my hon. Friend's quotations of constituents and head teachers in his area how closely he is in touch with his constituency. I know how highly he is respected as a Member.
I congratulate my hon. Friend on being born in a vintage year, the year in which I was born. I am not surprised by his effectiveness and his contact with everyone in the constituency. He was educated in a county technical school, a type of school that has disappeared. Such schools tried to create people for the technical age that we are moving into.
My hon. Friend then went to the univeristy of St. Andrew's, which commends itself to me, as I am the
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president of the Conservatives there. It may be that my hon. Friend laid the foundations for its strong Conservative association. When I go there for the annual dinner, little do I realise that it is to him that I owe such a great organisation.
My hon. Friend fell slightly by the wayside after that. You and I, Mr. Deputy Speaker, must sympathise with him, in that he joined the Royal Air Force instead of the Royal Navy, though I realise the necessity for the RAF and am the last to condemn the requirements of the other Services. However, my hon. Friend would have been even more powerful, and this country would have been different, if he had joined me in the Royal Navy. Our friendship would not have had to wait so long to begin, until he entered the House.
Village schools were mentioned by my hon. Friend. I went to a village school myself. Despite coming from a strong Methodist family—I believe that you have similar religious connections, Mr. Deputy Speaker—I went to the small Church of England school, and it seemed to do me no harm. I learnt the 39 Articles, and that did me no harm. I always believed that we had an extra day's holiday on Ash Wednesday. That almost attracted me to the Church of England, which I joined later, when I was in the Royal Navy—like John Wesley, to bridge both worlds.
It was good to hear my hon. Friend commend the work done in the grammar schools and the old schools in his constituency, just as a headmistress commended the remedial work done elsewhere.
Becasue I was so impressed by my hon. Friend's speech, I feel that before long I must speak in his constituency. I shall not be surprised if I do so before many weeks pass. Just as I listened to him tonight, he will have to listen to me then.
As my hon. Friend knows, there is a long history to the current discussion of the reorganisation of secondary education in the Bournemouth and Poole areas. The 1976 Education Act was a typical example of the Labour Party's dogmatic approach. It is clear that Labour hon. Members are ashamed of it, as their absence shows. They are wearing sackcloth and ashes, feeling sorry for what was done in that Act.
The Act was a typical example of the Labour Party's dogmatic attitude to complex matters. It compelled local education authorities to submit schemes for comprehensive reorganisation, whether or not local people thought that comprehensive schools were right for their area, and whether or not local geography and existing school buildings meant that a comprehensive system was practicable.
I have served as the head of grammar, secondary modern and comprehensive schools. It is a question of having the right schools for the right area, depending on the circumstances, and then checking what they achieve. I am proud to have been a member of the Conservative Government who, as one of their first actions on taking office, put on the statute book the 1979 Education Act, which enabled those LEAs that had been forced against their will to submit proposals for comprehensive reorganisation to withdraw those proposals. What we were saying in effect was, "It is not part of the duty of central Government to impose a single form of organisation on every part of the country. There must be scope for flexibility, to respond to the different needs of different areas." That is part of the Conservative Party's political creed.

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It is from diversity that strength comes. The only way to build a dry stone wall is to have different shaped stones. Both my grandfathers were farmers, and they taught me that. That is when I began to believe in the free society and the variety of people. Just as one needs a variety of stones to build a good stone wall, to build a powerful society one needs people with all kinds of talents to develop it to the full. We do not want everyone to be alike.
The Dorset county council was one of the local education authorities compelled under the 1976 Act to submit comprehensive proposals for Bournemouth and Poole. It did so in 1978, and was able to take advantage of the 1979 Act to withdraw them.
However, in common with almost all authorities, Dorset is faced with falling pupil numbers over the next decade. I understand that in Bournemouth—we have debated this previously—secondary pupil numbers are projected to decline from about 8,900 in January 1980 to 6,400 by 1990. That is a fall of about 30 per cent. It will mean that there will be about 2,400 spare places in secondary schools in Bournemouth. The situation in Poole is similar, with secondary school population numbers falling from about 6,300 in January 1980 to 5, 100 over the decade, which would leave 1,200 spare places. I also agree with my hon. Friend that the decline in the number of children coming through is less here than in the remainder of the country.
Faced with a fall in numbers of this order, Dorset has decided to look at the options which are open to it for organising secondary provision in ways which will make better use of the resources available. It has issued a consultation paper and held a series of public meetings to discuss the various possibilities. I understand that the council expects to be considering the results of the consultation process from April. It does not see any possibility of changes to the organisation of secondary schools in either Bournemouth or Poole being implemented before 1986. Many things may happen before then, such as general elections. In four years we may have another Adjournment debate.
My hon. Friend may find it helpful if I explain the statutory procedures which Dorset would have to go through if it wished to change the existing pattern of provision. The procedures are laid down in the Education Act 1980. They are designed to ensure that no local education authority can simply ride rough-shod over the wishes of local people.
If an LEA proposes to establish, close or significantly change the character of a maintained school, it must publish proposals to that effect and submit them to my right hon. Friend. Once it has done so, there is a two-month period during which objections to the proposals may be submitted. A statutory objection is one made by 10 local electors, by the governors of a voluntary school affected by the proposals or by any other local education authority concerned. If objections are received, the proposals automatically fall to be decided by the Secretary of State. He may in any case call proposals in for his decision if that seems appropriate. All voluntary school proposals are decided by the Secretary of State.
That should make clear to my hon. Friend why I cannot comment in detail on the options being canvassed by Dorset. If it decides to proceed with the reorganisation proposals for Bournemouth and Poole, it is likely that, one
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way or another, the proposals will come to the Secretary of State for decision. My hon. Friend may even have hinted at that. My right hon. Friend therefore has a quasi-judicial role in the process. I have to take care not to seem to be prejudicing his decision by comments that I offer this evening.
However, I believe that my hon. Friend may find it helpful if I say something about the considerations that the Secretary of State bears in mind when reaching a decision on proposals for secondary reorganisation. In the first place, we recognise the tremendous difficulties presented by the sharp fall in the number of pupils. Many authorities simply find themselves with too many schools. Indeed, we estimate that it costs £100 per head to keep empty places in schools for heating, lighting and maintenance.
If we leave things as they are, we may find in some cases that classrooms are half-empty, teaching groups are uneconomically small and schools with few pupils cannot afford sufficient teachers to offer a balanced curriculum with a sufficient range of speciallised subjects, such as the sciences and modern languages. Rationalising provision by removing places surplus to present requirements therefore offers an opportunity to maintain the quality of education in two ways—by making it easier to protect the broad curricullum which we wish to see—and by releasing scarce resources which can be better used on books and teachers than on heating, lighting, cleaning and maintaining half-empty buildings. The Government said as much in a circular which we issued to LEAs last June.
However, the purpose of any reorganisation which flows from this process must be to ensure that existing educational opportunities are maintained, and, if possible, improved. There have been too many examples in the past of good—even excellent—schools being destroyed for the sake of an apparent rationalisation or the uniformity of provision. A school can be destroyed overnight, but it takes a long time for a successful school to be built up. Too often, the hopes and claims for the advantages of the new system have not been realised, and the net effect of some reorganisation schemes has been to reduce opportunity. My hon. Friend referred to the many changes in education over the past 20 years which did not meet the claims made for them before they were brought in.
For this reason, the Department is in the process of consultation on a draft circular setting out for authorities three policies which the Secretary of State will particularly take into account from now on. Most prominent among them is the need to retain what has proved its worth within the existing system of secondary education. The Secretary of State will not normally approve proposals which would result in the closure or a significant change in the character of schools which have demonstrated their success in the provision that they make for sixth form education, and which in his judgment can continue to do so. The exception that we make is where the prima facie case for retaining such a school is overwhelmed by other compelling educational considerations.
The draft circular also makes clear the Secretary of State's view that
"proposals should have particular regard to parental preference, on religious or other grounds, for maintaining opportunities for the education of pupils in single sex schools"
where it is obvious that there is parental demand. Finally, it emphasises the need to allow sufficient time for proposals to be implemented. We are thinking not only of those pupils who will experience the reorganised system

867
when it is fully in operation, but also of those caught up in the process of reorganisition. It is vital that LEAs plan to avoid disruption to those pupils' education. We are very concerned about parental choice of school, and we campaigned in the general election on parental choice of school. It is something in which my hon. Friend and I totally believe. Parents in the area give a vote of confidence or no confidence in the school. After all, the parents are risking the lifetime of their own children; they are not experimenting with other people's children. It is their children who are going to the school.
A copy of the draft circular has been placed in the Library if my hon. Friend is interested to look at it—not necessarily tonight, but at some future time—and we have asked for comments from interested bodies by the end of this month.
Naturally, the Secretary of State looks very carefully at all proposals which come before him, and the policies that I have just mentioned are taken into account along with a detailed study of the educational, financial and social implications of the proposals, before he decides whether to approve them, with or without modification. We also pay a great deal of attention to any points made by objectors. Indeed, there was a certain amount of objection
868
in what my hon. Friend said tonight. After all, they are local people who will be affected by the proposals: not only do they have a right to be heard—my hon. Friend will know that I spend much of my life meeting deputations concerned about particular proposals—but also they are likely to offer valuable insights into the effects of the proposals, and difficulties that may not be obvious at first sight.
In the end, however, the Secretary of State has to balance against each other the advantages and disadvantages of proposals. These are rarely as clear-cut as one would like, but I can assure my hon. Friend that the Secretary of State would not approve any proposals which he was convinced would be to the educational disadvantage of the children concerned.
I hope that what I have said this evening will have been helpful to my hon. Friend and to his constituents, and that he will have been reassured as to the care which we will take in looking at any proposals which may come before us from his area or from any other area.
Question put and agreed to.
Adjourned accordingly at eighteen minutes past Twelve o'clock.

TRADE
  Manufactures
  Manufactures
  Balance of Trade
  Balance of Trade
  Petitions
  Petitions
  "The Sunday Times"
  "The Sunday Times"
NATIONAL FINANCE
  Pensions, Severance and Termination Grants
  Pensions, Severance and Termination Grants
  Civil Service (Executive Officers)
  Civil Service (Executive Officers)
  Medical Schemes (Tax Relief)
  Medical Schemes (Tax Relief)
  Public Corporations (Wages and Salaries)
  Public Corporations (Wages and Salaries)
  Value Added Tax
  Value Added Tax
  Medals and Coins
  Medals and Coins
  Tax Revenue (Cinema Tickets)
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  Gaming and Amusements Machines
  Gaming and Amusements Machines
  Corporation Tax
  Corporation Tax
  Smoking and Alcohol Consumption
  Smoking and Alcohol Consumption
  Economic Statistics
  Economic Statistics
  Income Tax
  Income Tax
PRIME MINISTER
  Quangos
  Quangos
  NATIONALISED INDUSTRY BOARDS
  NATIONALISED INDUSTRY BOARDS
  Engagements
  Engagements
  Trades Union Congress
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WALES
  Pay Beds
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  Housing Development Programme
  Housing Development Programme
  Assistance to Industry
  Assistance to Industry
  Private Hospitals
  Private Hospitals
  Advance Factories
  Advance Factories
HOME DEPARTMENT
  Young Offenders
  Young Offenders
  Fines and Maintenance Defaulters
  Fines and Maintenance Defaulters
  Police Officers (Motoring Offences)
  Police Officers (Motoring Offences)
  Immigrants (Appeal Tribunals)
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  Prison Regime
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  Commission for Racial Equality
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  Crime Statistics (Cheshire)
  Crime Statistics (Cheshire)
  Disabled Persons (Charities)
  Disabled Persons (Charities)
  Amusement Machines
  Amusement Machines
  Smoking and Alcohol Consumption
  Smoking and Alcohol Consumption
FOREIGN AND COMMONWEALTH AFFAIRS
  Hong Kong (New Territories)
  Hong Kong (New Territories)
  El Salvador
  El Salvador
NORTHERN IRELAND
  Royal Ulster Constabulary
  Royal Ulster Constabulary
ENERGY
  Offshore Safety
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  Bulk Electricity Supply Tariffs
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  Coal Stocks
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INDUSTRY
  Petrochemicals and Plastics Industry
  Petrochemicals and Plastics Industry
  Advance Factories
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  Aid to Industry
  Aid to Industry
  Industrial Development Certificates
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  Smoking and Alcohol Consumption
  Smoking and Alcohol Consumption
  Northern Region
  Northern Region
ENVIRONMENT
  Local Government Expenditure
  Local Government Expenditure
  Owner-occupiers
  Owner-occupiers
  Dangerous Excavations
  Dangerous Excavations
  Weather Damage (Costs)
  Weather Damage (Costs)
  Rent Arrears (Recovery)
  Rent Arrears (Recovery)
  Building Regulations (Insulation)
  Building Regulations (Insulation)
  House Building
  House Building
  Rents and Rates
  Rents and Rates
TRANSPORT
  Car Sharing (Risks)
  Car Sharing (Risks)
  Road Construction
  Road Construction
  Piccadilly Line (Heathrow Airport)
  Piccadilly Line (Heathrow Airport)
  Accidents (Alcohol Consumption)
  Accidents (Alcohol Consumption)
  Newcastle upon Tyne (Western Bypass)
  Newcastle upon Tyne (Western Bypass)
  Cycling Policy
  Cycling Policy
ATTORNEY-GENERAL
  Divorce Laws (Reform)
  Divorce Laws (Reform)
AGRICULTURE, FISHERIES AND FOOD
  Common Agricultural Policy
  Common Agricultural Policy
  Public Bodies (Appointments)
  Public Bodies (Appointments)
  Non-payment of Debts (Newcastle upon Tyne)
  Non-payment of Debts (Newcastle upon Tyne)
  Food Prices
  Food Prices
  "Lichen on Farm Roofs" (Report)
  "Lichen on Farm Roofs" (Report)
DEFENCE
  Trident
  Trident
  Soldiers (Costs)
  Soldiers (Costs)
  Obsolete Nuclear Weapons
  Obsolete Nuclear Weapons
  HMS "Invincible"
  HMS "Invincible"
  HMS "Endurance"
  HMS "Endurance"
  Surplus Land
  Surplus Land
  HMS "Dreadnought"
  HMS "Dreadnought"
  Northern Ireland
  Northern Ireland
  Royal Air Force
  Royal Air Force
  Apprentices
  Apprentices
  Signals Research and Development Establishment
  Signals Research and Development Establishment
  Hawk Jet Training Aircraft
  Hawk Jet Training Aircraft
EMPLOYMENT
  Unemployment Register
  Unemployment Register
  Alsager
  Alsager
  Professional and Executive Recruitment
  Professional and Executive Recruitment
  Foreign Nationals
  Foreign Nationals
  Northern Region
  Northern Region
  Unemployment, Training and Early Retirement
  Unemployment, Training and Early Retirement
  Crown Employees
  Crown Employees
  Factory Closures and Redundancies
  Factory Closures and Redundancies
  Unemployment Statistics
  Unemployment Statistics
  Community Industry
  Community Industry
  Young Persons
  Young Persons
  Newcastle upon Tyne
  Newcastle upon Tyne
SOCIAL SERVICES
  Doctors
  Doctors
  Pensions and Allowances
  Pensions and Allowances
  North Staffordshire (Aftercare Facilities)
  North Staffordshire (Aftercare Facilities)
  Renal Dialysis
  Renal Dialysis
  Benefits
  Benefits
  Community Health Councils
  Community Health Councils
  Maternity Allowance
  Maternity Allowance
  Cervical Cytology
  Cervical Cytology
  Surrey (Hospital Services)
  Surrey (Hospital Services)
  Smoking and Alcohol Consumption
  Smoking and Alcohol Consumption
  Infant and Perinatal Mortality
  Infant and Perinatal Mortality
  Family Income Supplement
  Family Income Supplement
  Contaminated First-aid Dressings
  Contaminated First-aid Dressings
  Private Nursing Homes
  Private Nursing Homes
SCOTLAND
  Public Expenditure
  Public Expenditure
  Housing Revenue Account Capital Allocations
  Housing Revenue Account Capital Allocations
  "Scottish Local Government Financial Statistics"
  "Scottish Local Government Financial Statistics"
  School Books (Expenditure)
  School Books (Expenditure)
  Ashkirk (Trunk Road Lighting)
  Ashkirk (Trunk Road Lighting)
  Unemployed Persons (Glasgow)
  Unemployed Persons (Glasgow)
  Roads (Tree Planting)
  Roads (Tree Planting)
  Prison Regime
  Prison Regime
  Cystic Fibrosis
  Cystic Fibrosis
  Rent Rebate
  Rent Rebate
  Building Regulations (Insulation)
  Building Regulations (Insulation)
  Motorways
  Motorways
  Advance Factories
  Advance Factories
  Regional Development Grants
  Regional Development Grants
  Museums and Galleries
  Museums and Galleries
  Animal Breeding Research
  Animal Breeding Research
EDUCATION AND SCIENCE
  London Theatres (Support)
  London Theatres (Support)
  Higher Education Committee and Board (Appointments)
  Higher Education Committee and Board (Appointments)
  Science Parks.
  Science Parks.

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

Business Confidence
Lord Gisborough: 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 there are any signs of a return of business confidence.
The Minister of State for Defence Procurement (Viscount Trenchard): My Lords, the results of the last three CBI Quarterly Industrial Trends Surveys taken together indicate some modest strengthening of business confidence. This, together with the rise in output since the second quarter of 1981, especially in manufacturing industry, suggests that a gradual recovery in economic activity is under way.
Lord Gisborough: My Lords, I thank my noble friend the Minister for that Answer. Can he give an indication of the figures on output for 1981 and how they compare with perhaps those of some of our industrial competitors? Can my noble friend say whether the rise in the chemical industry's output is a significant factor towards an approaching increase in demand?
Viscount Trenchard: My Lords, the figures of increase in output in the third quarter were some 2½ per cent. up on the previous level, and there has been an increase since that time. As I mentioned before Christmas in an Answer to another Question, this modest increase in output has meant a very significant increase—some 10 per cent. from the low point—in productivity or output per man. These increases, both in output and in productivity, are ahead of our main industrial competitors. I am afraid that I did not quite hear the last part of my noble friend's supplementary question.
Lord Gisborough: My Lords, I thank my noble friend for that answer. I asked him whether he considers the increase in the output of the chemical industry to be a strong indicator.
Viscount Trenchard: My Lords, the chemical industry has had a share of the increase, and the engineering industry has also had a share of the increase, with particularly good export orders.
Lord Paget of Northampton: My Lords, the noble Lord's Question refers to:
" … a return of business confidence ",
but he does not say business confidence in what. Surely it is not suggested, in the Government?
Viscount Trenchard: My Lords, I think that there is an increase in confidence in the future, and an increase in confidence that the policies of this Government will lead to a real improvement in our competitive position.
Lord Mackie of Benshie: My Lords, can the noble Viscount say from what level that increase started?
Viscount Trenchard: My Lords, after a loss of half British industry's share of world markets since 1960, confidence was low. The result of this loss of share of markets due to lack of competitiveness showed up only when world growth stopped. But confidence from that accumulated low—accumulated under Governments of both parties over a long period—is now being dispersed.
Lord Glenkinglass: My Lords, will my noble friend not agree that it is not only the engineering industries who have had a very good increase in exports, and has this not stimulated some confidence in business?
Viscount Trenchard: My Lords, yes. Indeed, during the most difficult periods, the maintenance of very low margins on our export position showed the determination of British industry, and, with a more competitive position now, those who stuck to the export markets are receiving their rewards.
Lord Molloy: My Lords, will the noble Viscount agree that perhaps a lowering of the bank rate and other interest rates would enhance the confidence of the small businessman who, I believe, has a magnificent contribution to make; and that, if this is announced early, it would make some contribution to easing the fear of the nation, when today the highest figure for unemployment ever recorded has been announced?
Viscount Trenchard: My Lords, I believe that small business confidence is improving. Interest rates will be kept no higher than is necessary in the continuing battle against inflation. On the unemployment figures, I do not think that anyone expected the peak to have yet been reached, but unemployment trends follow economic trends, and the rate of increase of unemployment is already substantially lower than it was this time last year.
Lord Bruce of Donington: My Lords, is the noble Viscount aware that we on this side of the House very much welcome the fact that there has been an increase of 2½ per cent. in output from the low level to which it has sunk? But is he aware that since May 1979 industrial production—manufacturing production—has declined by 16½ per cent., and this still leaves the odd 14 per cent. to go?—and one would hope for rather more significant signs than the noble Viscount has been kind enough to give so far.
Viscount Trenchard: My Lords, as I have already said, the reason for the lowering of manufacturing output prior to this rise was based on the loss of world market share, from nearly 20 per cent. in 1960 to 8½ per cent. in the late 1970s. This showed up only when world growth of the most spectacular level came

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to an end. That is the reason that the troubles of non-competitiveness did not show much earlier.
Lord Leatherland: My Lords, if the prospects are as bright as he suggests, may I ask the noble Viscount why the Government are selling their investments in British industry?
Viscount Trenchard: My Lords, if the noble Lord will table a Question on which particular industries he has in mind, I am sure we will answer it. The confidence is rising, but I do not want to give an impression that we believe there is going to be a very fast rise in economic activity. With the winter we have just had there is bound to be a small change.

Palme Commission: Arms Sales Recommendations
2.45 p.m.
Lord Brockway: My Lords, I beg leave to ask the Question which stands in my name on the Order Paper.
The Question was as follows:
To ask Her Majesty's Government what is their response to the recommendations of the Olaf Palme Commission on Disarmament and Security on the limitation of arms sales by:

1. a United Nations public registry of deliveries of conventional arms;

2. bilateral talks between the Soviet Union and the United States on conventional arms transfers, and

3. regional security arrangements among recipients of arms transfers.

The Parliamentary Under-Secretary of State, Foreign and Commonwealth Office (Lord Trefgarne): My Lords, the Palme Commission has not yet reported, but when it does the Government will give the commission's recommendations careful study.
Lord Brockway: My Lords, while thanking the Minister for that reply, may I ask whether he is aware that the commission has already made the proposals which I indicated in my Question? While there is major concern about nuclear weapons, is not the increase in the arms trade, arms of conventional technology, also a matter of concern? Is it not particularly serious for the third world countries who should be using, their expenditure for agricultural development and lifting the standards of life for their people? Will Her Majesty's Government support these proposals at the renewed United Nations' assembly on disarmament next year?
Lord Trefgarne: My Lords, it is true that some of the suggestions trailed in the noble Lord's Question have been the subject of press releases, I think, by the commission, but it is too early yet to give a detailed response to these. We shall certainly be ready to do so as soon as the report appears and we have had a chance to study it. I understand that that will be in time for
858
the second special session on disarmament, which is to take place in New York later this year.
Lord Peart: My Lords, is the Minister aware that today in the Herald Tribune there is a fairly full account of the attitude of General Haig, and a welcome that Gromyko has also agreed to have discussions on this? We have dealt with SALT in many debates, so I shall not press the matter, but I hope that the House will be kept informed of progress.
Lord Trefgarne: My Lords, I shall certainly be very willing to answer appropriate questions on this matter which your Lordships may see fit to table. If the noble Lord is referring to the talks which I think are taking place today in Geneva between Mr. Gromyko and Mr. Haig, then we are certainly watching those with great interest.
Lord Brockway: My Lords, will the Government reconsider their decisions to hold exhibitions by 140 armament companies in this country, inviting third world countries to send representatives to buy arms? Is not that a direct incentive to divert to the arms race expenditure which is needed to end disease, starvation and illiteracy in those countries?
Lord Trefgarne: My Lords, may I just make two points about our attitude to arms sales in general? The first one is that we would not seek to restrict the ability of other Governments, be they third world or any other, to acquire such arms as they may properly require for their defence. We naturally take a strong view about arms being sold for what the noble Lord has referred to as " repressive purposes " from time to time. As the noble Lord and the House will recall, we do license each and every sale of arms of this kind, and indeed any other kind, and so they cannot be regarded in the same light as commercial sales of other categories.

The Fishing Industry: Government Aid
The Earl of Kinnoull: 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 moneys are at present allocated to research work concerned with the fishing industry, what funds in the last year have been made available in support of the trawler fleets, and what support is given by other EEC member countries in support of their competing trawler fleets.
The Minister of State, Scottish Office (The Earl of Mansfield): My Lords, in the current financial year the full economic costs of the National Programme of Fisheries Research and Development for the United Kingdom are estimated to be £22·9 million, of which two-thirds is directly or partly related to the needs of the fish catching industry. The remaining third includes expenditure on the aquatic environment, fish cultivation and freshwater fisheries. In addition,

859
the Government have made more than £38 million of aid available directly to our fishing fleet this financial year.
It is not possible to give direct comparisons with the aid which is given in other member states. However, there is a report, which was compiled by officials and industry representatives and which was placed in the Library of the House in June of last year. This sets out the information which was then available.
The Earl of Kinnoull: My Lords, I am grateful for my noble friend's longish Answer. Would my noble friend accept that other members within the EEC definitely support their industries with such things as fuel subsidies? Would my noble friend consider a fuel subsidy to assist the industry? Can my noble friend confirm that of the very substantial funds that have been made available to the industry, for which I am sure the industry is grateful, at least half goes to one or other of Her Majesty's Government's agencies, or to administration, or to harbour works, and only half goes to the industry?
The Earl of Mansfield: My Lords, the rather long Answer to which my noble friend referred was in answer to a tripartite Question. Other countries in the European Community do indeed give national aid to their fleets. We do not claim to have comprehensive information on such aid and it is particularly difficult to make meaningful comparisons between different countries. That is because the fleets are differently constituted, differently sized, and Governments have different policies on aid to fishing which can be paid, as my noble friend illustrated, in different ways, such as regional grants, free harbour facilities and even sometimes aid towards fuel costs. Her Majesty's Government have set their face against making an artificial price for fuel, which is not confined to the fishing industry but applies to many other industries as well. The reply to the last part of my noble friend's supplementary questions is, no; the aid which we made available to help keep our fishing fleet stable was, for the most part, paid out to the skippers of the various boats involved.
Lord Cledwyn of Penrhos: My Lords, does the Minister agree that the confidence of the British fishing industry has been badly shaken? Would he agree that one solution would be to ensure that the industry had a reasonable quota, a fair percentage, of total allowable catches? The industry has itself mentioned a figure of 45 per cent. Can the Minister say whether any progress is being made by Her Majesty's Government in obtaining a reasonable quota for our industry? May I further ask the noble Earl to say whether Her Majesty's Government see any future role for the distant water fleet of the British fishing industry?
The Earl of Mansfield: My Lords, the confidence of the fishing industry is not all one might hope for in the circumstances, because so much depends on the successful negotiation of a fair common fisheries policy which will provide an equitable means for the fishing industry of this country to fish, as I say, in
860
peace and profit, and it is to that end that the efforts of Her Majesty's Government have been directed during the last two wearisome years. We are indeed very conscious that it is only just that the British fishing industry—which operates in that part of the North Sea around our coast where a great deal of the immature fish come from—should have an equitable proportion of the fish and a fair share of fishing opportunity. This is what we have been striving to achieve in the negotiations.
The problems of the deep water part of the industry are of course rather different from those of the inshore part. They have been denied the fishing opportunity from places such as Iceland and the north coast of Norway. Those are different problems from those we face in relation to our Common Market partners, but the Government have certainly been conscious of their particular difficulties and have done their best to see that there has been a fair distribution of aid.
Lord Cledwyn of Penrhos: Can the noble Earl comment on the progress of the negotiations, my Lords?
The Earl of Mansfield: My Lords, as the noble Lord will be well aware, one of the countries of the Nine with some particular interest in fishing has had a somewhat inconclusive general election, and there is no doubt that that has, as it were, brought the negotiations to a halt. Her Majesty's Government are working extremely hard at the moment both by bilateral negotiations with some of our other Community partners and by making representations both to the Commission and to the Belgians, who now hold the chair, and it is to be hoped that further negotiations at Council of Ministers level will recommence before very long.
Lord Campbell of Croy: My Lords, on the original question of research, may I ask my noble friend whether further experiments are being sponsored into the catching of species such as blue whiting and grenadier, which frequent deeper water than other stocks and which can be caught normally only by new methods and not the traditional methods of fishing?
The Earl of Mansfield: My Lords, continuous experimentation is going on in relation to these previously less than popular varieties of fish. In fairness to my noble friend, I should tell him that at present the research is slanted more to what to do with the fish once one has got it rather than to the catching of it.
Lord Mackie of Benshie: My Lords, is the noble Earl able to say what is being done about the marketing of the fish? I understand from fishermen that the costs are too high and the prices too low. The Minister of Agriculture is always talking about marketing and farming. May we be told how much of this money is being devoted to marketing fish?
The Earl of Mansfield: My Lords, my right honourable friend the Minister of Agriculture set up a committee of his " wise people ", as they have been called, who produced a challenging and entertaining report on the marketing of fish in this country. Their recommendations have been considered both by the various

861
departments of Government and more especially by the new Sea Fish Industry Authority, which the Government have just set up to take over the functions which were formerly performed by the White Fish Authority and Herring Industry Board; and I know that the chairman of the authority is actively considering ways of improving the marketing of fish in this country.
Lord Harvey of Prestbury: My Lords, is my noble friend aware that Britain has come off far worse than other EEC countries and that at the present rate of deterioration there will not be a British deep sea fishing industry unless something is done very soon?
The Earl of Mansfield: My Lords, I regard that view as unduly gloomy and unjustified.
Lord Parry: My Lords, will the Minister admit that the Welsh deep sea fishing industry was a classic example in that it was a classic case of over-fishing by foreign rivals with lower net mesh sizes which cleared the hake away from the traditional Welsh fishing grounds and led to the demise of the industry there?
The Earl of Mansfield: My Lords, the noble Lord reinforces the points about the conservation of fish stocks and the limitation of fishing opportunity which is accorded great priority by Her Majesty's Government. One of the few areas where there has been general agreement as between our partners in the European Community is that without a sensible and enforceable conservation régime there will be no fish left to catch.
Lord Paget of Northampton: My Lords, is not the real problem—
The Chancellor of the Duchy of Lancaster (Baroness Young): My Lords, we have spent nearly nine minutes on this Question. I suggest that after we have heard the noble Lord, Lord Paget, it will be time to move on to the next business.
Lord Paget of Northampton: My Lords, is not the real problem with the fishing industry that it is far too efficient and that its efficiency has practically eliminated the fish, so that our energies should be exercised towards obtaining international agreement to reduce that efficiency?
The Earl of Mansfield: In a philosophical manner of speaking, my Lords, I think the noble Lord is right; the modern fishing boat, with all the electronic methods and aids available to the skipper, is a totally different craft from those of only 10 or 15 years ago. I agree with the noble Lord to that extent, but it comes back to the point that we must have a sensible conservation régime, that it must be properly enforced, and that we must have an allocation of quotas and access which will prevent these over-efficient boats from taking more than their share.

Business
Lord Denham: My Lords, it may be for the convenience of your Lordships if I announce that dinner will be available today at the usual time. The Committee stage of the Civic Government (Scotland) Bill will be adjourned at approximately 7 o'clock for a short period, and during this adjournment the Committee stage of the Civil Aviation (Amendment) Bill will be taken.
Lord Glenamara: My Lords, are we not to have a Statement today on the appalling crisis in the nation's social and economic life, with the rise in the unemployment figure to over 3 million, telling us what the Government propose to do about it?
Lord Denham: My Lords, the noble Lord will be well aware of the rules governing Statements in this House.
Lord Glenamara: I am, my Lords. That is why I asked the question.

Currency Bill
2.59 p.m.
The Minister of State, Treasury (Lord Cockfield): My Lords, I beg to move that this Bill be read a second time. This I suspect is the shortest and least controversial Bill which your Lordships are likely to be troubled with this Session. It consists of one clause of five lines, and a Short Title.
When the coinage was decimalised in 1971, under the terms of the Decimal Currency Act 1967, it was decided to retain the penny. Some of the ancient descriptions, such as " shilling " and " florin " vanished for ever. But " penny " was retained; otherwise the English language would have been poorer, and phrases such as " a penny for your thoughts " would have gradually lost their meaning. Indeed I find that the Oxford Dictionary of Quotations lists no less than 14 quotations referring to the penny. One of these, from The Gondoliers, reads: " Dukes were three a penny ". I suspect that that was not intended as a prophetic reference to attendance at today's debate.
But the decimal penny was worth 2·4 of the old pennies. So it was necessary to distinguish it, and this was done by describing it as a " new penny ". Now, 11 years later, even the most conservative of us have become accustomed to the new penny as the ordinary unit of coinage, and few people now use the full title " new penny ". The time has therefore come when the law might suitably be brought into accord with popular practice. The Bill therefore permits the use of either the term " penny ", or " new penny ". On new coins it is now intended to use the description " penny ", but it is necessary to preserve in law the description " new penny " to ensure that existing coins continue to comply with the law.
The immediate reason for the Bill is that we hope shortly to issue a 20 penny piece. This requires a Royal Proclamation, which is dependent of course on the passage of the Bill. My Lords, therefore I beg to move.
Moved, That the Bill be now read a second time.—(Lord Cockfield.)
3.2 p.m.
Lord Bruce of Donington: My Lords, the House will appreciate the non-controversial terms in which the noble Lord has introduced the Bill, and I am very happy to inform him that I am in complete unanimity with him, perhaps uniquely, owing to the fact that the Bill, including the preamble, occupies only 10 lines. Of course I cannot give hostages to the future, but it would appear to us on this side of the House most unlikely that there will be a protracted Committee stage, or many amendments to the Bill, and it is reasonable to suppose that the Report stage and Third Reading will go through with the minimum of delay.
The noble Lord has referred to a part of the history of decimalisation. I was reminded of it today when I tried to equate the price of some of the things that we now buy with the price that we paid in old currency in 1971. The cost of living, according to the cost of living index, as adjusted, shows that prices in general have risen to four times the level they were at when decimalisation was introduced. I am happy to report that The Times, now at 20 pence, is exactly four times what it was in 1971. I regret that the same cannot be said of the Daily Express, which originally cost 6 pence, and is now six times the price it was in 1971.
It is important to realise that decimalisation in this country was achieved at some cost. There have been some advantages to it, many advantages, of which your Lordships are well aware; but there were certain disadvantages at the time of its introduction. Many of us recall that the abrupt repricing of many items, in particular those that were lower-priced in old pence, gave rise to a certain amount of confusion early on, and in terms of working-class budgets made a significant addition to household expenses in the earlier part of the scheme. For example, one found that potatoes that cost 4 old pence a pound were marked up to 2 new pence, which was an increase of 20 per cent., or even to 3 new pence, which was an increase of 87 per cent. In those days there were many cases where ordinary working people suffered to a considerable extent by reason of the completely unjust up-pricing of goods on decimalisation. At the same time wages and pensions were precisely calculated.
Therefore it is important to remember that decimalisation was achieved at a cost. There can be no doubt that the earlier stages of decimalisation, imposing very heavily upon the incomes of old-age pensioners and of the workers generally, gave a powerful impetus to inflation. I do not think that the noble Lord in retrospect would deny that.
But decimalisation has produced advantages. There is no question but that it has aided commerce and simplified accounting. In saying that it has simplified accounting I have a slight unease because nowadays few people, including school children, go about without their pocket calculators, to which the new decimalisation gave a considerable impetus. It is for consideration as to whether decimalisation, leading to the very widespread use of calculators in their modern form, has caused a certain degree of laziness among people who would normally have to calculate. It is for consideration as to whether we are in fact now more numerate than we then were, and I would doubt it.
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Nevertheless decimalisation has brought considerable advantages.
When decimalisation was introduced many of us hoped—and I believe that the view was shared on the other side of the House—that it would have been wiser had we chosen the 50 pence unit, or the old 10 shillings unit, instead of the old pound sterling as the new unit. But I gather that the prestigious pressure emanating from the City of London, that promised all kinds of dire things unless the sacredness of the pound sterling was preserved, operated to influence the Government of the day, who happened to be a Government from my own party. But personally I think that perhaps it would have been far better had we adopted the old unit. Certainly it would have made the new penny a smaller unit and would have led to far less abuse in the early stages. But decimalisation is now with us, it is now successfully in operation, and aside from the slight misgivings that I have about the likelihood that, in general, we as a nation are not quite as numerate as we were, it is probably a very good thing indeed. There is certainly nothing in the Bill that would make me wish to detain your Lordships further on the matter.
3.9 p.m.
Lord Davies of Leek: My Lords I should like to ask a question arising from mention of the penny. Of course I am delighted that we are getting back the old term. I remember that as young schoolboys in West Wales every New Year's Day we used to go around the farms to get a bright new penny with the new year's date on it. Why is the penny not bigger than it is? Secondly, why has not something been said about the horrible, tiny coin, which arthritic old-age pensioners cannot handle, the half-pence? These coins are scattered in the gutters of Britain. Old people are unable to pick them up. I have seen them drop halfpence pieces on buses and not bother to pick them up. Surely something should be done about this. It must be costing Britain a fortune. A lady I know who is in the Women's Institute cadges off me every ½p I have. When I said, " What do you want them for? ", she said, " Every time I fill a matchbox with them I get ten shillings for the Women's Institute "; it amounts to that.
Despite his far-seeing introduction to this Bill today, what is the noble Lord going to do about that horrible coin the ½p; and why cannot the modern penny be bigger than it is? I will not quote a Welsh folk song about pennies, but I am delighted that something is being done to get rid of those horrible expressions " half p's " and " p's " from our economic language.
The Earl of Selkirk: My Lords, may I ask the noble Lord a question? First, how do you pay for a gallon of petrol which costs 159·9p? If it cannot be met by a coinage, is it improper to advertise it as such, or is it even illegal? Secondly, may I ask the noble Lord whether he is now envisaging a £1 coin? Have we reached that stage, and is this in the Government's mind?
Lord Harvington: My Lords, I rise to make what may seem to your Lordships quite a small point, and it may well have been made in the past when the de-

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bates on the former Bill took place. We have always been a country which has respected and valued tradition, and none of your Lordships, I am sure, takes a great liking to having a cheque returned marked" R.D." I have had three cheques returned marked " R.D." because when writing the sum of money I put " d " after the figure, instead of " p ". I was told by the bank that they were not prepared to accept the cheque unless the letter " p " succeeded the figure, and not " d ".
I think that is rather a poor show, and if it is going to catch on at all I think your Lordships and many others will get very vexed indeed. I wonder whether it would be possible, either to make a statement to banks through the Bank of England or, perhaps, to put something in the Bill to say that the letter " d ", signifying the old Roman denarius, in which we in this country dealt for about four centuries and which was one of the few links between us and the Roman occupation which were still in constant use, should be recognised as the proper denotation of what should appear after the pence figure; not that the " p " should be ruled out as making the cheque invalid, but that " d is the proper form.
Lord Hawke: My Lords, may I ask my noble friend one question? I have a bag of coins in a drawer labelled " One penny ". May I start to use them after the passage of this Bill?
Lord Harvington: My Lords, I am afraid I cannot answer for Her Majesty's Government but I am sure that you cannot because they are not part of the currency of the country today, and have been withdrawn.
3.14 p.m.
Lord Cockfield: My Lords, I am most grateful to the noble Lord, Lord Bruce of Donington, for his general welcome to the Bill, and for the suggestion he makes that the subsequent stages might well be expedited through your Lordships' House. As he himself was so generous to admit, the original Act of 1967 was of course passed by a Government which had the honour of being supported by him, and the points he raised were of course debated at very great length at that time. These are battles long since fought and won or lost, and I do not think that at this stage, however interesting these matters are, there is any question of them being re-opened now.
I noted what the noble Lord said about prices having increased four times since February 1971, and indeed I confirm that that in fact is the position. But, of course, there have been two Governments in power since then, and the Labour Government share some responsibility for the increase in prices which has occurred, although we all on both sides of the House greatly regret that it should be as great as it has been.
My noble friend Lord Selkirk raised the very difficult question of how you pay for petrol which is denominated in terms of decimal points of a penny. I am afraid that this goes outside the scope of this Bill. There has been a great deal of argument about this. The smallest coin we have is the much-maligned ½p. We do not have, and have no intention of producing, a
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coin equal to one-tenth of a penny. My experience is that it is much better to fill your tank to a figure such as £5, £10 or, in these days, even £20 than to concern oneself with tenths of a penny.
My noble friend also asked what is happening about a £1 coin. The intention to issue such a coin was announced early last year, and details of its general specification were given by my right honourable friend the then Financial Secretary to the Treasury in reply to a Question in another place on 31st July. The broad intention is that such a coin should be issued in April 1983.
The noble Lord, Lord Davies of Leek, asked why the penny is not bigger. Of course, most people object to the size and weight of the currency in this country as compared with the size of currency overseas. The complaint is that it wears holes in your pockets, although people fortunate enough to keep the money in their pocket long enough for it to wear a hole in it perhaps ought not to be complaining so loudly. But the general tendency is in the direction of lightening, not increasing, the weight of the currency. Indeed, the new 20p piece will in fact weigh, or is expected to weigh, five grammes only.
The noble Lord also referred to the question of the 1p piece. I have a considerable degree of sympathy with him because I in fact always discard the things immediately I receive them. Nevertheless, this opens up the possibility of people collecting these, as he suggests, and donating them to charity. The question of the continuation of this coin is kept under constant review. There still remains a considerable demand for it, and as long as that demand continues the Royal Mint feel that they need to meet it. The noble Lord will remember that in the comparable case of the sixpence this was ultimately discontinued when the public demand for it fell to such a degree it was no longer worthwhile keeping it. The old penny has now been demonetised, and cannot be used as legal tender. So far as Lord Harvington's problem is concerned, this seems to me to be essentially one between him and his bankers, and I would hesitate to intervene in that relationship.
On Question, Bill read a second time and committed to a Committee of the Whole House.

Civic Government (Scotland) Bill [H.L.]
3.18 p.m.
The Earl of Mansfield: My Lords, I beg to move that the House do now again resolve itself into Committee on this Bill.
Moved, That the House do now again resolve itself into Committee.—(The Earl of Mansfield.)
On Question, Motion agreed to.
House in Committee accordingly.
[The LORD ABERDARE in the Chair.]
Clause 23 [Second-hand dealers' licences]:
On Question, Whether Clause 23 shall stand part of the Bill?
Lord Ross of Marnock: This is a very important clause in a very important Bill. We have already covered, in the schedule, the whole general procedure in relation to licensing, and here we come to one of the first regulations in respect of certain trades that shall be required to have a licence in order to carry on business—provided, of course, that the district authority, the licensing authority, first passes a resolution to apply it. Here, this relates to second-hand dealers. A second-hand dealer is described as a person carrying on a business as a dealer in second-hand goods or articles of any description; but it leaves out pawn-brokers and certain people dealing in small quantities of materials. I do not know whether they realise it in Scotland, but once this resolution is passed and applied to them those people will be subject to a very considerable burden of paperwork. They are going to have to keep records about the time and date that an article is acquired, a description sufficient to identify it, the price paid, the name and address of the person from whom acquired, when it is sold, and to whom.
Bearing that in mind, we shall have to look at who are involved. I do not know what noble Lords think about second-hand dealers. Perhaps they think of the junk shop type of person. But everyone who sells a painting, apart from one that is very modern, is dealing in second-hand goods. People who buy stamps are dealing in second-hand goods. There are people who buy second-hand books and many book-sellers have departments for second-hand books, and it may be that, like me, many of your Lordships have prowled around them and have picked up books here and there. Nobody has asked me for my name and address and I have not asked the dealer from where he got them and when he got them and the time. But when you think of it, people who buy second-hand books do not usually buy them for resale; they do not usually buy them as single books but probably by the shelf-full or they buy a whole lot, perhaps at a sale in some house. Somebody who wants to get rid of a library will sell the lot. But every single item has later to be handled in a particular way. The thing is nonsense when applied to certain of the second-hand dealers in antiques, clothes, stamps, books.
Once the resolution is passed, is there any flexibility left to the local authority to leave out of account certain of the second-hand dealers; or have all the provisions to be applied and also the following clauses about keeping records of stock-in-trade, and of limiting the sales? Stock has to be kept for, I think, 72 hours before it can be sold. It is really silly when you apply it to the practice of different businesses. I had a complaint today about English metal dealers who in the present circumstances arc looking very much for orders for export. To be told that the scrap that they bring in must not be processed and sold for 72 hours is something that they regard as an infringement of business practice. But the point is that at the moment most of these people in Scotland do not know what is going to hit them.
I want to ask the Government whether, in regard to their definition of second-hand dealer, they have even thought of this particular problem. Imagine a boy going into a stamp shop, asking for a packet of stamps and paying perhaps 50p for it. Every single stamp must be detailed as to where it was bought and when
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it was bought before it was packaged by the stamp dealer. It is really a nonsense. I hope that the Government appreciate the difficulties they are going to get into with this generic term of second-hand dealer. I know a number of booksellers. There was one who was my colleague in the other place for a long time, George Willis. When I was in Edinburgh recently he put the problems to me. We have had quite a few Members of Parliament who dealt in second-hand books. Sir Will Y. Darling was another. I wonder what nonsense he would have produced to laugh this kind of thing out of court when applied to second-hand bookshops.
It is not good enough to pass this and the previous clauses and then face up to the difficulties later on. I am going to suggest later on that some flexibility be given to local authorities to leave out of account certain types of business in respect of these provisions. I know the arguments. This is to put a deterrent on theft and the fencing off of goods which have been taken from houses, shops and elsewhere. But, frankly, I think it will be a considerable burden on certain second-hand dealers that is unmerited by the facts of their business and the procedure will prove more troublesome than helpful.
The Earl of Selkirk: I have considerable sympathy with what the noble Lord has said. I was going to make one or two remarks of a similar character concerning metal dealers, whose situation is very complex. But could not some of these provisions be made in subordinate legislation? The trouble with a Bill is that it will not be amended for many years, but sub-ordinate legislation can be changed and more easily adapted when certain items prove difficult to handle. I do not know whether it is necessary to go into all these details, but surely it would be better to have a procedure that could be more readily adapted when some of these items become too onerous.
3.28 p.m.
The Earl of Mansfield: I am grateful to my noble friend Lord Selkirk and the noble Lord, Lord Ross of Marnock, who have expressed their anxieties, if that is the correct word, in respect of this clause. May I begin by saying why it was felt, not least by the working party, that there should be a form of control over the second-hand trade and its activities. The reason is that the second-hand trade is an obvious, convenient and, regrettably, all too common outlet for stolen goods. Not least the police consider it essential that there should be some means of scrutiny and control over trade in those areas, or in those types of merchandise, where crime prevention is a desirable and a significant feature. Equally, we recognise that there are areas and types of trade in which licensing may serve no useful purpose, and it is for this reason that the provision is included, so far as this clause is concerned, on an optional basis to be used if, and to the extent that, local circumstances may so warrant.
At present, there is a mandatory licensing system for brokers in what were formerly the burghs in Scotland. The working party recommended that brokers or second-hand dealers should be licensed and they proposed a mandatory licensing system in the consul-

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tation document. However, in the light of many comments received, we have opted instead for a discretionary licensing system. This will allow licensing authorities discretion to decide what kinds of second-hand dealing should be made subject to a licensing requirement to meet the local situation.
The noble Lord, Lord Ross, illustrated his argument with a number of activities. Clearly, for instance, it would be most unlikely that the licensing authorities would require second-hand book dealers to be licensed. Of course, that does not require any amendment to the Bill. Obviously, to provide an exemption for second-hand book dealers or stamp dealers would be to imply in effect that other kinds of second-hand dealing which were not included in the exemption provisions were right and proper candidates for licensing; and that is not our intention. That is why very few exceptions have been made in the Bill.
What we did not want to do was to consider each and every kind of possible second-hand trading and decide on the fitness of each or any of them, either for inclusion or exclusion in the Bill or indeed in subordinate legislation. We have taken the sensible course of leaving the matter to the local licensing authority to decide in the light of local circumstances and in response to local representations.
The noble Lord, Lord Ross, asked whether the Government have thought about these licensing provisions. The answer is that we have and we continue to do so, not least in the light of fears expressed by the local authorities. We believe that there can be some improvement to allay the fear that there are going to be blanket provisions which will cover all forms of a particular kind of second-hand trading. The difficulty is to steer the course between imposing on a small trader a blanket obligation to record the purchase and sale of every small item, which the noble Lord, Lord Ross, quite rightly condemned, and equally not to impose some bureaucratic nonsense which would be difficult to enforce. Nor could one—taking that argument a stage further—impose on traders difficulties which would not be justified by the results which might be expected to be achieved in the prevention of crime and the recovery of stolen goods.
What, therefore, the Government are considering—and what we hope to provide—is a form of non-statutory guidelines for the licensing authorities. They will give some indication of the manner in which particular types of second-hand trading may be distinguished, and licensing requirements will be imposed only where the type of merchandise or value of the items dealt with or the amount of business carried out—the volume of turnover, for instance—would indicate a real need for such control.
One is left therefore with our intention that a particular trade or type of trade should only be included where there is a positive reason for its inclusion: that its inclusion would require express provision in the resolution; that adequate opportunity be given to the trade association concerned to make such representations to the licensing authority about the inclusion of their particular trade as seemed to them appropriate; and, above all, to provide an element of flexibility which will avoid the pitfalls which I have tried to illustrate.
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In the circumstances, I hope that the Committee will agree that the clause, as it stands, is an essential and worthy part of the Bill. We are working hard to see to it that it will have the effect that we want, and certainly not have the effect that the noble Lord, Lord Ross, in particular, prophesies for it.
Lord Ross of Marnock: We are all glad to hear what the Government have to say about this: that there is going to be some guidance given to local authorities as to what phrase should be included and what should be excluded. Unfortunately, the Bill does not say that. Once a resolution is passed to give them power to deal with the licensing of second-hand dealers—and that is just the one phase—then second-hand dealers must be licensed. There are the words " shall be required ". Then we have the definition of who shall require it:
" second-hand dealer ' means a person carrying on a business as a dealer in second-hand goods or articles of any description … ".
So there is no flexibility in the clause for the local authority unless somehow or other somewhere we put it in. I ask the Government to look at that as well.
I had hoped that we might have had an explanation of what the Government propose to do about the actual clause. But if they insist upon the clause and then think that they can give guidance to local authorities as to who shall be in and who shall be out in relation not to particular people in the trade but certain sections of the second-hand trade, I do not see the powers in this clause to enable that to be done. I do not ask for an answer from the Government at the moment other than that they are prepared to look at this matter.
One of the greater troubles here is not the licence, it is all that follows in respect of the burden of the paper work that has to be done by people in business. I tell the Minister in relation to certain of the businesses that I have mentioned that it is quite impossible and unfair to expect them to do this, or even to go through the motions of saying that they are doing it, when everyone knows that it cannot be done. Despite the phrase " reasonably practicable to do so " in Clause 24, about keeping records, I do not think that we want to legislate for things that just cannot be done.
The Earl of Selkirk: I have great difficulty in seeing how flexibility can be worked into this. The words of the statute are concrete:
" 24.—(1) A second-hand dealer shall keep records in accordance with subsection (2) … ".
I do not see how you can modify that by subordinate legislation.
Lord Wilson of Langside: I share many of the misgivings expressed by the noble Lord, Lord Ross. I was not at all reassured by the answer of the noble Earl. He suggests guidelines. I cannot see that they would dispel some of the uncertainties which may arise from the operation of this clause. I hope the Government will give very careful attention to the points raised by the noble Lord.
The Earl of Mansfield: I hesitate to question the noble and learned Lord, Lord Wilson of Langside, when he starts to construe a clause. However,

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where I think all three noble Lords have erred is that they are not reading this clause with Clause 9, which sets up the licensing provisions. Clause 9 applies to a number of different clauses throughout the Bill, of which this is one. If one reads this clause with Clause 9 then the issue becomes quite plain. With respect to the noble Lord, Lord Ross, he is not reading the clause correctly. I am sorry to have to disagree with him rather flatly. If it is claimed that in some way this is a defective clause which will have onerous and unjustifiable effects on second-hand dealers in Scotland, I must refute it because it simply is not so.
Noble Lords say that they do not see how the element of flexibility can be imposed by the guidelines. I see no reason why it should not. It will be up to the licensing authorities, when they come to frame their resolution, to frame it in such a way that they will provide a degree of flexibility. We are going to make various suggestions so that they will avoid the pitfalls which noble Lords have illustrated this afternoon. Of course I will take this matter away and look at it again. It is implicit from my remarks that this Part of the Bill which relates to licensing is the subject of a continuous review process by the Government. That will continue until after the Bill becomes an Act. For the moment, I simply ask the Committee to pass this clause into the Bill.
Clause 23 agreed to.
Clause 24 [Keeping of records of stock-in-trade]:
3.40 p.m.
Lord Ross of Marnock Lord Ross of Marnock moved Amendment No. 50A:
Page 17, line 19, leave out (" shall ") and insert (" may be required by the licensing authority to ")
The noble Lord said: Here I am trying to be helpful to the purposes of the Government and to provide them with a certain amount of that flexibility I suggested was essential. It meets with the desire of the Government for giving power to local authorities if, instead of the word " shall ", we put in the words:
" may be required by the licensing authority to ".
It is so simple and so easy to meet the Government's point that no further words of mine are necessary to persuade the Committee that this should be done. I beg to move.
The Earl of Mansfield: I will consider this one, if I may. It is indeed simple, as the noble Lord has said. I think we just do have to bear in mind that in the Burgh Police (Scotland) Act the keeping of records was and is seen as a desirable feature as part of crime prevention, and there is an argument which has been put forward—and it is the only one really which prevents my accepting the noble Lord's contention here and now—that if it were left to the local authority to decide whether or not books should be kept, this would negate the purpose of controlling second-hand dealers by licensing.
One can turn the argument the other way round and say that if a local authority felt, or indeed was convinced so that it came to pass a resolution, that a particular activity should be licensed but that books or book-keeping was unnecessary, one can hardly see how it would be convinced that it is necessary to
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license the activity anyway. But I am attracted by the proposition in effect that local authorities should be given a discretion, and if the noble Lord will be good enough to withdraw the amendment for the time being I will take it away and obtain further advice on it.
Lord Ross of Marnock: I am very grateful for that. After all, we must remember that the local authority do not need to apply the section at all. They are completely free not to pass the resolution, but if they do and with all the flexibility in the world they apply to particular trades, it may well be that they think they do not require to keep, not books—there is not a firm in the country that pays income tax that is not required to keep books that can be inspected—what they are required to do is to keep records. Paragraphs (a), (b), (c), (d), (e), (f) and (g) are detailed in relation not to the keeping of books but to the carrying on of their business—who they buy things from, who they sell them to and when. That is a very different thing from the statement made by the Minister about the ordinary business of the keeping of books. This is particularly laid down here in Clause 24(1), and I hope that if my words are not suitable he will be able to find some that will meet the case and are more acceptable to the draftsmen in the Scottish Office. In that case, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
The Earl of Selkirk The Earl of Selkirk moved Amendment No. 51:
Page 17, line 33, at end insert—
(" () In any criminal proceeding, information recorded under subsection (1) above may be made available by order of the court.").
The noble Earl said: I beg to move this amendment. I am not sure that it is necessary but these records, if kept, should be available to the courts if they require them. There may be some provision elsewhere where this is covered, but it does not seem clear to me, in this Bill at all events, that this could be demanded by the court. Perhaps my noble friend would tell us whether there is some other part which contains that power. If so, this amendment is not necessary.
The Earl of Mansfield: I am assured that powers already exist for the recovery of records at the order of the court where these are required as evidence in criminal proceedings. I am sorry that I am not able to quote chapter and verse—in other words, the legal authority—for what I am saying to my noble friend at the moment, but perhaps he would be content to rest on my assurance for now. I promise him that I shall have the legal authority for what I am saying before the night is out. If he is so content, perhaps he will see fit to withdraw the amendment.
The Earl of Selkirk: I am grateful for what my noble friend has said. I expected that answer and I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord Ross of Marnock Lord Ross of Marnock had given notice of his intention to move Amendment No. 51AY:
Page 17, line 46, after (" person ") insert (" required to keep records under this section ").
The noble Lord said: This is exactly the same point that the Minister has promised to look at, and I therefore do not propose to move this amendment.
[Amendment No. 51AY not moved.]
Clause 24 agreed to.
Clause 25 [Disposal of stock-in-trade]:
The Earl of Mansfield The Earl of Mansfield moved Amendment No. 51AZ:
Page 18, leave out lines 12 to 21.
The noble Earl said: This is a drafting amendment which eliminates unnecessary verbiage. Subsections (3) and (4) duplicate the general provisions in Clause 29, subsections (2), (3) and (4) empowering the courts to make an order prohibiting disposal of stock-in-trade within seven days of acquisition. These subsections are therefore redundant and this amendment deletes them. I beg to move.
On Question, amendment agreed to.
On Question, Whether Clause 25, as amended, shall stand part of the Bill?
Lord Ross of Marnock: There is only one point I query here, and that is the point of the 72 hours. Will there be reconsideration as to whether it is right to require people to keep goods for 72 hours? It may well be there is no question of theft involved in their type of business. I would think myself that 36 hours might be plenty.
The Earl of Mansfield: I am perfectly happy to consider that. I think the noble Lord has to bear in mind now the five-day week, bank holidays and particularly such times as Christmas and New Year, when the period of festivities goes into hundreds of hours. But I will certainly look at it again.
Lord Mishcon: I wonder whether the noble Earl could help me on this. Those of us who are not accustomed to the Scottish courts but who have obviously a great respect for them, do not know what you can do by way of making a summary application. I see that a summary application can be made to a sheriff for permission within the 72 hours to sell a commodity which has just been purchased. Is there sufficient procedure to see that those applications can be made in the Scottish courts and dealt with, presumably after an investigation, within a period of 72 hours? It is a matter which the English courts ought to follow with great diligence, and I think we would look with great jealousy at that if we were told that this was an easy matter in the Scottish courts.
The Earl of Mansfield: The noble Lord, who used to brief me in my early days, has really given me a very googly ball, if I may say so. The answer is that I do not know, but I will find out.
Clause 25, as amended, agreed to.
Clause 26 and 27 agreed to.
Clause 28 [Sellers of second-hand goods: offences etc.]:
Lord Ross of Marnock Lord Ross of Marnock moved Amendment No. 51A:
Page 19, line 31, leave out subsection (4).
The noble Lord said: This amendment suggests that we leave out subsection (4). Subsection (2) of the clause says:
" If anything is offered to a second-hand dealer in the course of his business and he has reason to believe that it has been stolen or otherwise unlawfully obtained he may, subject to subsection (3) below, detain the person offering it and a constable may arrest that person and take possession of it ".
He cannot be detained longer than is reasonably necessary for obtaining the attendance of a constable, which may be quite a long time. Then there follows subsection (4):
" No civil liability shall arise as a result only of the detention in good faith of a person under subsection (2) above ".
So that a person who is detained quite wrongly—it might be in a public shop and considerably to his embarrassment—has no recourse to law to obtain recompense.
I should have thought that it was unfair to take away this right of an individual in a case like that, where he is being accused, or where everyone is being led to believe that he has obtained something which he is proposing to sell illegally. It may be that he is detained for quite a time. The Bill states that it shall be until a constable can be obtained. That might be a reasonable time, but it might be quite a long time, and it would take away a person's civil rights in respect of improper detention. Was this special right given full consideration by the working party? I beg to move.
The Earl of Mansfield: The working party recommended that second-hand dealers should have the right to detain anyone offering articles thought to have been stolen or unlawfully obtained. The Government accepted this recommendation, but we thought it prudent to protect the second-hand dealer who had acted in good faith against the possibility of civil action arising from the detention of a suspect. We thought—and, in fact, still feel—that without this provision in the Bill the dealer would feel unable to act even when he had good reason, because he would not be protected against a civil action for what may have been a perfectly genuine mistake. Clearly, this provision in Clause 28 will greatly assist the police in certain instances when they are trying to find stolen property. We were fortified in this, because, as I have said, the provision was included in the consultation paper and no adverse criticism was attracted.
As the Committee will be aware, there are two safeguards for the seller. First, there is the requirement that the dealer must have " reason to believe " that the object has been unlawfully obtained. Secondly, the dealer may not detain the seller longer than is " reasonably necessary " to obtain the attendance of a constable. Therefore, the existence of these two tests does not exclude civil liability where the tests can he shown not to have been met.
One is always anxious to hold a fair balance as between the rights of the individual and the perfectly laudable ambition of the police to clear up crime, and not only to detain the thief but to seize possession of the stolen goods before they can be dissipated, as they all too often can be on the second-hand market. I think that this clause holds a fair balance and I hope that the noble Lord, Lord Ross, will agree.
Lord Ross of Marnock: It holds a fair balance of some kind, but I am afraid that many people would not construe it as fair. It is very much to the advantage of the dealer rather than the seller, as the dealer has only to act in good faith. How one proves good faith, I do not know. I am perfectly sure that neither would the Minister of State. The other point is on the words,
" reasonably necessary for obtaining the attendance of a constable ".
I know certain parts of Scotland where it would take half a day to obtain the attendance of a constable, but, in that case, that would be construed by the courts as reasonable. So will any guidance be given by the Scottish Office in respect of that? I have no desire to detain the Committee on this point and I am prepared to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 28 agreed to.
Clause 29 [Functions of the court in relation to second-hand dealers convicted of offences]:
3.55 p.m.
Lord Ross of Marnock Lord Ross of Marnock moved Amendment No. 51B:
Page 19, line 37, leave out (" of ") and insert (" for lodging an appeal against ").
The noble Lord said: This is on a point which I raised earlier in relation to the reporting back of a conviction to the licensing authorities. After all, if a man is convicted he has the right of appeal. It may well be that on appeal the conviction will be quashed and in that case it will be unfair. On the previous occasion, the Minister of State said that further consideration would be given to this. I know that the wording of my amendment now is not exactly correct, and neither was the wording of my previous amendment, so from that point of view I do not propose to move the amendment.
The Earl of Mansfield: I wish that the noble Lord would move it.
The Lord Ross of Marnock: Then I shall be happy to move the amendment. I am so surprised that the Government are even listening to anything I say. I do not think that the wording is too good, but who am Ito argue with the omnipotent and omniscient. I beg to move.
The Earl of Mansfield: I wanted the noble Lord, Lord Ross, at least to move his amendment, because such is the speed with which the Scottish Office works—which was not wholly to be welcomed, may I say, by the noble and learned Lord, Lord Wilson of Langside, on a previous occasion when the Bill was debated—that we have already considered the noble Lord's earlier amendment to Clause 9(5) of the Bill, though, of course, I have to confess that there has been an unusually long period between the different days in Committee on this Bill. What we have done is to consult the Scottish Courts Administration and I am now of the opinion that the Bill as drafted is, indeed, adequate. If the amendment were accepted, it would introduce an inconsistency of approach in the area of conviction and
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sentence intimation, which, so far as the courts are concerned, is a single sweeping-up operation within a day or two of the court disposal.
The inference behind the amendment is that a convicted person ought to be considered innocent until he appears to accept the court's decision by not appealing against his conviction. This is unacceptable in principle and in practice. The provisions proposed in the Bill are no different, for instance, from the provisions which apply to driving offences and which involve disqualification. The present administrative procedures for the notification of appeals will ensure that the licensing authorities will be notified immediately when any appeal is lodged. Therefore, there will be no injustice and I hope that, in the circumstances, the noble Lord will rest content.
Lord Ross of Marnock: I shall rest content. But the clearing-up process means that there will be an intimation and paper work in respect of conviction, which will be repeated in respect of an appeal, and then, thirdly, there will be another intimation in respect of the decision on the appeal. I know that the lawyers want to be kept working and far be it from me to prevent that measure of triplication. I certainly would not dream of imperilling their employment by pressing this amendment. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
3.59 p.m.
The Earl of Mansfield The Earl of Mansfield moved Amendment No. 51BA:
Page 19, line 43, leave out (" including ") and insert (" involving ").
The noble Earl said: This amendment substitutes the word " involving " for the word " including " in Clause 29(2)(b) and brings the wording into line with similar provisions for metal dealers. The difference between " involving " and " including " is very slight. The apparent semantic distiction is only to ensure that the wording is identical in the two clauses which are similar in content. I beg to move.
On Question, amendment agreed to.
The Earl of Mansfield The Earl of Mansfield moved Amendment No. 51BB:
Page 20, line 2, leave out (" or process ").
The noble Earl said: This is another drafting amendment. We now think that the words to be left out are unnecessary and confusing. I beg to move.
On Question, amendment agreed to.
The Earl of Mansfield The Earl of Mansfield moved Amendment No. 51BC:
Page 20, line 4, leave out (" its ") and insert (" their ").
The noble Earl said: This is a straightforward drafting amendment to correct a point which is grammatically incorrect. The word " its " should be replaced by the word " their ". I beg to move.
On Question, amendment agreed to.
Clause 29, as amended, agreed to.
Clause 30 [Metal dealers' licences]:
Lord Ross of Marnock Lord Ross of Marnock moved Amendment No. 51C:
Page 20, line 24, leave out (" anywhere in Scotland ") and insert (" in the area of the licensing authority ").
The noble Lord said: This amendment relates, I suggest, to itinerant metal dealers who are very gently leaned upon so far as licensing conditions, records and the rest are concerned. I do not think it is right that a licence granted to an itinerant metal dealer should have effect so as to permit that dealer to carry on business anywhere in Scotland. If he wants to go outside the area of the authority which has licensed him I suggest that he should have a licence from the other areas to which he goes, otherwise it is going to be very difficult indeed to keep track of these dealers and exercise control over them. There is no question of a local authority passing a resolution concerning metal dealers.
All metal dealers, metal brokers, have got to be licensed. It is so important. There is no flexibility about it. Why should a licence given to somebody in Glasgow enable that same itinerant metal dealer to do business in Argyll, Aberdeen, even in the Borders? The City of Glasgow has sent a note to me saying that they object to this. They did so after I had put down my amendment. It appears that having been licensed in some other part of Scotland people have been going into Glasgow and doing business within that area. If these dealers are wandering around Scotland and want to do business in the places to which they wander they should be licensed to do business there. Hence my amendment: leave out " anywhere in Scotland " and insert " in the area of the licensing authority ". I beg to move.
The Earl of Mansfield: The noble Lord seeks in effect to apply the mandatory licensing requirements—I agree with him that in the area of metal dealers they are mandatory to itinerant metal dealers in a way which would mean, as he has said, that they would have to apply for a separate licence every time they went into a separate licensing authority area. I correct myself to this extent: that they would have to apply for a separate licence for every district or licensing area in which they wanted to ply their trade.
Is this really necessary? I ask myself. If we look at Clause 39, the definitions clause, we see that an itinerant metal dealer is defined as someone who collects waste materials and old, broken, worn out or defaced articles, by means of house to house collections and who disposes of them without causing them to be kept in a metal store or other premises. So we are not talking about major metal dealers. We are talking about somebody whose stock-in-trade consists of what he can carry in his van or on his horse and cart. He is very different, and very different considerations, I suggest, ought to be applied to him from the metal dealer who has substantial premises and a large turnover. So do we want to impose on the small man the burden of seeking a licence as he crosses licensing authority boundaries, always assuming that the poor man knows a licensing authority boundary as he crosses it?
Itinerant dealers will probably be what are now known as travelling people. When I was a boy they were called tinkers—not, I may say, an opprobrious, term. But in many instances they do not have a fixed address and they have very few local contacts which will enable them to engage lawyers, if necessary,
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or ask for assistance with licence applications when they come to a different area.
Bearing in mind that the whole of the legislation in this part of the Bill is aimed at striking a balance between the needs of crime prevention, and the seriousness of the crime which is likely to be committed, and the interests of the individual, I do not think it would be right that if an itinerant metal dealer has satisfied one authority he should not be free to ply his trade anywhere in Scotland but would have to go to every single licensing authority where he wanted to do business. I know that one large local authority—and it is Glasgow—suggests that the present provisions are unenforceable. I do not accept it. The police have welcomed the provisions and clearly are satisfied that they can enforce the licensing requirements.
If the noble Lord can provide evidence or even an argument that the provisions as they stand in the Bill are unworkable or in some way unsatisfactory then I would be prepared to look at the matter again, but at the moment I am bound to say that if the Bill were amended in the way that is implied by the noble Lord's amendment it would make a bureaucratic nightmare, be extremely unjust and probably, indeed, unworkable so far as the small, itinerant metal dealers are concerned. I hope that, in the circumstances, the noble Lord may agree that this is not warranted.
Lord Ross of Marnock: I still think that one has to listen to Glasgow when it gives its opinion. If it says that it is inappropriate and would be difficult to enforce, this is of considerable value because Glasgow is speaking from long experience. The Minister of State nearly had us in tears about the fate of the itinerant metal dealers and the tinkers. I hope that the tinkers will all read Clause 33 and find out what they are able to do and what they have got to do. They have got to keep invoices in respect of everything that they purchase for two years. These itinerant metal dealers whom the noble Earl said used to be described as tinkers have also got to keep a receipt showing the weight and description of the metal, the name and address of the buyer and the price paid for the metal for two years. I doubt whether they will do all that, which is one of the reasons why this is not enforceable. We should look at the matter from the point of view of tinkers and find some other way of dealing with it. If they can do all that, they can certainly apply for a licence wherever they are peddling their wares.
The Earl of Mansfield: I do not know whether the noble Lord, Lord Ross of Marnock, really wishes me to respond again. He cannot have it both ways.
Lord Ross of Marnock: Yes, I can.
The Earl of Mansfield: He says that the tinkers cannot keep records, but undoubtedly they will want to do so because they will want to pay their income tax! If the noble Lord says they cannot keep records then they certainly cannot apply in every single licensing district for a licence to ply their trade, particularly when, as I am trying to illustrate, it is not necessary for them to do so.
The Marquess of Headfort: Is this not the United Kingdom?
The Earl of Mansfield: If by a slip of the tongue I said " United Kingdom " when I meant to say " Scotland ", I apologise. This Bill is, of course, one which applies only to Scotland.
On Question, amendment negatived.
On Question, Whether Clause 30 shall stand part of the Bill?
4.11 p.m.
The Earl of Selkirk: I let the noble Earl know that I should like to say a word or two about Clauses 30 to 39, which deal with metal dealers and which, as the noble Earl said, are not optional but compulsory. I know nothing about this industry whatsoever, but I find it difficult to understand the effect of this clause and what it is trying to achieve. The noble Earl has quite rightly said that it is a mixture of crime prevention and individual freedom; but it is also of some substantial importance to the steel industry. I do not know how far what one might call " major dealers " are included here; that is far from clear. But I want to make two points. One is that there is an enormous amount o detail, and I would like to draw attention to some of the quite remarkable pieces of detail which exist in the Bill. First of all, one has to keep a record and that record has to be serially numbered. It has got to be kept in one book, and if it is not one may be fined £200. I would have thought it quite possible that metal dealers would want to keep separate books for ferrous metals, non-ferrous metals and for what they call sintered metallic carbides. I do not know, but it may be that dealers may want to do that.
Also, one cannot sell metals to a person under 16 years of age. Why should one not sell metals to a person under 16? Metal is not like a drug, is it? I can see many people under the age of 16 wanting to buy scrap metal, but that apparently is an offence. If someone delivers metal to one's store, and one does not take the number of that person's car, that is another offence. It seems to me quite an easy thing not to take someone's number plate. Under Clause 31(6), if one does not enter the particulars immediately, again one commits an offence. What does " immediately " mean? Is it the same day, the next day, or within a week?
Then we come to this rather curious clause at the end, Clause 39. It is really quite remarkable what a metal dealer is. Clause 39 says that a metal dealer is someone who carries on a business which consists of buying or selling material,
" made wholly or partly of metal ".
Does that include furniture with a hinge, or does it include nails, or something with a metal edge? What does it include? It appears to include almost anything that contains a certain amount of metal.
If I may go back to the general principle, what firms are these clauses supposed to cover? The Bill speaks of metal dealers and then an exception is made for " itinerant metal dealers ". It is quite obvious that Clause 31 deals with metal dealers. Then one comes to Clause 33 dealing with itinerant metal dealers. Then there is a series of clauses, Clause 34 to 38. Do they cover itinerant metal dealers or does the term " metal dealer " not cover itinerant metal dealers? Then one comes to another class of people, again in Clause 39, who I suppose are the bigger people. They
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are people who, apparently, are not licensed at all because Clause 39(2) describes the people who deal in metal and then goes on to make an exception for those who carry on business in the course of which metal is not bought except as materials for the manufacture of other articles and not sold except as a byproduct. Apparently those people do not need a licence at all. There are three different kinds of metal dealers. I may be wrong and there may be a much simpler explanation, but I really do not understand what is covered.
I wish to make two further points. One is that I think that this immense number of details should be in subordinate legislation. We are laying down an Act of Parliament which is not optional, and it will be years before we can amend it if we want to do so. It would be much simpler to put all these details into subordinate legislation which could be changed very easily. Secondly, can we not make quite clear what kind of metal dealers are dealt with here? In particular, do " metal dealers include itinerant metal dealers, or arc they specifically excluded?
This is an important matter. It is important from an environmental point of view. We want metal cleared up because there is masses of metal lying about the country. We want to give metal dealers every possible facility for collecting it. Secondly, the use of scrap metal plays a very big part in the steel industry. I do not know how this will be affected by this Bill, but it seems to me that the drafting is pretty confusing. I ask the noble Earl to look at Clauses 30 to 39 fairly carefully. I shall later be moving an amendment on the question of precious metals. Do we really want to include precious metals in this? Are we going to bring jewellers into this business? If we are going to bring in jewellers, what about precious stones? Would not the same obligation apply there? They are things which are very easily stolen, but do we want to bring those in too? I wonder if the noble Earl could make this clause a little clearer so that ordinary people could at least understand what it is all about?
Lord Mancroft: If it is any comfort to the noble Earl, Lord Selkirk, may I remind him that, despite the most desperate efforts made from these Benches some years ago, it is still in English law a criminal offence to sell a second-hand anchor to a young person under the age of 16 between the hours of 9 o'clock at night and 7 o'clock in the morning.
Lord Stodart of Leaston: I wonder if my noble friend can clarify something for me and say whether or not this applies to what one might call the scrap merchant who pays a visit to farms, probably every summer. The definition describes him as going from house to house, and no doubt that covers going from farm building to farm building. I am bound to say that I view with a certain amount of gloom the fact that, according to Clause 33, I presumably have to issue this scrap merchant with an invoice for the scrap I provide him with; and whether or not I shall be liable for the VAT I do not know. It does seem to me to be carrying one's bookwork to rather gloomy extremes. I need hardly say that it is the practice for the scrap dealer to pay in cash. I have never known cheques

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to be used—I doubt whether he would accept a cheque from me if I offered him one. I rather feel that this is making a mountain out of what is, certainly agriculturally, a comparative molehill.
The Earl of Mansfield: If I point the finger at my noble friend it is because he is having not only a clause stand part debate but also a nine-clause stand part debate, when we have not yet considered most of the clauses. If I may say so, the time to have this debate is when we finish with Clause 39, which is the definitions clause, on which a lot of the misunderstandings, if I may so call them, and uncertainties are in fact put right. Nevertheless, I accept my noble friend's castigation, although it will mean that we shall have to go backwards and forwards through the pages of these clauses and consider them as we go through as well as now.
The first thing I want to deal with is the question of legislation at all. This part of the Bill and its provisions have been included following widespread consultation with the trade and the police and the local authorities, all of whom, with the possible exception of Glasgow and the itinerant metal dealers, have welcomed its provisions. I will be frank enough to say that there were plans for a separate scrap metal dealers Bill prior to the drafting of this Bill, but opportunities for legislation being what they are it was considered that it would be sensible to incorporate these very desirable new provisions and the extension of the provisions under the Burgh Police Act into the Bill as part of the Civic Government Bill. As I have said, the provisions have been welcomed. The working party on civic government recommended that scrap metal dealers should be brought within the scope of the Bill if a separate Bill was not proceeded with.
Under the Burgh Police (Scotland) Act 1892, metal dealers in the original Burghs are controlled, and the present Bill's provisions do no more than extend these controls into the modern law. Unlike other sections of the Bill dealing with licensing matters, these provisions are, of course, mandatory, because the Government have accepted the view of the police, and a number of other authorities too, that scrap metal dealers should be subject to a mandatory licensing system for crime prevention reasons.
I know that to the uninitiated the requirements attached to the licensed scrap metal dealers do seem to be bureaucratic and rather onerous, but I can tell your Lordships that details relating to record keeping and the retention of metal, the duties of itinerant dealers, the offences which have been laid down, and so on, are a complete package which will assist the trade and the police and the local authorities, who in fact understand these provisions very well and have known them for a very long time. It is they who will have to operate the scrap metal provisions. Unless one has in part of one's life dealt with the criminal law—and in another guise and in another country I have had such experience—one may not know it, but I can tell your Lordships that the opportunities for crime when one comes to scrap metal are legion, and I am not only concerned with the rather more exotic branches of crime, such as, for instance, taking lead roofs off churches.
The next matter which I think I had better deal with
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is the definition clause, because that really lays down a number of matters which I hope will help to clear the thing up for my noble friend Lord Selkirk. I go to Clause 39(2), where it says:
" For the purposes of sections 30 to 38 of this Act a person carries on business as a metal dealer if he carries on a business which consists wholly or partly of buying and selling for scrap ".
It is the words " for scrap " which I would underline, metaphorically speaking, because none of this applies to businesses which are not for scrap. So that, when my noble friend asks whether the provision of a metal hinge on an antique piece of furniture thereby makes the dealer a scrap metal merchant, the answer is, no, because he is not dealing in metal for scrap.
Then I turn to the itinerant metal dealers, who, as we have heard, in effect in modern Scottish conditions are really travelling people going from place to place, without premises or without effective premises. The definition in Clause 39(1) applies to them. In those circumstances, I hope that, if noble Lords read Clause 39 and then go backwards, so to speak, they will see how the various provisions of these clauses hang together.
I am very tempted to reply to my noble friend and his precious metals because he raised it, but the matter is the subject of an amendment of its own and therefore I will resist the temptation, although I should take it up if I thought that he might not move the amendment.
It is, of course, complicated, because we are legislating for a fairly complicated activity and laying down some precise rules which will have to be observed. My noble friend asks whether this could not be made the subject of subordinate legislation. I am advised that it is not so suitable, that the Burgh Police Act survived for tens of years perfectly satisfactorily, and therefore it would not be appropriate to have some kind of enabling clause and for the Secretary of State to bring out regulations in pursuance of it. I hope that this will go some way to reassure noble Lords on both sides of the Committee about what it is that these Clauses 30 to 39 seek to achieve.
Lord Mackie of Benshie: I did not speak on this clause. I thought it perfectly reasonable to issue licences, and I was staying off the following clauses. Would the noble Earl the Minister tell me, is an itinerant metal dealer to have exactly the same licence as the pukka metal dealer? I know metal dealers who have machines that cost £150,000 in their yards and run very big businesses. Is the itinerant chap, the tinker, going round the farms, under exactly the same conditions as these fellows who are in big business?
The Earl of Mansfield: The licence will be the same, but of course the duties consequential upon it will be entirely different, because the man in business in a big way will have premises, and he will, therefore, have to observe the conditions of the licence, and indeed the law, in relation to his business premises.
There is another matter which perhaps I should clear up. I think a number of noble Lords questioned why persons under 16 could not in effect deal with metal. That was one of the recommendations of the working party. It is consistent with other legislation of a similar nature; for instance, the granting of credit. I do not suppose that many children, unless they are the children of itinerant metal dealers, would really feel

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drawn to the trade. It was considered that few children can have come honestly by scrap metal in any quantity, and that is why it was put in in the way it was.
Lord Ross of Marnock: We have had rather a disorderly debate so far as I can see, supposedly dealing with the Question, That Clause 30 stand part of the Bill. That being so, provided I can come back to one or two points, I will be very happy to deal with Clause 30 right away and come back to the others.
Clause 30 agreed to.
Clause 31 agreed to.
Clause 32 [Retention of metal]:
On Question, Whether Clause 32 shall stand part of the Bill.
Lord Ross of Marnock: The point raised by the noble Lord, Lord Mackie of Benshie, is relevant here because many people who are metal dealers are in this business in a big way and may well be supplying, and urgently supplying, other metal-using industries. Indeed, those are the industries that I spoke of earlier to the Minister of State and as regards which I asked him whether he would look again at the 72-hour limit that is laid down, because it says that they shall not:
" dispose of or process any metal acquired … in the course of business until the expiry of a period of 72 hours ".
This is really a restriction upon business which may be harmful to particular businesses which are working probably all-out to supply another industry that is working hard on export orders. I only want the Minister to have a look at this and to make some inquiries as regards the point at which it becomes difficult, from a business point of view, to subject them to the business of disposing of or even going ahead and processing metal before it can be disposed of in the general course. That is the only matter I want to raise.
The Earl of Mansfield: I shall certainly have a look at it. I would just remind the noble Lord, Lord Ross, that the consultation document in relation to metal dealings suggested a 14-day retention period. But we considered that that was really far too long. However, I shall certainly consider whether 72 hours is the right period.
Clause 32 agreed to.
Clause 33 [Itinerant metal dealers]:
On Question, Whether Clause 33 shall stand part of the Bill?
Lord Ross of Marnock: I wonder whether the noble Earl could make clear that this is the only clause of the group of clauses into which we strayed that affects itinerant metal dealers? The concern is only as regards the keeping of receipts and invoices for two years in relation to the people from whom they purchase and to whom they sell. Later on the mention is of "metal dealers", so the question of buying and selling to people
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under the age of 16 and the suspicion about goods being stolen need not worry the travelling people, because it applies not to itinerant metal dealers, but to metal dealers. I want to emphasise that there is a clear separation—this was the point that was worrying the noble Lord, Lord Mackie of Benshie. There are many people who would have thought that the people under the age of 16 who are likely to sell things are likely to sell them to itinerant metal dealers, rather than to metal dealers. However, that is the situation. We want to get it clear that these later provisions apply not to itinerant metal dealers but only to metal dealers, and the statutory obligation of itinerant metal dealers is limited to Section 33.
Lord Stodart of Leaston: I should like to apologise for having been carried away by the fluency of the noble Earl, Lord Selkirk, and making a point slightly in advance of where we were in the Bill. However, looking at Clause 33(3), it seems to me that we are being quite unrealistic in suggesting that an invoice should be made out by a farmer to a scrap merchant for various items of metal that are picked up over what used to be known as the " stack yard ", showing the weight and the description of the metal. Where is one to weigh it, if there is no weighing machine on the farm?—and there are very few farms which do have wieghing machines, certainly in the upland areas. I am sorry to be nit-picking about this, but I am bound to say to my noble friend that I find this particular subsection totally unrealistic.
Lord Mackie of Benshie: I should like to support the noble Lord, Lord Stodart of Leaston. I cannot see any of the gentlemen who I know who buy metal from the farms being able to carry out this procedure and I certainly cannot see them being willing to carry it out. I must say that, as regards the keeping of receipts for two years, it would be an interesting exercise to see what they would do if they ran short of paper for any purpose whatever.
The Earl of Mansfield: There are a number of fundamental mistakes which are being made by noble Lords in relation to these clauses. I shall deal first with the noble Lord, Lord Ross. Clauses 34 to 38 cover metal dealers. Metal dealers are defined in Clause 39. Therefore, those five clauses deal with both static and itinerant metal dealers. Clause 33 applies to itinerant metal dealers as defined in Clause 39 and, in effect, relaxes some of the rules or some of the book-keeping requirements which are applied to what I might call static metal dealers. That I hope disposes of that problem.
I now come to my noble friend Lord Stodart. His point is not nit-picking at all. But, of course, it is not the farmer who is the metal dealer: it is the travelling person. He comes along and offers to buy some scrap metal from the farmer. It is up to the itinerant metal dealer to provide a weighing machine and to weigh the metal. It is up to him to give the farmer a receipt in respect of the metal. What the farmer does with it is entirely up to him. However, so far as Clause 33 is concerned, the invoice, or rather a copy of it, shall be retained by him for the period which is specified—that is to say for two years. Whether, as the noble

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Lord, Lord Mackie, wondered, he will find it very agreeable to accumulate this weight of paper, I do not know, but—for reasons which we have already discussed in the Committee as regards which, with my new-found sense of humour, which the noble Lord, Lord Wilson of Langside, commented on earlier, I raised some sort of mirth—that is what is enjoined on the itinerant metal dealer and therefore, it is he who is caught by subsection (3) and not the farmer.
Lord Mackie of Benshie: I want to be quite serious about this. The type of person who goes round and does this performs a valuable function and he does lift metal which is much needed throughout the country. But if we impose this type of book-keeping requirement on that sort of person, he will not do it. I think that it is very valuable that there should be a record of licensed scrap dealers. But to ask them to keep records for two years seems to me to open them to prosecution and a fine of £200 for something that such a person is constitutionally incapable of doing. They have carried on this trade for a long time and they are useful members of society. To open them to a fine of £200 for something that they really could not do even if they tried is in my view quite wrong.
Lord Stodart of Leaston: I do not want to detain the Committee, but surely it must be the case that if an itinerant metal dealer is to retain an invoice it is the farmer who must give him the invoice, because it is the farmer who is making the sale. Therefore, all that I am saying is that I do not think that it is realistic that an invoice could be made out for things which it would be remarkably difficult to describe. Junk is just loaded on to the lorry.
Lord Wilson of Langside: I understood the Minister to say—and this is my own recollection—that these provisions, or similar provisions, have been in effect for many years under the Burgh Police (Scotland) Acts. This is not to introduce fresh law, but simply to codify existing law. Of course I see the force of what the noble Lord, Lord Mackie of Benshie, said, but I imagine that although these laws existed, the law enforcement authorities and the police have exercised a certain sensible discretion before taking proceedings. But as I understand it—and the Minister will correct me if I am wrong—these penalties have always existed in this field.
The Earl of Mansfield: Yes. Under the Burgh Police (Scotland) Act 1892, itinerant metal dealers are treated as brokers and are, therefore, subject to the legislation applying to brokers. I do not wish to mislead the Committee in any way, and the Committee would not expect me to; I do not know that the receipts presently have to be kept by itinerant metal dealers for any particular time. I must say that.
But having listened to this debate and the very real fears which have been expressed—particularly as to this question of the two-year period—I think that I should take the matter away to see whether, in all the circumstances, it is a proper period to lay down as regards itinerant metal dealers. If it is not, at the next stage of the passage of the Bill through your Lordships' House I would propose an appropriate amendment.
The Earl of Selkirk: I should like to ask one question. Is it an obligation on behalf of the farmer (if I may use the expression) to give a receipt? Is he liable for a punishment of £200 if he refuses to give a receipt? I think that we should be clear on that, and I do not think that it is quite clear from the Bill at present.
The Earl of Mansfield: Clause 33 applies only to itinerant metal dealers. Therefore, there is no question of any farmer committing any offence under that clause. In effect, the itinerant metal dealer has to give a receipt or an invoice—call it what you will; it depends who is giving it and who is taking it—in respect of a sale of scrap metal. At the moment he has to keep that for two years.
Lord Ross of Marnock: I think that we have stumbled into some complexity in relation to the itinerant metal dealer. I must say that I am even more perplexed after the explanation by the noble Earl. I should have thought that if we meant a metal dealer, we meant a metal dealer apart from the itinerant metal dealer, and where we meant an itinerant metal dealer, we specifically said so, as indeed we do in Clauses 31 and 33. But the Minister of State informs me now that thereafter, in these other clauses, where we say " metal dealer " it will include " itinerant metal dealer ". We should bear in mind if that is the case and bear in mind that Clause 39 says that an itinerant metal dealer goes round farms, houses and so on and disposes:
" of such materials or articles without causing them to be kept in a metal store or other premises ".
Clause 32, which I presume also applies to him as it does not leave him out, says that he has to keep them for 72 hours. Where?
The Earl of Mansfield: Yes, it does.
Clause 33 agreed to.
Clauses 34 and 35 agreed to.
Clause 36 [Stolen metal]:
4.45 p.m.
The Earl of Selkirk The Earl of Selkirk moved Amendment No. 52:
Page 23, line 36, leave out (" he ") and insert (" the metal dealer ").
The noble Earl said: This amendment deals with Clause 36(2). Frankly, I am rather worried about the syntax of this clause. In order to make clear what it says I think that it needs a little redrafting. If someone has a letter posted to him and it states a description of some piece of metal, then the person who has the metal cannot say that he has not read the letter. There are a good many gaps in that argument.
First, who can send him a letter? Is it intended to be a letter from the police? Is it intended to be from a member of the public? I do not know, but apparently this is the case if he is sent the letter. Secondly, he has only to post the letter. We are not unaware that letters are not always delivered when they are posted. There is no guarantee that he has even seen the letter. There is also no guarantee that having described the metal, they also say they think it is stolen. Do they

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want the letter to say that it is describing metal which is stated to be stolen? It does not say that; it only says that it is believed to be stolen, and that need not necessarily, as far as I can see, be included in the letter.
In this amendment I am asking only that the words " the metal dealer " be included because I do not quite know who the word " he " refers to, unless you specify the subject of the sentence. Would the noble Earl look at this sentence a little more closely? I do not quite know what the police want here, but I think that they want a clear statement that a man cannot say, " I never saw this description ". In that case, I suggest that it should be a letter from the police; it should be delivered; it should describe the metal and say that it is believed to be stolen. I believe that those points could be brought out more clearly in this subsection. I beg to move.
The Earl of Mansfield: I think that the word " he " is perfectly plain. There may be parts of this sub-section which are not, but I think that the word " he " is. If my noble friend's amendment were accepted, we would have the word " dealer " appearing twice and, indeed, side by side in the same line.
However, I am much more interested, if I may say so, in his argument which did not go to his amendment; in other words, to the sense of the subsection. If I may, I shall have another look at it.
The Earl of Selkirk: I thank my noble friend. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 36 agreed to.
Clauses 37 and 38 agreed to.
Clause 39 [Interpretation of sections 30 to 38]:
4.48 p.m.
The Earl of Selkirk The Earl of Selkirk moved Amendment No. 53:
Page 24, line 38, leave out (" precious metal and ").
The noble Earl said: With the leave of the Committee, I should like to go a little wider than simply the amendment which I have tabled. First, I make no apology to the Committee for having raised the points on these nine clauses before we reached them. To my mind it has been a trifle easier to understand what they are about. Now we can make one or two things clearer. One point which the noble Earl has brought out very clearly, which I had not grasped, and which the noble Lord, Lord Ross, had not grasped, was that in the words " metal dealer " you include the word " itinerant " metal dealer. That was not clear and, with respect, it should he made clear. I think I am right in saying that Clauses 34 to 39 should state that metal dealers here include itinerant metal dealers. I think that that is a perfectly straightforward proposition to make.
Before referring to the amendment, I should like to go to Clause 39 (2). The noble Lord said that the fundamental distinction here is the word " scrap ". What about railway lines? What about the big scrap merchants who form a very large basis of the subject dealt with by the steel industry? Are they included in this? Must they have licences, or not? I think that
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we should be clear about this. It is quite clear that they cannot possibly have licences which extend only to a district. It should be made quite clear that this is a different type of man altogether. It is a very important part of our industry in this country.
To return to the words " precious metal ", I do not quite understand what this means. I take it you do not intend to include—although you may—jewellers. They deal with precious metal. They must be itinerant in some sense in their work. They collect them and they work on them. If you include them, do you include precious stones, which are in very much the same category?
What is the purpose of bringing in "precious metal"? In the ordinary course of events a tinker, if we use the expression, does not deal with precious metals except in the greatest unlikely chance. Is there any necessity to bring these in? If there is not, then I suggest that we might just as well leave them out. There may be some arguments I am unfamiliar with and, if so perhaps the noble Earl will tell me about them. I beg to move.
The Earl of Mansfield: Of course the definition of " metal " applies to metal dealers, and it does not matter a hoot whether they are static metal dealers or itinerant metal dealers, although it is probable that so far as precious metal is concerned it is more likely that that will be dealt with—or " dealt in " is a better phrase—by static metal dealers. The words of the definition are in fact meant to be all-embracing. In other words, " metal " includes, one could have said in a sloppy way, all metal, but what the draftsman has chosen to do is to define " metal " as
" any base metal or precious metal "
or any alloy of metal. Then he goes on to say " whether old or new ", and so on. But that is why the words " precious metal " are included in the definition.
Then one goes on to ask: should " precious metal " be included in the definition? In other words, should " metal " not be metal without " precious metal ". Bearing in mind that these clauses apply only to persons buying and selling for scrap, for the purposes of crime prevention it was considered that it was proper that precious metals should be included within the definition, because apparently following thefts, and so on, there is, unfortunately, a reasonably flourishing business in melting down precious metals for scrap. That is the reason why the words " precious metal " appear.
The noble Earl also asked me about railway lines. I think that that also is taken care of in subsection (2). May I draw my noble friend's attention to the concluding words in the subsection:
" … other than a business in the course of which metal is not bought except as materials for the manufacture of other articles … ".
I am informed in fact that that is not old railway lines. They are no different from ordinary scrap, and the difference is merely in size. But the only metals which are excluded from subsection (2) are those at the end of the subsection.
The Earl of Selkirk: I shall not press this amendment. I must say that I thought that all scrap was in fact used

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for the manufacture of other articles, otherwise I can see no point at all in collecting scrap. Most of it goes to some of our big steel works in one form or another, and they are apparently completely excluded. I imagine that many tinkers put their steel in such scrap.
I shall not press this matter any further, except to say that this is a confusing clause, and if the police or other people can work it they must he extremely clever and I give them my heartiest congratulations. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
4.55 p.m.
On Question, Whether Clause 39 shall stand part of the Bill?
Lord Hawke: I do not know whether it is relevant to take an English analogy for Scotland. Does an itinerant metal dealer in Scotland comprise the gipsy who in England, carries on a flourishing business in breaking up motor cars? He certainly does not go around from house to house collecting his motor cars. They sometimes descend into his lap by some mysterious means. He guts them of all saleable parts and then leaves the rest as an eyesore to be removed eventually by the council, if one is lucky. Is there any clause here which covers that gipsy, or do gipsies not exist in Scotland?
Lord Ross of Marnock: While the noble Earl is thinking about that—he will probably say that he has already answered it; I do not know whether the noble Lord was here earlier—the point I should like to make is that I am getting rather tired of itinerant metal dealers being only tinkers or gipsies, or travelling people. It is relevant to the amendment which was eventually withdrawn by the noble Earl, Lord Selkirk, that the kind of metal dealer that I come across and who knocks at my door occasionally is a person who wants to buy anything with gold or silver in it. They go around various places and offer prices which are generally not the prices that a person would get selling his grandfather's gold watch or chain, or anything else, to a bona fide static precious metal dealer. We should make clear that the itinerant metal dealer is not just purely a scrap metal dealer in that sense, but is somebody who is out to get hold of pretty good bargains from unsuspecting people.
I am glad that these people are going to be licensed in future, or have to be licensed. I hope that housewives and people who are visited by these folks will ask to see their licence, and see whether or not they have it. Many of them do not come from Scotland at all. They make a foray probably from this part of the world because there is money to be made, and where there is money to be made you will find the English doing down the Scots—if you can imagine that as possible. I just want to have substantiated by the Minister that it does not apply only to itinerant travelling people but also to anybody who goes from house to house seeking to buy articles of value from, it may well be, unsuspecting people.
The Earl of Mansfield: I think we have discussed this definition of an itinerant dealer fairly extensively
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now, and I suppose it might have been inappropriate to include the phrase " travelling people ". But it is plain from those of us who know different localities that lots of travelling people do in fact act as itinerant metal dealers, though of course not all gipsies are itinerant metal dealers, and, as the noble Lord, Lord Ross, has pointed out not all itinerant metal dealers are gipsies or travelling folk.
I think that the definition is reasonably clear. I am bound to say from this debate that I for one should like to go over the definitions again with the officials and put them to the draftsmen. If, as a result of this debate, anything really does appear unclear so far as these definitions are concerned, then we shall have to consider whether any amendment is needed or desirable at a future stage.
Lord Wilson of Langside: When the noble Earl is doing that, would he bear in mind that on the face of it there is room for the view that Lord Ross of Marnock's itinerant collector of old gold is not at present covered by the definition of an itinerant metal dealer in Clause 39? I do not want to pursue that, because I think we are all getting tired of the itinerant metal dealer, but I think I am right in saying that.
The Earl of Mansfield: If the purpose of obtaining the old gold was to sell it eventually for scrap, then he would be an itinerant metal dealer, because he would come under the definition of Clause 39(2), but otherwise not.
Lord Wilson of Langside: I should not have thought the reference to the itinerant metal dealer going from house to house collecting certain articles included the collection of old gold, but I do not want to pursue the subject and merely suggest that when the noble Earl is considering the matter he has regard to that as a point of view.
Clause 39 agreed to.
Clause 40 [Boat hire licences]:
5.1 p.m.
Lord Ross of Marnock Lord Ross of Marnock moved Amendment No. 53A:
Page 26, leave out line 15.
The noble Lord said: By this amendment I am simply inquiring why a boat hire licence is not required for any vessel in an inland waterway or harbour owned or managed by the British Waterways Board.
Lord Lyell: It is not the Government's intention to impose the licensing requirement we are discussing in a double form and for people to be regulated twice. The British Waterways Board already has, and exercises, powers approved by Parliament to regulate vessels operating on its inland waterways or in harbours owned or managed by it. In view of that, we see no need for local authorities also to be exercising the control of regulations in those waters. Such exemption from double control has already been achieved for England and Wales in Section 185(2)(a) of the Local Government, Planning and Land Act 1980. I hope that brief explanation will convince the noble Lord that the position as set out in the Bill meets the case of licensing.
Lord Ross of Marnock: I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 40 agreed to.
Clause 41 [Street traders' licences]:
Lord Ross of Marnock Lord Ross of Marnock moved Amendment No. 53B:
Page 27, line 38, after (" trading ") insert (" within the area of the licensing authority ").
The noble Lord said: We are certainly getting variety; we move from metal dealers to street traders and the amendment aims at avoiding itinerant street traders. When a Member of Parliament, I received complaints from shopkeepers about street traders appearing on a Saturday afternoon, often near a similar business, selling in the streets. Often they did not come from the locality but from a nearby city. I want to make certain that the street trader will be licensed only for street trading in the area of the authority issuing the licence.
I should like to go further and limit such traders to a particular street or streets by the licensing authority. There is a considerable argument as to the desirability of having people moving from one place to another as it suits them, damaging the businesses of others who are paying rates. The street trader may not pay any rates, although he may be selling flowers or fruit only a few yards from a florist or fruiterer who is burdened with the business of paying rates for the police and keeping order and so on. If we arc going to give this licence, we should ensure that it is suitably limited.
Lord Lyell: The noble Lord, Lord Ross, has made a plausible attempt to explain why in his view certain types of trading should be restricted to certain geographical areas, but I must tell him that his amendment would not achieve what he seeks. Clause 41 is subject to Clause 9, which is the general empowering provision empowering licensing authorities to resolve that certain, or indeed any, activities—including street trading—shall be licensed in all or part of the area covered by the authority. If the noble Lord's intention is simply to clarify the geographical scope of a street trader's licence, his amendment is unnecessary. The local authority will be able to impose conditions about the area within which the licence is valid, as he will find clearly set out in Clause 9(2), which covers the general empowering of licensing authorities.
Lord Ross of Marnock: Whatever is clear in the Bill, it is not Clause 9. However, I am reasonably satisfied with the Minister's reply. I hope that local authorities, with the flexibility and powers given to them by Clause 9, will be able so to licence street traders that they are limited, as achieved by the English Bill, which has been printed. I wondered whether, under the Scottish Bill, such traders could be limited to a particular stance. After all, we talk about " a public place " at one point in the clause and later refer to " the public place ". The Minister's reply is reassuring and I gather the intention is that the local authority shall so delimit, within the licence, the place and area within which they will trade that it will be a restriction on the kind of damage these
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traders do to other shopkeepers. In view of that, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
On Question, Whether Clause 41 shall stand part of the Bill?
Lord Hawke: Will it be necessary to have a street trading licence for anybody who wishes to sell anything on a public highway? In other words, when the farmer's wife puts out some eggs on a little platform outside the farm gate, must she have a street trader's licence to permit her to do that?
Lord Lyell: I am afraid I cannot give my noble friend a definite answer. However, I think he will find that subsection 4(a) covers the point he raised about, for example, the farmer's wife selling things outside the farm gate. I think that such activities would be covered by the Food and Drugs (Scotland) Act 1956. I think that there are certain regulations regarding that type of farm produce activity. I do not know whether flowers, fruit and other items of a perishable nature are covered by the Food and Drugs (Scotland) Act 1956. But certainly I think that the example raised by my noble friend would be covered in that way.
The answer that I have just received is, yes, the farmer's wife would be covered; she would be caught by the definition of a public place which I understand is found in Clause 128 on page 78 of the Bill. The Committee will find in the intepretation clause, at line 32, the definition of public place I understand that if the authority so decided, the farmer's wife would require a licence to carry on the activity described by my noble friend since the public highway would come within the category of a public place under the intepretation clause, Clause 128. So the answer to my noble friend is, " yes ".
Lord Hawke: I hope that my noble friend will have a good read of that on the quiet, because I do not read it the same way as he does. It would be ridiculous if the Bill was to stop this kind of petty trading that goes on the whole time, would it not?
Lord Lyell: My noble friend asked me to have a good read of " that ". May I ask him to define it exactly—page 78 or page 28?
Lord Hawke: Both, but particularly page 78. I read the public highway as coming within the category of the places where one is not allowed to sell without a licence, but I am not a lawyer.
Lord Wilson of Langside: Surely if the Minister's intepretation of the provisions is correct, the Government will take steps to remedy the position. Surely it was never intended that the activity by the farmer's wife outlined by the noble Lord opposite should be covered by the provisions. That was not the purpose at all. I very much doubt that the Minister's interpretation is correct and that the farmer's wife carrying out this activity in the countryside would be covered by the provisions. But, if that is the Government's view, will they not consider putting the matter right?
Lord Stodart of Leaston: I think there is just one other point. If a " public place " means what is stated—
" any place (whether a thoroughfare or not) to which the public have unrestricted access "
it certainly brings to mind a farm road leading off a public road to a farm building where every summer considerable business is done in the sale of strawberries on premises which are private, but to which undoubtedly the public have unrestricted access. I do not think that anyone has ever imagined that a street trader's licence should be needed for that.
Clause 41 agreed to.
Clause 42 [Market operators' licences]:
5.14 p.m.
Lord Ross of Marnock Lord Ross of Marnock moved Amendment No. 53BA:
Page 28, line 38, leave out paragraphs (b) and (c).
The noble Lord said: Now we proceed to private markets, whether under cover or in the open air. The suggestion here is that a licence is required for them, but on the other hand a licence will not be required for
" private markets held only for the sale of livestock or grain "
or
" wholesale markets held for the sale of fruit, vegetables, fish or meat at which members of the public are not normally present ".
The advice that I have been given by the council which probably has pioneered the business of publicly-owned markets—Glasgow—is that there ought to be licensing for all private markets. I should have thought that in regard to the sale of livestock, fruit and vegetables the local authority should have the power to license markets and so ensure that conditions are as they should be for such markets. The council considers that exceptions to licensing are undesirable and the markets should be placed under the control of the licensing authority. I believe that that is reasonable and that it was once the opinion of the Scottish office, as well. I beg to move.
Lord Lyell: The purpose of the licensing requirement, following the recommendation of the working party, is to enable local authorities to regulate the growing phenomenon of what have become known as Sunday, or private, markets which are directed very much at retail customers. Such markets have given rise to concern, such as complaints from local residents of general annoyance, and complaints from shopkeepers, and there has also been concern about the time and manpower devoted by the police to controlling traffic and pedestrians and dealing with other problems. In terms of Clause 42 councils have a discretionary power to require a licence for the holding of any, or indeed all, such private markets throughout all, or any part, of their particular area.
The amendment seeks to extend licensing to markets for the sale of livestock or grain and to wholesale markets for the sale of fruit, vegetables, fish or meat. Such markets are essential to all of us in society, and to say that we have had such markets for a long time is to understate the case. These markets are not the type of markets which gave rise to the concern expressed by the working party in its recommendations
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for a licensing requirement. These markets are a traditional, and indeed an integral, part of our everyday life, and normally they are held in purpose-built accommodation and are subject to planning and building Act control. There is no evidence that they give rise to any difficulties which would now require local authorities to have powers to license them. To us the amendment seems to be both unnecessary and undesirable, and therefore I cannot recommend it to the Committee.
Lord Ross of Marnock: That is rather a pity, bearing in mind the obligation on the local authority in respect of the food and drugs Acts. In Scotland we do things very differently, even in relation to the food and drugs Acts, and I should have thought it desirable that the local authorities should satisfy themselves about conditions at markets other than their own markets. Most of the markets in Scotland are for the sale of livestock. Certainly in Ayr, and in other places that I know, such as Glasgow, the fruit market is owned by the local authority. I believe that markets for livestock and for fruit and vegetables should be under the control of the local authority. I might have to return to the point, but I do not want to pursue it at the moment, and so I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord Ross of Marnock Lord Ross of Marnock moved Amendment No. 53C:
Page 29, line 4, after first (" of ") insert (" days and ").
The noble Lord said: This is the amendment in which I suggest that the local authority, the licensing authority, should be able to regulate not only the hours of opening, but also the days of opening of the private markets. The Minister who replied to my previous amendment mentioned the fact that concern has been expressed by the public in many areas at the siting of these new forms of private markets which are dealt with under the Bill and are going to be licensed. I do not think there is the slightest doubt about it but that many people are very concerned about them in relation to their siting. I have not heard many complaints about Ingliston, which is one that is fairly new, is being built up and is very popular—popular with everyone, probably, except the police, who, on a Sunday, have to deal with that business of a considerably expanded traffic.
But in various parts of our older burghs open spaces are being taken over and are being used for private markets that never existed before, and I am very glad indeed that there is going to be the question of regulation and that they are going to look at the provision of toilet facilities, the site of the premises and the maintenance of public order. Of course, it is the ratepayers who have to pay for the police being there to look after public order. In fact, as far as I can see, the only people who pay for public order are the football clubs. Certainly in Scotland they do, and they do so in England as well. They are absolutely soaked in respect of the demands of the police. But there are other occasions—and quite big public occasions—when the police are provided free and it is not only the people of the area who get the benefit of the maintenance of law and order.
But one of the things that I know has concerned many people in Scotland is that many of these markets

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open on Sundays as well, and that very much annoys them. I know your Lordships are all aware of the whole problem of Sunday opening. The one part of this country where you do not need a licence to open on a Sunday is Scotland. There was no Bill to regulate Sunday opening in relation to Scotland because Scotland was thought to be such a Presbyterian country that nobody would open on Sunday. How wrong they proved to be! During all the week-ends at Christmas, and at any other time that they like, shops are now open in Scotland on a Sunday; and it may well be that part of the reason for their opening on Sundays is because these private markets open on Sundays.
I want to give power to the local authority to regulate, not just the hours of opening but also the days of opening. It may well be said that they have got that; it is implicit in the word " hours ". I do not think it is. I think it is far better that it is stated in the Bill in respect of the powers of the local authority, and then the local ratepayers who are annoyed about this and the people who are annoyed about Sunday opening can say, " You have got the power—what are you going to do about it? " I beg to move.
Lord Lyell: In his amendment the noble Lord is seeking to add to the mandatory conditions set out in subsection (3), which lays down what a local authority is required to include in any licence for a private market operator, the requirement that they regulate the days on which the private market may be permitted to operate. It seems that the noble Lord is not content to rest on the permissive power that already exists in the Bill, which is to be found in paragraph 5(2) of Schedule 1. I would be inclined to argue that the phrase " regulation of hours of opening " indeed embraces the days to which those hours relate, but I would accept that there may be a certain element of ambiguity.
I would myself be content to leave it to the local authorities to decide in all circumstances whether or not they wished, whether under subsection 3(a) which is before us now and which we are discussing in this current amendment or, indeed, under paragraph 5 of the schedule, to spell out in detail the days of the week to which the licence relates. Indeed, such a course would be consistent with the noble Lord's desire for economy of words. But I would go on to say that if the noble Lord wishes to press the case for his amendment being made at this point in Clause 42, then we would not wish to oppose this amendment because we think there is sufficient doubt to enable us to accept this amendment, certainly in a clarificatory sense.
Lord Ross of Marnock: I have no desire to have an economy of words at the expense of clarity of intention, and I would ask the Government to accept the amendment.
On Question, amendment agreed to.
Clause 42, as amended, agreed to.
Clause 43 [Public entertainment licences]:
5.26 p.m.
Lord Ross of Marnock Lord Ross of Marnock moved Amendment No. 53D:
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Page 29, leave out line 28.
The noble Lord said: We now come to one of the mandatory areas of licensing, where the local authorities, whether or not they like it, have to apply a system of licensing involving the issue of what is to be known as a "public entertainment licence"; and we have here been given a long list or catalogue of the things which, without prejudice to the generality, have got to be licensed. Why they went so far as this, I do not know. I myself started making another list of things that are worth licensing for the entertainment of the public, including, of course, horseracing and greyhound racing and a few other things; but I do not know why certain things were singled out. I did not quite see why, in this day and age, a billiard or pool room, was being singled out for special mention so far as licensing is concerned.
In the days when I was brought up in Presbyterian Scotland the sign of a mis-spent youth was time spent in a billiard room playing billiards and pool. I never dared to venture into any such place. Mind you, the only one near us was in the Conservative Club—not the Conservative Club, but the Unionist Club, because we never had Conservatives in Scotland, they were Unionists in those days. But things are slightly different now. It has become so respectable and so attractive from the point of view of watching in television that dear old ladies of the most fervent Presbyterian persuasion are, I am perfectly sure, entranced by the activities of Thorburn, Steve Davis and all the others who delight us in " Pot Black " and the other championships which are going to start at Wembley, I think, this week. I think this one is a hit out of date, even in a Scottish Civic Government Bill, so I suggest that we leave out " billiard or pool room ". I beg to move.
The Earl of Mansfield: I have to say to the noble Lord, Lord Ross, that the Government do not agree that it is desirable to exclude billiard halls from the licensing requirement; and even if it were, and even if this amendment was agreed to, in fact it would not relieve them—and I shall explain why. I accept that billiards (although I do not think most people go to these places to play billiards these days, but snooker or whatever) is popular and that most of these establishments are well conducted, but they do attract a considerable clientele and on safety grounds alone I think they should be properly regulated. At any rate, that is what the working party concluded in their report on page 14, and the Government have not been urged by anybody except the noble Lord to disagree with the working party in its report.
Then, I think I should explain this for the benefit of the Committee, although it is possibly more of a "clause stand part " argument than merely going to this particular amendment. The various places which are set out in Clause 43 (2) paragraphs (a) to (j) are illustrative and are put in there, as I understand it, because in many cases they formed the subject of legislation under the old Burgh Police Act; but in fact the criterion for the imposition of a licensing requirement is set out in the preamble to the subsection. In other words, members of the public are admitted or permitted to use entertainment or recreational facilities,

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" on payment of money or money's worth ".
That is the criterion. So, as I said, a commercial billiards hall will still fall within the provisions of this clause whether or not it is in the illustrative list. Conversely, if you have a billiards hall run on a non-commercial basis—for instance, run by a youth club and no money is charged for admission—then it would not be caught by the provisions of this clause. For those two reasons I would ask the noble Lord to withdraw his amendment.
The Earl of Selkirk: What is a pool room?
The Earl of Mansfield: A pool room is where one resorts to play pool, which is not unrelated to billiards.
Lord Ross of Marnock: As against the next clause which deals with a swimming pool. This also raises questions. The working party report was not enthusiastic about billiards and pool rooms. They referred to the fact that there were local and general Acts giving powers at the moment and that there are not many of these establishments nowadays. They advise that the powers are still useful and might be retained. The one thing that they did not mention was the one thing by which the Minister of State justified it. That was crowd control. They were concerned just that the provisions governing licences should be simple, basically a requirement to hold a licence and the offence of failing to hold one; and that the conditions of the licence should specify such matters as hours of opening. That is all.
Frankly, I think we are cluttering up the statute book with unnecessary things; and all of these things, anyway, are covered. Why do we have this specified list that is singled out for special mention when all the items are covered anyway? I am surprised about this. There should be a saving, said the working party, for tables in hotels and licensed premises. I suppose that that goes for swimming pools in hotels, too; although in these hotels (at least, the ones I am thinking of) you are asked to pay additionally to use the swimming pool. I should like to know if they are covered. Is a special licence going to be required for the swimming pool in the Gleaneagles Hotel and the Turnberry Hotel? It must be so; there is nothing to say that they are left out. I think it right that the relatively poor people who use these undistinguished premises should be subject to the same conditions as anyone else. I am disappointed that it has been suggested that billiards and pool rooms must be continued and specially designated as requiring the licence. However, we hope that the whole of this will be looked at during the long period between this and the next stage of the Bill and that the Government will come to some different conclusion. In that case, I will not press the amendment.
Amendment, by leave, withdrawn.
5.43 p.m.
Lord Mackie of Benshie Lord Mackie of Benshie moved Amendment No. 54:
Page 29, leave out line 32.
The noble Lord said: I should like to move the amendment which stands in my name and in that of my noble friend Lord Thurso. He and I and many
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other noble Lords, I am sure, have attended concerts or political meetings and other functions in village schools. I have seen concerts so crowded that you could not get anyone else in and, in case of fire, could not have got anyone out. We wondered what safeguards the Government thought there were for excluding premises used as educational establishments. I should have thought that the restrictions over the page were quite useful: to restrict the use of premises to specified kinds of entertainment with a limit on the number of persons; and that this would be useful from a safety point of view. Perhaps the whole thing is covered in other ways, but I think I should like to hear what the Government have to say. I beg to move.
The Earl of Mansfield: The noble Lord, Lord Mackie of Benshie, seeks to delete,
" premises used as an educational establishment ",
from the list of premises exempted. If this amendment was agreed to, a licence would be required for the use of any such premises for public entertainment. During the debate on Second Reading of this Bill, noble Lords will recall that my noble friend Lord Campbell of Croy and others held strongly to the view that licensing should be imposed only where it was strictly necessary for the protection of the public. Various instances were brought out as examples of what I might call innocent goings on which do not require the rather draconian mechanism of the local licensing authorities in order that they should be allowed to take place.
I have been bearing this very much in mind, but at the same time I am conscious that one wants to avoid the unlicensed use of educational premises by bodies which have no formal connection with the main purpose of the establishment. I am, therefore, considering an amendment to this clause making it clear that educational establishments are exempt from the licensing requirement only where they are being used by appropriate bodies for educational purposes and not when they are leased out for commercial or unrelated purposes to which the public are admitted on payment.
What it comes to is that it would be slightly absurd to require a local primary school or a parent-teacher association to be licensed if they go in for some harm-less local fund-raising ctivities. Where there is an activity which has nothing to do with the educational authorities,which, in fact, can monitor perfectly well the activities which go on in their premises and particularly when the organising agent, so to speak, has something to do with education, that is one thing. On the other hand, there is a case probably for bringing outside organisations within the sphere of the clause. I will reconsider the matter if the noble Lord is good enough to withdraw his amendment for now.
Lord Airedale: It is encouraging to know that the Minister has in mind an amendment of his own to deal with this problem. Will he bear in mind that quite often a village school is used by, say, the local horticultural society, who hold a dinner and, perhaps, have a cabaret?—so that there would be the entertainment coming in. It is perfectly orderly and there is no question of overcrowding, and so on. But the horticultural society are going to be excluded if

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the Minister's amendment stresses the educational aspect—unless one regards horticultural societies as educational societies, which probably is not the case. Perhaps he could bear examples of that kind in mind when considering his amendment.
Lord Ross of Marnock: My interest in this matter was raised by a gentleman from Lanark. He was concerned about churches and the use of church halls. He said, " Unless this is covered by the definition of " educational establishment ' …" It took me immediately to the Library and I had a look at what " educational establishment " covers here. It is on page 30:
" ' educational establishment ' has the meaning given by paragraphs (i) and (ii) of the definition of that expression in section 135(1) of the Education (Scotland) Act 1980 and also includes the institutions and premises excluded … ".
Let us look at what it covers. It covers a school, a junior college or any other institution for the provision of any form of further education; technical colleges. They can hold entertainments; they charge people what they like and there is no need for a licence. That is only the start.
I hope that the noble Lord realises what he started by leaving out " educational establishment ". May I tell him that the young farmers in Ayrshire last week had an entertainment on at Craigie College, which is a college of education. It was packed out every night. I do not doubt that a considerable sum of money was made available for a charity or something like that. The noble Lord says that it should not be used without a licence.
It goes beyond that—and I am very glad that there is a right reverend Prelate present—because among the excluded areas of places of possible entertainment (which are now brought in by that wiping out of the exception) are a university and a theological college. These places can be used as places of entertainment now without a licence. Also a club or other centre conducted by a voluntary society or body. The university union could run dances for union funds. No question arises about the safety of the public or anybody else; and so it goes on. Bearing in mind the complaints I have had from other people about church halls being left out—in other words they have to have licences—this should be a very wide exception indeed.
I sincerely hope that when the noble Lord is looking at this again he will take it a hit wider. I have an amendment down—I could cover it here—that church buildings and church premises adjoining should be accepted. That is fair enough. It may not go far enough. The English Bill only leaves out churches and church buildings in respect of music alone. There is a narrower definition in another amendment. I hope that the Government will have a look at this whole area in respect of premises that are going to be left out and which will not require premises. As it stands, " educational establishment " is far too wide.
Lord Howie of Troon: I should like to take up the point raised by my noble friend Lord Ross when he referred to student unions. I recall that a number of years ago, when I was younger and more athletic than I
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now am, I used to play billiards in the student union at the Royal Technical College, Glasgow—and sometimes even in Glasgow University. This draws attention to this amendment and the one that we debated a few moments ago. I wonder why ordinary commercial billiards rooms were required to be licensed but not students' union premises. There may be some distinction to be drawn between the two, but I am certain it has nothing whatever to do with the protection of the public, because billiards in my experience was a far from dangerous game.
Lord Mackie of Benshie: I did not realise the can of worms that we would uncover; but that is the purpose of debate—one uncovers a whole lot of factors which have not been considered. My noble friend and I were concerned with the safety aspect in a great many village schools in the country areas. When the Minister is considering these matters, will he also take into account my noble friend's thoughts on local organisations which may or may not be termed as having an educational background? Certainly young farmers could be termed as having an educational purpose, not in all their activities but taken in the main. With these remarks, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
5.46 p.m.
Lord Ross of Marnock Lord Ross of Marnock moved Amendment No. 54A:
Page 29, line 41, leave out (" or ").
The noble Lord said: This is a purely drafting amendment to make sense of the later amendment which inserts,
" Churches and church buildings ".
Entertainments may go on in the church hall or the church itself and there might be a charge for admission. I think anyone gets his money's worth in going to a church at any time. I do not think that churches and church halls should be left off the list in the Bill. I do not know whether the Government feel that this is too wide or not wide enough.
I am prepared to listen to any soothing words they have on this point, provided that they are prepared to accept the spirit of the amendment that I am moving. I do not think that it would be a question of public safety because of overcrowding—I should like to think it was. This is not just for entertainment but even for the ordinary activities on Sundays. But churches and church buildings are slightly different, they are drawing usually on just the people in the church themselves. Safety does not really arise. I know that Glasgow would have every conceivable building covered for every conceivable occasion. They think that there should be no exceptions at all. I think that there should be exceptions and one should be churches and church premises. I beg to move.
The Earl of Mansfield: I should like to speak to Amendments Nos. 54A, 54B and 54C together in order to save time. I have a lot of sympathy with the amendments of the noble Lords, Lord Ross and Lord Mackie. I emphasise that what is to be regulated here is the commercial element. If people merely go to church—even if they pack it to the doors—such would not come

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under the ambit of Clause 43(1) because the public are not admitted on payment of money or money's worth. I do not think that a collection during the final hymn counts for these purposes. If the local church Sunday school puts on a nativity play for admission to which they charge and raise a little money, the Government have no desire to see them go to a licensing authority for a licence. If the intention of the noble Lord refers, as I think it does, to those church organisations which occasionally use church premises for fund-raising efforts, the Government would not dissent from that for one moment, in the sense that, despite the overriding public safety provisions, one would not want to see licences having to be obtained for those events.
But there are difficulties. For instance, where a professional theatrical company takes over a church hall on a commercial basis for the duration of the Edinburgh Festival, then quite different considerations obtain. For reasons of public safety, I could not possibly accept the view, nor do I think the noble Lord, Lord Ross, would put it forward, that in those circumstances a licence should not be applied for. So that is the difficulty. I do not think the amendment is satisfactory as it stands at present.
The same goes also for the amendment of the noble Lord, Lord Mackie. This really refers only to music being played, and I understand that the amendment is prompted by very laudable anxieties on the part of the Salvation Army. Obviously, while the Salvation Army are entitled to put on their concerts, if that is what they are, and charge for admission to their own halls, that is something upon which one would not wish to impose a licence in any circumstances. However, we have to consider the wording. The noble Lord's amendment, if I may say so, is modelled on rather different provisions in the English Bill, and I think we have to consider the matter. So what I should like to do is to bring forward an appropriate Government amendment at a later stage in effect to exempt bona fide church use by associated church organisations on church premises, if I may so describe them. On that basis, I hope that the noble Lord, Lord Ross, might withdraw his amendment and possibly that the noble Lord. Lord Mackie, might not move his amendment.
Lord Ross of Marnock: I am certainly grateful to the Minister for what he has said. He has obviously thought about it and I think the conclusion he has come to is right. I had not appreciated the difficulty about the churches that I know are used during the Edinburgh Festival. Indeed, the Minister is quite right: I will withdraw this amendment and I will not move my next amendment.
Lord Mackie of Benshie: Before we move on, may I simply say that I am very glad to have the assurance from the Minister? As he rightly stated, it is a cause of concern to the Salvation Army that their premises are not always regarded as " a church ", and of course the use of music by the Salvation Army is probably very much greater than in an ordinary church. But, as long as the noble Earl recognises that the Citadel is a very good church, then I believe the Salvation Army will be satisfied that justice has been done.
Amendment, by leave, withdrawn.
[Amendments Nos. 54B and 54C not moved.]
On Question, Whether Clause 43 shall stand part of the Bill?
Baroness Phillips: I have been sitting through this debate with great interest and I am rather relieved to hear that if this is a dry run for the English Bill there is not as much material in the English Bill, if I understood my noble friend Lord Ross correctly. Having spent many years as secretary of an educational charity and having to plough one's way through Acts of Parliament to find ways of not paying VAT or having an entertainment where you do not have to conform to certain laws, it seems to me that we are dealing here with matters which ought to be further discussed, as they could make life much more difficult.
1 have always understood that it is bad legislation to spell out what you do exclude or what you do license, and then go on to specify what you exclude, because it gives the opportunity for people who wish to get round an Act of Parliament to do just that. The particular question I am interested in is: what is the meaning of " money " or " money's worth "? There used to be in the old Acts concerning places of entertainment, and particularly charitable entertainment, a distinction made between money paid at the door, such events then being held to be public, and tickets purchased before the event. Neither of those are mentioned in this section. " Money's worth " seems to suggest to me barter, and I did not think that they did this in Scotland—we have not done it in England and Wales for a very long time. I am wondering where we get a definition which would enable a charity to actually run one of these events without having a licence, even if it went within these little exclusions, but which would still permit charging for entry. I do not wish to introduce a totally different point at this stage, but if this is a dry run for the English Bill it is proving extremely useful.
Lord Howie of Troon: I should like to take up the point about bad law which was raised by my noble friend Lady Phillips. I recall a year or more ago, while we were debating in this House the Bill that became the Employment Act 1980, moving amendments to exclude a certain class of person from the provisions of that particular Bill. I was assured during the course of the debate by no less an authority than the noble and learned Lord the Lord Chancellor that it was very bad law to list inclusions and exclusions in the way I was proposing to do. In the face of that high authority, I withdrew my amendments. I am beginning to wonder whether the noble and learned Lord the Lord Chancellor was right or whether I was right on that occasion, because the legislation before us contains exactly what he was then suggesting was wrong. I shall be interested to see how the Committee deals with this clause, and I daresay that if we ever get employment Bills coming before us again I will put in the same amendments as I did before, armed with the assurance that what was then thought to be bad law has now become good law.
The Earl of Mansfield: I rather suspect that the noble Baroness, Lady Phillips, and the noble Lord, Lord Howie of Troon, have not been in their places while

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the various amendments to Clause 43 have been discussed. Therefore I hope the Committee will forgive me if I very briefly say one or two things.
First, I should like to say that I explained that the list of types of buildings or places to which Clause 43 applies is illustrative and is taken because of the old Burgh Police Acts, which in fact mentioned all these different types of activity. It says in subsection (2), " without prejudice to the generality ". This is not a definitive list and still less an exhaustive one. The criterion as to what constitutes a place of public entertainment is given at the beginning of the subsection, and it says:
" place of public entertainment ' means any place where, on payment of money or money's worth, members of the public are admitted or permitted to ",
and so on. So it is actually quite different, I think, from the legislation in the last Session to which the noble Lord referred.
The second matter which was taken up by the noble Baroness, Lady Phillips, concerned " money or money's worth ". I think that " money " is obvious. " Money's worth ", for instance, could be the purchase of a programme if it were a children's play or something of that kind. Equally, it could be something like the purchase of a token to put into a slot machine which then lets one go through a bar or something like that in order to get into the body of the hall. Those are two examples of moneys' worth.
Then the noble Baroness, Lady Phillips, went on to ask: how can charities be exempted from this legislation? The answer is that we do not want to exempt charities from this legislation if the over-riding public safety considerations make it proper that they should be within it. The reason why I say that is that the licence is required for the use of premises. This is not a way of taxing the poor charity to relieve it of some of its cash which it would rather devote to the purposes of the charity. It is a means for the licensing authority to know, as it were, what is happening in its area and, above all, to lay down fire and safety rules for places of entertainment where the public congregate on payment of a fee. So if, for instance, you have a village hall which is probably used—as it certainly is in my part of the world—every Saturday for all kinds of activities from the ladies' badminton club to a Burns' Night supper, such a hall will be licensed by the licensing authority at the beginning of the period and such licence, and the various conditions which may be applicable to it, will be continued for the duration of the licensing period. I hope that that clears up the matter for the noble Baroness and the noble Lord.
Lord Howie of Troon: Very briefly, may I say that, although I was admonished for my absence at one stage, I have been here for some of the time. I was wondering, for my own guidance, whether, in any future amendment which I may bring forward on later Bills, I should include some such phrase as " without prejudice to the generality ", and whether I shall then be able to overcome the objections of the noble and learned Lord the Lord Chancellor.
The Earl of Mansfield: I cannot answer hypothetical questions of that nature on a Scottish Bill. When I am
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no longer a member of the Government, I shall be delighted to so do on payment of a fee.
Clause 43 agreed to.
Clause 44 agreed to.
Clause 45 [Window cleaners' licences]:
6.2 p.m.
The Earl of Selkirk The Earl of Selkirk moved Amendment No. 55:
Page 31, line 7, leave out from (" licence ", ") to end of line 25 and insert (" may be issued at the discretion of the Council to a person who is carrying on the trade of or being employed as a window cleaner.").
The noble Earl said: This clause deals with window cleaners. It was rather hotly contested in the course of the Second Reading debate and powerful arguments were advanced for taking it out altogether. The noble Lord, Lord Ross, has down an amendment to remove Clause 45 altogether. I was, however, greatly impressed by the strong and powerful arguments which my noble friend used for retaining some licensing for window cleaners, and I have put forward this amendment which is a halfway house.
It would be voluntary for window cleaners to get some kind of identity, or, at least a licence, from the local authority, should they so wish. There is quite a lot to be said for this, because, if someone comes along and asks, " Can I clean your windows? ", he may be some kind of crook who will take advantage of all he sees by looking through the window. It would be a consolation to householders if they knew, when they let someone into the house, that he was, at least, known to the local authority and was identified by them.
That is what normally happens in the case of people who read gas and electricity meters, and with other authorities who go into people's houses. It may not be necessary in the case of window cleaners, but I put this forward as a suggestion which I believe will not be unwelcome, so as to give a certain assurance that the person in question is not a well-known thief or robber and, so far as is known, is a person of reasonably good character. I beg to move.
The Earl of Mansfield: I am bound to say that, when I read my noble friend's amendment, I had not realised that he intended to make the obtaining of a licence by a window cleaner a voluntary act. In other words, what my noble friend says this afternoon is that, in these circumstances, a window cleaner can obtain a licence, or not, according to what he wishes. Equally, the licensing of window cleaners would be discretionary, so far as the licensing authority was concerned, as indeed it already is under the terms of Clause 9. I think that my noble friend's attempt to find a compromise falls smartly between the two stools, and I appreciate the motivation behind the tabling of this amendment.
To start with, let me just deal with the matter from the point of view of the licensing authority. As I have said, these licences are optional at the behest of the licensing authority. I suppose that the majority of authorities will not feel that it is necessary to license window cleaners. I suspect that the only window cleaners who will require licences are those in some of

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the conurbations where, unfortunately, the crime rate is the highest. I have to remind the Committee that it is particularly in relation to crime, and at the request of the police, that these provisions have been put into the Bill, and I think I said on Second Reading something to the effect that the case for licensing window cleaners rests on crime prevention.
One has to bear in mind that window cleaners enjoy a very privileged position, and I do not mean only to look through windows to see what is going on behind them. They also have a very privileged position, in that they have a very ready access to buildings, and many folk who go out to work have to leave their windows unsnibbed so that the window cleaner can clean both sides of the windows. He therefore has a perfect opportunity to get into somebody's house and do what he likes inside. So I believe that the provisions in subsections (2), (3) and (4) of the clause are essential, if this safeguard to the public is to be of any use at all.
I now come to the other matter which is inherent in my noble friend's amendment, because one of its effects is that a person who is a window cleaner and who is licensed will be under no duty to carry the licence, or some means of identification, about with him. We feel not only that window cleaners should be licensed, but that they should be under an obligation to show their licence. We think that this is a basic protection. Anybody who has anything to do with the police, as so many of our Lordships have in your capacities of magistrates and so on, must have had case after case where members of the public have admitted strangers to their homes and did not take the precaution of asking for means of identification.
We think it is absolutely essential for window cleaners to be enjoined, as part of the granting of the licence, to show their licence on demand to the householder. So the whole thing really comes back to good faith on the part of window cleaners, and the production of a licence, which shows that the person enjoys the confidence of the licensing authority, is the best proof positive of the window cleaner's good faith. Therefore, although I cannot agree with my noble friend's amendment, which I know he put forward in a spirit of compromise, I appreciate the motivation behind it.
The Earl of Selkirk: I am sorry if my amendment does not meet the purpose which I intended, though I think that a narrow interpretation of it would give it that meaning. I do not make it compulsory and I remove the fine which could be imposed on a neighbour. Let us bear in mind that if you pay a neighbour 30 bob for cleaning your windows and he is caught cleaning those windows by a policeman, he might be fined £25. I say that this is unnecessary. It should be perfectly possible to give a man a small tip and say, " Clean my windows ". That is impossible under the Bill. I believe that is wrong, supposing, of course, that the local authority adopts Clause 45. I say that anybody should be able to clean windows if they want to, but that the householder should be able to say, " Can you show me an identity card authorising you to do so?" That is a simpler process. I am not going to press the matter. If the noble Earl wishes to say something, by all means let him say it.
The Earl of Mansfield: If my noble friend is canny enough to persuade his neighbour to clean his windows for 30 bob—I do not know how many windows my noble friend has—that person is not carrying on the trade of a window cleaner. Indeed, he would very soon go broke. Therefore, the provisions of Clause 45 do not come into the picture.
The Earl of Selkirk: I am going to venture to disagree with my noble friend. The words are, " being employed as a window cleaner ". One window would make that employment. I am not going to carry the argument any further. If the noble Earl and the Committee do not like it, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
6.12 p.m.
On Question, Whether Clause 45 shall stand part of the Bill?
Lord Ross of Marnock: I think the clause should come out of the Bill. It is so confused and so muddled. Most of us were fairly clear about it until the noble Earl the Minister of State told us that window cleaners could not possibly be trading as a business when obviously he had not had his attention fully drawn to the point that had been made:
" An authorised officer of a local authority, a constable or any other person having reasonable cause to require to see it, may require any person who the officer, the constable, or, as the case may be the other person has reasonable cause to believe is trading or being employed as a window cleaner forthwith to exhibit his window cleaner's licence ".
Why not just produce it? He has got to exhibit the licence. How do you exhibit rather than produce? He is not required to show the licence when he is carrying on his business. To exhibit his licence means, I should have thought, to show publicly his licence. If he is asked by some person who has reasonable cause to require to see his licence, he has to exhibit it. I do not know what " reasonable cause to require to see it " can possibly mean. He may be required to produce it by some passer-by who has his suspicions aroused, or by a constable or an authorised officer of the local authority.
The more you think of this the more silly it becomes. How many local authority officers will be sent round the streets of Glasgow looking for window cleaners and asking them to exhibit their licences? I am sure that the working party was not very keen on this clause. They dropped chimney sweeps. It was thought at one time that they would include chimney sweeps. Then it was realised that most chimneys are swept from the outside, not from the inside. But the chimney sweep still has to get on to the roof. There still has to be entry into and around buildings. Noble Lords may remember the old Father Brown shop story of the man who was invisible—the postman whom nobody saw. If a sweep is moving around buildings, people think nothing of it. It is an easy way to obtain access and get acceptance by the public that you are doing something or other. But chimney sweeps have been left out. The district council of the City of Glasgow want sweeps back in. I have not put down an amendment of that kind. I do not

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agree with it. We have to depend upon the common sense of people who hire somebody to wash their windows. People usually want the outside rather than the inside of their windows to be washed. I know that during the school holidays many youngsters are prepared to wash windows. People are lucky to get them. They do not want to have to turn them away because they do not hold a licence. If somebody is asked by a person in authority to produce his licence, then he must exhibit it. He does not exhibit it otherwise. That is probably an offence, too. We are going a little far. At one time a licence was required by beggars, pedlars and messengers. Caddies of some kind were in the old Scottish legislation, bootblacks, chimney sweeps and also window cleaners. We have got rid of so many of them. We do not require this one. I suggest that we should leave it out.
We have not had a Division. The discussion has been friendly. This is an important matter, but I do not want to call a Division. I hope the Minister will say that he is prepared to have a look at this point.
Lord Howie of Troon: Noble Lords may recall that not very long ago the noble Earl the Minister offered to give me certain hypothetical advice of a legal nature, for a fee. I should be perfectly willing to listen to that advice, though I am not sure that I should be too keen on the fee. Let us consider another hypothetical case. Let us suppose that instead of offering legal advice for a fee the noble Earl offered to wash my windows for a fee—or, if not he, the neighbour of the noble Earl, Lord Selkirk, who goes in for that kind of thing. In the first place, would the man offering legal advice for a fee be thought to be in trade in some sense as a lawyer, or employed as a lawyer? He may be; I am not sure. But if so, would it be different? And how would it differ if, instead of offering legal advice for a fee, he offered window cleaning for a fee? I ask the question in perplexity and for no other reason.
Lord Airedale: There are some curious words in this clause. Although a window cleaner has to exhibit his licence under subsection (2), under subsection (4) an authorised officer does not have to exhibit his authorisation. He only has to produce it. A police officer not in uniform does not have to exhibit his identification; he only has to produce it. I should have thought it would be enough if a window cleaner only had to produce his licence, and not exhibit it.
The Earl of Mansfield: The distinction is that it is contemplated that the window cleaner might have something nailed to his little ladder. That is exhibiting his licence, whereas the officer of the authority will produce something from his wallet which identifies him as being in the position which he holds. That is the reason for the different language.
So far as the noble Lord, Lord Howie of Troon, is concerned, one has to keep a sense of proportion. I am thinking of the photograph of the somewhat elderly boy scouts when they came to the Palace of Westminster, I think yesterday. Obviously somebody taking part in
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a bob-a-job week and offering to clean windows, which is what I used to get up to years ago, does not thereby create a contract of employment which would make the unfortunate boy scout subject to the rigours of the law for not being licensed under the terms of this clause. One must keep a sense of proportion about it.
What I want to do is to deal with the noble Lord, Lord Ross of Marnock. He has not produced a single valid reason, and hardly an invalid one, for doing away with this system of licensing window cleaners. Edinburgh, Glasgow, Aberdeen and Dundee all license window cleaners. I believe that Edinburgh District Council has no fewer than 508 window cleaners currently licensed. They all want to continue to license window cleaners. The police, for the purposes of crime prevention, want window cleaners to be licensed. Therefore, when the noble Lord is not thinking about boot blacks and chimney sweeps I would ask him for his reasons.
Is it an unnecessary fetter on the civil liberties of the individual? Is it a layer of bureaucracy which we should strip away? Why is it that he wants to get rid of this licensing system? I would remind the Committee that, of the people who hang about houses who are up to no good, it is the easiest of all to say that one is a window cleaner, because a window cleaner does not need much equipment or a uniform. That, unfortunately, is the reason why, since time immemorial, window cleaners have been the butt of jokes and stories, because of things they get up to—not least of which is burglaring peoples' houses.
The clause is not intended to place a restriction on their trade. It is a trade that is much in demand. All the clause is intended to do is enable a bona fide window cleaner to be identified as such when he is on the job, and, perhaps more important, a person who says that he is a window cleaner or who sets out to be a window cleaner but who is not to be easily recognised. I believe this will deter ill-minded persons from passing themselves off as window cleaners. The working party said that such a provision would be useful in urban areas but doubted whether it would be in rural areas. The Government agrees with this and this is why the clause is discretionary in terms of Clause 9. This is a useful clause and I would be sorry if it were not agreed to.
Lord Wilson of Langside: I have listened with great interest to the noble Earl's reply to the suggestion that this clause should be dropped. There is, of course, much force in his part about concern with the criminal fraternity in Glasgow, Aberdeen and Edinburgh, and indeed elsewhere. But the first thing that strikes me about that is that in the days when I was dealing, in one way or another, with the criminal fraternity, especially in Glasgow, I was astonished at the number of that fraternity who when asked what their employment was replied that it was that of a window cleaner. I never had the opportunity to ascertain whether or not these people held a licence for that occupation, but I believe there is a certain amount of illusion as to the extent to which, by imposing licensing provisions in this particular form, one will bring the situation under better control.
I may be wrong about this, but it occurs to me that one of the reasons why crime is or appears to be

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somewhat more intractable as a problem than it was 20 or 50 years ago is that the motor-car is much more common and that criminals have ready access to motor-cars. This makes criminal activities much easier for them and makes it much easier to escape detection at high speed, and so on. No one has ever suggested that a licence to drive a motor-car should be dependent on the absence of a serious criminal record. I appreciate that the analogy is not complete, but it does have a point.
By objecting to this clause, those who dislike as I do, for the reasons which the noble Lord, Lord Ross of Marnock, has given, do not dislike it because it is putting an unnecessary fetter on the liberty of the subject and so on, as the noble Earl suggested, but because it will be yet another example of the domestic trivia which make life more difficult for so many people. Here, it will be in not being able to get a window cleaner because in many parts of the country people who clean windows will no longer want to do so because they will not go to the trouble of getting a licence. For my part, I thought there was much common sense (and I am sorry I did not say so at the time) in the amendment moved by the noble Earl, Lord Selkirk. He was trying to find a solution which would ensure that the criminal fraternity did not get at our windows. At the same time, this domestic problem of getting one's windows cleaned—which is a very irritating thing which has nothing to do with the levity of the subject but just makes life a little more irritating than it needs to be—is going to he rendered more difficult for many people. I wish that the Government would exercise a little more ingenuity in the context of this sort of thing than they appear willing to do.
Lord Howie of Troon: I am very sympathetic to the noble Earl the Minister in his desire to protect us from burglaries and things of that kind. I would go a long way with him in the arguments he has used in defence of his clause, but I am not wholly convinced that he answered my objections wholly satisfactorily. I can see that " carrying on the trade of " implies some kind of continuity and that it might therefore be reasonably licensable but I am not sure that " being employed as " has quite the same sense of continuity about it. We can perhaps get past the neighbour who cleans windows once for a fee. He would be being employed in a sense but it would be absurd if he had to be licensed to do it. Cleaning windows is the kind of thing that schoolboys are quite likely to do during the Easter holidays, lasting for a fortnight. There is an element of continuity there but they are not necessarily " being employed " although they will certainly want a fee. I am not talking here of " bob-a-job " or anything of that charitable nature but about young fellows trying to turn an honest penny for their own profit. Are we seriously to suggest that schoolboys working at cleaning windows during the Easter holidays or during the longer summer holidays will require a licence in order to carry out this very sensible service to the public? Is there not room here for some exclusions to the generality which we have allowed in an earlier debate?
Lord Ross of Marnock: I raised this simply because it is a bit pettifogging, in view of the difficulty people
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have in getting window cleaners. I was delighted to hear that there are 600 window cleaners licensed in the City of Edinburgh. I reckon there are about another 600 being employed without a licence for the simple reason that people cannot get a window cleaner. I wonder whether noble Lords have looked at all the other licences. If one does not comply with them, what is the fine? It is £200, but here the fine is £25. That itself is an indication that, " We are not terribly sure about this one." The language of the clause is rather silly. There is no good saying that there is no formal contract of employment. There does not need to be one. To be employed as a window cleaner all one has to do is to clean windows.
There is also the question of exhibiting the licence. There is nothing to say that the window cleaner must exhibit his licence. It is only when some constable, or some person in authority or somebody else asks to see it that the window cleaner must exhibit it. It is the failure to exhibit a licence, not the failure to have a licence, that is penalised. I think there is a lot of muddled thinking here and I do not believe that we should proceed with it on the basis that it is going to give great protection to the public. The noble Lord says you do not need anything to be a window cleaner. Well, in many parts of Glasgow the first thing you need is a ladder. You could put that in your inside pocket and nobody would notice it! You require buckets and chamois and leathers and the rest, and you require water; but evidently that does not matter. He wants to know what people are getting up to hanging around. Well, window cleaners are getting up to the windows, and to get up to the windows requires a certain amount of climbing.
The suggestion is that somehow or other if we licensed them it would be security for the public. Will it? It is suggested that no licensed window cleaner is going to dare to break into a house. It might well be the case that you would give the impression that you do not need to worry about seeing that window cleaners are honest because they are subject to a licence and you can employ anybody you like. I think that would be false trust and confidence indeed. And people might presume that they have a licence without even asking them, and then there is more trouble. One would be much more likely to be suspected if you had been cleaning the windows. This is the point that the noble and learned Lord, Lord Wilson of Langside, was getting at. If you are going to burgle a house the one thing you do not do is to make yourself conspicuous by first of all posing as a window cleaner. I think this is all muddled thinking, and it is bad drafting and we could do without it.
Why did we drop chimney sweeps? Because the very same argument in relation to chimney sweeps in respect of protecting the public was used as is used here. We dropped them because it was just a bit too much, and we should do the same in this case.
Lord Airedale: I cannot see in the clause who is to be the licensing authority, or how much the licence is to cost, or on what terms the licence is to be issued. Do you have to show that you are a skilled window cleaner to get a licence? Do you have to show that you have no criminal record? Is the licence issued at the whim of the licensing authority, whoever it may

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be? And if you are an applicant and you think you have been unjustly refused a licence, do you have a right of appeal to some higher authority complaining that you have been wrongly refused permission to carry on your trade? There seem to be a lot of loose ends in this clause which have not been tied up.
The Earl of Mansfield: If I may reply to the noble Lord, Lord Airedale, if he looked at Clause 9 he would see how the licensing provisions are set up and precisely what happens in relation to licences. And if he and the noble Lord, Lord Ross, will look at Clause 7 they will see what happens if you do not have a licence. That is what is at issue, not failure to exhibit the licence, in Clause 45(3).
There has been muddled thinking all right, but certainly not on the part of the Government. The noble and learned Lord, Lord Wilson of Langside, said that when he was sitting in a judicial capacity in Glasgow, or when he was in Glasgow dealing with criminals, which perhaps is more accurate, he heard or met or talked to or read of—I know not—many criminals who claimed to be window cleaners. If that is not a first-class recommendation for what is in the Bill I do not know what is. Certainly when I was at the Bar it was one of the standard excuses for people loitering near houses to say, " I am a window cleaner ". So this at any rate is an argument for licensing. At least if a police officer or a householder sees somebody lurking round a house he will have a check as to whether or not the person is a licensed window cleaner. Of course, if my noble friend's compromise was accepted the police officer could say, " Jimmy, let's see your licence ". And he would say " Oh, I am a window cleaner all right, but I believe in the liberty of the individual and I have not applied for one ". So neither of them would be much further on.
Then both noble Lords said that the licensing of window cleaners meant a scarcity of these valuable craftsmen and one having to wait an unconscionable time to have one's windows cleaned. There has not been the slightest bit of evidence from any of the four cities in Scotland that the previous licensing arrangements, which I may say they very much wish to continue, have caused or contributed in any way to a shortage of window cleaners.
Finally the noble Lord, Lord Howie of Troon, made a point about employment. I recognise that difficulty could be caused by what I might call—not the amateur, but perhaps the window cleaner who is employed only on a casual or temporary basis. I certainly will look at the clause to see whether on reflection we should do something to let such a person out of the clause, as it were.
I think, if I may say so, we have really made very heavy weather over a clause which everybody except the three noble Lords opposite wants to retain. Not a single word has been raised in all our consultations saying that this is an intolerable infringement of the liberty of the subject. I think perhaps it might be best if we now came to some decision on the clause.
Lord Ross of Marnock: May I make one short point. Since this is so terribly important and everyone wants to retain it, will the noble Earl tell me how many
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people have been charged with failure to have a licence as a window cleaner in Glasgow, or in Edinburgh or anywhere else? Has anyone in Scotland, where presently a licence is required, been charged with failing to have a licence?
The Earl of Mansfield: I do not think the production of the licence at present is the subject of criminal legislation. It is the fact of their being licensed which is important.
Clause 45 agreed to.
Clause 46 [Additional activities]:
On Question, Whether Clause 46 shall stand part of the Bill?
Lord Underhill: This clause provides, as made clear in subsection (1), that the Secretary of State may designate additional activities for licensing. I would wish to raise with the Minister the question which has been urged by the Scottish Consumer Council. The noble Earl will no doubt be aware that the Consumer Council has sent to a number of noble Lords, of which I am one, a copy of a letter sent to him towards the end of December. Undoubtedly the noble Earl would not have had this letter until around Christmas time, and therefore possibly had no opportunity to consider possible amendment to the Bill.
The Consumer Council has raised a very important question regarding the one day sales held in various parts of Scotland, as they are in various parts of England. Nobody has suggested that these are not helpful, particularly those that take place in more remote areas. But it is a fact and it is suggested by the Consumer Council that this does lay the way open for dishonest individuals to palm off shoddy or faulty goods, and therefore licensing of people who hold these sales would be in the interests of the consumer. It may be argued that there is consumer protection legislation, but licensing would enable it to be properly carried out. I am assured that all the enforcement authorities would be pleased to see legislation to deal with this matter.
I would like to ask the Minister whether the Secretary of State has in mind making one day sales an additional activity for licensing, which he would have power to do under this clause, or, better still, whether the Government would consider meeting the request of the Consumer Council and tabling a separate clause to this Bill.
The Earl of Mansfield: I did see the letter in question and it is fair to say that up until now the resources of my department have been wholly exercised in getting the Bill through Parliament rather than considering what the Secretary of State may or may not do once it has received Royal Assent. I understand that we have asked the council for more information about the abuses which they say are a part of these sales. So far as I know, they are giving, the matter their attention. But I think that I can give the noble Lord the undertaking that, if after the Bill becomes an Act it is shown that these particular sales are an abuse in some way or another, or that the activity is one that needs regulation and to be brought into the ambit of licensing under

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Clause 46, then, of course, my right honourable friend will consider the matter and, if so advised, will take the necessary action. I am sorry that I do not think that I can be more helpful to the noble Lord, Lord Underhill, at this still comparatively early stage of the Bill.
Lord Drumalbyn: If it is an early stage of the Bill—
The Earl of Mansfield: I said " comparatively " early.
Lord Drumalbyn: If it is a comparatively early stage of the Bill, surely there is time for it to be included in the Bill? I can assure my noble friend that, from my experiences in the standards authority, there is indeed good reason for including some kind of means of keeping up with people who hold one-day sales. What happens is that they advertise the sale, they breach all kinds of Trade Descriptions Act provisions and so forth and as soon as they are caught out they change their name and come back again. There is a real matter to be looked into seriously, and I suggest that it would not be difficult to draft a clause to cover this and to include it in the legislation at this stage rather than to wait until later, because I think that the experience of all of us is that it takes very much longer to get a provision through, even if it only requires an order or a regulation, than if you have the existence of legislation before the House which concentrates people's minds on taking the opportunity to get something put right that ought to be put right. Therefore, I should like to support the noble Lord, Lord Underhill, although I have not actually seen the representations from the Consumer Council on this matter.
Baroness Elliot of Harwood: I also have received the same letter as the noble Lord, Lord Underhill, and I think that it is well worth going into this matter. It can be an abuse—I do not know whether it is or is not. Anyway, it is something that should fit into a Bill of this kind when we are making licences for different things. I hope that the noble Earl will possibly do what my noble friend has just suggested, and will not wait too long, but will get hold of the matter. It would not require a great deal of planning or anything else to put it into the Bill as it is.
The Earl of Mansfield: If my noble friends were in the Chamber to appreciate what I went through in relation to window cleaners' licences, they will know that I would not want to put anything into this Bill which was not totally desirable. In fact the matter is also being considered in another place in relation to the English Bill, and I understand that the Department of Trade are looking at it. We shall do so ourselves. I adhere to what I said to my noble friend, Lord Drumalbyn. We are still at a comparatively early stage so far as this Bill's passage through both Houses of Parliament is concerned. If the bringing of such activities into the licensing system is thought to be desirable, then I can give my noble friends the assurance that the opportunity will be there.
Lord Ross of Marnock: We are at a very early stage of the Bill and there are quite a number of activities that require the consideration of the Com-
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mittee, if not now, at a later stage. I have one or two ideas myself. I, too, have read the English Bill and noted the new evils in England of acupuncture establishments, massage parlours and the rest of it. It may well be that if they are to be required to be licensed in England there is no reason why they should not be licensed in Scotland. The point that was raised by my noble friend is an important one. I am not personally convinced that the stage has been reached when it should be required to be one of the activities that could be subject to licensing if the local authority feels that that is so. No, I think that there is plenty of time to do that.
I welcome the spread of interest that has been shown in Scottish window cleaning and everything else. I do not know whether it is the weather that has driven people to this consideration of the need for good government, or good legislation, covering the towns and cities of Scotland. I do not know what it is, but I welcome it and I hope it will continue. I have some ideas about licensing and local authorities being allowed to license sex shops in Scotland—just to control them, not to say that there should not be any, but to say that there should be some control for the local authority. It is in the same spirit that I look on the point raised by my noble friend. He and I certainly will talk about it and see whether or not at the next stage we should put down an amendment. I do not know when the next stage will be, but please let it not be during the World Cup, when the Scots will have other things to attend to as well as the Civic Government (Scotland) Bill.
Clause 46 agreed to.
Clause 47 [Soliciting and importuning by prostitutes]:
The Earl of Mansfield The Earl of Mansfield moved Amendment No. 55A:
Page 32, line 14, leave out (" except that it includes ") and insert (" but includes—
(a)").
The noble Earl said: I beg to move Amendment No. 55A and, with the leave of the Committee, I shall speak to Amendment No. 55B. As presently drafted, Clause 47 makes it an offence to solicit for the purpose of prostitution in any public place. For the purposes of the clause, a " public place " is defined as having the same meaning as in Clause 128—that is, any place to which the public have unrestricted access, including doorways and the common areas of tenement buildings—except that it includes any place to which at the material time, the public are permitted to have access, whether on payment or otherwise.
So the definition is wide enough to include public areas in hotels, cafés and so on, to which public access is restricted by limited capacity and opening hours, and places of entertainment to which entrance is obtained on payment of a fee. However, unlike Clause 50, the definition does not cover public transport. In other words, while it will be an offence under Clause 50 to be drunk and incapable in a train or a bus, it will not be an offence under Clause 47, as presently drafted, to solicit on a train or bus. We consider that this loophole may be exploited and that it should therefore be an offence to solicit on public transport. These amendments are therefore designed

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to make such behaviour an offence by bringing the definition of " public place " in Clause 47 into line with that in Clause 50. I beg to move.
Lord Ross of Marnock: I do not think that I have very much objection to the expansion of the definition to cover public transport. However, it raises interesting points. There is the question of loitering—loitering on a train, for instance—but I do not doubt that the legal experts have worked it out. It is interesting that one will be prevented from soliciting from a car but not from a taxi or a hired car. Am I right? If prostitutes are in cars—and it has been known for prostitutes to be in cars in public places—there is no bar at all upon them: as far as I can see, they can be charged. But if they do it from a taxi or hire car, that will not be possible because of the definition, which specifically leaves out taxi or hire car. I hope that some people do not get many ideas about how to go about this particular business because, as my noble friend Lord Howie of Troon knows, this business of exceptions being included can be difficult. It may well be that it is quite wrong here, but I am perfectly sure that the Scottish Office will ask us to accept it now and say that they will look at it, and, like good, kindly citizens of Scotland, we shall do that.
But this business of being able to loiter on a train is a point that interests me, as does the effect of leaving out the taxi or hire car. Is it an offence to importune from a private car but not an offence to importune from a taxi or hire car?
On Question, amendment agreed to.
The Earl of Mansfield The Earl of Mansfield moved Amendment No. 55B:
Page 32, line 16, at end insert ("; and
(b) any public coveyance other than a taxi or hire car within the meaning of section 22 of this Act.").
The noble Earl said: I beg to move.
Lord Underhill: I think it would be helpful to the Committee if we could have the Minister's comments on the points that have been raised by my noble friend Lord Ross of Marnock. I was about to raise precisely the same points as he raised. If we want to decide whether or not to go further at another stage, it would be helpful to have the Minister's comments upon them.
The Earl of Mansfield: There is all the difference in the world between soliciting in a bus or soliciting in a train, which are conveyances with a certain number of seats, and soliciting in a taxi, which has only four seats. I should have thought that it is obvious. I reassure noble Lords that this has nothing to do with kerb-crawling.
Lord Airedale: Is the answer that, if you are in a street, you are in a public place and it does not matter whether you are inside a car, a taxi or where you are—you are in a street and you are caught? But a bus or a train may not be in a street and, therefore, it is made itself a public place for the purpose of the clause.
The Earl of Mansfield: If the noble Lord reads the words of Amendments No. 55B, he will see that it includes:
" any public conveyance other than a taxi or hire car … ".
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That is what the definition is meant to include.
On Question, amendment agreed to.
Clause 47, as amended, agreed to.
Clause 48 [Urinating etc.]:
On Question, Whether Clause 48 shall stand part of the Bill?
Lord Howie of Troon: I have one very brief question to ask. I say right away that I sympathise entirely with the intention of this clause, but I am wondering whether it refers to a public place or to a private one. I can imagine circumstances in which these activities could be done in a private place; if, for example, someone left the lavatory door open, that might conceivably cause annoyance to someone, perhaps to other members of the family. However, I should have thought that a £50 fine might be overdoing it rather. I am wondering whether this clause really is as far-reaching as I imagine it to be, or if it is intended to be more circumscribed than I think.
Lord Lyell: Clause 48 is, I understand, a result of the working party, which expressed a particular view that the activity which is caught by the old offence, which I would quote as " commiting a nuisance ", is defined under Section 380 (10) of the Burgh Police (Scotland) Act 1892. This was just in reference to committing a particular offence. But I understand that the particular offence which is spelt out in Clause 48 covers both public and private places. I hope that that might give some help to the noble Lord.
Lord Howie of Troon: I am afraid that I have to ask whether the noble Lord thinks it is a good idea to make the clause quite as far-reaching as that and to include private places as well as public ones.
Lord Lyell: We should probably have to consider the offence. I attempted to delineate " committing a nuisance ", which is an attempt to bring up to date the Burgh Police (Scotland) Act 1892. To commit this particular offence, as we have it in Clause 48, is clearly both insanitary and unpleasant in both a public or a private place. The offence is given wherever it is carried out and, therefore, we think it is right that this particular offence should not be an offence in public or private.
Lord Howie of Troon: Is nuisance the same as causing annoyance?
Lord Lyell: I did not hear the first five words of the noble Lord.
Lord Howie of Troon: I said, is nuisance in this context the same as causing annoyance? It does not seem so to me, at first sight, but it may be that the Minister is right.
Lord Lyell: One can cause annoyance in many ways, but I understand that the only offence which is covered by Clause 48 is the old definition of " committing a

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nuisance ", which is I think fairly well spelt out in line 17 of Clause 48. Of course, the offence must also cause annoyance to another person.
Clause 48 agreed to.
Clause 49 [Dogs: fouling of pavements]:
Lord Mackie of Benshire Lord Mackie of Benshire moved Amendment No. 56:
Page 32, line 23, after (" footway ") insert (" or amenity area ").
The noble Lord said: I rise to move the amendment standing in the name of my noble friend and myself. It is a very simple amendment, although I am not sure whether in our amendment it is not a little difficult to define " amenity area ". But I think that we have a very good point here. Nowadays with the number of dogs roaming the countryside, to say nothing of the towns, the amount of mess and distress that they cause is quite ludicrous. For example, in many parts of America there are notices indicating the fines and telling citizens that they must clear up and shovel up after their dogs. Dogs fouling the pavement is a subject of great merriment, but it is a most offensive habit, very prevalent and growing. I think that it is even worse in a city where there are open spaces where families take their children to play and where people let their dogs roam completely uncontrolled, fouling grassy areas. It may be that " amenity area " is too wide, but I think that the Minister and the Government should consider whether they should give local authorities power to define an amenity area where it would be an offence to allow your dog to foul as well as the few yards beside a pathway, which is right and proper. I think it should be extended to these areas which give such pleasure to families in the cities. I beg to move.
Lord Lyell: The noble Lord has confirmed our view that the clause includes in general statute an offence provision presently found in byelaws in many parts of Scotland as well as in the Edinburgh local Act. The amendment suggests that this offence should be extended to include all what we might call amenity areas. I must say straight away that I have much sympathy with the view put forward by the noble Lord, my noble neighbour, and I know that all responsible dog owners in the wide open spaces of the countryside or indeed in the more confined areas of the cities and the towns share the disgust which so many people feel about the indiscriminate, as we call it, fouling of public places. Indeed, this word might have a separate meaning to the noble Lord, Lord Ross, and myself on various other amenity areas. But so far as canine fouling is concerned we have to recognise that even dogs have to have their day—indeed, more than once a day; once or twice a day—and it is a question of making legislation enforceable.
How can we pass legislation which would restrict the dog's discharge of what we might call their natural function? Of course some kind of amenity areas, as the noble Lord, Lord Mackie, has explained, where there can be no doubt that it would be desirable to restrict the activities and, above all, these unpleasant activities of dogs and to make it an offence for dogs to use these amenity areas for these fouling activities. An example might well be a children's play area; or a
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particular area of grassland which was kept and maintained to encourage family games; or parkland where people could walk. I am also instructed that it would include areas where team games are played. I do not know whether that covers bowling greens, and the like.
On the other hand, within urban areas there are many stretches of woodland, and indeed long grass, where dogs may carry out their natural functions freely and without nuisance, but of course a balance has to be struck between the problems of enforcement and of avoiding nuisance and of course the legitimate needs of dogs. Perhaps the noble Lord would see fit to withdraw this amendment if I undertake to consider the whole of this clause again with a view perhaps to extending the offence to include such areas as children's play areas and sports and recreation grounds which were maintained by a local authority. I wonder whether he would consider that?
Lord Mackie of Benshie: I thank the Minister for that reply. Restraining the natural functions of dogs is already in the Bill. You have to restrain the natural functions on footpaths and the areas adjoining. But in making that point I am happy to accept the noble Lord's assurance that he will look at it, and I am sure that it will be much for the benefit of the younger citizens of Scotland. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 49 agreed to.
Lord Denham: I think we have probably reached a suitable point where we can break our discussion of this particular Bill for the dinner adjournment. Before I move that the House do now resume so that the intervening piece of business can be taken, I think I should tell the Committee that consideration of this particular Bill will resume at 7.35. Is the noble Lord, Lord Ross, happy about that?
Lord Ponsonby of Shulbrede: I think the noble Lord would be happier if it was 7.45.
Lord Ross of Marnock: Yes. I believe there is haggis on the menu tonight.
Lord Denham: Then 7.45 be it. I beg to move that the House do now resume.
Moved accordingly, and, on Question, Motion agreed to.
House resumed.

Civil Aviation (Amendment) Bill
7.6 p.m.
Lord Trefgarne: 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 Tregarne.)
On Question, Motion agreed to.
House in Committee accordingly.
[The LORD WELLS-PESTELL in the Chair.]
The Deputy Chairman of Committees (Lord Wells-Pestell): The Civil Aviation (Amendment) Bill: I understand that neither of the noble Lords who had given notice of their intention to speak on Clause stand part—
Lord Ponsonby of Shulbrede: The noble Earl, Lord Kinnoull, is present.
Lord Trefgarne: It may be for the convenience of the Committee if I, quite out of order I think, intervened at this moment to say that there has been a slight change of plan, and I understand that my noble friend Lord Kinnoull would now wish to have his amendment considered.
Clause 1 [Increase of financial limit of British Airports Authority]:
On Question, Whether Clause 1 shall stand part of the Bill?
The Earl of Kinnoull: I must apologise to the Chairman of Committees for that misunderstanding. We have been allocated 40 minutes for this Committee stage, and I shall do my best to keep within the 40. As my noble friend will realise, an amendment to leave out Clause 1 I hope allows the Committee to examine in more detail the work of the British Airports Authority in that at Second Reading one was talking more about the generalities of civil aviation. I should say straight away that I do not necessarily intend to press to a Division, as I am sure that my noble friend will satisfy us all.
It was noticeable during both the passage of this short Bill through another place and indeed on Second Reading in this House that there was a disquiet over the policy of the British Airports Authority financing. Indeed, the noble Baroness, Lady Burton, even threatened to call up the reserves forces in the form of Lord Taylor of Gryfe. Luckily for my noble friend, I see that he is not here this evening. The bones of the argument are, simply, should the British Airports Authority continue to fund their now massive capital programme very largely out of their annual profits or, as has been said, why should the customers of today pay for airports of tomorrow? Indeed, would such a programme cause such a spiral in costs to the detriment of the BAA, our national airports, and indeed our trade interests?
The British Airports Authority's financial results over the last 15 years make the most staggering reading, and are even better, I suggest, than those of the heyday of Mr. James Slater during his best wheeler-dealer days. I would see little difficulty in the present scope of their accounts if Her Majesty's Government were to consider privatisation. The capital base in 1965, when the body was born, was £70 million. Over the last 15 years it has invested £400 million and has only had to raise on borrowed money £14 million out of that figure. Thus, it has financed out of profits £386 million, and today it has an asset value of, apparently, £820 million. We know that in the next five years BAA have the intention of a capital programme of
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£800 million and under this Bill they will be granted approximately 20 per cent. of the capital they will require.
One can see that the result of that could possibly be even more escalating costs to the users and indeed detrimental to the authority, to our airports and to our trade. I suppose the duty of Government and Parliament is to frame public corporations such as BAA to be able to run profitably, to run efficiently, but, above all, to run in the best interests of the country. On profitability, as I have said, there is little doubt that BAA can show a good profit, even if at the moment they show it simply by raising their charges; although I do not suggest for a moment that the obviously well run BAA do that simply to show a profit. Nevertheless, they raise their charges, as we have seen in the past, particularly their landing charges, to a somewhat contested extent.
On efficiency, I have no comment except to say that one has great faith and admiration for the dedication of the staff and board of BAA. But as to the best interests of the country, I am, frankly, more doubtful, because one is concerned about the charges to the users, for the health of the airlines and about the law of diminishing returns. As my noble friend will be well aware, the Civil Aviation Authority own and run Sunburgh Airport, and some years ago they put in facilities to meet the helicopter services and decided to recoup those costs over a 10-year period. The result has been that the costs have been so large that they forced the operators away from Sunburgh and they have now moved to Aberdeen. There is a classic case of the law of diminishing returns. The alternative to the present financing, clearly, is to allow BAA either to raise bonds in the market or to do what many other countries' airports do, and most effectively.
My next point is the question of the duty of planning that the BAA have. I much admire the way they have shown both perseverance and determination to be able to provide facilities in time to meet the future growth of traffic. While realising that the Stansted inquiry is in the middle of its life—we hope it is the middle of its life—may I ask if my noble friend can give any projection at all as to when a decision is likely to be able to be reached? Secondly, may I ask him to say, on a similar basis, something about the second terminal at Gatwick? Thirdly, if by chance—this is of course a hypothetical question—the inspector of the third London airport inquiry should come down in favour of the fifth terminal, may I ask my noble friend to say whether the Government have shut the door to that alternative, or are they able to reconsider it? I hope that those questions are not trespassing on the inquiry in any way—that has not been my intention—and, in order to obtain information, I speak on this Motion.
7.14 p.m.
Lord Ponsonby of Shulbrede: I support the noble Earl, Lord Kinnoull, in his concern over the financing of the British Airports Authority. I often feel that in Second Reading debates we are in danger of making Committee stage remarks. Tonight it is probably the other way round—we are possibly in danger of re-running the Second Reading debate in Committee—but I shall try to avoid doing that and avoid discussing

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on the Motion the general question of civil aviation policy. The Motion enables us to discuss the financing of BAA. I raised this question on Second Reading, when the noble Lord, Lord Trefgarne, said:
" It might not be entirely appropriate this evening to go into the philosophy behind the British Airports Authority's finances … but it is perhaps worth saying that the mere possibility of BAA borrowing substantially to cover current capital costs would not necessarily have any effect on the current level of charges ".—[Official Report, 18/1/82; col. 486.]
BAA is a very successful state enterprise and operates without any form of subsidy from public funds. Since 1966, it has borrowed money in only three years and over that period its capital expenditure has approached some £400 million, which has been met largely from its own cash resources. The authority now faces a major capital programme involving some £800 million in the next five years, and again this will be financed mainly from cash flow and only partly from loans.
The fact that so much of BAA's capital expenditure is financed from its own cash flow means that the new facilities which it is creating for tomorrow's users are being paid for by today's users. The noble Lord, Lord Trefgarne, will have seen that BAA's annual report for 1980–81 stated:
" Heathrow's financial results for the year showed a trading profit of some £46·4 million against some £24·9 million for 1979–80. A further £33 million was invested in capital facilities. Excluding security, income rose by 27 per cent. and expenditure by 17 per cent. before depreciation ".
That means that today's users were providing, first of all, £33 million for immediate expenditure on capital facilities at Heathrow, and a further £46 million, which was reduced to £18 million after taxation and after offsetting BAA's losses elsewhere in the system, towards tomorrow's facilities. The question must be asked: is that the correct way of financing the future development of airport facilities in the United Kingdom?
I have dealt in earlier debates with the adverse effect that this form of financing can have on the long-term outlook for traffic at Heathrow, particularly in view of the high landing fees charged there; this point was made by the noble Earl this evening and I do not wish at this stage to delve further into that question. If one is building a new facility, like a road bridge—for example, the Humber Bridge—a common way to finance such a project is to borrow the money and ask future users to pay by levying a toll for the use of that facility. I am, therefore, compelled to ask whether the borrowing limits proposed in the clause are entirely appropriate. The limits which are proposed just take account of inflation, go no further than that, and do not suggest any new ways of financing the future developments of the British Airports Authority.
When one knows, for example—the noble Earl touched on this, too—that the Paris Airport Authority borrowed £100 million for the Charles de Gaullle Airport at a rate of 5 per cent., that the airport at Copenhagen is 100 per cent. Government financed, and like that at Frankfurt, pays interest on loans at the rate of 4½ per cent., and that United States airports can raise cash through tax-free bonds, often guaranteed by the airlines themselves at very favourable interest rates, one asks whether the Government are strangling the goose which is laying the golden egg in the airport
922
industry by sticking rigidly to the traditional form of financing.
I should add that the British Airport Authority is at a further disadvantage vis-à-vis local authority-owned airports since it is subject to corporation tax, while they are not. I wonder whether in this Committee stage of the Bill the noble Lord can be more forthcoming about any future new ideas for financing the work of the British Airports Authority.
Baroness Burton of Coventry: My Lords, I shall not detain the House for more than a minute, because the points to which I referred on Second Reading have arisen tonight, but I shall be very interested in what the noble Lord, Lord Trefgarne, has to say in reply. I felt very strongly that the users of today should not pay for the airports of tomorrow. I was also very interested in the question asked by the noble Earl, Lord Kinnoull, as to whether the Government had quite definitely decided that a fifth terminal at Heathrow should not be built. That was my reading of what was said, and I shall be most interested to hear what the noble Lord, Lord Trefgarne, has to say in reply.
7.22 p.m.
Lord Trefgarne: My Lords, we have heard a number of critical comments this evening, and indeed on other occasions, about the arrangements for financing the British Airport Authority's capital expenditure, and allegations have beenmade that certain changes would enable the authority to reduce its charges. I think that that is the burden of what the noble Lord, Lord Ponsonby, was saying. Before I respond to the specific points which he, my noble friend, and indeed the noble Baroness, raised, perhaps I should make a couple of general observations.
The financial arrangements for the nationalised industries which are now in place were introduced by the then Labour Government and presented to Parliament in a White Paper published in March 1978. The present Government endorse these arrangements, and perhaps for a moment I may refresh your Lordships' minds on one or two of the details. Because of the pervasive influence of the nationalised industries throughout the economy, the efficiency with which they use their share of the national resources is a matter of great importance. Thus an adequate level of nationalised industry profits is essential to the continued wellbeing of the industries and their customers and indeed of the economy as a whole. They—that is, the profits, with depreciation—provide some of the funds for the very large investment programmes necessary to maintain supplies and services to the public. This keeps down the industries' new borrowing requirements, thus helping to reduce the burden of taxation and enabling the Government to maintain other important public expenditure priorities.
I should now like to turn specifically to the points that have been put to me. The noble Lord, Lord Ponsonby, and my noble friend Lord Kinnoull—and I suspect that the noble Baroness, too, would have made the suggestion had she spoke at greater length—suggested that airport charges could be reduced if present users were not expected to pay for future investment. As is the case with other nationalised industries, the Government expect the authority to earn a proper rate

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of return on its assets. This policy is based on the principle that the prices of goods and services should reflect the full economic cost of supply; that is to say that the authority should price to cover its long-run marginal costs—an accepted economic principle of pricing, which I explained to your Lordships at some length in reply to the noble Lord, Lord Ponsonby, during the debate on the 1980 Civil Aviation Bill. If I may, I shall spare your Lordships a repetition of the arguments that I advanced on that occasion.
It has also been suggested that the authority should be allowed to borrow more from the private sector. As I have explained, it is misconceived to believe that the source and amount of debt financing is the primary influence in the determination of charges. Simply being able to borrow on the open market would not bring about any changes in the determination of proper charges. In fact the Airports Authority Act 1975 does not allow the authority to borrow, other than temporarily, in sterling other than from the National Loans Fund, though in any case, because of its greater worthiness, the Government are able to offer loans at a more advantageous rate than the private sector, especially now that there is greater flexibility of terms and now that a proportion of each industry's borrowings may be taken up at variable rates of interest. However, as my honourable friend the Parliamentary Under-Secretary in the Department of Trade said during the proceedings on this Bill in another place, the Government are looking at ways in which private sector finance can be introduced into the authority's investment programme.
I now wish to turn to one or two of the points raised by my noble friend Lord Kinnoull. He referred to the example of Sunburgh. It is not I think true to say that the decline in the use of Sunburgh was a result of the charges that are in force at that airport. As my noble friend rightly said, Sunburgh is operated by the Civil Aviation Authority, but as an example of pricing policy it is not true to say that the prices there dictated the decline in the use of that aerodrome, which has indeed taken place in recent years and months—
The Earl of Kinnoull: Has my noble friend invited comment from the operators?—because I have received the opposite view.
Lord Trefgarne: My Lords, I was about to explain to my noble friend why the decline took place. As I said, it was not due to prices, though operators may claim that. The truth is that longer-range helicopters came into service, which meant that the traffic, which in any event originates other than at Sunburgh, can now proceed to most of the oil rigs and production platforms in the North Sea direct, without making a stop at Sunburgh. So whereas originally the helicopters operated from Sunburgh to the rigs—and Sunburgh itself was served by fixed-wing aircraft—it is now possible for the helicopters to proceed direct from Aberdeen, for example, and not land at Sunburgh. It is certainly the case that the facilities that gave rise to the level of charges to which my noble friend has drawn attention were specially installed for the benefit of the oil-related traffic, and thus in our view it was right that that traffic should in general bear the cost of providing those facilities.
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My noble friend also referred to the question or Stansted. I am not yet in a position to give him a date as to when a decision could be reached on that matter. Suffice it, however, to say that the provisions of this Bill have no particular bearing on that, because they would certainly fall outside the 5-year period to which it is envisaged the existing provisions should relate.
My noble friend also referred to the position at Gatwick. There is indeed an outstanding decision in respect of Terminal 2 at Gatwick. My right honourable friends the Secretaries of State for Trade and for the Environment are inviting further comments on that proposal in the light of certain new traffic figures that came to hand recently, and they will be deciding the way forward in that particular connection as soon as the comments have been received and analysed.
My noble friend, and indeed the noble Baroness, Lady Burton, also referred to the position with regard to a fifth terminal at Heathrow. I am reluctant to speculate on what would be a purely hypothetic supposition, but clearly my right honourable friends would consider the inspector's report very carefully, if it included such a recommendation, before reaching their decision in respect of the Stansted application, to which my noble friend has referred.
I hope I have convinced your Lordships that the way in which the authority's capital investment is financed is really of no relevance to the determination of their charges, but perhaps this would be an appropriate opportunity to remind your Lordships that in 1980/81, as in previous years—and I think it was the noble Lord, Lord Ponsonby, who referred to the profits of the British Airports Authority—they in fact made a loss on their overall traffic operations. Their profitability is a result of the commercial revenue which they earn from other, not directly related activities.
I hope that in the light of what I have said the Committee will agree that this clause should stand part of the Bill.
Clause 1 agreed to.
Clause 2 [Increase of financial limit of British Airways Board]:
On Question, Whether Clause 2 shall stand part of the Bill?
The Earl of Kinnoull: May I very briefly ask one question of my noble friend? It is to do with European air fares, which, of course, is very much a matter which British Airways are facing and, indeed, are trying to promote. The Government, I know, are in negotiations with various countries over air fares, and I am wondering whether my noble friend has anything to comment on this evening.
Lord Trefgarne: I am afraid I am not up to date on the latest position as to that, but I will certainly ascertain what the position is and write to my noble friend. However, perhaps I could just say that the borrowing powers being conferred on British Airways by this clause are of course for the purposes of their current capital expenditure programme.
Clause 2 agreed to.
Remaining clauses and the schedules agreed to.
House resumed: Bill reported without amendment: Report received.
Lord Lyell: I beg to move that the House do now adjourn during pleasure until 7.45.
Moved accordingly, and, on Question, Motion agreed to.
[The Sitting was suspended from 7.33 p.m. until 7.45 p.m.]

Civic Government (Scotland) Bill [H.L.]
House again in Committee.
Clause 50 [Drunkenness]:
The Earl of Selkirk The Earl of Selkirk moved Amendment No. 57:
Page 32, line 34, after (" place ") insert (" or on any property defined in section 61(3) ").
The noble Earl said: This amendment may be unnecessary in the view of my noble friend. Clause 50 deals with the question of how you handle persons who are drunk and incapable. That deals with persons drunk and incapable in public places only; but what I am suggesting is that there should be a perfectly clear connection between Clauses 50 and 61. Clause 61 deals with persons who commit offences on private property. I want to be quite clear that, if a person is drunk and incapable on private property, the person authorised—the tenant or any person including the owner or, as the case may be, the tenant/ occupier—who finds him committing an offence can use those powers not only in respect of Clause 61 but also in respect of offences under Clause 50.
That may be held by Clause 61(4), which makes reference to Clause 50. But the difference here is that the offence is in a public place—that is to say, under Clause 50—whereas in Clause 61 the offence is on private property. I think it important to be clear that offences in a private place are also offences in private property; and not only that, but the person committing that offence can be arrested by a private person. I want to be clear that that is the case. If it is the case already, then I am happy. If it is not, I believe that this amendment should be included. I beg to move.
The Earl of Mansfield: Under the terms of Clause 50, a person who, in certain circumstances, is drunk in a public place, with all that that implies, is guilty of an offence. I remind my noble friend that not only does it include under the terms of Clause 50(7) any place to which the public have unrestricted access, including doorways, entrances and the common areas of tenement buildings, but also includes any place to which at the material time the public are permitted to have access whether on payment or otherwise and any public conveyance other than a taxi or a hire car within the meaning of Clause 22.
What my noble friend is seeking to do is to make it an offence to be drunk not only in a public place but also on any private property. I am bound to say that we find this unacceptably wide. The Committee may
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recall our debate on the Criminal Justice (Scotland) Act 1980. It was then made plain, so far as the Government were concerned, that it was our intention to move towards the removal of simple drunkenness from the criminal calendar. The dreadful, trendy word is now " decriminalisation ", but I use that word under protest. As a first step, Section 56 of the Act abolished imprisonment for the statutory offence of drunkenness, so that the purpose of Clause 50(1) is to deal with a nuisance that can be created by persons who are drunk and incapable in public places.
If the Committee were to accept my noble friend's amendment, I think that would be a retrogressive step. It would widen the scope of the offence to make it an offence to be drunk and incapable not only in a public place but also on any private property—indeed, even in one's own house. I should point out that Section 7 of the Licensing (Scotland) Act 1903 covers only drunkenness in public places. If one considers that this clause of the Bill is one designed to deal with public nuisances—that is to say, people who are drunk and incapable in the street and other places to which the public have unrestricted access, and, indeed, public transport—then I think it goes far enough. I think that it would be going far too far to make the matter as wide as my noble friend suggests by virtue of this amendment. I hope, therefore, that on reflection he will agree to withdraw it.
The Earl of Selkirk: I understand the point that my noble friend is making. I want to put it the other way. Supposing somebody is in your property whom you do not want there and is drunk and incapable? Can you apprehend him as is stated under Clause 61(3) and hand him over? This is the point that I have in mind. If someone is in your property—however he got there—and makes himself drunk and incapable, what do you do with him? The remedy provided under Clause 61(3) is a perfectly satisfactory remedy which one can deal with; otherwise one can hand him over to the police and get rid of him out of the house. That seems a rational step to be able to take.
May I say that 1 do not know—if this is what my noble friend is saying—how he deals with Clause 61(4) which says:
"This section applies to offences under Sections 50, 59 and 60 of this Act ".
That means that Section 50 offences also apply in the circumstances of private property which is referred to under Clause 61. I am not certain what those words mean if they do not mean that one can take action for an offence which is on public property. It may be on the strict drafting of this Bill that my noble friend is perfectly correct but I do not quite know then what is not correct. In other words, what does the term " Section 50 " mean there? Does it mean one can take action under the specific Section 50 which deals exclusively with drunkenness? If it is not covered, can he think of some way of covering it in the sense that a person uninvited—not the owner—can be excluded from the house if he is drunk and incapable in the house? What does one do in those circumstances? I should like to believe that one can take action under Clause 61(3), and one can apprehend him and hand him over to the custody of a constable. If it is not in

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the Bill already, I think there should be some provision of that character.
The Earl of Mansfield: Clause 61(3) gives the owner, tenant or occupier of any heritable property in which an offence under Clause 50 is being committed a power to apprehend and detain the person involved. Therefore, the position is clear. He can apprehend somebody who is drunk on his premises. Clause 61(3), which is the definitive part of the clause with which we are dealing, allows the owner of a public house, as an example, to apprehend and detain a drunk on his premises. Although Clause 61 relates back to Clause 50, the clause with which we are dealing relates to drunks in public. I hope, therefore, this is now plain to my noble friend.
There are two issues: first, the offence of being drunk and incapable of a public place. That is what we are considering in Clause 50. I have resisted my noble friend's amendment because it would widen the terms of the offence far too much in circumstances in which we are trying to narrow down the offence of simple drunkenness and trying to deal with those cases outside the ambit of the criminal law. What my noble friend is talking about in Clause 61 is different and relates to the power of people to detain—in the case of subsection (3)—people who can be on property which can be private. I hope this is clear.
The Earl of Selkirk: I am not entirely happy with what the noble Earl has said. I hope that he has taken the point and I hope that he will consider it further. If someone forces his way into your house—that is private property—and is drunk and incapable, what do you do? I am not wholly satisfied that the noble Earl has answered that. Perhaps he will think about it. This is an offence. In a sense for a non-invited guest a private house is a public place. He has wandered in and should be dealt with as if he had been outside the house. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord Ross of Marnock Lord Ross of Marnock moved Amendments Nos. 57A to 57C:
Page 32, line 38, leave out (" 7 ") and insert (" 10 ").
Page 33, line 2, leave out (" 7 ") and insert (" 10 ").
Page 33, line 6, leave out (" 7 ") and insert (" 10 ").
The noble Lord said: These amendments deal with the offence of drunkenness, but not simple drunkenness. The last amendment related to being drunk and incapable. We are now dealing with any person who is drunk in a public place while in charge of a child. I do not know, quite honestly, whether it is worth having subsections (2) (5) or (6) in the clause. If you are drunk and incapable, then you are liable for arrest and the penalty is £50. If you are drunk in a public place, in charge of a child, the offence is punishable still by a fine not exceeding £50. The same is true about subsection (6)—a fine not exceeding £50.
If a person is drunk it is bad enough when he is incapable of looking after himself, but when he has a child with him or is carrying a loaded firearm, or a firearm, then that merits a much increased fine. It aggravates the original offence of drunkenness. Leaving that aside—because I am not dealing with it
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in Amendment No. 57A—the question arises about being in charge of a child. Is it right that the age should be seven? I think it is far too low an age at which to draw a line, and I have suggested in my amendment that the age should be 10.
Since I put down my amendment I have had correspondence from Glasgow and I think their age is much higher—under the age of 12. While there is something to be said for that, to my mind there is nothing to be said for putting the age as low as seven. I have seen many people in the street in charge of children who are over the age of seven, and they really should not be in charge of them in the state they have been in. I think it is a serious offence and merits more than the penalty for simple drunkenness, but I also consider that the age should be at least 10. My amendment and the two subsequent ones, which are consequential, would leave out " seven " and insert " 10 ". I hope the Government will see their way to accept that suggestion. I beg to move.
The Earl of Mansfield: The existing provision in the Licensing (Scotland) Act 1903, which Clause 50(2) is designed to replace, make it an offence to be drunk in a public place while in charge of a child under the age of seven. It is not now known what particular significance, if any, the age of seven years had at that time. I have to confess that the only reason for putting " seven " in Clause 50 is that that is the age which is used in the 1903 Act. I do not know how the noble Lord alighted on the age of 10, but I confess that I should like to test the opinion of the Committee on this. If noble Lords feel there is now a case for extending the protection afforded by this section to children between the ages of seven and 10, I think I would accept the amendment; so I am in the hands of the Committee.
The Earl of Selkirk: May I just make one point. Supposing a man is drunk and he is with a girl of 15—I should think it is very improper to go around with a girl of that age, but I think that a girl of 10 with a drunken father, if that is the case, is improper and should be curtailed. I should have said that 10 was certainly not too high.
Baroness Elliot of Harwood: I should also like to support that. If we say 10 or 12, children pass on to secondary school, at any rate in the country districts, when they are 10 or 11 and therefore have more experience. But I certainly think that 10 is the absolute minimum and I would not mind if it were 12.
Lord Mackie of Benshie: I would agree that 10 is a much more reasonable age than seven.
Lord Drumalbyn: I share that view, too.
Lord Ross of Marnock: The Minister of State has heard the views of the Committee from all parts and from both sexes. I think it is quite clear. However, there is one other danger: if you arc going to put the age as low as seven, you will get to the point where you will say: " the child is 10 and the child is in charge of the father ". Therefore, subsection (1) becomes very dangerously defective.
Lord Mackie of Benshie: It could be a mother.
Lord Ross of Marnock: Yes, it could be a mother, but it is most unlikely. Scots mothers are not like that, as I am sure the noble Lord will fully appreciate.
The Earl of Mansfield: The Committee is clearly of the opinion that this is an amendment which should be accepted, and I therefore invite the Committee to do just that.
On Question, amendments agreed to.
The Earl of Mansfield The Earl of Mansfield moved Amendment No. 57CA:
Page 33, line 8, leave out (" loaded ").
The noble Earl said: The offence of being drunk in a public place while in possession of a firearm is essentially a public nuisance offence. The proposal is to delete the adjective " loaded " and that is in recognition of the fact that the person who is drunk in a public place while in possession of a firearm, and it is unknown to the persons present whether it is loaded or not, is no less a nuisance than a person who is drunk in a public place while in possession of a firearm which is loaded but which fact is equally unknown to the persons present. So, in effect, the amendment seeks to protect the public from both types of nuisance by making it an offence to be drunk in a public place while in possession of a firearm, whether or not it is loaded. I beg to move.
Lord Ross of Marnock: I think the important thing is that you have a person in a public place with a firearm and people do not know whether it is loaded or unloaded. The other important thing is that the person is himself loaded.
Lord Drumalbyn: There is just one point here. The firearm may be covered and may be in a sling. Surely that would not be an offence?
The Earl of Mansfield: Yes, it would.
On Question, amendment agreed to.
Lord Ross of Marnock Lord Ross of Marnock moved Amendment 57D:
Page 33, line 10, leave out (" £50 ") and insert (" £100 ").
The noble Lord said: I think we have all agreed that being in possession of a firearm, whether loaded or unloaded, is a serious matter. Your Lordships can well imagine what would happen in a crowd, for instance, if a person started brandishing, as a drunken man is much more likely to do, a firearm. Now we come to this question of penalties. This surely is not the same thing as someone being drunk in a public place. If being drunk in a public place commands a penalty of £50, surely these special circumstances mean that the offence is more serious and indeed that the penalty should be greater. My amendment suggests that we should remove £50 and replace it with £100.
The Earl of Mansfield: This offence, although it has grave connotations, is essentially what is described as a minor nuisance offence. If the offender's actions constitute more than a minor nuisance there are several other much more serious offences which can
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be charged either in addition to or by way of substitution of an offence under Clause 50. Examples which spring to mind are breach of the peace, assault, reckless discharge of a firearm—and of course it is a separate offence under the Firearm Act 1968 to be in possession of a loaded firearm in a public place without lawful authority. So for these reasons I do not think it would be appropriate to impose a more severe penalty than the other minor nuisance offences involving drunkenness.
The other matter is that a tine of £100 would be at variance with the provisions of the Criminal Justice Bill, which is now going through its stages in another place. That Bill seeks to rationalise tines for summary offences by placing them on the appropriate point of a five-point scale; that is, £25, £50, £200, £500 and £1,000. The amendment would put the maximum fine for their particular offence at complete variance with the attempted rationalisation.
The important part of this is that if somebody does anything with a firearm in a public place, whether it is loaded or not and whether they are drunk or not—which in effect is, shall I say? a nuisance or worse so far as the public are concerned—there are far graver offences with which they could quite easily be charged than this offence. It is for that reason that I would resist the amendment.
Lord Ross of Marnock: I am sorry about that. I think that there should be degrees of nuisance as well. In relation to drunkenness, what is outlined in subsections (1) and (2) is fairly obvious. To be drunk in charge of a child is more serious and, to my mind, should merit a heavier penalty. The same is true of what we are addressing ourselves to now. The Minister of State cannot have it every way. He has already persuaded us to leave out the word " loaded ", so that all we are talking about is a firearm. I still think, despite all he said, that it is far better, when we are legislating in this way, to be rational and to put our degrees of nuisance in here. If the Government want to make any consequential changes in another Bill that is going through the House, they can do so. But I still think that this merits a fine greater than £50.
The Earl of Mansfield: If the noble Lord really thinks that, he should go up the scale to £200 and, at least, he consistent, and do that at a later stage. I have tried to explain why £100 is quite inappropriate.
Lord Mackie of Benshie: In this case, I must disagree with the noble Lord, Lord Ross of Marnock, because, if no worse occurs, to be drunk in charge of a firearm is not as bad as being drunk in charge of a child. As there are penalties for being dangerous thereafter, I rather agree with the Minister in this case.
Lord Ross of Marnock: The noble Lord, Lord Mackie, agrees with the Minister at the same time as he agrees with me, that it is more serious to be drunk in charge of a child than it is to be drunk in charge of a firearm, and it is only £50 for each of those. I originally drew attention to this anomaly in logic. There is another stage, and the Liberals and we shall together, I hope, press upon the Government the need to do something more than is being done here. Meantime, in view of

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the impeccable logic of the Minister of State on this occasion, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
8.12 p.m.
Lord Ross of Marnock Lord Ross of Marnock moved Amendment No. 57E:
Page 33, line 11, leave out subsection (6).
The noble Lord said: We now come to what is probably the most important amendment of the night, which has to do with being drunk in charge of a horse or cattle. This is 26th January, and 1 had to cancel one or two very important engagements to be here tonight because I thought that this was so important. At one of those engagements, I was to recite a poem by Robert Burns called Tam o' Shanter. If noble Lords remember,
"Tam had got planted unco right,
Fast by an ingle, bleezing finely,
Wi' reaming swats, that drank divinely;
And at his elbow, Souter Johnny,
His ancient, trusty, drouthy crony;
Tam lo'ed him like a very brither;
They had been fou for weeks thegither."
This was no exception, according to the poem, for,
"Kings may be blest, but Tam was glorious,
O'er a' the ills o' life victorious!"
So he was drunk, but what did he proceed to do? He got on his horse:
"Weel mounted on his gray mare, Meg,
A better never lifted leg,
Tam skelpit on".
It is such a wonderful poem that you begin to wonder where he will stop. But there is no doubt that there was Tam o' Shanter and, without the benefit of fines or an Act of Parliament, he managed to proceed towards Alloway and there he saw some terrible things:
Warlocks and witches in a dance!
Nae cotillon brent new frae France,
But hornpipes, jigs, strathspeys, and reels,
Put life and mettle in their heels.
A winnock-bunker in the east,
There sat auld Nick, in shape o' beast "—
and all because he was drunk in charge of a horse. We must try to save the Scots from this terrible fate. Your Lordships will remember what Burns said:
" Now wha this tale o' truth shall read,
Each man and mother's son, take heed;
Whene'er to drink you are inclin'd.
Or cutty-sarks rin in your mind,
Think! ye may buy the boys o'er dear;
Remember Tam o'Shanter's mare."
After this Bill goes through, we shall need to change that to,
" Whene'er to drink you are inclin'd,
Remember now you may be fined."
Do we really want this penalty of £50 for being drunk in charge? I do not know how many people have been charged with being drunk in charge of a horse. As in the case of Tam, when the rider is drunk the horse very often takes him home. It is well-known in farming circles, probably around the Aberdeen area. It has even been known in Ayrshire for the horse to take the rider home. I am just wondering whether we should go ahead with it.
So far as cattle are concerned, there was a case in Stornoway a few weeks ago when somebody was
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drunk in charge of a cow. I do not know exactly what happened, but, again, for that the fine would be £50. You could charge the man with being drunk and still fine him as in this case, which the Government designate as being specially serious and which I have my doubts about. This may have been needed when there were far more people like Tam o' Shanter going to market on horses and creating trouble, not just in Alloway but in other places as well. I doubt very much whether it is worth putting this in now. In view of the fact that we already have the warning from Burns about the danger of being drunk in charge of horses, we should rest on that, rather than on this new-found piece of poetry that comes from the Scottish Office draftsmen. I beg to move.
The Earl of Mansfield: One of the disadvantages of a brief is that one cannot compete with the noble Lord, although I dare say that the shorthand writers will be grateful—
Lord Ross of Marnock: I assure the noble Earl that I warned them to have their Burns ready.
The Earl of Mansfield: The fact is that this is an offence which does not figure too highly in the calendar. The noble Lord was perfectly right when he said that in Stornoway last month a man was convicted of the offence of being drunk in charge of cattle, and in July 1981 there was what I might call a Tam o' Shanter situation, when a person was reported for being drunk in charge of a horse. When we were consulting with various authorities as to the contents of this Bill, the Association of Chief Police Officers made representations that, although they expected the powers to be infrequently used, there would be some advantage in retaining the offence. That is why subsection (6) finds its way into the Bill.
I suppose that, particularly in the country areas, it is irritating for the local citizenry to have stockmen drunk in charge of their beasts and, perhaps, in those circumstances it is sensible to keep this provision. What I think the noble Lord, Lord Ross, must show, if he wants to exclude subsection (6), is that there is some good reason for deleting it. I appreciate that there are not too many cases, but there are a few. I am glad to say that Scotland is still a reasonably agricultural country, and I suppose that we must so frame our criminal law that we take cognisance of that fact. So in spite of the infrequency with which the law is to be used, and the fact that one may have a certain sympathy with people who are drunk in charge of animals, I think the noble Lord may agree that we should retain the offence for the time being.
Lord Ross of Marnock: If " for the time being " is between now and Report stage, I shall agree with the Minister of State. But, if a person is drunk, you can charge him anyway and fine him £50. For some reason or other, the Government are not going to change that, unless we convince them that this should have been dropped along with some of the other things which were in the now obsolete private legislation of the old burghs. However, I shall not press the amendment now.
Amendment, by leave, withdrawn.
8.20 p.m.
Lord Ross of Marnock Lord Ross of Marnock had given Notice of his intention to move Amendment No. 57F:
Page 33, line 19, leave out (" taxi or ").
The noble Lord said: The intention of the amendment was to leave out the words " taxi or ". It could be argued that some protection ought to be afforded to taxi drivers from people who are drunk in taxis. This can be a nuisance for taxi drivers. However, it is a matter which we can take up later. Therefore, I do not propose to move this amendment.
[Amendment No. 57F not moved.]
Clause 50, as amended, agreed to.
Clause 51 [Obscene material]:
The Earl of Mansfield The Earl of Mansfield moved Amendment No. 57FA:
Page 33, line 25, leave out (" subsections (3) and (4) ") and insert (" subsection (5) ").
The noble Earl said: This is a drafting amendment. The opening words of subsection (2) of Clause 51 state that the provisions of subsection (2) are subject to the provisions of subsections (3) and (4). Subsection (3) merely fixes the penalty for offences under subsections (1) and (2). So subsection (2) should have referred to subsections (4) and (5) which provide a saving for persons who distribute obscene material otherwise than for gain and provide a " due diligence " defence in respect of offences under subsection (2). I beg to move.
On Question, amendment agreed to.
The Earl of Mansfield The Earl of Mansfield moved Amendment No. 57FB:
Page 33, leave out from the beginning of line 26 to (" any ") in line 28 and insert (" publishes, sells or distributes or, with a view to its eventual sale or distribution, makes, prints, has or keeps ").
The noble Earl said: Clause 51 does not penalise simple possession of obscene material. It only penalises possession where such possession is with a view to sale or distribution. However, if one makes or prints some obscene material in one's own home simply for one's own possession and with no view to sale or distribution, one is guilty of an offence under Clause 51 as presently drafted. There is an inconsistency. We feel that Clause 51 should be amended to provide that the making and printing of obscene material are, like possession, only offences when they are with a view to eventual sale or distribution. It is really a matter of consistency. I beg to move.
On Question, amendment agreed to.
Lord Ross of Marnock Lord Ross of Marnock had given Notice of his intention to move Amendment No. 57G:
Page 33, line 36, leave out subsection (4).
The noble Lord said: There have been alterations to subsection (2) since I put down this amendment. I should like to have a look at them and then see how the subsection reads. I am not terribly happy about it. I do not know whether or not there is any inconsistency in the fact that the word " prints " is still there as against what is elsewhere. For that reason,
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I do not propose to move the amendment. Nevertheless, it is a subject to which I shall return, probably at an earlier time of the day, because it merits the consideration of the House.
[Amendment No. 57G not moved.]
The Earl of Mansfield The Earl of Mansfield moved Amendment No. 57GA:
Page 34, line 5, leave out from (" above ") to end of line 7 and insert (" the court may, if satisfied that the person accused is guilty of an offence under section 1(1) of the Indecent Displays (Control) Act 1981 (offence of public display of indecent matter), convict him of a breach of the said section 1(1).").
The noble Earl said: As presently drafted, subsection (6) of Clause 51 provides that where a person is charged with the offence of displaying obscene material under subsection (1) he may be convicted of the offence of displaying indecent material under the Indecent Displays Control Act 1981. This provision is designed to cover cases where a person who is charged with the offence of displaying obscene material in a public place is found not guilty of that offence on the grounds that the material displayed was merely indecent. It allows the court in such circumstances to convict the accused of the offence of displaying indecent material. It is not, however, entirely clear from the wording of subsection (6) that a person charged with an offence under subsection (1) can be found guilty of an offence under section 1(1) of the Indecent Displays Control Act only if the display was an offence under that Act. So there could, for example, be circumstances where a person who has been charged with an offence under subsection (1) is found not guilty on the grounds that the material displayed was merely indecent and where the material was displayed in circumstances where the display of indecent material is permitted by the Indecent Displays Control Act. In such circumstances, it would not be appropriate to find the accused guilty of an offence under the 1981 Act. This amendment therefore simply makes it clear that a person charged with the offence of obscene display under subsection (1) can be found guilty of an offence under section 1(1) of the Indecent Displays Control Act only if the display was an offence under that Act. I beg to move.
On Question, amendment agreed to.
The Deputy Chairman of Committees (Earl Cathcart): In calling Amendment No. 57H, I must say that, if this amendment is agreed to, I cannot call Amendment No. 57HA.
Lord Ross of Marnock Lord Ross of Marnock moved Amendment No.57H:
Page 34, line 8, leave out subsection (7).
The noble Lord said: I suggest that we should have another look at this subsection. Nothing in it applies to any matter relating to television and sound broadcasting. All this might have been relevant when one could argue that the BBC, with their standards, would do something about it and that this would cover the whole country and would not be a matter for a district authority. The same could be true of the Independent Television Authority. The new factor is that commercial radio stations now cover limited areas. Radio Clyde covers the Glasgow area while Radio West Sound covers the Ayrshire

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district area of Kyle and Carrick. Are we to suggest that one gets nothing obscene or indecent from them? I should like to think that that was so, but how are we going to deal with it if it arises? Some people may have objected to a programme which went out last night on Radio West Sound. They may have had to listen to 20 minutes of Ross of Marnock on the subject of Robert Burns. But I do not think that because I was broadcasting I should be allowed to say what I like and offend people by saying something which they might consider to be offensive.
I am wondering whether the new situation regarding local radio is amply covered by the exceptions. I am not sure. I do not know whether the Independent Broadcasting Authority transmits; they do not produce programmes. It may be a different matter for the BBC; they actually produce and transmit programmes. It may be argued that the Independent Broadcasting Authority provide the facilities for transmission, so that covers it. There are many people who are worried about the kind of things which are broadcast on radio and television. I would have said that some of the broadcasts were indecent. This kind of exception should be explained to the Scottish public. It should be explained to them that their broadcasts are covered by some other procedure. I beg to move.
The Earl of Mansfield: The noble Lord's speech, as opposed to the content of his amendment, dealt with obscene material in broadcasting, and I shall therefore confine myself to broadcasts rather than plays. This exemption in respect of television broadcasts by the BBC or IBA—or indeed radio broadcasts, because the two are exactly similar—or by way of a diffusion service (that is to say, local community cable television or subscription television) is similar to that contained in Section 1(3) (b) of the Obscene Publicatons Act 1959. Indeed, the exemption in that Act also extends to sound broadcasts by the BBC or IBA, but unfortunately the words " or sound " have been omitted from the Bill. That I intend to rectify by way of a Government amendment.
The noble Lord will be aware that successive Governments have stuck to the policy that the responsibility for programmes broadcast by the BBC or IBA must rest with the broadcasting authorities themselves, who act as trustees for the public interest in broadcasting. The exemption for the BBC and IBA from the provisions of Clause 51 is in line with this policy. The BBC under its charter and the IBA under its statute have an obligation to maintain proper standards and they take this obligation very seriously. To that extent, the noble Lords' amendment is unneccesary. There are other matters which the amendment envisages, such as video cassettes and closed circuit television as well as plays. But as the noble Lord has confined his remarks to broadcasting, I shall do likewise.
Amendment, by leave withdrawn.
The Earl of Mansfield The Earl of Mansfield moved Amendment No. 57HA:
Page 34, line 9, after (" television ") insert (" or sound ").
The noble Earl said: Subsection (7) of Clause 51 exempts television broadcasts from the provisions of
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Clause 51. As I have said, this is in line with the policy of successive Governments. The extension of this exemption to cover sound broadcasts by the BBC and IBA accords with that policy and brings the exemption in the Bill in line with that in the Obscene Publications Act 1959. I beg to move.
On Question, amendment agreed to.
The Earl of Mansfield The Earl of Mansfield moved Amendment No. 57HB:
Page 34, leave out lines 28 to 31.
The noble Earl said: The definition of " publishes " in subsection (9) of Clause 51 is designed to bring within the scope of the offence provision in subsection (2) the playing of obscene records, tape recordings and video tapes and the showing of obscene films and so on. However, in its reference to material which " if played or projected … would be obscene " the definition implies that material which is designed to be played or projected is only obscene if it is actually played or projected. That, of course, is not the intention. It is intended that obscene records and films should be caught by the provisions of Clause 51 at the point of making and distribution and not only when they are played or projected, and so on. The amendment therefore removes the unwanted implication while retaining the intended effect of the definition. I beg to move.
On Question, amendment agreed to.
The Earl of Mansfield The Earl of Mansfield moved Amendment No. 57HC:
Page 34, line 33, at end insert ("; and the reference to publishing includes a reference to playing, projecting or otherwise reproducing.").
The noble Earl said: I have already spoken to this amendment, and I beg to move.
On Question, amendment agreed to.
Clause 51, as amended, agreed to.
8.35 p.m.
Lord Ross of Marnock Lord Ross of Marnock moved Amendment No. 57J:
After Clause 51, insert the following new clause:
" Solvent abuse
. The inhalation of any chemical substance or combination of substances for the purpose of causing a condition of intoxication, elation, euphoria, excitement or irrational behaviour shall be an offence.").
The noble Lord said: This is a new clause that I consider should be considered by your Lordships, dealing with glue sniffing. It is something that has come more and more to the fore in recent years, not only in Scotland but elsewhere in the United Kingdom. We have had quite a few cases, not least one in December of last year, when a young Scots lad aged 14 was found dying in a wood in Stirlingshire. The post mortem, it was suggested, would give the cause of death as glue sniffing.
There have been quite a few deaths and the argument has been made, how on earth can one make this an offence? Would such action be effective? Would it be better to try to deal with the question of supply? One appreciates that the supply comprises an amazing number of substances which are quite innocent and useful in the home and to tradesmen. Then there has been the suggestion that shopkeepers should be persuaded not to sell this glue to young people. There have been voluntary arrangements made in some places

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and in other parts of the world. I believe there was one place in America where they persuaded shopkeepers not to sell this glue to minors unless they were accompanied by an older person. That had some effect.
The position at the moment was outlined by police in, I believe, Strathclyde: that all they could do if they found someone sniffing glue on several occasions was to take him home and get the parents to warn him. That has not been effective. I believe the police would also suggest eventually that they should try to bring the children before a children's panel and try to get treatment. Whether we can get this measure of agreement and co-operation from parents without glue sniffing being an offence is very doubtful indeed. My suggestion is that we make it an offence. I have not put in any penalty because I believe that that is a matter for further consideration. The answer may well be to give the police the power to bring the children before the children's panel and, because it is an offence by young people, let the children's panel decide what kind of treatment ought to be given. But something must be done.
I believe that, according to the Scottish Sunday Standard, it was Tampa, in Florida, which succeeded in bringing in legislation prohibiting the inhalation of any chemical substance for the purpose of causing a condition of intoxication, dizziness, exhilaration and the rest of it. It was also reported that a police inspector from the community involved in Strathclyde visited Tampa early last year to assess the impact of that development. He said that it had not stopped glue sniffing altogether but there was no doubt that it had had a deterrent effect. Even if the proposed clause achieved that, that would be something. If we go on doing absolutely nothing in respect of this problem and find it worsening, then we shall be blamed. This is an appalling thing, where youngsters from 8 to 15 years of ageschoolchildren—are mainly involved. It occurs where there are housing schemes and where there are high rise flats. I am told that one can even tell where it is being done from the marks on the walls.
So far the Scottish Office have made noises, but most of the time they have been saying, " This is no use, that is no use, and the next thing is no use ". We have never discussed the matter in this House, and I am sorry that we should be discussing it at such a late hour, when we should be thinking about the difficulties which Members are going to have because of the problems of transport at the present time. I think it is serious. I think we have to do something about it quickly. If the Government cannot accept this amendment, can they tell us what they are going to do and when they are going to do it? I beg to move.
Lord Drumalbyn: I have a great deal of sympathy with what the noble Lord, Lord Ross of Marnock, has said about this. I wonder whether he has gone quite far enough. I wonder whether it would not be better to say, " the inhalation of, or causing another person to inhale, any chemical substance ". It might be worthwhile adding those words.
Baroness Elliot of Harwood: I should like to support this proposal of the noble Lord, Lord Ross of Marnock. It is, so to speak, a fairly new offence with young people. It is quite inexplicable, so far as I am concerned; I simply cannot understand why it has caught on as it has.
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It is extremely dangerous. People do it encouraged by other people. It grows all the time, because young people encourage their friends to do it. I think it is something we should try and stop at once. I entirely agree with both noble Lords that this is the moment when we ought to look at it really seriously and see whether something can be done. I agree with Lord Drumalbyn that you could add something to the amendment and make it even more powerful. I entirely support what Lord Ross has said.
The Earl of Mansfield: Noble Lords in the Committee have shared the concern of the noble Lord, Lord Ross, about the very serious problem of solvent abuse. The Government equally share his concern. He is no doubt aware that my right honourable friend the Secretary of State recently issued a consultative memorandum, which discusses various possible ways of approaching the problem and, in particular, the role which the children's hearings system might play. Members in another place had a very full debate on this issue in the Scottish Grand Committee on 3rd December. So far as the memorandum goes, among the matters upon which views were invited was the suggestion that inhalation of solvents should be made a criminal offence, and comments on these matters have been sought from a considerable number of bodies. We have asked that, if possible, the comments should reach us by the end of next month. It would be premature of me to try to give any indicaton of our thinking before the comments on the memorandum have been received.
Noble Lords should be aware that Ministers in England as well as in Scotland have expressed strong reservations about the creation of such an offence, because among the considerations which I think are relevant are that to make somebody who inhales glue or some other solvent a criminal is likely to drive the practice further underground and therefore make detection and treatment, which perhaps in this instance is more important than conviction, that much more difficult. Furthermore, the Committee should be aware that a sheriff in December last year conducted a fatal accident inquiry into two deaths resulting from such inhalation. He recorded that the senior police officer and the reporter to the children's panel, who had each given evidence, had both indicated that if solvent abuse were to be made a criminal offence it would greatly hamper the work of their respective departments to help children and their parents. So thinking on this particularly difficult matter is by no means one-sided. I hope, therefore, that the Committee, and indeed the noble Lord, Lord Ross, will accept that the Government are thinking very seriously about this very serious problem and how it is to be tackled, and we shall take stock of the situation once the comments on the memorandum have been received and then see what, in the light of those comments, is the best way forward. In the meantime, I thank the noble Lord, Lord Ross, for bringing this to the attention of the Committee, but I ask him, for the moment at any rate, to withdraw the amendment.
Lord Ross of Marnock: I thank the Minister of State for his response to the concern that has been expressed, not just by this side of the Committee but by his own

939
side as well. The fact is that we have not got legislation to deal with it and we need legislation of some kind to deal with it, even if we are going to bring it into the panel system. As the noble Earl probably knows, the police are having to bend existing legislation, framed before glue sniffing became the problem it is, in an effort to deal with it. He says he has asked for comments by the end of next month and then he is going to consider them. It may well be during the passage of this Bill—it will be a month or maybe two months before it is finished, because it has to pass all its stages in another place. I hope that the Government will not delay in respect of this. After they receive the comments I hope they will take the opportunity of the presence of this Bill to take action. Otherwise, we may have to wait another two or three years, and that means another two or three deaths of young people from this. I do not think we should shirk it; if we have got to make it an offence, we will make it an offence, because it is something that can spread very quickly indeed. Anybody who knows anything about the activities in schools and among children will appreciate that it becomes very much a thing you have got to do and it is doing harm to a great number of children at the present time. But, in view of what the noble Earl has said, I will not press the new clause at the present time. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clauses 52 to 55 agreed to.
Clause 56 [Dangerous games, etc.]
The Deputy Chairman of Committees: In calling Amendment No. 57K I should point out that Amendments Nos. 57L and 57M have been wrongly marshalled under Clause 56 and should be marshalled under Clause 58. I shall, of course, call them in the proper order.
8.47 p.m.
Lord Ross of Marnock Lord Ross of Marnock moved Amendment No. 57K:
Page 35, leave out line 38.
The noble Lord said: This is one of the most serious offences and one which has been so prevalent in recent weeks. I wonder how many people were charged under the existing legislation—and it is existing legislation in those burghs where it applies—with making or using a slide upon snow or ice. I saw children sliding. I never saw a policeman stopping them. It was very difficult not to make a slide with every footstep, during the past six or seven days. I think this is really a bit of bureaucratic nonsense. The Minister of State has said before that, if we want to deal with some of these troubles, we deal with them as a question of creating a public nuisance. I do not think we should put this in. It does not mean a thing; not a single person will be prosecuted for it. It will never be used, and to my mind has not been used. So let us forget it. I beg to move.
Lord Lyell: As always, at this stage in the evening I shall be brief. I must admit to the Committee that the noble Lord, Lord Ross, both with his amendment and
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with his explanation of it tempts me very sorely. He, and I am sure your Lordships, will note that Clause 56 deals with what we call " dangerous games, et cetera". It may appear fair enough to your Lordships in the Committee. It is a question of any person making or using a slide on ice or snow. This offence is not any draconian measure which is designed to deprive hundreds, perhaps even thousands, of people, and particularly young children, of a great deal of innocent pleasure. Although I might say that this pleasure of young children, watching their elders and betters, and especially Members of your Lordships' House, slithering, perhaps to their personal injury, upon a slide in snow or ice, may not be quite so innocent when seen by the victim.
Clause 56, like the provisions of the Burgh Police (Scotland) Act 1892 which it replaces, does not make it an offence to make or use a slide on ice or snow in any circumstances; it only makes it an offence where—and we can see this in line 39—it is done in such a way as to cause, or to be likely to cause, danger or obstruction to other persons or to give other persons reasonable cause for alarm or for annoyance. Let me give a quick example. The kind of situation which this provision is designed to catch is where a person, be they old or young, makes a slide directly outside an old person's front door. Perhaps it might give the watchers or the makers of the slide innocent pleasure, but certainly it will not give the old person any pleasure at all if he or she slips or falls, or perhaps if the slide is made deliberately or actively on a narrow pavement on a steep hill in the town.
I would hope that Members of your Lordships' Committee would agree that people, especially the elderly and the infirm, have the right to be protected from these dangers which can arise from the indiscriminate and active making and use of slides on ice and snow in the wrong circumstances. I believe that the safeguards are specifically spelled out in lines 39 and 40 and, therefore, I hope that the noble Lord, Lord Ross, will come to see that he is making something of a mountain out of this rather minor ice slide. I invite the noble Lord to leave the Bill as it is.
Lord Drumalbyn: I wonder whether my noble friend would agree that, even taking his examples and the instances which he has given, there are some cases where it would not be appropriate to make it an offence to make or use any slide upon ice or snow. I wonder whether it would not be better to make it more precise and to say:
" makes or uses any slide upon ice or snow on a pavement ",
or words to that effect, because that is really what is dangerous. Personally I have never been able to stand up on ice anyway and I find it, myself, pernicious. I am particularly concerned about the places where pedestrians go and that should be made clear instead of having such a very wide definition in the clause. I wonder whether my noble friend would look at that again.
Lord Lyell: I should like to reply briefly. I hope that my noble friend will agree that there is not very much between what he is seeking and what we believe is the reasonable interpretation of lines 39 and 40 of the Bill.

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Clearly my noble friend gave the example of making a slide, or whatever might be defined as a slide upon ice or snow upon the pavement. Presumably the police would enforce this measure if it were likely to cause danger, and indeed it could, or obstruction, to any other person or give them reasonable cause for alarm. I believe that that catches the particular dangers which were described by my noble friend in that it leaves young people and children who might wish to make a slide to do so in the park or recreational area, where they are not going to cause danger or obstruction to any elderly or infirm persons who are not likely to go and wander deliberately on ice or snow. I hope that my noble friend might agree that lines 39 and 40 of the clause achieve very much what he seeks to achieve, and possibly trying to draw ice or snow any narrower might leave slides to be made in wintry conditions to be open too widely.
Lord Ross of Marnock: I do not want to prolong this debate too long, but the noble Lord should have come here armed with the number of offences that have been created and the many lives that have been saved by having this provision on the local authority statutes for over 90 years, because that is what he is implying. He is saying that we have had this for over 90 years and we cannot do without it.
In answer to some of the points made by the noble Lord, Lord Drumalbyn, " public place ", as it is defined, goes way beyond streets and thoroughfares." It says:
" any place (whether a thoroughfare or not) to which the public have unrestricted access "
and it includes doorways, entrances of premises, common passage, close, court, stair, garden or yard. They cannot do it even in their own back yard. It is not just a question of limiting it to the pavements in front of the old folks' home. I think that we do not need it. Indeed, very often during the past weeks we have, just by walking down the streets, created a slide. This provision has never been put into force by the police—never. I defy anyone to come and tell me of a case where this has been used. It is a matter of common sense and I think that it should be dropped. However, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 56 agreed to.
Clause 57 agreed to.
Clause 58 [Mobile advertisements]:
[Amendments Nos. 57L and 57M not moved.]
Lord Airedale Lord Airedale moved Amendment No. 58:
Page 36, line 18, after (" a ") insert (" European Parliament or ").
The noble Lord said: I beg to move Amendment No. 58. My noble friend Lord Mackie has been caught up in travelling difficulties and has asked me to move this amendment in his place. Clause 58 prohibits, in general terms, advertising from vehicles, but subsection (2) specifically exempts parliamentary and local government elections. In my noble friend's view, it must have been intended also to exempt European Parliament elections, and my noble friend thinks that the need for this amendment is self-evident. I beg to move.
The Earl of Mansfield: I am with the noble Lord in spirit as regards the principle of his amendment, but I am not with him in the way in which he has drafted it. I think that we have to make one or two inquiries to see what the European Parliament is in law. So, if the noble Lord will withdraw his amendment in the meantime, I shall consider the matter further and table my own amendment to a similar effect at a later stage.
Lord Airedale: I am much obliged. I shall report to my noble friend that there are hopes of ultimate success and, in the meantime, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
On Question, Whether Clause 58 shall stand part of the Bill?
Lord Underhill: I am sorry to detain the Committee at this hour, but there is a very important point which should be raised. Incidentally, the clause as it stands at the moment is a great improvement on that in the consultation paper, because subsection (2) was not in the consultation document. Can the noble Lord tell me—it may be due to my lack of understanding of grammar—as regards the last line whether " local event " stands on its own or does,
" local event or activity for charitable purposes ",
all read as one? If so, then we could find ourselves in some difficulties, because there are organisations which do not run events for charity, but voluntary organisations as such—political parties and sports organisations which run events. They would be debarred from advertising, as I have done many a time for meetings and other activities with what used to be called double crown posters on board on a vehicle. Therefore, I would like to know whether what I am saying is correct. Would this debar the advertising on a vehicle, in the way in which I have suggested, of any event which is not organised for charity?
I know that there is the interpretation clause, which says that charity shall be construed at large. Not being a lawyer, I do not understand what " at large " means and whether it would cover the sort of point that I am raising. It seems to me that, as it is here, it could exclude quite a number of events which might use a vehicle for advertising purposes which are not for charitable purposes.
The Earl of Mansfield: I think that one has to take the English as one finds it. It says the use:
" relating to a local event or activity for charitable purposes ".
Therefore, the local event, in the same way as an activity, must relate to charitable purposes. That is the exception which Clause 58(2) presupposes. I am reinforced in that by the information that I have received.
Lord Underhill: Does the Minister think that there is any validity in the point that I have raised? Surely we do not wish to exclude the voluntary organisations which may run sports events, discos and all sorts of other events and which want to advertise them on a vehicle, which, as I said before, I have done many times in my life, by attaching a poster to the wheel, the side or the rear of my car in order to advertise a

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particular event. As I see it, that would be excluded by this particular clause.
The Earl of Mansfield: This discussion would really be very much better carried on under the mantle of an amendment than an ad hoc argument into the meaning of the subsection under a debate on clause stand part. Here one has to consider the charitable purposes part of it. By that I assume—and I am speaking without having given the matter any consideration—that the purposes are not those for private profit. Therefore, many of the purposes which the noble Lord, Lord Underhill, has illustrated would be perfectly proper in the context of subsection (2). But if I may, I shall take it away and think about it. If I have not told the noble Lord the true position, then I shall write to him. In any event, both of us might like to consider the matter before the next stage.
Clause 58 agreed to.
Lord Denham: I think that this is probably the time of the day when we should make a break in the proceedings. I beg to move that this House do now resume.
Moved accordingly, and, on Question, Motion agreed to.
House resumed.

British Waterways Bill [H.L.] Cornwall County Council Bill [H.L.] County of Lancashire Bill [H.L.] Derwent Valley Railway Bill [H.L.] East Lindsey District Council Bill [H.L.] Epsom and Walton Downs Regulation Bill [H.L.] Hampshire Bill [H.L.] Hong Kong and China Gas Company Limited Bill [H.L.] Norwich City Council Bill [H.L.] Nottinghamshire County Council Bill [H.L.] Shrewsbury and Atcham Borough Council Bill [H.L.] Swinford Bridge Bill [H.L.] Thomas Brown and Sons, Limited Bill [H.L.]
Presented and read a first time.
John Francis Dare and Gillian Loder Dare (Marriage Enabling) Bill [H.L.]
Petition for Bill, together with a copy of the proposed Bill (certified by the Chairman of Committees and the Chairman of Ways and Means under Private Bill Standing Order No. 3) annexed thereto, was read and referred to the Personal Bills Committee.
Hugh Small and Norma Small (Marriage Enabling) Bill [H.L.]
Petition for Bill, together with a copy of the proposed Bill (certified by the Chairman of Committees and the Chairman of Ways and Means under Private Bill Standing Order No. 3) annexed thereto, was read and referred to the Personal Bills Committee.
  UNDERGROUND OPERATIONS CENTRE: HIGH WYCOMBE
  UNDERGROUND OPERATIONS CENTRE: HIGH WYCOMBE
  DEFENCE EXPENDITURES: NATO AND WARSAW PACT
  DEFENCE EXPENDITURES: NATO AND WARSAW PACT