Sitting of 10 June 1982

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

  GREATER LONDON COUNCIL(MONEY)BILL (By Order)
  Order for second Reading read.
  To be read a second time upon Thursday 17 June at seven o'clock.

  ALEXANDRA PARK AND PALACE BILL (By Order)
  Order for second Reading read.
  To be read a second time upon Thursday 17 June.

Oral Answer To Questions
  AGRICULTURE,FISHERIES AND FOOD

    Farm prices
    Mr. Jim Marshallasked the Minister of Agriculture, Fisheries and Food what measures he intends to introduce to protect the interests of both consumers and farmers in the light of the European Economic Community Council of Ministers' decision to accept majority voting on the farm prices review.
    Mr. Marlowasked the Minister of Agriculture, Fisheries and Food if he will make a statement on agricultural prices.
    The Minister of Agriculture, Fisheries and Food (Mr. Peter Walker): I refer the hon. Member and my hon. Friend to the statement which I made on 19 May.
    Mr. Marshall: Does the Minister agree that the acceptance of majority voting on the farm price review creates the great danger that in future years the British housewife will have to pay, through increased prices, for the voracious financial appetite of Continental farmers, particularly French farmers? Therefore, will the Minister accept that there may be a need for Britain to withdraw from the common agricultural policy?
    Mr. Walker: No, Sir. I do not accept that there is a need to withdraw from the common agricultural policy. As the hon. Gentleman knows, my right hon. Friend the Foreign Secretary will be discussing future procedures at the meeting later this month, and I hope that a satisfactory solution to the problem will be found.
    Mr. Marlow: Does my right hon. Friend agree—I think that he might this time—that the effect of increasing common agricultural policy prices above that which we agreed, taken in isolation from the budget, has two
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    effects? The first is to increase our net contribution, and the second is to increase the price to the British consumer of the £1,000 million net of European food that we import. They vote and we pay. Does my right hon. Friend agree that that is entirely unacceptable?
    Mr. Walker: No, Sir. What is wholly unacceptable is the exaggerated figure of £1,000 million. The figures produced by one consumer organisation have been shown to be blatantly inaccurate. For example, the figures included tropical food products which do not come into the CAP.
    Mr. Buchan: Has the Minister seen the text of the letter sent by Agricultural Commissioner Paul Dalsager to Commissioner Gaston Thorn, in which he points out that they have seriously underestimated the full cost of the agreement—he estimates by about 700 million or 800 million units of account. Does the Minister agree that this will therefore cost the British taxpayer and consumer another £400 million?
    Mr. Walker: No, Sir. I have not seen the text of such a letter and there has been no confirmation from the Commission that such a letter has been sent.
    Mr. Farr: Does my right hon. Friend accept that whatever the financial mechanics of the recent result, it has been desperately unfair to Britain and to British consumers? Will my right hon. Friend do his utmost to ensure that an amendment is written into the Treaty of Rome, by addendum or in some other way, to ensure that it does not happen again?
    Mr. Walker: Yes, it is important that the principle of unanimity continues in Common Market agreements in areas where national interests are at stake. That point has been made clear by my right hon. Friends the Prime Minister and the Foreign Secretary.
    Mr. Campbell-Savours: Although we have lost out in the only area where there has been majority voting to date, are there any issues or areas in which we could benefit by majority voting? Has the Minister given any consideration to promoting those issues?
    Mr. Walker: No, Sir. In terms of the principle of majority voting, one accepts, or does not accept, the principle that a country has the right to declare that a national interest is at stake. One does not calculate whether on some issues it would be an advantage and on others a disadvantage. It is an important principle, which has to be adhered to in the Community.

    Wheat (Levy)
    Mr. Spearingasked the Minister of Agriculture, Fisheries and Food what is the current level of levy per tonne of wheat imported into the United Kingdom from countries outside the European Economic Community.
    The Minister of State, Ministry of Agriculture, Fisheries and Food (Mr. Mick Buchanan-Smith): Yesterday's levy was £72·38 per tonne.
    Mr. Spearing: Is the Minister aware that the farm gate price for wheat is only £123 per tonne, which is high for Britain and suggests that the levy is nearly two-thirds the cost of home grown wheat? In that case, does he agree that even if the cost of wheat represented as little as one-third of the cost of bread, using imported wheat without levy

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    could bring the price of bread down by 15 to 20 per cent. at a stroke? If he does not agree with those figures, will he place his Department's calculations in the Library?
    Mr. Buchanan-Smith: The hon. Gentleman should not exaggerate this matter, because the levy amounts to less than 2p on the price of a standard loaf. That is the effect at the consumer end. I agree with the hon. Gentleman that the threshold price for wheat and the levy that must be paid—particularly as this is wheat in respect of which the Community is not self-supporting—is too high. We have tried, and we shall continue to do so, to bring that price down.
    Mr. Mark Hughes: Does not the Minister accept that the cost to the livestock sector of the farming community of this level of levy is prohibitive?
    Mr. Buchanan-Smith: This question relates to strong wheat, which is of particular interest to our baking industry. The issue of importance is the discrimination against our baking industry in obtaining a raw material that it cannot get from within the Community. That is what is wrong.
    Mr. Jay: What does the figure of £70 a tonne amount to as a percentage of the import price?
    Mr. Buchanan-Smith: At present, the world price for wheat—we cannot necessarily be sure what quantities will be available at that price—is around £84 per tonne. On the other hand, and contrary to what the hon. Member for Newham, South (Mr. Spearing) said, the right hon. Gentleman should bear in mind that the actual market price for strong wheat in the United Kingdom is around £130 per tonne.

    Tenant Farmers
    Mr. Brocklebank-Fowlerasked the Minister of Agriculture, Fisheries and Food if he will take steps to prevent further loss of land for letting to tenant farmers.
    Mr. Peter Walker: I have nothing to add to the replies given on 1 April and 6 May to my hon. Friend the Member for Lichfield and Tamworth (Mr. Heddle). We are continuing to consider what action is required to encourage the letting of land to tenant farmers.
    Mr. Brocklebank-Fowler: When does the right hon. Gentleman intend to introduce legislation to implement the CLA-NFU agreement? What discussions has he had with his right hon. and learned Friend the Chancellor of the Exchequer about the need for fiscal measures to encourage new lettings, and what steps does he propose to take to ensure that county councils no longer sell vacant tenancies into private ownership?
    Mr. Walker: The selling of tenanted land is something about which the county councils must, as democratically elected bodies, take their own decisions. We are considering what should take place in legislation, and that will obviously be considered within the context of the Government's future legislative programme. As to implementing the CLA-NFU agreement, I hope that as part of an alliance the hon. Gentleman will confer with his colleagues in the other half of that alliance who have made it clear that they would wish to make substantial amendments to the CLA-NFU agreement.
    Mr. Charles Morrison: My right hon. Friend will be aware that one of the consequences of the shortage of land
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    is that last year there was an average increase in farm rents of about 25 per cent. in England, and rather more in Scotland. In the light of that, will he now give further consideration to introducing changes in the system of rent arbitration?
    Mr. Walker: In the context of the whole question of tenanted and rented land, that is one of the matters that we are carefully considering.
    Mr. Newens: Does the Minister recognise that over a number of years the pattern of agricultural subsidies has tended to favour large-scale farming operations and, thereby, the incorporation of smaller holdings into larger ones. Will he recognise that that factor, as well as the sale of smallholdings by county councils, has diminished the amount of tenanted land available? In those circumstances, he ought not to pay too much attention to the Country Landowners Association.
    Mr. Walker: The agreement is not one by the CLA alone. It has also been arrived at by the NFU, which represents the majority of tenanted farmers in Britain. I have had no complaints from either the smaller farmers or the tenanted farmers about progress on the price structure and so on. Indeed, among farmers of every description—tenanted and others—I find a complete dislike and disfavour of the Labour Party's current proposals to nationalise the land.
    Mr. Douglas Hogg: Will my right hon. Friend accept that many of his hon. Friends do not think that the last Session of this Parliament is the most appropriate time to implement the CLA-NFU agreement? However, those hon. Members hope that the agreement will be implemented in the first Session of the next Parliament.
    Mr. Walker: I take note of my hon. Friend's views.

    Hill Farmers
    Sir Hector Monroasked the Minister of Agriculture, Fisheries and Food what additional resources will be available to hill farmers following the European Economic Community price agreement.
    Mr. Buchanan-Smith: Hill farmers will benefit from the improved levels of support for sheep and cattle arising from the price settlement.
    Sir Hector Monro: Will my right hon. Friend accept the thanks of agriculture generally for the negotiations that he and his colleagues carried out in Europe? He will have seen the recent figures, which show a drop in the income of hill farmers. Therefore, will be ensure that in the current year they receive the maximum grants and allowances to which they are entitled?
    Mr. Buchanan-Smith: I am grateful to my hon. Friend for the first part of his question. One of the good things arising out of this price review is the better position of livestock producers in relation to cereal producers. That is something that we worked for and welcome. The hill livestock compensatory amounts have increased by more than 50 per cent. under this Government. That shows that we are concerned about the interests of hill farmers. Together with the better price agreement that we achieved this year, that should give them some assurance for the coming livestock year.
    Mr. Bill Walker: Does my right hon. Friend agree that support of the hill farmer is an essential part of the policy

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    of preventing the denuding of the Highland glens, and that the Government's record in that respect is something of which we can all be proud?
    Mr. Buchanan-Smith: I agree with that, and I am grateful to my hon. Friend for saying so. It is also important in another sense, in that our hill farmers contribute to the health of agriculture and the economy as a whole and also work for the benefit of British consumers.
    Mr. Geraint Howells: Why will the Government not pay the £29 to our beef producers under EEC rules?
    Mr. Buchanan-Smith: I assume that the hon. Gentleman is referring to the suckler cow subsidy. As he knows, the level of that was reduced in the price review. We have decided that we shall pay from our funds the amount by which it has been reduced, so that it will remain at the same level. It is an option whether we increase it and we have decided not to do so. On the other hand, however, the fact that we have an improvement in the beef premium scheme, where we have gone from 25 per cent. Community funding to 40 per cent., indicates the considerable extent of what we achieved in the price review.
    Mr. Campbell-Savours: Have the proposals for a marginal land scheme been submitted to Brussels, and if so, what is happening?
    Mr. Buchanan-Smith: They have not yet been submitted to Brussels. When we have completed consideration and preparation of the case, we shall do so.

    Sheep
    Mr. Mylesasked the Minister of Agriculture, Fisheries and Food if he will now take steps to ameliorate the effect of clawback on sheep exported to other Community countries.
    Mr. Buchanan-Smith: During the seven months up to March, exports to other Community countries have averaged over 4,500 tonnes a month, which compares favourably with trade in recent years.
    Mr. Myles: I recognise that British sheepmeat exporters have coped remarkably well with the problems of the sheepmeat agreement, but is my right hon. Friend aware that the problems they are now experiencing are very great? Will he therefore take steps to try to ameliorate those problems?
    Mr. Buchanan-Smith: The figures that I mentioned indicate that some of the fears that were originally voiced about this export trade were not realised. I pay tribute to the efforts of our exporters. At the same time, I acknowledge that there are at present substantial difficulties, just as there were at exactly the same time last year. We shall take any opportunity within the Community to improve these arrangements and do our best in the interests of our export trade.

    Common Agricultural Policy
    Mr. Flanneryasked the Minister of Agriculture, Fisheries and Food if he intends to have further discussions on the common agricultural policy with his counterparts in the European Economic Community.
    Mr. Peter Walker: Yes, Sir, on 14 June.
    Mr. Flannery: May we assume that in any discussions with his counterparts the Minister will again raise vigorously the whole question of the veto? Did the right hon. Gentleman not hear the Foreign Ministers say yesterday that the re-establishment of the right of veto was something for which Britain would have to fight? What will happen if our rights are violated, as they already have been, and our people are hurt and injured by the CAP? What will we do in those circumstances if the right of veto is not forthcoming? Will he consider withdrawal at least from the CAP, or, as many of us would like, from the Common Market?
    Mr. Walker: As my right hon. Friend the Foreign Secretary has made clear in his Council of Ministers—the Council that is primarily responsible for the procedures of the Community—the matter will be raised at the next meeting. We have had major discussions and my right hon. Friend has clearly expressed the Government's views.
    Mr. Geoffrey Johnson Smith: Is my right hon. Friend aware that there is some anxiety about the impact on British agriculture and horticulture of the inclusion of Spain and Portugal in the EEC? Has he made an estimate of what that impact might be? If so, will he publish it?
    Mr. Walker: No, Sir. At present, negotiations must examine the various formats of a transitional arrangement. In general, there will be some considerable advantages as well as problems from Spanish accession to the EEC, as many of Spain's food imports are produced in Britain. When finalising our negotiating position we must examine both the advantages and the disadvantages.
    Mr. Buchan: Will the right hon. Gentleman ask Mr.Dalsager or another Commissioner to obtain a copy of the text of the letter that the right hon. Gentlman, extraordinarily, does not seem to have read? It was published verbatim in the last issue of Agra-Europe. Is the Minister aware that it says that they have seriously underestimated the cost of the price agreement and that it will cost several hundred million pounds more? Does the Minister agree that he has concealed that cost from the British people?
    Mr. Walker: I have sought and will continue to seek the most updated. figures on the estimates of the Commission. I asked at the last meeting what the exact costs were. I also asked for a detailed assessment of the updated costs, post the agreement from the Commission. As soon as they are available to the United Kingdom I shall see that they are published and made available.
    Sir Anthony Meyer: Will my right hon. Friend explain slowly and carefully to the Opposition that there is no way in which Britain, a major exporting country, can secure the larger share of the home market that it needs without accepting in return some form of CAP?
    Mr. Walker: Having almost doubled the proportion of the agricultural budget that comes to Britain during the past three years, we are now in a rather stronger position than we were three years ago to support the advantages as well as to recognise the disadvantages of such a policy.

    Farm Production
    Mr. Stan Thorneasked the Minister of Agriculture, Fisheries and Food whether he is satisfied with the level of farm production in the United Kingdom.
    Mr. Buchanan-Smith: Yes, Sir. The situation described in the "Annual Review of Agriculture 1982" White Paper, Command. 8491, is satisfactory.
    Mr. Thorne: Does the Minister agree that increased productivity of British farms could be achieved if we used to that end the contribution that we make to the Common Market?
    Mr. Buchanan-Smith: If the hon. Gentleman intends to follow that line, he must realise that any other system could cost the taxpayer up to £2,000 million per year in deficiency payments. If that is his choice, I hope that he will say so.
    Mr. John Wells: Is my right hon. Friend satisfied with the level of horticultural production? If he is, is he satisfied with the level of horticultural profitability for the industry?
    Mr. Buchanan-Smith: Yes. There have been problems in some parts of horticulture. I acknowledge them. My hon. Friend will know, both from our support for marketing and on fuel costs, that there has been ample evidence during the past few years of our concern. We have demonstrated it in practical terms for that important section of the industry.
    Mr. Spearing: Although the Minister may be satisfied with production, is he not worried about over-production, especially of cereals? Does that not mean that, in addition to the levies, the taxpayer must pay £50-plus for exports of surplus wheat and barley, as well as having to support the Minister in a programme, which is also backed by public money, to export British food?
    Mr. Buchanan-Smith: Yes, I am worried that products are in surplus. The hon. Gentleman will know that we did our best to achieve restraint at the last price negotiations for those products. I would have more respect for the hon. Gentleman's comments if he showed some pride for and appreciation of what British agriculture has achieved. From 1978 to 1980 self-sufficiency in the commodities that we can grow increased from 67 to 75 per cent. In terms of savings on imports, that means that agriculture is saving about £1 billion more this year in foreign exchange than three years ago.
    Mr. Colin Shepherd: Is my right hon. Friend aware that there is a substantial body of opinion among the Opposition that it is neither important nor relevant for the United Kingdom to have an agriculture industry?
    Mr. Buchanan-Smith: Yes, Sir.

    European Community (Exports to Russia)
    Mr. Teddy Taylorasked the Minister of Agriculture, Fisheries and Food when the European Economic Community Council of Ministers last discussed the export of subsidised food to the Soviet Union; and if he will make a statement.
    Mr. Buchanan-Smith: On 5 February 1980.
    Mr. Teddy Taylor: Is it right or tolerable that we still export millions of tonnes of food and wine to the Soviet Union at knock-down prices, when our consumers must pay Common Market taxes of up to £1 per pound on beef and 50p per pound on butter? As the Government have been talking about that matter for years, is it not intolerable that the export of subsidised food and wine to Russia is greater than ever before?
    Mr. Buchanan-Smith: As my right hon. Friend the Prime Minister told my hon. Friend on 8 April this year, we are not happy about that. My hon. Friend is quite right to raise the matter. I should have more respect for what he said if he did not exaggerate, but showed some appreciation of what we have already achieved. We have opposed any special subsidy—no special subsidies favouring Russia are in force. On two commodities that have caused anxiety—butter and butter oil—there is no subsidy and therefore no exports. I should respect what my hon. Friend has said more if he acknowledged what had been achieved.
    Mr. Geraint Howells: We all know that there are surpluses in the Community. Do the Government have any plans to give such surpluses to the young, the needy and the elderly in Britain?
    Mr. Buchanan-Smith: I hope that the hon. Gentleman will acknowledge the butter subsidy that we have achieved, the fact that we operate premium schemes on beef and sheepmeat that are of direct benefit to British consumers, and that, last but not least, at the last price fixing we considerably improved—by 25 per cent.—the sum available under the school milk scheme. All of those demonstrate our interest in the matter.

    Luxembourg Compromise
    Mr. Lathamasked the Minister of Agriculture, Fisheries and Food whether, at the next meeting of the Council of Agriculture Ministers of the European Community, he will table a further strong protest regarding the recent abandonment of the Luxembourg compromise and seek a clear assurance that the recent incident will not be repeated.
    Mr. Allan Robertsasked the Minister of Agriculture, Fisheries and Food if he will seek to convene a meeting of European Economic Community Agriculture Ministers in order to reverse the decision on the farm price review.
    Mr. Home Robertsonasked the Minister of Agriculture, Fisheries and Food if he will raise the subject of the farm price review at the next meeting of European Economic Community Agriculture Ministers.
    Mr. Peter Walker: The Government regret the way in which the Community's customary procedures were set aside at the Agriculture Council on 18 May. My right hon. Friend the Secretary of State for Foreign and Commonwealth Affairs has made that clear to our partners. Foreign Ministers will return to the subject of the Luxembourg compromise on 20 June, when the Government hope that a clear understanding will be reached for the future.
    Mr. Latham: Can it be made clear, and without too much diplomatic finesse, both on 20 June by my right hon. Friend the Foreign Secretary and on 14 June by my right hon. Friend the Minister, that we will never put up with this type of behaviour again, and that it crucially affects the basis upon which the British people voted "Yes" in the referendum?
    Mr. Walker: Yes,Sir.
    Mr. Allan Roberts: What will the Government do if the Minister does not obtain satisfaction on 20 June? Does he agree that the issue is one of sovereignity, in which foreign powers are attacking the British consumer?
    Mr. Walker: No. I never operate on the basis of making suppositions about what we shall do if we do not succeed. I am sure that we shall succeed.
    Mr. Home Robertson: Is the Minister aware that some Opposition Members feel more sorrow than anger about the incident, not least because the additional cost that his proposed package will allegedly impose on the CAP could put the future of European planning in jeopardy? I appeal to the Minister to do everything in his power to bring a constructive end to this unhappy episode.
    Mr. Walker: Yes, we shall certainly do that.
    Mr. Donald Stewart: In view of the long struggle to arrive at a common fisheries policy, does the Minister agree that if the Government continue negotiations on fisheries without the Luxembourg compromise being on the table the chances of achieving any deal in favour of or even fair to our fishermen are almost non-existent?
    Mr. Walker: I agree that for a common fisheries policy, or, indeed, any other policy, it is right to have the principle of unanimity. The last time that we failed to secure a fisheries agreement was due to the use of the Luxembourg compromise by another country. But for that, we might have agreed a policy that our fishing industry required and wanted. Irrespective of that experience, however, it is absolutely right to have the principle of unanimity.
    Mr. Teddy Taylor: In view of the great concern in the fishing industry at the implications of this breach of the Luxembourg compromise, will the Minister now do what we have long been asking him to do and set out in a statement what Britain regards as its legal rights to exclude Common Market fishing vessels from British waters after 31 December?
    Mr. Walker: As my hon. Friend well knows, no Government have worked more closely with the fishing industry than we have in the past three years. Only this morning I had further deliberations with the industry. We are working together on negotiations on the common fisheries policy and will continue to do so.
    Mr. Beith: Whatever the dispute over farm prices, several other countries believe that the Luxembourg compromise is still in operation and would be prepared to operate it. Does that not apply to the fishing industry, or is the Minister now in a more optimistic frame of mind about the fishing issue after his discussions with the French?
    Mr. Walker: I am not in a particularly optimistic frame of mind about the fishing negotiations, because there are many factors involved, concerning not just France, but Denmark and other countries. Having experienced several sets of fishing negotiations, I remain, until agreement is reached, neither optimistic nor pessimistic. It is true, of course, that within minutes of violating the Luxembourg compromise a number of member countries such as France and Italy swore their future allegiance to the compromise.
    Mr. Buchan: Will the Minister accept his guilt in this matter? Does he agree that his foolishness and ineptitude
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    in having already accepted most of the inordinately high prices led the other countries to assume that they could go ahead? The real question, however, is what he intends to do about it. Does he accept that the House is entitled to know this in advance of the meeting, because the House agreed to enter the Common Market on the basis of the false promises and the false premise? We therefore wish to know in advance what the Minister intends to do. If he cannot get agreement, is he prepared to withdraw the section of the European budget that is applied to create these high food prices?
    Mr. Walker: The answer to the last part of the hon. Gentleman's question is "No". On the first part, I make no apology for those parts of an agreement in which I secured double the butter subsidy achieved by the Labour Government and massively improved the beef premium scheme that they had achieved.
    Mr. John Evans: What about the higher prices?
    Mr. Walker: I shall come to them. I also massively improved the school milk subsidy achieved by the Labour Government. Finally, the total effect on prices in a full year is that which was achieved by the Labour Government every three weeks.

    Wildlife and Countryside Act 1981
    Mr. Andrew F. Bennettasked the Minister of Agriculture, Fisheries and Food what impact the Wildlife and Countryside Act 1981 has so far had on agriculture.
    The Parliamentary Secretary to the Ministry of Agriculture, Fisheries and Food (Mrs. Peggy Fenner): Not all of the provisions of the Act are as yet in force. It is therefore too early to assess its impact on agriculture. But it is already providing a stimulus for much constructive debate in the countryside and I believe that full co-operation by all concerned will ensure its success.
    Mr. Bennett: Does the Minister accept that, so far, the Act has actually been a disappointment to all those who wanted to stop the destruction of a great deal of Britain's countryside and to ensure that it was preserved? Does she realise that we want action from the Government and not excuses for failing to protect Britain's countryside?
    Mrs. Fenner: I am sure that that is a great exaggeration. I have pointed out that some parts of the legislation have not yet come into full effect, so the hon. Gentleman cannot say that the Act has been a disappointment. Indeed, all the signs are that the contrary will be the case.
    Sir Albert Contain: Is the Minister satisfied that enough publicity has been given to the contents of the Act? Should not more publicity be given in schools, for instance, about the purpose of the Act and the need to make the countryside a better place?
    Mrs. Fenner: My hon. Friend will be aware that this is primarily a matter for the Department of the Environment. Nevertheless, with regard to my Ministry, ADAS is doing a great deal to ensure that there is publicity about the Act and we shall be constantly watching its implementation. I shall ensure that my right hon. Friend the Secretary of State for the Environment is made aware of my hon. Friend's concern about publicity.
    Mr. Spearing: In paying tribute to the efficiency of farmers and, particularly, plant breeders, may I ask the

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    Minister to confirm that, as well as paying high costs, high levies and high export refunds for food, it will be possible under the Act for the public to pay farmers for not producing food? Is that one of the provisions of the Act? Does she agree that such a precedent must be examined very closely?
    Mrs. Fenner: No, I do not agree that that will be an effect of the Act, any more than I agree with the hon. Gentleman's exaggerated comments about the increases in food prices in the CAP review.
    Sir Hector Monro: Does my hon. Friend agree that the helpful approach of the National Farmers Union, the Countryside Commission and the Nature Conservancy Council has made farmers well aware of their responsibility for conservation? Does she also agree that the confrontation forecast by the Labour Party has not taken place?
    Mrs. Fenner: Yes, I agree with my hon. Friend. As I have said, a major role is being played by ADAS in encouraging the co-operation of farmers.
    Mr. Flannery: Is the Minister aware of the brutal official vandalism of the countryside that is taking place under the Act? Is she aware that in a recent "Farming Today" programme the interviewer said that he was standing in a field of 1,000 acres? Does she realise that that means that ditches, hedgerows and so on have been destroyed and that posterity will agree that the farmers, and not people from the cities, have vandalised the countryside? Is she aware that nothing is being done to prevent this, which is taking place in the interests of immediate profits? Is it not disgraceful that wildlife is suffering dreadfully because of the official despoliation of the countryside, leaving large chunks of it looking like the prairies of Canada?
    Mrs. Fenner: I am sorry to disagree so much with the hon. Gentleman, but the contrary is true. Removal of boundary hedges, for instance, has not been eligible for grants since 1974. Moreover, advice from ADAS shows that the rate of hedgerow removal has declined markedly in recent years. I am sure that the hon. Gentleman, like many others, will be delighted to know that.

    Horticulturists (Energy Costs)
    Mr. Newensasked the Minister of Agriculture, Fisheries and Food if he is satisfied that the solution reached to the problem of Dutch horticultural gas prices will provide fully equivalent energy costs to horticulturalists in all European Economic Community States.
    Mrs. Fenner: I am satisfied that the agreement between the European Commission and the Dutch Government will achieve its aim of removing the distortion of competition in the glasshouse sector caused by the Dutch growers' preferential gas tariff.
    Mr. Newens: Can the Minister say when full harmonisation will be achieved, so that our glasshouse growers know when they are supposed to be on the same basis as Dutch growers? Will she give an undertaking here and now to keep the position under careful review so that in future no steps are taken on the other side of the Channel to restore in some other form the advantages against which our growers have had to contend for so long?
    Mrs. Fenner: As the hon. Gentleman knows, we shall certainly be doing that. Under the existing Commission guidelines, the aid that we currently pay to our growers ceases on 31 December this year. The Commission has agreed to give early consideration to extending the guidelines so that aid may continue until April 1983, when the Dutch advantage will be eliminated.
    Mr. Latham: I congratulate my hon. Friend on the progress made on this subject, after a long period when no progress at all was made. Will she continue to ensure, however, that close attention is paid to this, as the Dutch have got away with a great deal over the past few years?
    Mrs. Fenner: I can assure my hon. Friend that we are determined to have a viable and successful British glasshouse industry.
    Mr. Brocklebank-Fowler: Will the hon. Lady also ensure that capital grant-aid to glasshouse producers is equivalent to that which is provided by the Dutch Government to their producers, in order to ensure that fair competition exists within the Community?
    Mrs. Fenner: I can assure the hon. Gentleman that we keep that matter under constant review.
    Mr. Colin Shepherd: Is my hon. Friend aware that the British glasshouse industry will be watching the progress of talks between now and the end of December with considerable anxiety? Continuity of assistance between the end of December and April, when the new arrangements come into effect, is important. Will my hon. Friend also undertake to have long-term discussions within the Community to ensure that the energy costs do not get out of kilter in the future?
    Mrs. Fenner: I can reiterate to my hon. Friend that the Commission has agreed to give early consideration to the matter of assistance from the end of 1982 until April 1983, when the advantage will be eliminated. We certainly keep the matter under constant review.

    Common Agricultural Policy
    Mr. Jayasked the Minister of Agriculture, Fisheries and Food what is expected to be the total cost of the common agricultural policy in 1982.
    Mr. Peter Walker: Taking into account the latest revisions proposed by the Commission, the 1982 budget provisions for the common agricultural policy, as estimated by the Commission, are likely to be as to guarantee expenditure £6,898 million and as to guidance expenditure £409 million, making a total of £7,307 million.
    Mr. Jay: Is that not a great deal of money and are there not many better ways in which it might be spent?
    Mr. Walker: It is, but it covers the whole of agriculture in the EEC. To go over to the deficiency payments system in Britain alone would cost about £2 billion. I know that, with his considerable interest and anxiety on this subject, the right hon. Gentleman will be relieved to hear that in the past three years the budget has increased by only 26 per cent., whereas under the Labour Government it increased by 260 per cent.
    Mr. Peter Mills: Will the Minister explain to the Labour Party that the CAP has many advantages? One is

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    that the consumer has not gone short of any food over the past five or six years. Will the Minister also bear in mind that, while it may be slightly expensive, it has tremendous advantages for the whole of the rural scene?
    Mr. Walker: Yes, Sir. It is also true that in the three years that the Conservative Government have been in power the price of food has increased less than the retail price index in general and has been very much to the forefront in the battle against inflation.
    Mr. Ioan Evans: Is it not true that between 60 and 70 per cent. of the EEC budget goes on the CAP? Will the issue of the restoration of the veto be decided by a majority vote? Will we be allowed to use the veto or will the Government be treated with the same contempt that they were on the last occasion?
    Mr. Walker: I gather from the last part of the hon. Gentleman's question that he has been absent for most of Question Time. I am sure that he will read with fascinated interest in Hansard tomorrow the replies already given to that question.
    Mr. Farr: Does my right hon. Friend agree that, despite what he has said, the whole policy is in danger of becoming structurally unbalanced because of the rapid fall in the beef breeding herds in the past six years? As my right hon. Friend knows, they have declined by about 25 per cent., from 1·9 million cows per annum to 1·4 million. Will my right hon. Friend look at that matter?
    Mr. Walker: My hon. Friend's point is of immense importance and that is why in this price-fixing we are pleased to have obtained substantial improvements in the beef premium scheme. As my hon. Friend also knows, the Government, as part of their policy, have substantially improved the hill subsidies for beef cattle. I hope that a combination of those factors will bring about the restoration of the fortunes of the beef industry that my hon. Friend rightly proposes.
    Mr. Buchan: When the Minister gives us the appalling figure £7 billion as the CAP cost, does he realise that most of that is completely wasted money, in so far as it is used to create surpluses which then have to be exported onto the world market and depress it further? Is he not aware that 47 per cent. of that expenditure goes on export subsidies? Would it not be better if we had our own agricultural policy so that we could take advantage of cheaper world prices and use our money to develop British agriculture?
    Mr. Walker: No, Sir. That is a myth, because the hon. Gentleman looks at world prices in isolation so that they do not reflect the impact that there would be on those world prices if European production were suddenly eliminated and one started to purchase the existing small surplus. That would produce an enormous rise in world prices. Plenty of illustrations in recent years show that that would be the case.
    Mr. Marlow: Can my right hon. Friend tell the House the value of the net import of foodstuffs to Britain from the European Community? On average, how much is that above world prices at the moment?
    Mr. Walker: No, Sir. However, my hon. Friend will be pleased to know that in the past three years of Common Market membership the balance of trade has improved by £1 billion as a result of Britain's food and agriculture performance.

  PRIME MINISTER

    Engagements
    Mr. Stan Thorneasked the Prime Minister if she will list her official engagements for Thursday 10 June.
    The Secretary of State for the Home Department (Mr. William Whitelaw): I have been asked to reply.
    My right hon. Friend is attending the NATO summit in Bonn.
    Mr. Thorne: Since a long-term settlement of the Falkland Islands problem will demand negotiations with the Argentine, are the Government prepared to start now in order to avoid any further loss of life?
    Mr. Whitelaw: No, Sir.
    Mr. Dickens: As the price of the recovery of the Falkland Islands grows in terms of life, injury and cost, will my right hon. Friend accept that the Argentine is simply not interested in just the Falklands or South Georgia, but also the South Sandwich Islands and British Antartica? Does my right hon. Friend accept that some of that territory is further from Argentina than London airport is from Moscow?
    Mr. Whitelaw: If I knew the correct answer to that question I would say "Yes, Sir." As I do not, I am not sure.
    Mr. Foot: The right hon. Gentleman might have used the same technique with the previous answer to advantage. However, may I say that his answer to that question is quite unsatisfactory? I urged upon the Prime Minister on Tuesday, and in a letter to her yesterday, that the Government should take a fresh initiative in the Security Council to see whether an alternative to unconditional surrender can be offered to the Argentine forces. Many hon. Members and people throughout the world have pressed that upon the Government. Such a Security Council resolution would insist that the Argentine agreed to withdraw from the Falklands but would also offer the possibility of negotiation thereafter.
    I must urge the right hon. Gentleman to take back to the Cabinet the proposition that the whole matter should be looked at, because if the fighting continues to the bitter end many more lives will be lost on both sides.
    Mr. Whitelaw: The right hon. Gentleman wrote to my right hon. Friend the Prime Minister. He has made a serious point that deserves a serious and proper answer.
    First, it is important to say that at no time have we demanded unconditional surrender. We have made it clear that if the Argentine forces in Port Stanley announced their wish to withdraw to the mainland they would be given time to do so with dignity and good order. That is their opportunity. Before their invasion we made it clear to the Argentines that we were prepared to discuss matters affecting the future of the islands with them. Even after their invasion we were prepared to do so if they promptly withdrew. However, their response was to insist on ultimate transfer of sovereignty to them as a pre-condition. That was not acceptable.
    Since our landings on the islands and the losses that we have incurred, it is unthinkable to negotiate about the future of the islands as if everything was as it had been before. As I am sure that the right hon. Gentleman will accept, the situation has moved on and the islanders will

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    need a breathing space before they can express their views about their future. I am sure that all hon. Members would wish them to do that.
    Mr. Foot: I fully acknowledge part of what the right hon. Gentleman has said. We have never disputed the fact that fair offers have been made to the Argentine junta. I am not asking the Government to come forward with a full plan of what they are prepared to negotiate about later, but I repeat that a number of people and countries are saying that the Government should see whether a fresh proposal could be made immediately to the Security Council to help stop the loss of life. The loss of life in the past 24 or 48 hours and the loss of life that may be occurring now adds further weight to that proposition. Once again, I urge the Government to do what many people throughout the world are asking them to do.
    Mr. Whitelaw: I think that the right hon. Gentleman will agree that I made a careful and considered response to an important request. I stand by that response and have nothing to add to it.
    Sir Paul Bryan: Will my right hon. Friend find time today to draw the attention of the Secretary of State for Education and Science and of the Secretary of State for Foreign and Commonwealth Affairs to the report of the Overseas Students Trust, which highlights the anomaly of charging students from Hong Kong and the Falkland Islands three times as much for their education as students from Europe are charged, and recommends that students from the British dependent territories should be treated as if they were British born?
    Mr. Whitelaw: I appreciate my hon. Friend's concern and I assure him that the Government will consider the report very carefully.
    Mr. George Robertson: Since the whole country owes an unrepayable debt to those of our forces who have given their lives in the Falkland Islands, will the Government give further consideration to the genuine and deeply felt pleas from relatives that the bodies should be brought home for burial?
    Mr. Whitelaw: Yes, Sir. My right hon. Friends the Prime Minister and the Secretary of State for Defence said that the matter will be carefully considered, and it certainly will be.
    Mr. Dubsasked the Prime Minister if she will list her official engagements for 10 June.
    Mr. Whitelaw: I have been asked to reply.
    I refer the hon. Gentleman to the reply that I gave some moments ago.
    Mr. Dubs: Will the Home Secretary confirm that as soon as hostilities cease in the Falkland Islands the Government intend to hold a full and fair inquiry into the events leading up to the Argentine invasion? When will such an inquiry begin and how will it be set up?
    Mr. Whitelaw: In response to the right hon. Member for Orkney and Shetland (Mr. Grimond) my right hon. Friend the Prime Minister undertook that there would be such an inquiry. She will certainly be in contact with the leaders of the Opposition parties to discuss how that might best be promoted.
    Mr. Lennox-Boyd: Is my right hon. Friend aware that many people are somewhat bewildered by the proposal to
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    repatriate Captain Astiz, since we are not required under the Geneva convention to do so at this stage and bearing in mind that there are still three innocent British citizens, who happen to be journalists, who are being unlawfully detained in Argentina?
    Mr. Whitelaw: Captain Astiz has been questioned, as agreed, on behalf of the French and Swedish Governments. He is a prisoner of war. Certain dispositions have to be undertaken in relation to prisoners of war, but there are no positions to be taken against him as far as Britain is concerned.
    Mr. Dormand: As the number of long-term unemployed reached 1 million for the first time last week, and as this week's CBI Economic Review says that there is no evidence of an upturn in the economy, will the right hon. Gentleman ask the Prime Minister to publish the evidence for the economic recovery that the Chief Secretary to the Treasury assures us is all around us?
    Mr. Whitelaw: In recent weeks a number of statistics have shown that the economic recovery is proceeding. I stand by them.
    Mr. W. Benyon: Can my right hon. Friend assure me that the commander of the task force is not being restrained in his operations to recapture Port Stanley for any political reason?
    Mr. Whitelaw: He is not being restrained in any way. The operations are entirely a matter for the commander of the task force.
    Mr. Geoffrey Robinsonasked the Prime Minister if she will list her official engagements for Thursday 10 June.
    Mr. Whitelaw: I have been asked to reply.
    My right hon. Friend the Prime Minister is attending the NATO summit in Bonn.
    Mr. Robinson: Will the Home Secretary find time today to look at reports in the press about the proposals from the Select Committee on Home Affairs for a review procedure for complaints against the police in England and Wales? Does he agree that it would do much for his reputation as a Home Secretary who is committed to fairness and justice as much as he is to law and order if he went for a fully independent review system? Short of that, will he at least commit himself in the White Paper to independent regional assessors?
    Mr. Whitelaw: I have undertaken to consider carefully what the Select Committee said. I shall fulfil that undertaking and will come forward with an answer to it and with my proposals for legislation as soon as possible.
    Mr. Amery: Will my right hon. Friend probe the Leader of the Opposition's views a little further? To many of us it sounds as if he is prepared to hand over the Falkland Islands to a Fascist dictatorship, in the hope of saving some lives?
    Mr. Whitelaw: It is not for me to probe the views of the Leader of the Opposition under any circumstances.
    Mr. Alton: What news does the right hon. Gentleman have of the number of casualties sustained so far in the Lebanon? What news does he have of the bombing of refugee camps in and around Beirut? Will he take this opportunity to condemn the unwarranted incursion into the

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    Lebanon by Israeli forces and tell the House what negotiations the Government have held with our European partners?
    Mr. Whitelaw: In response to the hon. Gentleman's first question, I cannot give him the information that he seeks. On his second point, I confirm what my right hon. Friends the Prime Minister and the Foreign Secretary have said—that we wholeheartedly condemn Israeli aggression in the Lebanon. We have demonstrated that in the United Nations and we shall support Mr. Habib and everyone else in seeking an Israeli withdrawal at the earliest possible moment.
    Mr. Dalyell: At what point did the Prime Minister reveal to her Deputy Prime Minister that she had brushed aside the professional advice on air superiority given by some of her Chiefs of Staff? As a former Scots Guards officer, what did the right hon. Gentleman say?
    Mr. Whitelaw: She did not do so and so I did not have to say anything.
    Mrs. Knight: Will my right hon. Friend disregard the comment made by the hon. Member for Coventry, North-West (Mr. Robinson) about the Home Affairs Committee report on complaints against the police, because the hon. Gentleman was not a member of the Committee and heard nothing of the many hours of evidence listened to keenly by those who were members of the Committee and who submitted the report?
    Mr. Whitelaw: On the rare occasions that I have to answer at Prime Minister's Question Time, I am always grateful to those who question me on my subjects as Home Secretary. I well understand the great problems that attach to finding the correct solution for complaints against the police. The situation is extremely complex and I hope that the House will bear with me, because we all want to get the answer right.
    Mr. Canavanasked the Prime Minister what are her official engagements for 10 June.
    Mr. Whitelaw: I have been asked to reply.
    I refer the hon. Gentleman to the reply that I gave some moments ago.
    Mr. Canavan: In view of the Prime Minister's statement yesterday that she is ready, if necessary, to turn the Falkland Islands into a fortress for an indefinite period, are we not at least entitled to know the estimated annual cost of all this and where the money is to come from? If, as the Prime Minister said, freedom is expensive but worth defending, when will the Tory Government give greater priority to public investment in jobs to ensure freedom from unemployment for the 3 million people on the dole queue?
    Mr. Whitelaw: When the Prime Minister said that freedom was worth defending, she was surely right. The right of self-determination for the Falkland Islanders is worth defending and that is what we are doing.
    Lord James Douglas-Hamilton: Given the generous offer made by the Australian Government, will my right hon. Friend seriously consider the possibility of retaining HMS "Invincible", especially as there is an overwhelming case for having two carriers permanently operational?
    Mr. Whitelaw: As my right hon. Friend the Prime Minister and my right hon. Friend the Secretary of State for Defence have made clear, we are grateful to the Australians for their offer and it will be most carefully considered.
    Mr. Abse: How many more men from the 1st Welsh Brigade are to be killed or cruelly mutilated, and how many Welsh mothers are to mourn their sons, before the Prime Minister desists from her provocative and deliberate insistence on unconditional surrender and from an insistence that for eternity the Argentine must not participate in affairs on those islands? Will the right hon. Gentleman ask the Prime Minister to think as a mother, which she fitfully and publicly did some time ago, and stop the role-playing of a warrior queen?
    Mr. Whitelaw: The hon. Gentleman has made some personal remarks. Perhaps it would be in order for me to reply to him in a similarly personal way. There are a good number of us in the House who fought for a long time in defence of freedom in the world. We are entitled to say that we did. We are entitled to be worried about what strains we are putting on our young soldiers today, but we know in our hearts that it is right to do so.

Business of the House
3.31pm
Mr. Michael Foot: May I ask the Leader of the House to state the business for next week.
The Lord President of the Council and Leader of the House of Commons (Mr. John Biffen): The business for next week will be as follows:
MONDAY 14 JUNE—Motion relating to the Industrial Training Board Orders.
Motion relating to the Control of Atmospheric Pollution (Exempted Premises) (Scotland) Regulations.
TUESDAY 15 JUNE AND WEDNESDAY 16 JUNE—Further progress on the Northern Ireland Bill.
THURSDAY 17 JUNE—Motion On the European Community document on the German-Italian proposals on European Union.
Motions on the Clergy Pensions (Amendment) Measure and on the Pastoral (Amendment) Measure.
The Chairman on Ways and Means has named opposed private business for consideration at 7 o'clock.
FRIDAY 18 JUNE—Debate on the fourth report from the Select Committee on Social Services, Session 1980–81, on Medical Education, House of Commons Paper No. 31 and the relevant Government observations.
MONDAY 2I JUNE—Supply [20th Allotted Day]: Subject for debate to be announced.
[Debate on Italo-German proposals on European Union (Draft European Act).
Relevant report of the European Legislation Committee: Ninth report, Session 1981–82. HC 21-ix (1981–82) para. 4 114-ii].
Mr. Foot: I wish to put four matters to the right hon. Gentleman. First, there may be a need for further statements or possibly a further debate in the House on the Falkland Islands. I am sure that the right hon. Gentleman will take that into account. I repudiate entirely the suggestion made by the right hon. Member for Brighton, Pavilion (Mr. Amery), because there has never been any suggestion from the Opposition that the Galtieri occupation of the islands should be accepted. The right hon. Gentleman would not be able to find a single statement by me from this Dispatch Box that would justify such a suggestion. I ask the Leader of the House to give us the undertaking that he has always given on this subject.
Secondly, I understand that the Prime Minister is going to New York next week to engage in the disarmament discussions at the United Nations. Will the right hon. Gentleman arrange for the Prime Minister to make a statement to the House on Monday on that subject? The House has the right to cross-examine her on what she will be saying in New York.
Thirdly, the right hon. Gentleman will obviously make provision for reports to the House on the position in the Middle East which seems to be getting more dangerous hour by hour.
Finally, I should like to ask the right hon. Gentleman about British Rail. We have warned the Government on a number of occasions that a serious crisis was coming upon us. We have made suggestions to the Government about how that crisis could be avoided. We have suggested to the Government how they should come forward with fresh proposals to enable British Rail to do its job for the country as a whole. Will the right hon. Gentleman ensure
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that there is an early discussion on the subject? We should like a statement to be made to House and a debate. We wish to do our best to ensure that a railway strike is avoided.
Mr. Biffen: First, I happily give the undertaking that facilities will be provided for the House to be informed as appropriate on developments in the South Atlantic.
Secondly, with regard to the disarmament discussions which will be attended by my right hon. Friend the Prime Minister, I shall certainly draw to her attention the right hon. Gentleman's remarks. I am certain that she will wish to take account of them.
Thirdly, I acknowledge the importance of the unhappy dispute in the Middle East and the anxiety of the House to monitor those events, although I have to say at once that no provision has been made in next week's business for a debate on that topic.
Finally, with regard to the problems of British Rail, I note the right hon. Gentleman's anxiety that there should be no strike. I hope and believe, therefore, that he will join all of us in exhorting that recourse should be had to discussion, negotiation and conciliation. Whether that would be facilitated by a parliamentary debate is a matter of concern, but no Government time is available for such a discussion next week. There is a Supply day, and the right hon. Gentleman may like to take that into account when deciding his future action.
Several Hon. Members rose—
Mr. Speaker: Order. May I remind the House that we are about to have a half-day Supply debate on the National Health Service. There is considerable interest in it. There is a major statement to follow from the Secretary of State for Defence and a Standing Order No. 9 application. Therefore, I hope that the House will agree with me that, out of fairness to the debate, business questions ought not to go beyond 3.50 pm by the digital clock.
Mr. Nigel Forman: Is it my right hon. Friend's intention to introduce legislation this Session to deal with the important matter of data protection?
Mr. Biffen: Not this Session.
Mr. Robert Kilroy-Silk: Why not?
Mr. Alan Beith: Since the days of devolution legislation in the previous Parliament, has the Leader of the House and his right hon. Friends reconsidered their view on the suitability of timetable motions for major constitutional Bills which run into time-wasting tactics?
Mr. Biffen: The Procedure Committee has commented on this topic. We have no reason at this stage to dissent from its comments.
Mr. John Major: Is my right hon. Friend aware that many of us who have strong sympathies with the State of Israel none the less believe that its present actions in the Lebanon are a great danger to all of us? Will he reconsider his remarks of a few moments ago and promise us a debate in the near future on this important subject?
Mr. Biffen: I recognise that there is a strong sense of concern in the House that we have not had a foreign affairs debate for a long time. It weighs on my conscience, but

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I must confess that it does not weigh too much on my arithmetic when I look at the crowded state of business for the next few days.
Mr. David Young: I wish to express my concern about the failure to grant a debate on the Middle East. Many of the problems there are exactly the issues for which we claim to be fighting in the Falklands. Many hon. Members are concerned that the right hon. Gentleman has not said when such a debate will take place. I press him urgently to state when time for a debate will be made available.
Secondly, when will the right hon. Gentleman arrange a debate on the proposed redundancies in British Rail workshops?
Mr. Biffen: The situation in British Rail workshops has changed quite considerably since we last discussed the issue in the House. I cannot offer any Government time for a debate on the topic.
I recognise the deep concern that has been expressed by my right hon. and hon. Friends, and by the hon. Gentleman, about the Middle East. However, I cannot offer time for a debate next week. I shall bear in mind the anxiety that there should be a debate.
Mr. Richard Needham: Does my right hon. Friend agree that the present position in the Middle East will lead to a legacy of hate that will take generations to overcome and will threaten the peace of the world? In these circumstances, does he agree that a debate must be forthcoming the week after next if not next week?
Mr. Biffen: I cannot commit myself to a specified time. My hon. Friend has expressed succinctly a number of sentiments that will be argued when a debate is held.
Mr. John Roper: Does the right hon. Gentleman accept that there have been repeated representations for a debate on disarmament before the Prime Minister visits New York for the United Nations special session on disarmament? We shall welcome a statement from the right hon. Lady, but we believe that it is necessary to have a debate.
Mr. Biffen: No one has been more eloquent in pressing the need for a debate than the hon. Gentleman. I am sorry that it was not possible to provide time for one before my right hon. Friend's visit to New York. I do not hold out any early prospect of a debate upon the topic, but I have taken account of the representations made earlier by the Leader of the Opposition.
Mr. Clinton Davis: May I draw the right hon. Gentleman's attention to the Cork report on insolvency? Will there be a statement on Government policy? Will he give an assurance that this far-reaching and significant report, which goes to the heart of consumer protection, will not be pigeon-holed by the Government?
Mr. Biffen: My right hon. and noble Friend the Secretary of State for Trade will wish fully to evaluate this highly important report. I have no doubt that the Department's reaction will be forthcoming in due course.
Mr. Nicholas Winterton: Will my right hon. Friend give further consideration to the business for next week? Does he agree that this is a debating chamber as well as a legislative chamber? Does he recognise that many of us are sick and tired of stupid legislation being debated in the early hours of the
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morning? Does he agree that the British people would think more of this place if we debated some of the major issues of the day—for example, the problems of the Middle East, the Falkland Islands yet again and defence and disarmament—rather than the mish-mash of a constitutional monstrosity for Northern Ireland?
Mr. Biffen: I cannot accept the caricature of the past weeks's business that has been presented by my hon. Friend. However, I shall note his preferred priorities and bear them in mind. I cannot say that I am immediately persuaded by them.
Mr. Kilroy-Silk: Given the appallingly high level of unemployment on Merseyside and the increasing number who have been unemployed for over one year, and the fact that in some districts in the area male unemployment has reached 40 per cent., will the right hon. Gentleman provide an early opportunity to debate these matters so that we can hear what policie3 the Government have for reinvigorating industry on Merseyside?
Mr. Biffen: I am sure that the hon. Gentleman will concede immediately that unemployment is indivisible and that unemployment on Merseyside is part of a wider economic problem that covers the nation. The House will have a full opportunity to advance general economic arguments when we consider the Finance Bill on Report. I can hold out the firm promise that that opportunity will not be long delayed.
Mr. Ivan Lawrence: If my right hon. Friend is not yet convinced of the wisdom of the request of my hon. Friend the Member for Macclesfield (Mr. Winterton) concerning the Northern Ireland Bill, will he at any rate ensure that adequate time at a reasonable hour is giver to discuss that important constitutional measure so that there is the minimum number of closures and no guillotines?
Mr. Biffen: The orderly progress of the Bill requires at least two to tango.
Mr. Derek Foster: When may we expect a debate on the Northern region, bearing in mind that the number of long-term unemployed in the region has risen to over 1 million? As the right hon. Gentleman well knows, the North has more than its fair share of long-term unemployment. Does he agree that the special programmes for the long-term unemployed are derisory? Is he aware that at least 150,000, if not 250,000, of the unemployed are unable to read and write? Is he prepared to say what can be done about that?
Mr. Biffen: No, not in answer to business questions. I trust that the hon. Gentleman will allow me to dissent from his premise but to accept that there is a need for an economic debate that will embrace unemployment and related issues. As I said to the hon. Member for Ormskirk (Mr. Kilroy-Silk), these issues could well arise when the Finance Bill is considered on Report.
Sir Frederic Bennett: We have already had five or six debates on the Falklands and no one makes any complaint about that, but surely it is realistic, bearing in mind that all these debates have had to take place at the expense of consideration of legislation which would otherwise have gone forward, for us all in ever) quarter of the House to urge that equal attention be paid to at least one debate on the Middle East. My right hon. Friend will be aware that the casualties in the Middle East are already

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considerably more than those incurred in the Falklands dispute, and throughout the House pressure is being placed on the Government to enable the House to express a point of view. In 10 days it may be too late for us to express a view on events which by then might have reached a tragedy of almost unimaginable proportions.
Mr. Biffen: I understand my hon. Friend's point. Successive generations of hon. Members have interested themselves intimately in the affairs of the Middle East. There can be no debate next week, but I shall bear in mind the fact that there is widespread anxiety for a debate as early as is practicable.
Mr. David Ennals: Will the right hon. Gentleman reconsider his answer that we cannot have a debate on disarmament next week in view of the special session of the General Assembly and growing concern in Britain? Over 1 million people have signed a petition in support of disarmament and over 250,000 gathered in Hyde Park on Sunday to express the same view. Against that background, this is surely a matter of great urgency.
Mr. Biffen: No time is available for such a debate next week. I would mislead the right hon. Gentleman if I said that there was an early prospect of a debate. As I have said in response to the Leader of the Opposition, I am sure that my right hon. Friend the Prime Minister will wish to consider his request that she make a statement on Monday about her attendance at the disarmament conference.
Mr. Ivor Stanbrook: Why is it necessary, when parliamentary time is so limited, for the Government to stir up trouble on its Back Benches—[Interruption.]—by forcing through the ill-fated Northern Ireland Bill?
Mr. Biffen: The chorus that accompanied my hon. Friend's question leads me to think that there are at least two views on the matter.
Mr. Dennis Skinner: Does the right hon. Gentleman recall that many months ago the Prime Minister said from the Dispatch Box that her Department and the other Departments concerned with unemployment, including the Department of Industry, would keep their doors open to those concerned with the problem of unemployment? Is he aware that the Department of Industry is refusing to meet the representatives of Derbyshire county council, Chesterfield district council, Bolsover district council, the North-East Derbyshire district council and Amber Valley district council to discuss the removal of intermediate status from the area? Will he pass on that message and ensure that the representatives of the councils to which I have referred can have an opportunity to make their representations to the Department of Industry?
Mr. Biffen: I shall pass on that message.
Mr. John Stokes: I thank my right hon. Friend for not recalling the House during the Whitsun Recess for yet another statement on the Falkland Islands. However, may I ask him to think again about the question of the Middle East? I know that we have no force or power there, and that probably it is only force or power that will stop Israel, but surely this House, with its historic connections with Israel, Palestine and Jordan, should have a say next week on this vastly important question rather than on the comparatively trivial matter of Northern Ireland?
Mr. Biffen: I should never describe Northern Ireland as a trivial matter. I take my hon. Friend's point, and perhaps he will allow my answer to my hon. Friend the Member for Torbay (Sir F. Bennett) to stand as an answer to his question.

Falkland Islands
3.51 pm
The Secretary of State for Defence (Mr. John Nott): Since I reported to the House on 26 May, British forces have moved forward to positions surrounding Port Stanley, and are in firm control of high ground on an arc surrounding the town.
Earlier on 29 May, 2 Battalion the Parachute Regiment, supported by units from the Royal Marines, Royal Artillery and the Royal Engineers, captured Darwin and Goose Green. This action, against a greatly superior force, was a remarkable feat and our forces displayed great determination, valour and fighting skill. At the same time, units of 3 Commando Brigade liberated the settlements at Teal and Douglas. While these actions were in progress, 5 Infantry Brigade came ashore without incident and the QE2, which carried them, is due back in Southampton tomorrow.
In order to move forward elements of 5 Infantry Brigade as rapidly as possible to the Port Stanley area, and given the appalling weather which was making the logistic problems difficult for helicopters, the force commander moved some forces with heavy stores and equipment around the coast by landing ships.
When the weather cleared on 8 June all but the last elements had moved forward successfully, but the sea movement coincided with better weather and the Argentines at this time renewed their air attacks on our forces. Our latest assessment is that during these attacks at least seven Argentine aircraft were destroyed and maybe another four making 11 in all.
One air attack was launched against two landing ships, "Sir Galahad" and "Sir Tristram". Both ships were hit. The "Sir Tristram' had virtually completed offloading and she was not severely damaged. The "Sir Galahad' had already started unloading but still had some men embarked.
Having consulted the military authorities, I am not prepared at this stage to give the total numbers of our casualties, and to do so could be of assistance to the enemy and put our men at greater risk. Meanwhile, next of kin are being informed and I shall give further information as soon as is reasonably possible.
In another incident Argentine aircraft attacked a small landing craft. Four Royal Marines and two Naval personnel were killed, and their next of kin are being informed. In this incident all four attacking Mirage aircraft were intercepted by our Sea Harriers and were shot down.
HMS "Plymouth" sustained an attack on the other side of East Falkland, in the Sound. Five Royal naval personnel were injured and their next of kin have been informed. The ship was damaged but she remains operational.
The losses that we have sustained in these incidents are tragic, and as soon as we can give further information to the families we shall do so. I should like to express my tribute to the bravery and skill of those who were involved in the rescue of our men, particularly the helicopter pilots and crews who, in extremely hazardous conditions, were responsible for saving a great many lives by removing men from the damaged ships.
I must tell the House that the task force commander's plans have not been prejudiced by these attacks and the losses of stores and equipment are already being made good from other stocks held ashore.
Mr. John Silkin: Despite the skill and valour of our forces, which is one of the bright spots in this continuing story, it is disturbing news that we have received from the Secretary of State. The Opposition wish to add their tribute to that of the Government and should like to send their sympathy to the relatives and friends of those who died and suffered in these attacks.
However, it is rather more than sympathy that we should be sending There is practical help that we can give. I should like the Secretary of State to tell us that the Ministry of Defence will resume the emergency telephone procedures that it had until recently, and perhaps improve on them. If one is at the other end of a telephone and is worried about one's next of kin in the Services, and one hears stories or rumours, it is important to be able to get on the telephone to talk to someone who is sympathetic, even if there is no news. May we have the Secretary of State's assurance that the relatives and friends of our forces in the Falklands will be saved that needless amount of anxiety?
Secondly, we owe the nation the feeling that we are doing everything possible to avoid needless danger to our forces. I am not probing any further than this, but, in the light of the renewed Argentine attacks, can the Secretary of State assure us and the nation that every possible opportunity is being made to re-assess our defensive equipment?
Thirdly, without prejudice to the task force commander's plan—I keep saying that this is no business of ours; it is his concern—can the Secretary of State reassure us that Britain will be willing to table a resolution at the United Nations so that diplomatic pressure can continue at the same time as military and economic pressures are being reinforced on Argentina?
Mr. Nott: I thank the right hon. Gentleman for his first remarks. I give him an absolute assurance that as soon as we can resume emergency telephone facilities for the families, we shall do so. I assure the House that the next of kin and the families of the men involved are of overriding concern to us. Where possible, we try to tell them before every announcement is made.
Our problem is that we have to counteract Argentine propaganda, which greatly exaggerates the successes that they have. We need to say something in answer to that. Where we can, we are as specific as possible about any units that have suffered damage as a result of an Argentine attack. However, I also have to give every consideration to the overriding operational value to the enemy of any information that we announce. That is why, I regret, I came to the decision, having consulted all the relevant military authorities, that I should not at this stage give our latest estimate of the numbers of casualties from the "Sir Galahad" and "Sir Tristram".
I agree with the right hon. Gentleman that we must do nothing to put our men in needless danger. Clearly that is the principal concern of the task force commander. I am satisfied that he made the right decision to send round the final equipment and men in these landing ships. There are Harrier combat air patrols active the whole time and there are ships deployed—I cannot say more than that. I regret that some Argentine aircraft got through on this occasion. That may always be the case, however effective our air defence may be.

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My right hon. Friend the Prime Minister answered a question from the right hon. Gentleman the Leader of the Opposition on the subject of a resolution at the United Nations. I have nothing to add to what she said then.
Mr. John Silkin: Will the Secretary of State think again about his first reply? I am asking him to arrange for someone to be at the end of a telephone who can say to a lonely and frightened relative or friend "I have no information for you at the moment, but please telephone again, whenever you like." That is all I am asking for—a sympathetic voice at the end of a telephone.
Mr. Nott: I agree with the right hon. Gentleman. Of course we shall do that. The families of the men in the Royal Navy live primarily in the Devonport and Portsmouth areas, where the Service authorities are in contact with them the whole time. I agree with what the right hon. Gentleman is seeking.
Several Hon. Members rose—
Mr. Speaker: Order. I hope that the House will agree with me that if I bring questions to a conclusion at about 4.15 pm in view of the statements from both Front Benches, that will be too long rather than too short.
Mr. John Peyton: As many of the casualties that have, unhappily, occurred have been my constituents, is my right hon. Friend aware that the commander and others at the Royal naval air station at Yeovil have carried out a very careful and understanding operation to let the next of kin know as soon as possible and to relieve everyone of anxiety where that has been possible?
Mr. Nott: I am grateful to my right hon. Friend. I know that all the units of the three Armed Services are pursuing the matter as sympathetically as they can.
Mr. A. J. Beith: Why were relatives advised on television last night not to attempt to telephone the usual numbers at the Ministry of Defence? Would it not be helpful for them to be able to hear a sympathetic voice? Does the Secretary of State agree that, whenever operational requirements permit, there are two reasons why information should be given as soon as possible? There is a need to ease the minds of relatives, and to counter Argentine propaganda.
Mr. Nott: Those are two reasons why we try to release information as soon as we can. When such an incident happens, men are rescued by helicopters and ships and they are dispersed around the fleet. They may even be taken to the many units on the mainland and it takes some time to retrieve the information, which is scattered in different places, in order to provide it to the next of kin. That is our problem, but within those contraints we inform the next of kin as soon as possible, and we shall continue to show the sympathetic consideration that the House wishes.
Mr. Tam Dalyell: With considerable candour the Secretary of State said that, of course, aircraft will always get through. In those circumstances, are we not slipping into a British Vietnam in the South Atlantic, and before we go any further into the mire should not the task force be withdrawn?
Mr. Nott: With few exceptions, the House believes that the dispatch of the task force, the manner in which our
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forces were landed on the Falkland Islands and our successes since they arrived have been remarkable. With great respect to the hon. Gentleman, any analogy with Vietnam is entirely false. There has been a series of major victories, with some setbacks. I have told the House about those setbacks when they have occurred, but our forces have been magnificent and will go forward to another victory soon.
Mr. Edward du Cann: Although I recognise that there will always be times when my right hon. Friend cannot give the House the information that he might wish—this is undoubtedly one such occasion—can he reassure the House about a matter that is certainly in the minds of every hon. Member and of people outside, namely, that our ships and the gallant men who serve in them are receiving every protection possible, whether at sea, in the air, or on land, from early warning radar systems?
Mr. Nott: Our two aircraft carriers and every ship in the fleet have the most modern radar and communications systems. One element that we lack in the task force, because we are operating from 8,000 miles and outside the reach of a land base, is an airborne early warning system. We are giving urgent consideration to how we can create one. Apart from that, the radar and communications systems of the fleet, together with the Harriers, have worked magnificently. The record of the Harriers in shooting down Argentine aircraft has been outstanding. they would not have intercepted those aircraft had not the radar arrangements been working well.
Mr. Richard Crawshaw: On behalf of my party, I express our sympathy to the relatives of the casualties. I am sure that every hon. Member knows that, whether casualties are large or small, even one casualty is a tragic loss to a family. Can we not take comfort from the fact that until now in the operation losses have been much less than could have been conceived when the operation was started? At such a time, when losses may be greater than they have been until now, should we not steel ourselves to carry through our resolve in what we believe to be a righteous cause in the full knowledge, that, whatever the losses, failure to do so would bring much greater losses to Britain?
Mr. Nott: Most hon. Members share the sentiments expressed by the hon. Gentleman. I agree with everything that he said. Every soldier, sailor and airman that we lose is a tragedy, not just to his family, but to everyone. With 25,000 people involved in the task force, and with well over 100 ships there, I agree with the hon. Gentleman that it is remarkable that we have not had more casualties and sustained greater losses. We have been remarkably successful, but of course nothing will bring back lost lives.
Mr. Charles Morrison: Although the House will be grateful to my right hon. Friend for what he said about keeping families informed, the reality is that much worry stems from media speculation and partial reporting of incidents. Although I appreciate that considerable problems are attached to the matter, can my right hon. Friend reconsider the matter to see whether the present availability of news can be improved?
Mr. Nott: We are criticised both for giving too much information and for giving too little. Every hour of every day we must make a decision on whether to release

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information. The maximum amount of information is, rightly, required by the British public and we are not withholding any information that does not damage the operational objectives of the task force and that is not upsetting to the families. However, the more information that we can give, the better.
There have been some misunderstandings in the task force. The suggestion has been made that my Department has released information that will damage our forces on the ground. I have carefully checked every such suggestion and I can find no evidence that any damaging information has been given by the Ministry of Defence. What has sometimes happened is that reports have been based on speculation here at home rather than on actual information.
Mr. Reginald Freeson: Will the Secretary of State explain to the House how he could say in his opening statement that the losses that had been suffered would not alter the plan of campaign and yet go on to say that, for operational reasons, the information to which the House and the country were entitled would not be forthcoming? Some of us will not be satisfied and will be worried about what appears to be an unnecessary retention of information.
Mr. Nott: I am conscious of the fact that day by day we are criticised for giving too much or too little information. The criticism comes from different quarters, and sometimes from the same quarter but from different directions. However, no one is entitled to information that puts any life at risk. In making that difficult judgment in each case, it is right that we should rely largely upon the advice that we receive from the operational commanders on the spot. In the last resort they are the people best able to judge whether information is likely to be damaging to their actions.
Mr. Terence Higgins: As the Leader of the Opposition seems to distinguish between unconditional surrender of the Argentine forces, which he is against, and our forcing them to withdraw from the islands, of which apparently he is in favour, can my right hon. Friend confirm that our military objective is to remove the Argentine invader from the Falkland Islands—no more and no less?
Mr. Nott: Yes, I can confirm that.
Mr. Frank Allaun: Can the Minister inform the House of the number of casualties among Falkland Islanders, men, women and children? How many are concentrated in the Port Stanley area? Was not the objective the liberation of the islanders, not their annihilation? To avoid their death or wounding, will the right hon. Gentleman now do what our Front Bench has asked and resume negotiations at the United Nations?
Mr. Nott: With regard to casualties among the islanders, we are doing everything that we can through the force commander on the spot to keep these to an absolute minimum. We are in constant contact with the International Committee of the Red Cross to see whether we can find some means whereby islanders who may be in a difficult situation in the town can, with Red Cross assistance, be brought out. The Red Cross is working with us on this. So far we had not had a satisfactory response from the Argentines. Our concern for the islanders is very great, and we share that concern with the hon. Gentleman.
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I have already commented on the United Nations. Our objective in the short term is the removal of the Argentines from the Falkland Islands. There is nothing more that the United Nations can do to bring that about. It can be brought about only by British forces on the ground. We have given every opportunity to the Argentines to withdraw. They have turned down every chance, and we must now remove them by force.
Sir John Biggs-Davison: Will the entire Government be mindful of the reported words of a Royal Marine colour sergeant in the task force, that since the Falkland Islands are worth dying for they are worth keeping?
Mr. Nott: I noted that remark by one of our men, a Royal Marine commando. I am sure the vast majority of the House share his views.
Mr. Laurie Pavitt: Will the right hon. Gentleman join me in offering sympathy and condolences to a family in my constituency on the death of Sapper Prabeen Gandhi? Does he recall that during the passage of the British Nationality Bill 1981 many voices behind him cast doubt upon patriotism and the nature of our multiracial society? Will he therefore make it clear that some of the first deaths, certainly in relation to my constituency, were of members of the Indian ethnic minority?
Mr. Nott: I know of no one on my side of the House who would feel anything but praise for the ethnic minorities. I may not have got quite the right phrase, but I am thinking, for example, of the Hong Kong Chinese, the Indians and, indeed, all those serving with the task force many as members of the Merchant Marine. They have done a magnificent job. Their patriotism is not in doubt. Of course I join the hon. Gentleman in offering condolences to Sapper Gandhi's family.
Mr. Kenneth Warren: Without casting any reflection on the professional skill and, indeed, bravery of the British press men in the Falklands, may I ask the Secretary of State to examine the way in which their personal dispatches are issued? Can he tell us whether there is any monitoring of these reports before dispatch, bearing in mind that often, inadvertently I am sure, targeting information is given to the Argentines, such as the location of a damaged British Royal naval vessel today?
Mr. Nott: The reports coming from the journalists in the Falkland Islands have, generally speaking, been magnificent. They have been vivid and have given the country much information, which has been of great value to us. I have nothing but praise for what the journalists there have done.
All the journalists' dispatches are looked at on the ground down there. Of course, the lives of the journalists themselves are involved. We do not seek to censor or change their dispatches here. Sometimes we hold them back if we feel that a dispatch has slipped through inadvertently, perhaps in the heat of the battle when no one has had proper time to look at it. We have held back some for a day or two because we felt that it would be wrong for them to go out. We have done that in co-operation and agreement with the press and the newspaper or television company concerned. Generally speaking, the journalists

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have done a magnificent job. Of course, we are vigilant to ensure that no information is released through them that would damage our forces.

Middle East
Mr. Speaker: I have received three applications to move the Adjournment of the House under Standing Order No. 9, from the hon. Members for Sheffield, Heeley (Mr. Hooley), Northampton, North (Mr. Marlow) and Abingdon (Mr. Benyon). all three deal with the same subject, the Middle East. I propose to take the first one and to give my ruling on that because there is no point in the same application being made three times.
4.15 pm
Mr. Frank Hooley: 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 invasion of the Lebanon by Israeli forces and the threatened occupation of the Lebanese capital, Beirut".
That the matter is specific is beyond doubt. Israeli regular armed forces have advanced between 40 and 20 miles into the Lebanon. They are now attempting to encircle Beirut and have stated that they intend to occupy it.
The matter is important for the following reasons. First, the Lebanon is an independent sovereign State, a member of the United Nations, and is entitled to the protection of its territory and unity, as are all other members. Secondly, there has been a unanimous Security Council resolution requiring the withdrawal of Israeli forces, which Israel has so far disregarded. Thirdly, there is the question of human suffering and the massacre of mothers and babies, boys and girls. The figure has already been put at 8,000, and the killing and murder go on. Fourthly, and of fundamental importance, the principle of collective security and United Nations peacekeeping is at stake. If no action is taken to uphold the rule of law, the consequences for international peace not only in the Middle East but in the world at large are terrifying.
The matter is urgent for the following reasons. Not only does the fighting involve Israeli, Lebanese and Palestinian people, but the Syrian forces have been drawn into the conflict. It is reported today that forces may also be sent from Iran. The Saudi Foreign Minister has flown to Bonn to talk personally to President Reagan, and the American Secretary of State, Mr. Haig, has gone to Jerusalem for direct talks with the Israeli Government. The Ministers of Western Europe have discussed the matter urgently and are talking in terms of economic sanctions.
In the light of these considerations the House ought as a matter of the greatest urgency to discuss this conflict, which could have most fatal implications not only for peace in the Middle East but for the world at large.
Mr. Speaker: The hon. Gentleman gave me notice before 12 o'clock this morning, as I indicated, as did two other hon. Gentlemen whom I have identified by constituency, that he would seek 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 invasion of the Lebannon by Israeli forces and the threatened occupation of the Lebanese capital, Beirut".
The House listened, as I did, with deep and anxious concern to what the hon. Gentleman said. The House knows that my powers are strictly limited in this matter. I am directed to take account of the several factors set out

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in the Order, but to give no reasons for my decision. I have given careful consideration to the representations that the hon. Gentleman has made, but I have to rule that the hon.
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Gentleman's submission does not fall within the provisions of the Standing Order and, therefore, I cannot submit his application to the House.

BILL PRESENTED
  DEMOCRATIC AMNESTY AND UNFAIR PENALTIES (REPAYMENT)
  Mr. Ernie Ross, supported by Mr. William McKelvey, Miss Joan Maynard, Miss Jo Richardson, Mr. R. McTaggart, Mr. Norman Atkinson, Mr. Tony Benn, Mr. Martin Flannery, Mr. Robert Litherland, Mr. Reg Race, Mr. Stan Thorne and Mr. Dennis Skinner, presented a Bill to introduce an amnesty for those who in the discharge of their democratic responsibilities as citizens have suffered punishment in the courts and the imposition of fines under legislation introduced since May 1979 for offences in connection with the work of elected councillors, trade unions and members of trade unions and for the repayment of moneys paid in such fines where the offence committed was not an offence prior to that date: And the same was read the First time; and ordered to be read a Second time upon Friday 9 July and to be printed. [Bill 139].
Orders of the Day
  SUPPLY
  [19TH ALLOTTED DAY]—considered.

  National Health Service Pay
  4.20 pm
  Mrs. Gwyneth Dunwoody: I beg to move,
  That this House notes that the Health Service workers have been offered a totally inadequate increase in their wages, on the basis that this Government believe the lowest paid should be the worst treated; and condemns the Secretary of State for his refusal to refer this dispute to ACAS in the interests of both patients and Health Service workers.
  Mr. Speaker: I have selected the amendment in the name of the Prime Minister.
  Mrs. Dunwoody: Any debate on National Health Service pay must take account of one or two basic facts. No one enters the National Health Service to make a fortune. If one wants to make money, almost any other profession is preferable. I assure the House that there are no newsletters circulating with advice on the high rates of pay, the good hours and acceptable perks of the jobs available to technicians, porters, nurses or midwives. No recruiting agencies publish glowing advertisements on the conditions of work and marvellous surroundings. If they did, the Trade Descriptions Act would compel them to say something like "Jobs available in low-paid posts with very long hours in largely substandard buildings, with routine overtime and awkward shift work. Apply to the Minister for Health, who will undoubtedly pay you less than the poverty line and lecture you on the need to be responsible."
  The appalling truth is that the Government have precipitated the industrial action in the National Health Service. During the general election the Conservative Party made great play of its commitment to free collective bargaining and the right of workers to negotiate the rate for the job. The reality for public sector workers has been different. National Health Service workers have suffered a direct attack on their standard of living since the Government came to office. Unlike other groups in the public service, they have not received even the catching-up rate that could enable them to keep pace with inflation.
  It is salutary to examine the history of the present dispute. The Labour Government, who made mistakes on pay, were concerned with the problems of the widening gap in pay between National Health Service workers and other professions. They set up the Clegg commission at the behest of my right hon. Friend the Member for Norwich, North (Mr. Ennals) on 7 March 1979, with the express remit:
  "to examine the terms and conditions of employment … in agreement with the employers and unions concerned, and to report in each case on the possibility of establishing acceptable bases of comparison, including comparisons with terms and conditions for other comparable work, and of maintaining appropriate internal relativities."—[Official Report, 7 March 1979; Vol. 963, c. 1252.]
  Because the commission was asked to report by 1 August 1979, there is no doubt that it did not have the opportunity to produce a perfect scheme. Nevertheless, it concluded that there were workable methods of examining

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  National Health Service pay in relation to outside analogues. Given time, it is obvious that one could now produce machinery that would be sensitive enough to produce a number of realistic comparisons.
  The Clegg commission also recommended a catching-up exercise on behalf of the nurses, which was equal to 19·6 per cent. over two years. However, when the Government came to office, almost their first action was to destroy the Clegg commission and to remove any remaining external links with outside wage rates. Furthermore, the Secretary of State has been extra-ordinarily ambivalent even about the role of the Whitley councils as a means of negotiating pay. He announced that they were independent bodies, but he made it clear that, when it suited him, he intended to intervene directly in pay bargaining by insisting that National Health Service pay should be contained within the Treasury's limit of 4 per cent.
  Although the Secretary of State subsequently announced that a further £81·9 million would be available to be divided unequally between various groups of workers, by ruthlessly using the cash limits that he has imposed, he has ensured that National Health Service pay awards have been lower than those to other public sector workers. Although the Secretary of State has paid lip service to the need for long-term arrangements for pay, he has made little real attempt to offer comparable terms in the interim. He has appeared to be waiting for the outcome of the Megaw report on Civil Service pay.
  Listening to the Minister of State this morning on the radio, I thought that he was wrong to imply that the trade unions in the National Health Service were deliberately dragging their feet in seeking the means for setting up the machinery. He knows that that is definitely not true and that, ever since the setting up of the Royal Commission on the National Health Service, they have been seeking to find suitable machinery. He should not in any way imply that that is not so.
  The Secretary of State for Social Services (Mr. Norman Fowler): Will the hon. Lady explain why, when my hon. and learned Friend's predecessor as Minister for Health wrote in August 1980 offering discussions on the long term, it took over 12 months for a response to come from the unions? That was the point that my hon. and learned Friend was making. We need a reply from the hon. Lady on that matter.
  Mrs. Dunwoody: The Secretary of State knows that he, and no one else, was responsible for that delay. The delegation from the TUC that saw the Prime Minister agreed that it would take time to find suitable machinery, so the right hon. Gentleman must not persist in trying to mislead the House in that absurd way.
  The difference in treatment between National Health Service workers and other public sector workers is noticeable. Both the police and the fire services have proved conclusively that indexation of pay does not automatically mean a restriction on the number of jobs available. The TUC health committee responded positively to a means of setting up new machinery, and it has been seeking urgently to proceed with that work.
  However, I must make it clear to the House that the setting up of the machinery cannot in any way be regarded as an alternative to a proper pay increase this year. Even if some suitable formula is found and the Government are
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  sufficiently realistic to agree on suitable machinery, it is obvious that, in the first year of its implementation, a considerable sum will be required to bring existing wage rates in the National Health Service up to a reasonable level.
  There is no doubt that pay in the National Health Service is at a completely different level from that of other comparable jobs. Sometimes there is a complete misunderstanding of the wage rates that are received by those who work day in, day out, in the National Health Service. There are 270,000 ancillary staff, 70 per cent. of whom are women and 50 per cent. of whom work part-time only. They have been offered 4 per cent., although the Government admit that 63·9 per cent. earn £80 or less in gross earnings and only 19·5 per cent. earn more than £100 per week. Their last pay rise was in December 1980, when they were awarded 7·5 per cent. to run for 15 months.
  I shall consider some of the other people whom the Secretary of State: mentions rarely when talking about the National Health Service. Ambulance men are vital Health Service workers. They have been offered 4 per cent., with an extra 1 per cent. for a salary change that was agreed in their pay round last year. Many of those men and women do a dirty, dangerous and largely unappreciated job. For an average week of 46 hours they receive £128 compared with the police who receive £171·60 for a 39-hour week and firemen who receive £137·80. The much maligned administrative staff, about whom the Conservative Party always seems to be complaining, who face considerable job losses not only because of reorganisation but because of deliberate Government policy, earn in the clerical grades the magnificent sum of £88·50 while their opposite numbers in the Civil Service earn £94. A similar comparison holds good for senior administrators.
  It is not only those groups of workers but the professional, scientific and technical grades, for whom the attempt to restrict the wage bill to an increase of 4 per cent. has produced some extraordinary anomalies, are already suffering from acute staff shortages. The pay in the National Health Service is considerably lower than for equivalent jobs outside. Scientists can earn £188·10 in industry, whereas radiographers earn £99·70 after long, professional training. Those comparisons can be repeated right across the professional and scientific grades of the National Health Service. Some of the workers in those grades will receive absolutely nothing if the Government adhere to the 4 per cent. rate.
  The shocking thing about the Government's attitude towards the joint pay claim—the first that has ever been submitted by all the Health Service unions for a common core claim—has been the deliberate attempt by the Secretary of State to divide one section of the Health Service from another. I refer specifically to the attempt to suggest that the nursing profession was acting responsibly by refusing to take any kind of strike action while somehow or other implying that the Health Service unions did not have the same attitude to patients or the same strength of feeling for the National Health Service. I deplore the need to take industrial action. I believe strongly that, had the Secretary of State responded to the initial overtures from the TUC health committee, the position need not have deteriorated to the point where industrial action has been taken.
  Mr. Michael Morris: Is the hon. Lady advocating that the various unions in the National Health Service should join and become a single union, thereby presenting a common front, or does the Labour Party continue to seek separate divisions?
  Mrs. Dunwoody: The hon. Member for Northampton, South (Mr. Morris) has not extended to me the elementary courtesy of listening to what I am saying. It is the first time that there has been a common core claim with all the unions working together and realising that, even with the differentials that exist between one union and another, they can nevertheless combine in a demand for a 12 per cent. increase and work closely together in the pay negotiations. That has been a remarkable development.
  Everyone who works in the National Health Service wishes desperately not to damage the patients' interests. That is why the TUC health committee issued its code of conduct and yesterday rejected the call for an all-out strike. The Secretary of State may like to pay tribute to the TUC health committee and to all the unions, not try to suggest somehow that one group of Health Service workers is worried about the impact of industrial action on patients and another group is not. That is not true and he knows it.
  Throughout the dispute, the TUC health committee has sought to behave in a responsible manner. It is extremely important that the Government should respond.
  The Minister for Health (Mr. Kenneth Clarke): The hon. Lady has used a rather ambiguous phrase. She said that she deplored the need for industrial action. Does she support the present industrial action?
  Mrs. Dunwoody: It is clear that if people whose entire lives are spent caring for the sick and in some cases for the mentally ill and handicapped, are forced into taking industrial action, they have been driven almost to the point of desperation. I do not in any way agree that they should be forced into that position. I am extremely sorry that the Government have not made some effort to produce the machinery that would obviate any such move. That has been obvious from the beginning.
  Unfortunately, the Secretary of State has been deliberately procrastinating in the hope that the ballot of the Royal College of Nursing would show acceptance of the 6.4 per cent. offer and that he could then use that to drive a wedge between the Royal College of Nursing and the other unions. The Government and the Secretary of State reckoned without the fact that nurses can do arithmetic. Any Government who pretend that they are giving them a special increase should explain why they simultaneously allow their lodging charges and national insurance charges to rise.
  It is ironic that the same Government who refuse to give nurses a pay increase in line with outside jobs are, nevertheless, insisting on increasing their rents in line with the Secretary of State for the Environment's £2·50 tax on council houses. The Royal College of Nursing, in spite of what the Minister hoped, actually voted decisively to refect the offer. The nurses and midwives side of the Whitley council supported the unanimous rejection of the 6·4 per cent. offer.
  The stage has now been reached where the full staff side of the Whitley council, acting unanimously, has rejected the insultingly low increase. It made clear to the management that it required not a realistic, but a fair and
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  just offer. The Secretary of State cannot seriously imagine that, by boasting of the number of extra jobs that he has created in the National Health Service, he has somehow convinced the workers that they must accept a future of low-paid jobs and imposed pay settlements. Not even the most sophisticated rearrangement of pay statistics to prove an illusory 76 per cent. increase since May 1979—a calculation that can be reached only if pay settlements entered into by the previous Government in April 1978 are included—will convince those who have to deal with the effect of low pay that they are being properly treated. It is the height of hypocrisy for the Government—elected on a platform of free collective bargaining—abitrarily to impose an incomes policy on one of the lowest paid sectors in the public service.
  By contrast with the police, the fire service, the water workers, or, even more strikingly, senior judges, NHS workers have been offered a derisory amount. Compared with civil servants—badly treated though they have been—NHS workers have been offered a smaller percentage. Meanwhile, this Janus-faced Secretary of State, like some Victorian ironmaster lecturing the poor on their duty, has sought to exploit the real sense of responsibility of National Health Service workers at all levels.
  Mr. Tom Benyon: I thank the hon. Lady for giving way. I must say that I admire her splendid rhetoric. Having shared a platform with the hon. Lady on the subject of nurses' pay, on which she did so well, I know that she will appreciate that it is not a new problem that we face. Nurses concede that their pay has increased by 44 per cent. since the Government came to power. The problem is that they were exceptionally badly paid in May 1979. Would she care to enlarge on that point?
  Mrs. Dunwoody: The hon. Member for Abingdon (Mr. Benyon) conveniently forgets that the whole purpose of the Clegg commission was to provide a catching-up increase for low-paid NHS workers and to set in train machinery—that is the important part of Clegg—that would allow comparable pay rates to be established without all this constant bother. The Secretary of State's first action on taking office was to destroy that machinery.
  It is essential to the lives of all of us that the Health Service should provide the highest possible level of health care, and those who, day in, day out, week in, week out, often in depressingly inadequate premises, provide that care, are entitled to decent rates of pay and to expect our support and admiration. Most workers in the NHS realise that this may be our last chance to stop the slide of the Health Service into the slough of despond, where it will remain an under-funded, over-stretched repository of low-paid workers and under-privileged patients.
  The Secretary of State should stop being so appallingly pig-headed and avail himself of the good offices of ACAS. He should immediately seek assistance from ACAS and reach an equitable and urgent solution of this problem. His intransigence is not in the interests of the patients. If he is seriously concerned about patients' welfare, he will not want industrial action to continue.
  The Government have the remedy in their own hands, if only they will respond. Health Service workers are not, in spite of what the Government have sought to convey, the natural material from which militants are made. Only their very real desperation has driven them to this atypical

  415
  response. Let the Minister today announce that he accepts that they have an unanswerable case for an increase that is at least commensurate with the rate of inflation. Let him acknowledge his responsibility and put the Health Service back to work in the way that everyone desires. That is what the patients want, that is what the workers seek, and that is what the House has the right to demand.
  4.41 pm
  The Secretary of State for Social Services (Mr. Norman Fowler): I beg to move, to leave out from "That" to the end of the Question and to add instead thereof:
  "this House deplores any industrial action in the National Health Service especially that which puts at risk the health and safety of patients; notes that present offers will give increases of over six per cent. to about half the work force in a service which enjoys secure and growing employment; and urges the trade unions to reconsider their position before taking any further action which could damage the National Health Service and the patients it serves.".
  I had hoped that there was one thing on which we could agree, because the Government deplore not only the need for industrial action, but industrial action itself within the National Health Service. Having listened to the hon. Member for Crewe (Mrs. Dunwoody), I see that the position taken by the Opposition Front Bench is still remarkably equivocal in that regard. We must be clear on the matter. Industrial action in the Health Service is potentially dangerous. It puts patients' lives at risk. The distinction that is drawn between emergency and non-emergency is often, in practice, a distinction that it is impossible to make. A patient who is referred by his doctor to a specialist may well need urgent attention.
  The prospect of pickets turning back ambulances bringing what the pickets regard as non-emergency patients to hospitals is repugnant—just as it is intolerable that anyone who is not professionally qualified should attempt to decide who does or does not need urgent treatment. Certainly I should not seek to make that kind of judgment.
  Even worse, regrettably there have been reports of instances where emergency cover has simply not been provided. On Tuesday, for example, 18 ambulance stations in Northumbria went on strike. The emergency service was left to the police and voluntary ambulance services to provide as best they could. We were, of course, ready to support them with military ambulances if this had been required—in the event it was not—but even then the absence of trained and fully equipped ambulance men would have exposed the public to unnecessary risk. That is the reality of industrial action in the Health Service.
  Mrs. Dunwoody: Will the Secretary of State give way?
  Mr. Fowler: Perhaps I might continue for a moment, and then I shall gladly give way to the hon. Lady.
  In 1979 the then Secretary of State for Social Services, the right hon. Member for Norwich, North (Mr. Ennals), said:
  "I believe that we should condemn industrial action that does damage to the Health Service, whether it comes from doctors, nurses or anyone else who works in the Service."—[Official Report, 1 February 1979; Vol. 961, c. 1684.]
  He also said:
  "I am sure that hon. Members in all parts of the House will not support the withdrawal of emergency services."—[Official Report, 18 January 1979; Vol. 960, c. 1955.]
  I hope that that remains the view of the Opposition. I now give way to the hon. Lady.
  Mrs. Dunwoody: I thank the Secretary of State for giving way. We do not support the removal of emergency services. However, in citing a specific case the Secretary of State might have made an effort to explain exactly what happened with that group of ambulance men and exactly who exacerbated the situation to the point at which they went out.
  Mr. Fowler: The hon. Lady keeps making the point—sometimes one sees it, and sometimes it disappears, but it has to be made clear to the hon. Lady—that industrial action in the NHS does cause and has caused, damage
  In this dispute we have seen Mrs. Castle, the predecessor of the right hon. Member for Norwich, North, indefensibly appearing on a picket line in support of industrial action which, when she was in office, she unequivocally condemned. I hope that that does not represent the new position of the Labour Party, and that by the end of this debate we will hear from the Opposition Front Bench just what its attitude is, in plain words that the public can understand.
  Mr. Reg Race: When the right hon. Gentleman talks about the withdrawal of emergency service cover in Northumbria and elsewhere in other industrial disputes, does he not realise that when ambulance men informed their local health authority that they were to take limited industrial action, while providing emergency cover, some managements told them that they would all be sent home if they went on strike at all? Therefore the management is responsible for the removal of emergency cover.
  Mr. Fowler: I do not accept for one moment what the hon. Gentleman says. If people withdraw emergency cover, which is a deliberate act, certain consequences must flow from it. If the hon. Gentleman wants further examples of where that has happened, I shall be glad to ask my hon. and learned Friend to give them.
  I pay tribute, as the hon. Lady asked me to do, to the many thousands of people who have continued working in the Health Service—nurses and doctors, and many others who, as the hon. Lady said, are continuing to care for patients. They, I believe, are the people in the Heath Service who are rightly attracting the support and sympathy of the public. They are the people with whom the Government are most concerned to deal fairly.
  Since this dispute started I have reported to the House on two occasions. There are, some further developments which I should like to set out a little later. I should like to start with what I hope will be an agreed basis.
  The National Health Service has a budget of over £12 billion a year. This is higher, both in cash and in real terms, than it has ever been in the history of the National Health Service. By the end of this financial year provision is expected to be 6 per cent. in real terms over the level of services in 1979. We are therefore not dealing with a service which has been cut, but one which has been deliberately increased, and increased against the background of world recession. The result has been new hospitals; new wards; waiting lists down, and perhaps most important for some people a 47,000 increase in whole-time equivalent staff. The biggest increase has been in staff providing direct patient care.
  Self-evidently, the National Health Service is a labour-intensive service. A 1 per cent. increase in pay costs about

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  £65 million. In England the pay bill is now about £6½ billion. The pay bill for nurses and midwives is over £2½ billion. That money has been used to provide, first, more pay—pay, on average, has in fact increased by 60 per cent. since 1979—and second, more staff. Nursing and midwifery staff have increased by about 34,000 during the past three years. The result is that the pay bill itself has increased by 80 per cent. since 1979.
  There is no staff group inside the Health Service that has not increased—including significant increases in administrative, clerical and works staff. Clearly, there is an obligation on the Government to secure the greatest possible efficiency of this service, and that is what we are determined to do.
  What these figures demonstrate is that there is a choice for the Government and a choice for the taxpayer. The National Health Service has a budget. By any standards that budget is massive. If, as this Government have done, we add new resources and increase the budget even further, we have to choose where those resources go. If all our extra resources go on pay to existing staff, there will not be the resources for new services. It is simply not possible to provide massive new pay offers plus new hospitals and wards, and plus new staff. We have to make a choice.
  Mr. Laurie Pavitt: Will the Minister confirm that, in real terms, nurses pay is 80 per cent. lower than in 1974.
  Mr. Fowler: I am coming to the details of nurses' pay. Over the past three years the average pay for nurses and midwives has increased by—
  Mr. Roland Moyle: What about Clegg?
  Mr. Fowler: Of course it includes Clegg, because the Government financed Clegg.
  Mr. Moyle: We set up Clegg.
  Mr. Fowler: It may seem extraordinary, but the right hon. Gentleman was a member of a Government, and even he must accept that pay increases have to be financed.
  Mr. David Ennals rose—
  Mr. Fowler: Those who argue for a 12 per cent. pay increase must say where the money is to come from. Even before that we must be clear that the 12 per cent. pay increase is only one part of the total bill that the Health Service unions are putting to the taxpayer.
  Mr. Race rose—
  Mr. Fowler: I shall give way in a moment to one or other of the hon. Members. Perhaps they will fight it out between them. I must make some progress.
  When we take into account the other improvements that are demanded by the trade unions—longer holidays and reduced hours—all told the value of the demands is 20 per cent. The Government's current offer will cost £320 million. The unions are claiming an extra £700 million. That is the size of the increase about which we are talking. I do not believe that anyone seriously thinks that we can provide that kind of money out of the resources of the Health Service.
  Mr. Ennals: Is the Minister now taking credit for the Clegg award? The Clegg Commission was set up by the
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  Labour Government. It was agreed that the awards would be accepted. The first action by the present Government was to abolish the Clegg Commission. Is the Minister now taking credit for the awards that were granted by the Clegg Commission?
  Mr. Fowler: The Government provided the resources for it. If the right hon. Gentleman is not careful, I shall quote what the former Chief Secretary said about his behaviour at that time. As a former Secretary of State, the right hon. Gentleman should appreciate that, above all, the Government have to provide the resources in these situations. The Government are entitled to take credit for providing the resources.
  Mr. Terry Davis: The Secretary of State lost the thread of his earlier remarks—no doubt because of the interventions by my hon. Friends—and did not finish his sentence. Will he make clear what percentage increase in National Health Service pay the Government claim has taken place during the past three years?
  Mr. Fowler: The pay bill for nurses and midwives has increased by 80 per cent. That is partly made up of pay and partly by increased staff. That is the figure that I have just given. The pay increase within that amount is 60 per cent.
  Mr. Michael Morris: Is not the real nub of the problem that when my right hon. Friend and his predecessors came to power in the Department of Health and Social Security they found that there was no control over the number of staff in the Health Service? The seventeenth report of the Public Accounts Committee gives that as the situation. Moreover, the increase for the nurses over the period 1971 to 1979 was 24·6 per cent., whereas for technical ancillary staff it was 47·4 per cent. and for administrative ancillary staff it was 45 per cent. That is the nub of the problem inherited by my right hon. Friend to which an answer must be found in the months ahead.
  Mr. Fowler: I agree with my hon. Friend. Those are the points that the right hon. Member for Heywood and Royton (Mr. Barnett), who was Chief Secretary to the Treasury in the Labour Government, was making in referring to a previous Secretary of State for Social Services, the right hon. Member for Norwich, North in his book "Inside the Treasury". The right hon. Member for Heywood and Royton wrote:
  "He had a case, not one with which I necessarily agreed, because I felt there was substantial overmanning amongst Health Service ancillary workers who, through strike action, had won a clearly excessive settlement."
  That is the point that my hon. Friend was making.
  Basically, what this amounts to is a call to increase the contribution made by the taxpayer. Here we come to a crucial issue. The National Health Service is not an island. It is not divorced from the rest of the economy, and it never can be. It can expand only in so far as resources are available to allow expansion to take place. It relies on the wealth creation of industry, and the health of industry relies on us getting inflation down and keeping it down. It would be madness at this point to turn our backs on the successes that we have achieved there—madness for industry and madness for the National Health Service. Therefore I repeat that the 12 per cent. claim—or, to be more accurate, the 20 per cent. claim—that has been put forward is totally unrealistic.

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  Let us be clear on what has actually been offered. Since the 4 per cent. pay factor for the public sector was first announced by my right hon. and learned Friend the Chancellor of the Exchequer last December, an additional £82 million has been made available to increase the pay offers for specific groups within the NHS responsible for the direct treatment of patients and a further £22 million to finance the Government's decision on the report of the Doctors and Dentists Review Body. As a result, more than half the total work force are being offered more than 4 per cent. Nursing and midwifery staff, the largest group, have been offered increases averaging 6·4 per cent.
  A similar offer has been made to the professions supplementary to medicine. The doctors and dentists have been offered increases of about 6 per cent. on average. Ambulance men have been offered 5 per cent. as part of a settlement which would include the introduction of a salaried structure. Overall, on the present offers the paybill would increase by about 5·5 per cent.
  Other groups, such as the Civil Service—this is a fair comparison—have received increases for individuals of 5·9 per cent., but they have had to live within the 4 per cent. pay factor. The difference will have to be made up by savings in administration, notably a reduction in the number of staff. That is in direct contrast to what is happening in the National Health Service.
  It is true that substantial numbers of staff are still being offered 4 per cent., and some of those staff are relatively low paid. I do not seek to dispute that fact, but there are also two important points to be made.
  First, I make no apology for seeking to make some distinction between groups on grounds of recruitment, the degree of skill, qualification and training required. That is why we have offered more to nurses and midwives than to some other groups of staff, and I believe that that is supported by the public generally.
  Mrs. Elaine Kellett-Bowman: On which point has my right hon. Friend put the physiotherapists, who are also highly trained and refrain from striking?
  Mr. Fowler: They are also offered 6·4 per cent., are included in the professions supplementary to medicine and are at the top of the list.
  Secondly, many of the figures—the hon. Lady put forward her own figures—are quite misleading. One that has been used is the figure of £82 a week and the so-called poverty line. As I am sure the hon. Lady knows, £82 a week is the level of family income supplement payable to a married couple with two children.
  The real comparison should be, not with the basic rate, but with earnings. Average male ancillary earnings are £104 a week, and average full-time female ancillary earnings are £84 a week. That compares with a private sector average of £74. Nor are those differences largely accounted for by excessive overtime. The average for the male ancillary worker is 5½ hours a week, and the full-time female ancillary worker does less than 1½ hours overtime on average.
  This dispute is between a Government who have increased expenditure on the Health Service, provided secure and increasing employment for the staff and have offered about half the work force more than 6 per cent., which will cost about £320 million this year, and trade unions which have made a claim that will cost another £700 million.
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  I agree with the hon. Lady that it would not be right simply to leave it at that. I am sure that the House will share my desire to do everything possible to try to bring this dispute to an end, but this must be done within the resources available.
  Because of our desire to make progress, and also because of the key role of nurses in maintaining patient care—[Interruption.] I want to make two points, and I advise hon. Members not to jump to too many hasty conclusions—I responded immediately to the request by the leaders of the Royal College of Nursing to see me following the ballot of their membership. We had a constructive discussion and it is clear that the Government and the Royal College are close together on a number of points. In particular, we both want to see a new permanent arrangement for determining pay introduced next year. We agree that we want progress on this as quickly as possible, and the first meeting on the subject took place today under the chairmanship of the Minister for Health.
  I repeat to the hon. Lady that any delay that has taken place is in no way the responsibility of the Government. If the hon. Lady checks the letters and the facts she will see that the Minister for Health wrote on 28 August 1980 and did not receive a reply from the staff side until 12 August 1981. That was the first reply. Those are the facts, and I hope that the hon. Lady will not pursue her point, which is wrong and totally dud.
  We also agree with the Royal College argument that settlements between now and the longer-term arrangements should continue to recognise the special position of its members, who have not taken industrial action. We have already recognised that special position in the 6·4 per cent. offer that we have made. Obviously the Royal College wants to see that offer improved, and it puts its case strongly on that point. At this stage the problem is that we must find the money from the resources available. That problem still remains. None the less, we had a helpful discussion. I promised to consider all the different points that the Royal College made, and I have asked its representatives to have a further meeting with me, I hope next week.
  There is much common ground between the Government, the Royal College of Nursing and its members. We admire and respect their dedication to patient care, and it was on that base of common ground that the meeting took place.
  I very much regret that at present no such common ground appears to exist between the Government and the Health Service unions affiliated to the TUC. They are committed to a continuing campaign of industrial action which puts patient care at risk, and that fact must constitute a barrier between us.
  It appears that the Opposition would turn to a third party—they mention ACAS—to arbitrate in these circumstances between the Government and the Health Service unions. As I said before, that is a course that I reject. The essential issues in this dispute are how much the nation can afford to spend on the Health Service and how, within that total, the money is to be distributed. Those decisions cannot be contracted out to anybody outside the Government, and certainly not to a forum of the kind with which we are all familiar, in which the arbitrator or conciliator sets out to fix it and ends up splitting the difference. I have given the House the figures, and I do not believe that that is the way forward.

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  The health services committee of the TUC has now indicated that it, too, would like to see me. It said so in the statement that it issued after its meeting last night. I should welcome such a meeting, provided I thought that we could, as I and the Royal College did, proceed from some common ground.
  In the light of the various reports of the TUC health services committee meeting yesterday, it is anything but clear that there is yet sufficient common ground to make such a meeting worth while. But it is very much the Government's wish that there should be such a meeting, so that without misunderstanding, and with a realistic recognition of what can be afforded, we can bring this dispute to an end.
  It was with that in mind, and with a view to removing any misunderstandings and finding common ground, that earlier this week I asked Mr. Pat Lowry, the chairman of ACAS, to act as an intermediary and go-between. Mr. Lowry has agreed to do this in a personal and private capacity as a channel of communication acceptable to both sides. Whether his explorations will prove fruitful remains to be seen. We are grateful to him for agreeing to do this job, which he is just starting, but I owe it to him and the House to make his position clear. It will not be his responsibility to make proposals, still less to make offers. These matters must ultimately be settled by the Government.
  It may be that no progress can be made. I should regret it if that were the case. But if his explorations succeeded in finding common ground for useful discussions between the Government and the representatives of the other unions which would enable us to end this dispute, no one would be better pleased than I. However, I am bound to warn that the present claims made by the trade unions, and their actions, are a substantial barrier.
  Mr. Stephen Ross: I warmly welcome what the Minister has just announced. However, as one who owes his life to the National Health Service I beg him to understand the feelings, as I have discovered from being in hospital, of the Royal College of Nursing and nurses in general. I could have predicted the outcome of the vote. The right hon. Gentleman's information is not very clever if he expected them to vote in favour of the pay offer.
  The right hon. Gentleman must not split the Royal College and the other health unions. If the role of ACAS, or, rather, of Mr. Lowry, is to prevent that, I warmly support it. I marched with the unions in my home town of Newport yesterday, because they have a strong case. They do not wish to be on strike. I am sure that the Minister can bring them together if he acts in the proposed way.
  Mr. Fowler: I am grateful to the hon. Gentleman for his response. No purpose is served by driving a wedge between the two. That was the hon. Gentleman's fundamental point. I hope—I do not want to raise false hopes—that matters will proceed from that.
  The amendment makes three points. First, it deplores the industrial action that puts at risk the health and safety of patients. No one should be in any doubt that that is the result of industrial action in the National Health Service. Secondly, it points both to what has been offered in pay and to the increased employment within the Health Service. That circumstance is exceptional in both the public and the private sector. Thirdly, and most
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  importantly, it asks the unions to reconsider their position before taking further action that could damage the NHS and, above all, damage the patients whom the service is there to care for. I urge the House to support the amendment.
  5.11 pm
  Mr. Roland Moyle: I declare an interest. I am a Member sponsored by the National Union of Public Employees which is one of the unions that are taking industrial action. I have also been a Minister of State at the Department of Health and Social Security. I nearly did not bother to declare my interest, as when the Secretary of State answered a question last week he was good enough to declare my interest for me. This is his kind way of admitting indirectly that no matter how long he holds his high office I am more likely to know more about both sides of the problem than he ever will. Added to that is the fact that I spent 10 years practising industrial relations before I came to the House. Moreover, my family and I make full use of the Healh Service. We have no private health insurance. I hope that the right hon. Gentleman can say the same.
  I admired the way in which my hon. Friend the Member for Crewe (Mrs. Dunwoody) put the case on behalf of the Opposition. It was first class. I have been through fire on this subject as the Government of which I was proud to be a member ended up on a head-on collision with the union of which I am also proud to be a member. As a result, I have thought a great deal about the problem before the House.
  I should like to give the Secretary of State the benefit of my advice. It is simple. If he feels that, as a result of his losing face, he cannot increase an across-the-board offer to all workers in the NHS, he should take the advice of the TUC health services committee and refer the matter to ACAS. ACAS could then discover a special scheme of arbitration that will cover the current problem and settle it. The right hon. Gentleman told us of one or two steps in that direction, but they are not enough. We want a full-blooded commitment to arbitration if the right hon. Gentleman cannot find a way in which he can increase his offer to all NHS workers without loss of face.
  There is an abhorrence of industrial action within the NHS. The right hon. Gentleman said so today, and my right hon. and hon. Friends have said it in the past. The Government amendment says it. That abhorrence is fully shared by every employee in the NHS. That should be taken on board. The right hon. Gentleman and his colleagues are deliberately exploiting the reluctance of NHS employees of every grade to take industrial action to hold down to the lowest possible level—comparable only with Members of Parliament—the offer that he has made, on his own admission, to more than half of the NHS employees.
  That is the Government's tactic. The right hon. Gentleman is intending the natural consequences of his act. It is a cynical exploitation of the natural reluctance of Health Service workers to take industrial action. It is designed to save the Government cost and trouble. The right hon. Gentleman ought to admit it. We have seen, as a result of preliminary exchanges on the matter before the debate, that the Government's case in no way rests on justice or on any attempt to provide it. It is based on power, cost-saving and the numbers involved. That much

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  is clear. The right hon. Gentleman has not attempted to pretend that the offer to ancillary workers depends on anything else.
  That position guarantees a continual temptation, even among the most noble-minded Health Service employees, to have full industrial action. One can only think of what would have happened if, on the first day of limited industrial action, all the Health Service unions had withdrawn all their labour permanently. One has only to grasp that possibility—perhaps it is impossible to grapple with its full horror—to realise the way in which all Health Service employees are pulling their punches. The time has come when all hon. Members must cease to exploit that sense of unity among NHS employees.
  We must return to the machinery—perhaps not in exactly the same form—that the Labour Government bequeathed to the present one in the form of the Clegg commission. The Clegg commission was set up so that there should be a permanent, regular and scientific study of pay movements and the cost of living throughout the economy to see how it affected pay in the NHS. It was also intended to ensure that there was appropriate information, without strike action, to allow Governments and unions to pay fair wages in the Health Service, relative to the rest of the economy, rather than the country getting into the ghastly position with which we are now faced yet again.
  Even at this early stage in his career, the right hon. Gentleman is suffering from a massive credibility gap. Although he says that he wants to introduce pay comparability into the NHS, he must first explain why the Government abolished the comprehensive machinery that they inherited from the Labour Government; who set it up. The right hon. Gentleman is not necessarily personally responsible for that prompt abolition, apart from any vote that he may have cast in Cabinet.
  Morover, during the limited time for which the Clegg commission lived under the present Government, the Government nobbled its operations so that it did not give the answer that many people in the Health Service expected. Therefore, if the right hon. Gentleman makes a proposal that is based purely on Clegg it will be received with mixed feelings in the NHS because of the memory of that experience. Apart from the inherited credibility gap into which the right hon. Gentleman has had to insert himself, he is beginning to dig a credibility gap of his own. He seems to be interested only in the pay of nurses and midwives.
  Over and again we hear the right hon. Gentleman refer to the pay of nurses and midwives. He put the matter succinctly on 27 May. He said:
  "We are trying to devise a long-term arrangement for determining the pay of nurses and midwives … We would then expect that to have an implication for the professions supplementary to medicine …"
  There is nothing especially strong there. He went on:
  "I am also prepared to consider the implications that that would have for the rest of the workers in the National Health Service."—[Official Report, 27 May 1982; Vol. 24, c. 1061.]
  I see the Minister nod, so I need not produce further quotations from his speeches in the past few days which have tended to reinforce that line.
  Nurses and midwives certainly form a vital part of the National Health Service, but all the other workers—ambulance men, cooks, cleaners, laundry people and porters—also form a vital part of the service. If they did not, they would not be there. Their pay is
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  therefore just as important as that of nurses, doctors and dentists. The Secretary of State must take that on board in setting out his plans for the future.
  Mr. W. R. Rees-Davies: I entirely accept that they all have to be paid, but two aspects must be borne in mind. First, a number of the jobs, especially among the cleaners, contractors and some but not all of the porters, could well be dealt with by subcontract so that the burden would not fall so directly. Secondly, where there is a dramatic increase in certain of those aspects as there has been—[HON. MEMBERS: "No, there has not.]—there would be a good deal more money if there were a decrease in subsidiary and ancillary services.
  Mr. Moyle: I do not wish to start a long debate about the morality of subcontracting, but I have noticed that subcontractors demand to be paid and they also pay their employees, so I cannot see how that would be a saving to the National Health Service. The hon. and learned Gentleman's arithmetic is about as good as the Secretary of State's. Indeed, the Secretary of State said today that if everyone received the same percentage increase differentials would be reduced. That is not true, of course. If both nursing sisters and hospitals cleaners received an increase of, say, 8 per cent., 10 per cent., or 12 per cent., the cash value of the differential would in fact increase.
  The other employees in the Health Service besides nurses and midwives are equally necessary and the right hon. Gentleman had better treat them all on that basis. Otherwise a continuing sense of unfairness will develop in the Health Service, and, if the situation this year is bad, it will be worse next year and even worse the following year.
  5.22 pm
  Mrs. Sheila Faith: I acknowledge the experience of the right hon. Member for Lewisham, East (Mr. Moyle), but I cannot agree with his argument. I agree that the debate is important as it takes place at a time when industrial action is already prejudicing patient care in the Health Service and health workers have decided to intensify their current campaign of industrial action.
  The Government cannot ignore the undoubted fact that nurses and ancillary workers in the National Health Service feel that they have been let down by successive Governments and that the public have great sympathy for them. I am glad that my right hon. Friend the Secretary of State is giving the matter further consideration, has called in a go-between and is supporting new methods for determining nurses' pay.
  Although the Royal College of Nurses, which represents the majority of nurses, has turned down the Government's original offer, its members, in accordance with their usual high principles, will not strike. The ancillary workers should bear in mind that if they continue their industrial action they will lose a great deal of support if it leads to a situation similar to that which arose in 1978–79 when many patients' lives were endangered and a great deal of suffering and discomfort ensued. For hospital ancillary workers to place themselves in the position of deciding which patients are seriously ill enough to be considered as emergencies is wholly unacceptable. As a dentist, I have a certain amount of medical knowledge, but I certainly could not rest happily if I thought that people 's lives depended on my estimation of the seriousness of their condition.

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  Of course we cannot say that we are satisfied with the salaries received by Health Service staff, but in every trade and profession people in this country are being paid less than their counterparts in other countries because we have not created a proper climate for industrial prosperity. We must bear in mind that the National Health Service is the largest single employer in the country and that £12 billion per year of public money is spent on it—an increase of 6 per cent. in real terms since the Government took office—and that more than half of the total expenditure consists of wage costs. Every concession by the Government has a real effect on the economy as a whole. Therefore, it is understandable that the Government do not wish to do anything that might halt the improvements in the economy that are now becoming more and more apparent.
  It is interesting to note that the Select Committee on Social Services, in its third report on public expenditure in the social services in the 1980–81 Session—in this context, I acknowledge the presence in the Chamber of my hon. and learned Friend the Member for Thanet, West (Mr. Rees-Davies)—recommended that, because the cost of providing jobs in the Health Service was not high, the Government might create opportunities for people to take up work in areas of the country where there is a low Health Service provision coupled with high unemployment. Although as a member of the Select Committee I must accept responsibility for that recommendation, I was sceptical about it and not surprised when the Government decided that the Committee had not taken overheads fully into account, nor the fact that it would be difficult to limit recruits to men who would otherwise be receiving maximum benefits, as would be necessary for the scheme to be economically viable.
  I have always supported the Government's overall strategy of trying to provide real jobs in the private sector, and I accepted the Government's reply to the Select Committee's recommendation. Nevertheless, the Government must have been influenced to some extent by the Committee's argument, because, unlike other areas of employment in the public sector, the number of jobs in the Health Service has increased considerably and there are now many more nurses and significantly more ancillary staff. I do not believe that the Health Service unions have taken that fully into account, or the fact that, unlike employees in the private sector, their members have security in jobs that are sought after and highly prized. I acknowledge the remarks of the hon. Member for Crewe (Mrs. Dunwoody) on this point, but when these jobs are advertised there is no shortage of excellent applicants, while many other job advertisements do not achieve a great response.
  It is sad that decent people are taking collective action in the name of their unions, which, in the Health Service, could be cruel and dangerous. Anyone who has been associated with business in the private sector knows that people in this country are loyal and extremely conscientious. In the past few years of economic difficulty, we have seen that they are prepared to make real sacrifices for the sake of the economic viability of the businesses for which they work. Yet the same type of people working in the public sector are prepared to
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  endanger lives and are behaving in a way that could never have been envisaged—and this has happened whether the Government have been Labour or Conservative.
  Therefore, greater impetus must be given by the Government to increase the contracting out of catering and laundry services to private firms. I know that the Government have offered advice and encouragement to health authorities, but the response has been unsatisfactory. The Government should also be instrumental in setting up a pilot scheme at one large hospital whereby laundry and kitchen space and equipment are rented to private firms. This would mean better and possibly cheaper services and would be to the advantage of all concerned. Patients would have better services, because if, for example, meals were below standard, the contract could be terminated. Most important, the union monopoly would be broken and hospitals would not periodically be hostages to bullying unions.
  The majority of people would be deeply grateful to the Government if this were put into effect, as they seek reassurance that they would not be subject to the possibility of being caught up in a dispute when they need hospital treatment. As soon as the industrial action is settled, I hope that the Government will make every attempt to move towards this privatisation measure. I believe that it would bring significant benefits in future industrial relations.
  5.30 pm
  Mr. Robert C. Brown: Like my right hon. Friend the Member for Lewisham, East (Mr. Moyle), I should declare an interest. I am a Member sponsored by the General and Municipal Workers Union, many members of which work in the Health Service. In addition, I had been Under-Secretary of State at the Department of Health and Social Security for only a few weeks when, asked by Mrs. Barbara Castle to take responsibility for staff and industrial relations across the board, we had the first industrial stoppage in the Department. However, I do not accept responsibility for that.
  The Falklands crisis and events in Poland have distracted attention from the National Health Service workers' battle on the home front. However, the significance of the fight that the Health Service workers are putting up today may well outweigh that of other battles in the long term. I shall return to that point later.
  The Government have turned a co-operative and caring work force into an increasingly militant one through their rigid and insensitive attitude. Even the traditionally docile Royal College of Nursing, which has until now refused to sanction industrial action, has voted overwhelmingly to reject the paltry offer made to it. Does the Minister feel any pride in the fact that he has caused that historic decision to be taken by nurses of the Royal College?
  The Government's response to the health workers' legitimate demand has been in marked constrast to their tax handouts to the highly paid and their latest round of huge increases to the top paid in the public sector. Some of the rises due to top public officials amount to as much as the lowest paid Health Service worker will take home in a year.
  To deny Health Service workers the right to a living wage without recourse to industrial action is nothing short of a national scandal. Their speed of thought and action daily save the lives of scores of people.

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  The assault on the living standards of nurses and other National Health Service workers should not be seen in isolation from the overall attack on the NHS that has been carried out by the Government. The Government reduced the real level of expenditure on the NHS by half of 1 per cent. in real terms in their first year of office. The Treasury Select Committee estimates that over the next two years spending on the NHS will decline by over 2 per cent. in real terms.
  The impact is far greater. Even if spending was maintained in real terms, expenditure would be inadequate to preserve existing services and to cope with the growing numbers of ill people imposing demands on the Health Service. A real growth in spending of 1 per cent. a year is needed to preserve existing services alone and to meet the demands of the increasing number of aged people.
  At the same time, the Government have sought every possible means to undermine confidence in the NHS. Private medicine has been encouraged and supported. There have been attempts to introduce private medical insurance in the public sector. The principle of health care provided on the basis of need and not wealth is once more at stake. The concept of a Health Service funded from general taxation has also been threatened. There have been persistent rumours of Government attempts to introduce an insurance element, despite the almost universal condemnation of the medical profession and the trade unions in the National Health Service, as well as that of many other interested parties.
  The Government have done everything possible to promote the privatisation of aspects of the Health Service through the contracting-out of its work. In that context, the Government's harsh and intransigent attitude to the lower paid in the NHS has been the final straw for the Health Service workers. The Government's pay policy in the public sector has long since revealed itself as no more than placating the strong and punishing the weak. Because of their reluctance to take industrial action, Health Service workers are in the weakest bargaining position in the public sector.
  The Government's response has been to impose settlements on the NHS that have been successfully resisted elsewhere. I do not need to remind the House that in the public sector workers generally have not been restricted to increases of 4 per cent. The miners had an increase of 8·6 per cent., local authority manual workers 6·9 per cent., water workers 9·1 per cent. and civil servants achieved an increase—true, it was via arbitration—of 6·9 per cent. Meanwhile, higher paid public servants, whose pay is settled by an independent review body, have had rises of up to 18·9 per cent. Judges had an increase of 18·9 per cent. and senior civil servants had one of 14·3 per cent.
  There are 270,000 ancillary staff employed by the NHS, half of whom are part-time. Almost 55 per cent. of the full-time workers, including 41,000 women, earned less that £75 a week in 1981. The average gross earnings for all ancillary workers in 1981 was £87·96 compared with a figure for the country as a whole of £140·50. Four per cent. of very little is indeed very little. I will not use the expression that a certain trade union leader used outside the House, but it is, nevertheless, true.
  In spite of what the Secretary of State has said, the Government offer of 6·4 per cent. to the nurses was a
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  blatant attempt to divide and rule Health Service workers. Even so, the gross increase for a staff nurse would be £5·46 per week, resulting in a net rise of £2·34.
  For many years ambulance men have argued for the same status and pay as the two other branches of the emergency services, the police and the fire brigade. On 31 July 1981 the Secretary of State recognised ambulance men as an essential part of the emergency services. Despite that recognition, their pay remains far behind that of their colleagues in the emergency services. In the police, ranks below police superintendent earn on average—
  Mr. Rees-Davies rose—
  Mr. Brown: No, I will not give way. This is a short debate and I must continue.
  Mr. Rees-Davies: It is easy to read the TUC brief. It should be put in the Library.
  Mr. Brown: I am not reading a TUC brief.
  The Government should now summon any compassion that they have to meet the demands of the Health Service workers. They are asking for 12 per cent. and even that will leave many o f them earning a miserable pittance. The Government must look to a longer term arrangement—which I understand they intend to do—not just for nurses' pay but for ancillary workers and everybody else who works in the NHS.
  If the Government do not do that, I must warn them that there might be terrible consequences in store. Health Service workers are rightly reluctant to take the ultimate action that could cost lives. However, powerful allies are now coming to the aid of Health Service workers. The miners took action this week and now my union, the General and Municipal Workers Union, has threatened to call on its public sector workers to show solidarity with the nurses' cause. My union effectively controls gas, water and electricity workers, who have great industrial muscle. If the Secretary of State continues to resist the Health Service workers' claim, he may find himself tackling a far tougher nut then the NHS workers whom he originally decided to treat with such contempt.
  5.39 pm
  Mr. W. R. Rees-Davies: I have already read the TUC brief carefully. We have just heard the hon. Member for Newcastle upon Tyne, West (Mr. Brown) read out its brief, not the GMWU' s brief. It would be perfectly good policy to leave the brief in the Library, so that other hon. Members can read it. It is well drafted, but it unfortunately misses the point. It fails to understand the background and why so many NUPE workers and others are not relatively highly paid. I shall paint the picture so that those concerned can understand it. [Interruption.] There will not be any laughter when hon. Members have heard the figures, because they are remarkable.
  There is little party political capital to be made out of my remarks, because they will hit both sides. In 1979 the Conservative Party manifesto stated:
  "In our National Health Service standards are falling; there is a crisis of morale; too often patients' needs do not come first. It is not our intention to reduce spending on the Health Service; indeed, we intend to make better use of what resources are available. So we will simplify and decentralise the service and cut back bureacracy "
  A Select Committee has not yet had time, or has not chosen, to deal with one of the most important questions.

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  Will the National Health Service be allowed to grow and grow without any control over its eventual size, or will it be contained within reasonable limits, so that high standards and good pay can be maintained? That is the issue.
  I shall pose three simple questions, which I shall then try to answer. First, given that today there are 200,000 more nurses than the 236,000 that were employed in 1960, do we still need to increase the number of nurses by over 11,000 per annum? In 1960 there were 236,711 nurses and midwives. In 1970 the figure had risen to 343,682 and by 1980 it had risen to 448,870. That information can be found in column 270 of Hansard of 23 November 1981. The number of medical and dental staff has increased from 20,000 in 1960 to over 46,450 in 1980. We must ask ourselves whether the figure for nurses is to increase every year by about 11,000.
  The second simple question is: why did the number of administrators increase by over 3,000 between 1979 and 1980? That was a large increase. It occurred not under a Labour, but under a Tory Government. Why was there such a big increase?
  The third question is: why did the number of ambulance personnel need to be increased by nearly 1,000 between 1979 and 1980? Were there suddenly more accidents in 1979–80 than in 1978–79? There were not.
  In the past 20 years we have steadily failed to alter the general direction of overmanning, restrictive practices and falling standards. In 1960 the population was 52,559,000. By 1980 it had risen to 56,010,000, but the population covered by the National Health Service had fallen from over 98 per cent. to 93 per cent. during those 20 years. The proportion covered has fallen because the British United Provident Association and other organisations now provide private care for 4 million people. In 1960 only 1¼ million were covered in that way. The number of those who look after themselves through private health care is rapidly increasing. In addition, the trade unions, particularly the electrical unions, have their own hospitals and cottage hospitals. Not only employers, but good union members recognise the need for private health care. The cost of the National Health Service is large and rising. Because the number of nurses, administrators and ambulance men has doubled in the past 20 years, difficulties arise over pay.
  I shall now mention a figure which you, Mr. Deputy Speaker, with your great knowledge of these matters will fully appreciate, but I do not believe that the House appreciates it. Do hon. Members realise that in the past year or so a reduction of just over 56,000 has been laboriously achieved in the Civil Service, through redundancies and so on? At the same time there has been an increase of 67,000 in the number of National Health Service personnel.
  I do not say that we have not gained a lot. In many respects we have, but my hon. and learned Friend the Minister for Health and my right hon. Friend the Secretary of State must face the problem that the figures for operations performed and for hospital waiting lists are not good. Given all the additional expenditure, and the additional nurses, administrators, porters, radiologists, and so on, one would have thought that the numbers on our hospital waiting lists would have fallen rapidly, but what is the truth?
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  In 1960 there were 401,000 people on hospital waiting lists. In 1970 the figure had risen to just under 500,000, and in 1980 it had risen to 611,000. There is no sign that the figure has significantly dropped. However, recently there has been some sign that we may be beginning to tackle hospital waiting lists. I hope that the Government will make that a top priority. We need more operating theatres. For example, many hip operations need to be done and people sometimes have to wait for two or three years.
  What is our priority? My priority, and that of those whom I represent on the Isle of Thanet, is to reduce hospital waiting lists. If extra money is to be spent, it should be spent for the benefit of the patients. I do not believe in strikes in the NHS, and I do not believe that the nurses will strike. Many years ago I represented a large body of nurses. I still have a great regard for them and know that my right hon. and hon. Friends also hold them in high regard. It is time that they were categorically told that there has been a good increase.
  Nowadays, many nurses are agency nurses, because it pays them to work part-time. They do not work as they did years ago. They tend to go for agency work, particularly in the London hospitals. That is a pity, and I hope that the trend will be reversed. Obviously they must be able to increase their opportunities for work, and there are many opportunities to do that, not only in the NHS, but in the private sector and in hospitals and services at home and overseas. There is no real reason for complaint about their pay and conditions.
  There are far too many ancillary workers. There are too many cleaners at the Westminster hospital in London. The number of hours worked is too high. The work could be done in fewer hours, without the need to employ them on a full-time basis. I hope that the contracting services will come in and that great care will be taken to save money by making reductions in the National Health Service. I hope, then, that those who remain in the service—95 per cent. of the total—will be able to get an improved standard of pay. I should like to have seen a slightly higher rate, as I should have liked to see a slightly higher rate for Members of Parliament. Four per cent. is on the low side for both groups. I might have opted for 6 per cent., but I do not see any case for a large increase at any point in this sector. They have had a growing and improving service, and we now want to see that that improving service improves the service for the patient. The patient must come first and foremost in all our considerations.
  5.51 pm
  Mr. Clement Freud: This is the fourth Parliament of which I have been a Member. While I have sat on the Liberal Bench I have been accompanied on this side of the House by colleagues in Opposition who were sometimes of one political party and sometimes of another. Yet in one case they were totally consistent. When they were in Opposition, they blamed the Government for the shoddy treatment that was meted out to nurses. When they appeared on the Government side of the House, they defended their action.
  Nurses—I have checked my figures with great care—have had pay within 5 per cent. of 60 per cent. of national average pay. Ward sisters have been within 6 per cent. of 75 per cent. of national average pay. Over the years we have seen the Halsbury and Clegg reports. One welcomes the Secretary of State's request for the chairman

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  of ACAS to come in, but I wonder for how long anyone will be satisfied until we have an incomes policy and we stop trying to score party political points in one way or another.
  On Tuesday, after a private notice question, I asked the Minister to be generous, to adopt an incomes policy, and to recognise the many nurses and physiotherapists who continue to work regardless of the dispute. The Secretary of State, in a traditional shirty reply, said:
  "I do not know what is the hon. Gentleman's definition of an incomes policy—and I am not sure that he does either."—[Official Report, 8 June 1982; Vol. 25, c. 21.]
  In his speech today the Secretary of State said that we needed new machinery for dealing with pay issues in future years. I should simply like to tell him that that is what I meant by an incomes policy, and clearly he now understands. We need new machinery for dealing with pay issues. We need an incomes policy to take away the specific case and to go for the general concept.
  We welcome ACAS. I repeat the plea made by my hon. Friend the Member for the Isle of Wight (Mr. Ross) that ACAS must be asked to cause no division between the component parts of the National Health Service. That would be invidious. What worries us predominantly is that the Government could have been so out of touch as to have thought that the poll among members of the Royal College of Nursing would be anything but a massive rejection of their offer.
  The Governent, like all Governments, referred to the decency and integrity of the nursing profession. The nurses have spoken loudly and clearly. They do not want to strike. The House would say to the Secretary of State "Do not force them to do something so alien to their nature". We all admit that workers have the right to withdraw their labour, but what on earth are they to do other than to withdraw their labour? I ask the Secretary of State to give them a reasonable increase now—one that will at least retain their position on the higher scale of the percentage. Then, in good time, an incomes policy should be brought in, as the Secretary of State intimated and as we, on the Liberal Bench, have advised him since the Government came to power.
  5.55 pm
  Mr. Richard Alexander: First, I apologise to my right hon. Friend the Secretary of State and to the House for having to leave the Chamber shortly after I make my speech. I had a duty arranged before I knew the subject of the debate.
  There can be hardly anyone in the House or in the country who is not deeply concerned about the dispute. Almost all of us will have been cared for by the nursing profession at some time in our lives. Their reluctance to take strike action should not be a reason for taking tough action over their pay now. My concern is wider than concern for nurses and midwives. I should like to express concern today for those who need treatment inside or outside hospital but who are not receiving it. Operations and treatment for non-urgent cases are being delayed by the dispute at a time when hospital waiting lists have been significantly reduced in accordance with the pledge that we made at the 1979 general election.
  In cold print, an operation for an arthritic hip replacement for the relief of back pain or an operation for
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  an hernia might be regarded as non-urgent, but for the person concerned it is extremely urgent. Such people are at the heart of, and are hurt by, the dispute.
  There is undoubtedly widespread sympathy for the nurses and midwives. They are skilled, dedicated and underpaid. In contrast to what we have heard from some Opposition Members, I do not believe that whenever we talk about nurses' and midwives' pay we ought automatically to be talking about ancillary workers' pay at the same time. I do not seek to drive a wedge between the claims of the two groups, but I suggest to my right hon. and hon. Friends that they be dealt with separately and on their own merits. That seems sensible.
  The ancillary workers do an essential job, but often their militancy, their growth in numbers, and their unwillingness even to consider the possibility of their work being done by the private sector with consequent savings to the Health Service budget means that they do not have the sympathy of the general public at this time.
  When ancillary workers have an average take-home wage of £104, albeit including overtime, it is difficult to justify the argument that they are on the poverty line, and that they are justified in taking the strike action with the results that I have mentioned. We talk about take-home pay and overtime. Most jobs involve overtime, and overtime payments must be considered when we talk about the average pay package. Many hon. Members work overtime. Many of my hon. Friends, including myself, and some Labour Members worked a 19-hour day yesterday. We do not always expect overtime for what we do.
  Mr. Race: We get paid for that.
  Mr. Alexander: Therefore, we must take into account what ancillary workers take home, including a reasonable amount of overtime.
  It is difficult to feel sympathy for those now engaged in strike action when my constituents know that many in the private sector have gone without pay increases, and that many others have settled for increases within 4 per cent. to 6 per cent. However, those in the National Health Service continue with their secure jobs and inflation-proofed pensions.
  Mrs. Dunwoody: That is not true.
  Mr. Alexander: It is true. They have secure jobs compared with the jobs of the majority of those who work in the private sector. Security of employment is a factor that must be taken into account. Furthermore, we must not forget that since 1979 the Government have been spending more on the NHS in real terms. The number employed in the NHS has increased. Some may thimk that that is a blessing because hospital waiting lists have been reduced. This is not a picture of a Government who care little for the Health Service or for patient care.
  Those employed in the NHS must accept that there is a limit to the money that is available for increased wages. If the Government accede to the demand for a 12 per cent. increase, the cost to the nation will be an additional £780 million. That sum could be raised by extra taxation, a reduction of the service or a reduction in the number employed in it. Those are the options that my right hon. Friend must bear in mind when he considers the 12 per cent. claim. No other options are open to him.
  Since 1979 an additional 50,000 have been employed in the Health Service. Has it been entirely necessary to

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  employ each one of the 50,000? The NHS work force has doubled since 1960. As my hon. and learned Friend the Member for Thanet, West (Mr. Rees-Davies) said, a significantly greater proportion of the public are taking their health care needs out of the public sector.
  A few days ago there was a television interview outside a hospital and a picketing nurse was asked "Are you leaving your patients at risk in the ward?" The young lady properly replied "Not at all. They are perfectly adequately cared for and we are well staffed in the ward without my presence today." Overmanning, the non-separation of nurses' and ancillary workers' pay structures and the lack of acceptance that the private sector has a part to play in the NHS are the difficulties that are facing the Health Service. If my right hon. Friend faces them, there will be a decent level of pay for all in the service, and that will automatically follow.
  Mr. Nicholas Winterton: Does my hon. Friend recall that in the Conservative Party's manifesto of 1979 it was promised that a Conservative Government would treat the nursing profession as a special case? It was the party's intention to bring them out of the party political wage round negotiating procedure. We have done that for the police and for those in the Armed Services, so why cannot we do it for the nurses and the paramedical staff, who are suffering quite severely and are being treated very differently from the two other special cases? Do they not merit the same consideration, and now?
  Mr. Alexander: I entirely agree with my hon. Friend. That is exactly the argument that I have been advancing. We must treat nurses and the paramedicals on their own merits. Let us not become bogged down with the numbers who are involved in the ancillary services. I support my right hon. Friend's amendment.
  6.5 pm
  Mr. Michael Meacher: Two days ago, during the latest one-day stoppage, I joined the picket line outside the Oldham and district hospital in my constituency. I did so because I believe passionately that the nurses and other Health Service workers have a rightful case. I talked to them, and it was clear that they did not want to take industrial action. They were forced into doing so because they could see no other way of getting their just claim met.
  Mr. Kenneth Clarke: Will the hon Gentleman tell us how many patients he prevented from getting medical care in the course of his stint with the union that he supported?
  Mr. Meacher: No patients were prevented from getting medical care. All those who approached the hospital were told of the reasons for the dispute. Those who insisted on going in, and certainly all the urgent or emergency cases, were allowed through. There was no disruption of proper medical care in Oldham, and I am sure that the same goes for other places.
  One of those on the picket line was Mr. Robert Paterson, a kitchen porter at the Oldham and district hospital. He showed me his pay slip, and I have it with me. I shall be pleased to show it to the Minister at the end of the debate. He works a 38-hour week, for which he is paid £57·10. After enhanced payments for working all day on Saturday and Sunday, a 25 per cent. bonus because of the
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  redundancies that were achieved in a previous self-financing productivity deal and after all stoppages, he took home £58·90. That must be compared with the national average wage of about £150 and the sum that the Secretary of State took home last week, which must have been about £550.
  Mr. Paterson is not an exceptional case. I met a porter who did not receive the bonus because his section had not been part of the self-financing deal. He was paid £49 for a 40-hour week. I can validate every one of the cases to which I shall refer with the appropriate documentation if the Minister wishes to see it. I met a female full-time clerk of 20 years of age who worked 37 hours and received £43 a week. I was told of a theatre technician who is required to be on call for five nights a week for 12 hours per night, for which he receives the princely sum of 50p per night.
  I met a mortuary technician who receives £60·13 for a 40-hour week. He gave graphic details of what it is like to strip the body of a lice-ridden tramp. I shall spare the House the details. I met some student technicians and junior path-lab officers under 21 years of age. The Government believe that they deserve no increase, because they have been awarded a zero increase.
  These details show that the debate is about poverty. It is not about a public sector norm that is built on money supply targets. I wonder how many Conservative Members, including the Secretary of State and his well-heeled colleagues, have any idea of what it is like to live on £50 to £60 a week—little more than one-third of the average national wage. How many Conservative Members would want their sons or daughters to take on the jobs to which I have referred at the present levels of pay? It means having to skimp on food, walk a couple of miles to save a 30p bus fare, not being able to afford a holiday and having to refuse treats for children that other children expect and normally get. It means poverty, and a 4 per cent. or 6 per cent. increase will not take these people out of poverty.
  Mr. Fowler: The hon. Gentleman has given a number of figures. Is he disputing the average figure that I have given to the House of £104, for example, as the average for a full-time male ancillary worker?
  Mr. Meacher: The figures that I have show that the average wage of an NHS ancillary worker is £99·30 a week. That means that many are paid more and that many are paid less than that. The right hon. Gentleman said that relatively few hours of overtime were worked. To get up to that sort of figure, the hours of overtime must be considerably more than those that he mentioned. I have here some pay slips that I should be glad to show to the right hon. Gentleman. He cannot deny that there are many people paid at this level.
  Mr. Fowler: The figure of £99 is wrong. It is £104. Does the hon. Gentleman dispute the five and a half hours average for overtime that I mentioned?
  Mr. Meacher: The figure that I have is £99 but the difference between £99 and £104, when the Minister earns £550, is not that much. I do not dispute the five and a half hours average overtime, but many ancillary workers do not have the opportunity to get up to the £99 mark. That is the average figure. The distribution on either side is considerable. Many are being paid at an exceedingly low level. I hope that the right hon. Gentleman will accept that fact.

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  The one clear lesson from this dispute—and this was made clear to me on the picket line—is that the nurses will not settle for better pay if their even lower paid ancillary colleagues do not get the same increase.
  The Secretary of State said that the money is not available. In his speech he laid great emphasis on affordability. What is so insulting about this attitude is the values that are revealed. The Government will happily shell out £1 billion—or will it eventually be £2 billion—on a military regaining of territory 8,000 miles away, but they cannot find the money to provide a Health Service to save people's lives in this country.
  Not only that, but the Government have made it offensively clear in the current pay round that, even within the public sector, they are willing to enhance further the high living of the already well paid. At the same time, they are steadfastly determined—this is the meaning of what the right hon. Gentleman said today—to enforce the cut in living standards of the manifestly poor, such as the full-time nurses, who even after overtime, earn a weekly wage below the family income supplement poverty line of £82 a week.
  In this dispute we are seeing the ugly face of the Government's social values—a recipe for two nations with a vengeance. That is even more so if one looks at the money rather than the percentages, but it reveals only partly the Government's priorities. They have already awarded 18·6 per cent. to judges and 14·3 per cent. to senior civil servants, but they have refused to offer more than 6·4 per cent. to nurses, and only 4 per cent. to ancillary workers, when inflation is running at 9 per cent. to 10 per cent.
  Percentages do not buy goods in shops. In money terms, the average gross earnings of full-time female nurses—the vast majority of nurses are women—was £99·70 in 1981. Those are the official figures from the Employment Gazette. The increase proposed by the Government works out at £5 to £6 a week, depending on overtime work. In comparison, judges, already on £673 a week in 1981, have just been awarded an extra £144 a week. Top civil servants on £689 a week last year have been given an additional £119 a week. Both groups are already well heeled, but they have been awarded pay increases in excess of the total new annual salary proposed for nurses.
  The Secretary of State argues that nurses in the NHS should not resort to industrial action. We suggest that if he really believed that, he would not exploit them. They are being exploited when we consider the awards already given to other groups and the promises that were made to them. In 1980, nurses accepted 14 per cent. when inflation was 20 per cent, because they were told that they would be treated as a special case in 1981. In 1981, they accepted 6 per cent. when inflation was 12 per cent., because they were told that they would be treated as a special case in 1982. In 1982, they have been awarded 4 per cent. to 6 per cent. when inflation is 9 per cent. to 10 per cent. It is time that the Government respected their promises and treated the nurses and other Health Service workers as the special case that they deserve to be.
  6.16 pm
  Sir Albert Costain: Nurses' pay is an emotional subject. The point that needs to be made is that if we are to run a hospital efficiently we need to have an efficient staff of nurses. I have found in my
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  conversations with nurses and ancillary staff that the reorganisation has not been in the pattern that they have expected. Many of those who joined the nursing service to do a nursing job are now being made to do administration work. We must appreciate that they would rather be nursing.
  I know nurses who have been promoted to jobs which they do not want to do, yet if they get not get that promotion they do not get the increase that they deserve. The Public Accounts Committee, of which I am a member, has heard of many examples of money having been wasted on hospital building. Often, that money could be better spent on providing better facilities for nurses.
  This morning I received a number of letters from constituents who are physiotherapists, claiming that they are getting only 4 per cent. I was delighted to hear the Secretary of State tell the House that they will be receiving the same increase as nurses. If I am not correct in that, I hope that the Secretary of State will give the reason why.
  6.18 pm
  Mr. Tom Pendry: I must first, as my right hon. Friend the Member for Lewisham, East (Mr. Moyle) and my hon. Friend the Member for Newcastle upon Tyne, West (Mr. Brown) did, declare my interest. I am secretary of the National Union of Public Employees group in the House. Before entering the House I spent 10 years in the service of that union, helping, among others, Health Service workers. Thus, to some extent, I share the background of my right hon. Friend. While I am concerned in particular with the 300,000 workers in the Heath Service who are NUPE members, I am interested and concerned with the whole dispute.
  The Secretary of State has been guilty of a great deal of hypocrisy. He speaks of his concern for the welfare and safety of patients, yet the discomfort experienced—there is no doubt that there has been discomfort and there may be more—by patients and would-be patients is his responsibility. If it is not his responsibility, perhaps more accurately it is the responsibility of his right hon. Friend the Prime Minister.
  This dispute should never have reached the stage where the Health Service workers were driven into taking industrial action. The Secretary of State has been unreasonable to refuse to entertain the proposal of the TUC health services committee that the matter should go before ACAS or another independent arbitration body. The formula has been before the Secretary of State for about five weeks, yet he has ignored it in his usual blinkered fashion.
  The right hon. Gentleman's apparent determination to make the NHS pay settlement the arena for a trial of strength between a Government still petulantly calling for pay increases of no more than 4 per cent. in the public sector and NHS workers—whose dedication and commitment is unquestioned—has been an of folly bordering on incompetence.
  I am being generous by using the word "bordering". However, I am a charitable man and perhaps the Secretary of State is secretly reluctant to preside over this scandalous turn of events. In that case, he should be ashamed of allowing himself to be tied to the apron strings of the Prime Minister and of being her creature in yet another of her vainglorious postures of ferric stubbornness.
  The glister on the right hon Lady's iron image is looking very tarnished. To date, no other group of public

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  service workers has been pegged to 4 per cent. in the current pay round. The pay offers over which the Government have control have so blantly been on the "favoured son" principle—with judges receiving a monstrous 18·6 per cent. and the police 13·2 per cent.—that the country is right to react with scorn and derision to the Government's insistence on 4 per cent. for the majority of Health Service workers.
  The Secretary of State has conducted the affair despicably acting on behalf of a Government who have been shown to be rigid on pay only with those who they know are reluctant to take industrial action. However, his actions have been seen by the country for the dirty tricks that they are and the longer he persists with his present course, the more ardent will nation-wide support for the Health Service workers become. No crocodile tears on the part of the Secretary of State or the Prime Minister can disguise the fact that the offers made to nurses, ancillary workers and others in the Health Service are derisory and insulting to the dedication that those workers have always shown to the sick.
  Happily, there is complete unity within the National Health Service on the inadequacy of this offer. The Secretary of State has miscalculated once again in believing that the professional services within the NHS—not only nurses, but radiographers, physiotherapists and others—could be bought off by a mere 2·4 per cent. over the 4 per cent. offer to ancillary grades. Correspondence sent to Members on both sides of the House will bear out the fact that the professional bodies have rightly agreed that the offer is both highly insulting and divisive.
  It is important that the Secretary of State understands the extremely harmful and divisive nature of the Government's offer. Within the National Health Service the workers, ranging from consultants to ancillary workers, have always been mutually dependent, working together as a team. The Government's strategy in attempting to sunder this complex pattern of relationships by means of differential offers demonstrates their lack of understanding. If the offer were to be successful it would go a long way towards breaking up the vital team enterprise on which the nation's health is built. Given the Government's health policy during the past three years, one ought not to be surprised.
  Another of the Secretary of State's miscalculations is that he has completely misjudged the mood of the general public, who are solidly behind the health workers' claim. Even the media have seen the justice of the health workers' case, although perhaps they have not done so in the past.
  The Secretary of State has perhaps misjudged his own area health authority, because the district authorities in Birmingham have already sent him telegrams asking that the matter be referred to arbitration. The regional authorities have done the same. He is on dangerous ground even on his own patch.
  I urge the Government even now to recognise that they have misjudged the mood of the country, the medical profession and the National Health Service workers. They had better not tamper with matters by bringing in the former chairman of ACAS, but should respond to the TUC's demands that ACAS be brought in, that a just claim be met and that we return to a proper Health Service where the Government are seen to recognise the worth of those
  438
  who work in it. All the points made by my hon. Friend the Member for Oldham, West (Mr. Meacher) are true. One could give more illustrations about the work that is done at below poverty line rates. The Government must respond, because they have missed out on this one.
  The right hon. Member for Sidcup (Mr. Heath) misjudged the mood of the miners when he took them on. If the Government are not careful they will find themselves in the same position by taking on the Health Service workers when the general mood of the country is behind those workers.
  6.25 pm
  Mr. Mike Thomas: I was glad to hear what the Secretary of State said earlier, because until now the Government's position in this dispute has been near to indefensible. Successive attempts by Ministers to turn the gun of public approbrium on Health Service workers have been disreputable in the extreme and the amendment on the Order Paper today is a classic example. There is no doubt that the Health Service workers have a case. Since their pay was last properly reviewed, a gap of about 10 to 20 per cent. has opened up between their treatment and that of other comparable workers. If we consider the going rate in the public sector, their case clearly merits an increase of between 7 and 10 per cent. Many groups of workers have had "special case" pay increases of between 10 and 14 per cent.
  That must lead us inescapably to the conclusion that the Government's policy is totally cynical. They give in to those who have muscle and exploit those who do not, regardless of their work for the community. That cynical calculation is further compounded by the Government's crude and blatant efforts to divide and rule. There can be no other justification for the terms of the amendment. It refers to half of the Health Service workers. What about the other half, amongst whom are some of the most poorly paid people in Britain? The Government have forgotten that their job should be to restore a sense of commitment to the National Health Service.
  The disputes arise from a genuine sense of grievance and unfairness. If we are not careful, they will leave a damaging legacy of bitterness within the service. That is why we are determined to deal with Health Service pay within the context of an incomes policy for the entire non-trading public sector. It may be that an NHS pay board, including doctors and dentists as well as other health workers, is an answer to the problem. Certainly the Government's offer of a continuing mechanism simply for nurses and midwives is no answer. It is more "divide and rule".
  Sadly the approach of the Labour Party and of some trade union leaders is little better. How can the Bennite Left and the hon. Member for Crewe (Mrs. Dunwoody) continue to preach the virtues of free collective bargaining when they should know that free collective bargaining has left NHS ancillary workers at the bottom of the pay league? The best increases that they had were during periods of incomes policy.
  The right hon. Member for Lewisham, East (Mr. Moyle) made an excellent case. Unfortunately, it was a case with which the National Union of Public Employees and the Labour Party officially do not agree.
  While I understand and sympathise with the plight of the health workers, I counsel them to exercise some

  439
  caution, too. Industrial action is a dangerous road to embark on, however outrageous the treatment being meted out by the Government. This is not just because inevitably claims will be made—the Government already make them gleefully in their own cause—that
  "the health and safety of patients"
  will be "put at risk" but also because their greatest asset in achieving a better settlement is public sympathy.
  The health workers will not serve their own interests best by running the risk of forfeiting that sympathy. Indeed, they play the Government's own "divide and rule" game when they allow such a stark distinction to be drawn, for example, between the Royal College of Nursing with its no-strike commitment and the industrial action of NUPE, CoHSE and the General and Municipal Workers Union. It would be much better if all the workers in the NHS could rely on the Government to respond to a total rejection of industrial action on their part with a proper and continuing arrangement for all of their pay.
  The most damaging aspect of the dispute is that it will destroy any faith the workers might have had in the Government's capacity to pursue that approach. At the next election we shall offer them that possibility once again.
  6.31 pm
  Mr. Nicholas Winterton: I shall be extremely brief. [Interruption.] I have caught Mr. Deputy Speaker's eye and I am permitted to participate in the debate. Just because I had other commitments earlier and was not able to hear the whole debate does not prevent me, I hope, from participating.
  Mr. Deputy Speaker (Mr. Bernard Weatherill): Order. I should point out to the hon. Gentleman that I have just taken the Chair. I understand that the wind-up speeches were to begin at approximately 6.30 pm, so I hope that the hon. Gentleman will be brief.
  Mr. Winterton: I shall be extremely brief, Mr. Deputy Speaker.
  I am gravely worried about the Government's attitude to nurses and the paramedical professions; they have been badly let down. The fact that the Royal College of Nursing has for the first time in its history turned down a wage award by the Government clearly shows the level of dissatisfaction and concern felt by an historically moderate and responsible group of workers. I have met nurses and members of the paramedical professions in my constituency and I have never found among these people, who are among the most responsible groups of workers, such a feeling of concern, dissatisfaction and frustration.
  I may be the only Conservative Member to reflect the views that I am putting forward. There is no harm in that. The Government are not honouring an election commitment. I accept fully the views expressed by my right hon. Friend the Secretary of State for Social Services that he wants to find a permanent mechanism to ensure that the nursing profession has a satisfactory level of wages which will be geared to a particular qualified group within the community.
  As I pointed out in an intervention during the speech of my hon. Friend the Member for Newark (Mr. Alexander), if the Government can make an arrangement for the police and for the Armed Services there is no reason why they cannot do it for nurses and paramedical groups
  440
  within the National Health Service. These are vital workers who deserve the support not only of the Government but of all hon. Members.
  It is my intention to abstain in the vote because the Government have failed to honour their election manifesto commitment, something which I cannot tolerate. I cannot go along with the motion in the name of the official Opposition.
  There is no reason for my hon. Friends on the Front Bench to say to the House that we are spending more on the National Health Service and on the nursing profession when we all know why. There are indeed more nurses, but they are working shorter hours; that was the reason for more nurses being employed. We all want to see nurses working more reasonable hours so that they can give better attention to the patients in our hospitals.
  This is an important matter. My hon. and learned Friend the Member for Thanet, West (Mr. Rees-Davies) was right when he said that we need to look at the rationalisation of ancillary workers. I hope that those hon. Members who represent CoHSE and NUPE appreciate that there will have to be a reduction in the number of ancillary workers. Like many other hon. Members on both sides of the House, I want them to get a fair deal. At the same time, there should be fewer of them.
  I hope that the Minister will appreciate the depth of feeling on this subject among people who are supporters of the Government. They think that nurses deserve a better deal, not next year in 1983–84 but in 1982–83. I hope that he will turn his attention to this and give them the increase which will justify my again being able to support the Government if there is a motion put forward on the subject.
  6.35 pm
  Mr. Terry Davis: Like many of my hon. Friends, I must begin with a declaration of interest. I, too, am sponsored, by the Association of Scientific, Technical and Managerial Staffs, which represents some people who work in the Health Service.
  The Secretary of State began differently, with a lecture about the effect of industrial action on the Health Service. He deplored not only the need for industrial action, but the industrial action itself because it is potentially dangerous and puts patients at risk. That is to state the obvious. I know it, the House knows it, and the staff know it. That is why the staff have always been so reluctant to take industrial action.
  The Opposition do not approve of industrial action in the National Health Service, but we do not join the Government in condemning it because we understand why the staff feel that they have no alternative, and why they feel that all Governments have always taken advantage of their reluctance to take industrial action and have exploited their dedication to patients. We understand that this year the staff in the Health Service have simply been taken for granted once too often.
  The Secretary of State paid tribute to the thousands who have continued to work normally. It is significant that he did not pay tribute to the trade unions for having decided against calling an all-out strike. Better still, instead o I paying tribute, why will the Secretary of State not pay them more money?
  In regard to the new and permanent arrangements for next year, the Labour Party welcomes the conversion of

  441
  the Government. After all, it was this Government who abolished the Clegg Commission. Now they have changed their mind, but what about this year?
  As my right hon. Friend the Member for Lewisham, East (Mr. Moyle) said, the Secretary of State kept talking about nurses and not ancillary workers. Of course, the Secretary of State treats them differently. He also distinguishes between the Royal College of Nursing and the trade unions of the Health Service. He has already met the Royal College of Nursing. Why has he failed to meet the Trades Union Congress health services committee? He denies that he is trying to drive a wedge between the Royal College of Nursing and the trade unions. What, then, is his motive?
  The Secretary of State gives the impression that he is refusing to meet the TUC health services committee because industrial action is taking place. Anyone who knows anything about industrial relations will tell him that this is one of the most serious mistakes anyone can make in trying to settle an industrial dispute. He said that he would welcome a meeting with the TUC health services committee, provided that Mr. Pat Lowry could establish that there was enough common ground between him and the trade unions. I am not sure what common ground exists between the Secretary of State and the Royal College of Nursing that does not exist between him and the trade unions. Surely the common ground should be a common concern about the well-being of patients.
  Why will the Secretary of State not go to the Advisory, Conciliation and Arbitration Service? He refuses because he says that the decision cannot be contracted out to someone outside the Government. What is the basis of his decision that 4 per cent. is enough for ancillary workers and that 6 per cent. is enough for nurses?
  The Secretary of State mentioned three factors that he had taken into account. First, he said that there had been an increase in spending on the Health Service and therefore the staff should expect a smaller increase than other people. What is the logic behind that statement? Why should people accept a smaller increase in their wages because the Government are spending more money on the service in which they work?
  What about other groups? Are the National Health Service workers unique? What about the police? By my calculations, the Government's expenditure on the police has increased during the past three years by the same proportion as expenditure on the National Health Service. How does the Secretary of State justify offering only 4 per cent. and 6 per cent. to National Health Service workers, when the police have rightly been offered 13 per cent?
  The same argument applies to the second factor listed by the Secretary of State—the increase in the number of staff. The right hon. Gentleman forgot to mention that a major part of that increase comes from the change in mathematics. The National Health Service has always employed a large number of part-time staff, who are converted to full-time equivalents. Three years ago there was change in the basis of that calculation. Previously, the calculation was done on the basis of a working week of 40 hours. It was then changed to 371/2 hours. Therefore, there were more full—time equivalents in the National Health Service than before, without any increase in the number of people working in the National Health Service or the hours that they were working.
  442
  The Secretary of State said that other groups had been offered more and that those other offers must be financed by reductions in staff. Does that mean that the Government are planning to employ fewer policemen and firemen? Of course not. I do not for one moment think that they have any intention of doing so. However, those people have had higher increases than the 4 per cent. and 6 per cent. offered to those who work in the National Health Service. If there were any logic in the Government's argument, there would have to be reductions in numbers in those groups in order to finance the increases in wages.
  Thirdly, the Secretary of State says that the nurses should accept 6 per cent. and the ancillary workers 4 per cent. because there has been a 60 per cent. increase in nurses' pay in the past three years. That is the Secretary of State's figure. I have tried to check that figure. My calculations have been confirmed by statisticians working in the Library, and I believe that the correct figure is 33 per cent., based on information that the Government have published in the Official Report. The only way in which we can achieve a figure of 60 per cent. is by including the settlement agreed immediately before the general election in 1979. To judge from the expressions on the faces of the Ministers, that must have been included in the Government's calculations. The Government had no alternative but to honour the agreement that was made before the general election, but paid afterwards, so they cannot take the credit for it. That settlement was for the 1978–79 pay round. The figure of 60 per cent. is for four years, not for three years.
  The Government have no case. Their attitude is as illogical as it is unfair. They are therefore forced to rely on a mixture of specious arguments and slick statistics.
  6.44 pm
  The Minister for Health (Mr. Kenneth Clarke): I understand that there is a depth of feeling about the level of pay for the various people who work in the National Health Service. Before the debate started, I hoped that there would continue to be bipartisan agreement on the role of industrial or strike action in the National Health Service. During the debate it has become clear that there has been a significant change of policy in the Labour Party, expressed by Back Bench and Front Bench members.
  I remind the House of the position taken by the Labour Government on 1 February 1979. The then Secretary of State, the right hon. Member for Norwich, North (Mr. Ennals) said of trade union leaders:
  "I deplore their policy of calling any form of industrial action in the NHS."—[Official Report, 1 February 1970; Vol 961, c. 1672.]
  The hon. Member for Birmingham, Stechford (Mr. Davis) has just said, only three years later, that he does not condemn industrial action in the National Health Service. The hon. Member for Oldham, West (Mr. Meacher) said that he went on a picket line. The hon. Member for Newcastle upon tyne, West (Mr. Brown) said that he supported the action of the miners and others in politicising the dispute by going on the picket lines during the dispute. I should have thought that in three years Opposition Members would not have moved so far that they now cannot bring themselves to utter a word of disapproval of condemnation of industrial action that comes between patients and the treatment that doctors believe they should recieve.

  443
  The hon. Member for Wood Green (Mr. Race) usually goes far beyond the position of most members of the labour party. He supported the ambulance men in Northumbria who withdrew emergency services. He sought to excuse them by giving an account of the way in which he thought the action had been provoked. The management in Northumbria said that it would pay 50 per cent. of the ordinary pay if the men carried out only emergency work, which in most ambulance services is less than half of the work that they carry out. However, because they wanted full pay for doing less than their normal work, they walked out and Northumbria was left with no emergency ambulance service. I understand that the hon. Member for Wood Green excuses even that.
  Mr. Race: As usual, the Minister has misinterpreted the action that employees in the National Health Service are implementing. In certain ambulance authorities the management is taking a much tougher line towards those who agree to provide emergency cover. By its actions, the management is undermining the provision of emergency cover. If the Minister had opened his ears, he would have heard me say that those men had offered to make available emergency cover, but the actions of the management undermined it.
  Mr. Clarke: The tougher line to which the hon. Gentleman refers, which the Government wholly approve, in the case of the chief ambulance officer, was refusing to pay the men their full pay when they were proposing to carry out only a fraction of their duties. What mattered was that the men walked out and failed to provide any emergency services for road accident victims and others. The hon. Gentleman cannot bring himself to condemn that. Other hon. Members did not go that far, but there has not been a word of effective criticism by the Opposition of those who are taking industrial action.
  I shall not deal with the extreme cases. The hon. Member for Oldham, West said that he did not come between patients and the care that they required, although what on earth one is doing on a picket line trying to reduce the number of patients going into a hospital other than coming between individuals and health care I cannot understand.
  I shall give a description not of an extreme case but of an ordinary case. In the Financial Times on Saturday 5 June there was an article about incidents at Leicester, where the TUC code has not broken down. A journalist, Mr. David Goodhart, who saw how the picket lines were going said:
  "The ruthless union thugs of Lindsay Anderson's film Britannia Hospital were nowhere to be seen as the hospital administrator and the police discussed with pickets how best to order the proceedings."
  Therefore, that was not a bad or extreme case. I shall quote from another part of the article referring to what went on on the picket line:
  "A tearful old lady was turned away from visiting a sick friend and there was a bit of car-bonnet thumping. Apart from a few minor incidents like these, however, the atmosphere inside and outside the hospital was quiet and accommodating."
  The article also stated:
  "It was a good day for the pickets. To claps and cheers they turned away the majority of the non-emergency out patients. The hospital administrator admitted that the 1,000-bed teaching-hospital, the biggest in Leicestershire, was reduced to weekend coverage."
  If that is the average of industrial action in the country, I think that the Opposition should do what we always did
  444
  in Opposition when there was industrial action in the National Health Service. We did not need to be challenged. When asked by Secretaries of State, from Barbara Castle onwards, Conservative Members always condemned industrial action in the National Health Service. So did the Labour Party until today—
  Mr. Race: The Government are responsible.
  Mr. Clarke: So did the Labour Party until the hon. Member for Stechford said that it did not condemn industrial action.
  Mr. Terry Davis: Will the Minister for Health understand that the Opposition believe that for this Government to condemn the effects of industrial action in the National Health Service at this time is like President Galtieri condemning war in the Falkland Islands?
  Mr. Clarke: The House will have to judge who is taking an extreme position. It has always been our position that, whatever people feel about the right level of pay in the Health Service, in something so vital as patient care there is no room for industrial action and responsible politicians should condemn it as politicians in the last Labour Government condemned it. They no longer do apparently.
  I turn to the merits of the case. I do not want to trade figures with the hon. Member for Oldham, West whose use of figures is always elaborate. He has earned the reputation of using Meacherisms, which lead on into rather curious interpretations of pay claims.
  The pay of nurses and midwives has moved ahead of inflation since the Government took office. The pay offer that we have made is fair and reasonable and in line with other groups of workers. The main argument between us—how the Government have dealt with the employees—has arisen from the attitude taken towards the settlements in 1979 and 1980 following the Clegg commission report. Those payments were made in 1979 and 1980. The resources were found by this Government. The previous Government made the promise, but we fulfilled the commitment. Workers' earnings increased as a result and we found the resources to pay for them. The details are set out in a written answer by my right hon. Friend the Secretary of State on Monday 10 May. Over the past three years the average earnings of nursing sisters have increased by 63 per cent., staff nurses 60 per cent., nursing auxiliaries 49 per cent., full-time ancillary staff 52 per cent. for men and 51 per cent. for women. The retail price index has not moved ahead of that during that time.
  The Opposition's position, when they say that that is not an adequate response to the problem, is somewhat weakened by their record. The Social Democratic Party and the Liberal Party say that the answer is to have a pay policy.
  During the last three or four years of the previous Government, when there was a pay policy, the real earnings of everyone employed in the Health Service actually fell until the 1979 dispute when the then Government offered a flat 5 per cent. to everybody and fought an extremely bitter industrial dispute which they resolved by setting up the Clegg commission.
  Mr. Moyle rose—
  Mr. Clarke: We have a substantially better record since we came into office of moving nurses' pay ahead of inflation. The record of the right hon. Member for

  445
  Lewisham, East (Mr. Moyle) was a decline in the living standards of Health Service workers and it ended with an appalling dispute.
  Mr. Moyle: If the Minister seeks to put the facts on record, will he not agree that on 22 January 1979 the Health Service employers' side offered 9 per cent. to the ancillary workers?
  Mr. Clarke: I believe that was the final unsuccessful move that the Government made before setting up the Clegg commission. That is my recollection. The recollection of the right hon. Member for Lewisham, East may be better than mine as he was in the thick of it. I should like to know whether his first commitment was to his union or to the Health Service. The right hon. Gentleman has referred to one of the offers made unsuccessfully during that dispute.
  Another point has been made about increased expenditure. There ought to be a wider measure of agreement between us on that subject. Opposition Members must make their minds up about the purposes for which we increase expenditure on the Health Service and the way in which such increased expenditure is to be divided between improvements in patient care, on the one hand, and improvements in the living standards of the staff, on the other. Both are desirable objects, but there must be a balance between them in any policy pursued by the Government.
  There should not be an issue between us over increased expenditure. Despite the recession and the difficulties of the past two or three years, the Government have not cut expenditure on the Health Service. It will have increased by 6 per cent., in real terms, by next year. That is in line with the plans that the previous Labour Government proposed. Total expenditure has reached about £12 billion.
  The Government's case is that part of that increased expenditure must result in improved patient care, better wards and facilities, and, as my hon. and learned Friend the Member for Thanet, West (Mr. Rees-Davies) said, shorter waiting lists in hospitals. The money has begun to show some improvement in that feature of the Health Service. The numbers on the waiting list have fallen from 752,000 in March 1979 to 628,000 in March 1981. One of the consequences of improving services for the patients in such a labour-intensive service is that one actually increases the numbers of staff and improves employment opportunities.
  I dispute the point made by my hon. Friend the Member for Bromsgrove and Redditch (Mr. Miller). There was a real reduction in the hours worked in the Health Service. There has been an increase in the number of people in the Health Service. Our full-time equivalent is 34,000 for nurses. The figure of 47,000 for all staff still applies.
  One of the effects—we insist upon this—of devoting a proportion of increased expenditure on the Health Service to improve patient care is that, if those plans are allowed to proceed, the number of staff employed in the Health Service over the next year would still increase. That has had the effect of producing an 80 per cent. increase in the pay bill while the Government have been in office. That is a combination of an increase in living standards for staff and improved services for patients.
  The Opposition are in serious danger when they advocate that where there are increased resources available
  446
  for the Health Service—where we are broadly in agreement—they should go to improving the pay of the staff at present in post. That is impossible.
  Mr. Pavitt rose—
  Mr. Clarke: I know that the hon. Member for Brent, South (Mr. Pavitt) has been in his seat throughout the debate, but I have only five minutes left.
  I believe that the House must address itself to the important point, made by a number of hon. Members, that somehow it is wrong to draw a distinction in this or any other pay settlement or arrangement between, for example, nurses and midwives and any other staff group in the Health Service. The argument coming from Opposition Members, again sponsored by trade unions where the substantial body of the membership is ancillary workers, is that it is divisive to make any distinction between the various groups because they all form part of a health and care team.
  I can think of no industry or service where one can actually adopt the principle that the present relativities and pay structure for all groups must be frozen rigid for all time so that one cannot react to the needs of the service and the need to recruit and retain the right level of trained and skilled—in this case—medical staff.
  If we are ever to do anything substantial to raise the position of nurses and midwives in the earnings league, no progress will be made if, every time the Government—as this Government have attempted to do—want to make a special case of the nurses and find the extra money and offer them 6·4 per cent., exactly the same offer must be made to the gardeners, cooks, window cleaners, laundry workers, porters, and so on.
  I defend the distinction that the Government have made purely on the ground of the needs of the Health Service. I believe that it is a distinction that is widely applauded in the country. We abandoned the first cash limits we set and found extra money to offer 6·4 per cent. to nurses and midwives and also to the professions supplementary to medicine, including the physiotherapists, radiographers, speech therapists and occupational therapists. It is wrong to argue that it should follow automatically that, whatever figure is arrived at for those professional groups, exactly the same money must be given to all the other groups in the Health Service. No service could be run on that basis.
  I should like to comment not only on this offer, which I have defended and, I hope, made the Government's position clear, but on the Government's expectation for the future. My hon. Friend the Member for Macclesfield (Mr. Winterton) appeared to believe that we are breaking some kind of election commitment by not having sorted out better arrangements for the people employed in the National Health Service. My right hon. Friend said that the Government first offered a better and lasting arrangement in a letter from my predecessor, my hon. Friend the Member for Reading, South (Dr. Vaughan). That letter was sent in the middle of 1980. That offer was reaffirmed at a meeting with the Prime Minister before Christmas 1981. Today I chaired the first substantial meeting that has taken place between all involved to achieve a new permanent arrangement. I am glad to say that all parties agreed on the desirability of a new permanent arrangement. All the unions which were represented, and the Government, too, desired to make rapid progress. That is the more constructive part of the Health Service.

  447
  Industrial action and the blind demand for 12 per cent. Coming from the Opposition Benches have no room in a modern Health Service.
  Question put, That the original words stand part of the Question:—
  The House divided: Ayes 219, Noes 281.

  Division No. 200]

  [7.00 pm

  NOES

  Abse, Leo

  Forrester,John

  Adams, Allen

  Foster, Derek

  Allaun,Frank

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

  Alton, David

  Freud,Clement

  Anderson,Donald

  Garrett, John (NorwichS)

  Archer, RtHon Peter

  George, Bruce

  Ashley, RtHon Jack

  Gilbert, RtHon DrJohn

  Ashton,Joe

  Ginsburg, David

  Atkinson, N.(H'gey,)

  Graham, Ted

  Barnett, Guy (Greenwich)

  Grant, John (IslingtonC)

  Barnett, RtHon Joel (H'wd)

  Grimond, RtHonJ.

  Benn, RtHon Tony

  Hamilton,James(Bothwell)

  Bennett,Andrew(St'kp'N)

  Harrison, RtHon Walter

  Bidwell,Sydney

  Hattersley, Rt Hon Roy

  Booth, RtHon Albert

  Healey, Rt Hon Denis

  Bottomley, RtHonA.(M'b'ro)

  Heffer, ErlcS.

  Bradley,Tom

  Hogg, N. (EDunb't'nshire)

  Brocklebank-Fowler.C.

  HomeRobertson,John

  Brown, Hugh D. (Provan)

  Hooley,Frank

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

  Horam,John

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

  Howell, RtHon D.

  Buchan,Norman

  Howells,Geraint

  Callaghan, RtHon J.

  Hoyle,Douglas

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

  Huckfield, Les

  Campbell,Ian

  Hughes, Mark(Durham)

  Campbell-Savours,Dale

  Hughes, Robert (AberdeenN)

  Canavan, Dennis

  Hughes, Roy (Newport)

  Cant, R. B.

  Janner.HonGreville

  Carmichael,Neil

  Jay, RtHon Douglas

  Carter-Jones, Lewis

  Jenkins, Rt Hon Roy (Hillhead)

  Cartwright,John

  John,Brynmor

  Cocks, Rt Hon M. (B'stolS)

  Johnson, Walter (DerbyS)

  Cohen,Stan ley

  Jones, Rt Hon Alec (Rh'dda)

  Coleman,Donald

  Kerr, Russell

  Concannon, Rt Hon J. D.

  Kilfedder, JamesA.

  Conlan,Bernard

  Kilroy-Silk, Robert

  Cook, Robin F.

  Lambie,David

  Cowans, Harry

  Lamborn,Harry

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

  Leadbitter,Ted

  Crawshaw, Richard

  Leighton, Ronald

  Crowther,Stan

  Lewis, Arthur (N'ham NW)

  Cunliffe,Lawrence

  Litherland,Robert

  Dalyell,Tam

  Lofthouse,Geoffrey

  Davidson.Arthur

  Lyon,Alexander (Yorty)

  Davis, Clinton (HackneyC)

  Lyons, Edward (BradfdW)

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

  McCartney,Hugh

  Deakins,Eric

  McDonald, DrOonagh

  Dean, Joseph (Leeds West)

  McElhone,Frank

  Dewar,Donald

  McGuire,Mlchael(Ince)

  Dixon, Donald

  McKay, Allen (Penistone)

  Dobson,Frank

  McKelvey.William

  Dormand,Jack

  MacKenzie, RtHon Gregor

  Douglas,Dick

  Maclennan,Robert

  Dubs,Alfred

  McNamara, Kevin

  Duffy, A. E. P.

  Marks,Kenneth

  Dunnett,Jack

  Marshall, D(G'gowS'ton)

  Dunwoody, Hon MrsG.

  Marshall, DrEdmund (Goole)

  Eadie.Alex

  Marshall, Jim (LeicesterS)

  Edwards, R. (W'hampt'nSE)

  Mason, Rt Hon Roy

  Ellis, R. (NED'bysh're)

  Maxton,John

  Ellis, Tom (Wrexham)

  Meacher,Michael

  English,Michael

  Mel lish, RtHon Robert

  Ennals, RtHon David

  Millan,RtHonBruce

  Evans, loan (Aberdare)

  Mitchell,Austin (Grimsby)

  Evans, John (Newton)

  Mitchell, R.C.(Sotonltchen)

  Ewing,Harry

  Morris, Rt Hon A. (W'shawe)

  Field,Frank

  Morris, Rt Hon C. (O'shaw)

  Flannery,Martin

  Morris, RtHonJ. (Aberavon)

  Fletcher,Ted (Darlington)

  Moyle, RtHon Roland

  Foot, RtHon Michael

  Newens, Stanley

  448

  Oakes, Rt Hon Gordon

  Stoddart, David

  Ogden,Eric

  Strang, Gavin

  O'Halloran, Michael

  Straw,Jack

  O'Neill,Martin

  Summerskill,HonDrShirley

  Orme, Rt Hon Stanley

  Taylor, Mrs Ann (Bolton W)

  Owen, Rt Hon Dr David

  Thomas, Dafydd (Merioneth)

  Park, George

  Thomas, Mike (Newcastle E)

  Parker,John

  Thomas, DrR. (Carmarthen)

  Pavitt, Laurie

  Thorne, Stan (PrestonSouth)

  Pendry,Tom

  Tilley,John

  Penhaligon,David

  Tinn,James

  Powell, Raymond (Ogmore)

  Torney,Tom

  Price, C. (Lewisham W)

  Varley, RtHon Eric G.

  Race, Reg

  Wainwright, E.(DearneV)

  Radice, Giles

  Wainwright.R.(ColneV)

  Richardson,Jo

  Walker, RtHon H.(D'caster)

  Roberts,Albert(Aformanton)

  Watkins, David

  Roberts,Allan(Bootle,)

  Weetch, Ken

  Roberts,Gwilym(Cannock)

  Wellbeloved,James

  Robertson,George

  Welsh,Michael

  Robinson, G. (Coventry NW)

  White, Frank R.

  Rodgers, RtHon William

  White, J.(G'gowPollok)

  Roper,John

  Whitehead,Phillip

  Ross, Ernest (Dundoe West)

  Whitlock,William

  Ross, Stephen (Isle of Wight)

  Wig ley, Dafydd

  Rowlands,Ted

  Willey, RtHon Frederick

  Sandelson, Neville

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

  Sever, John

  Williams, Rt Hon Mrs (Crosby)

  Sheerman,Barry

  Wilson, Gordon (DundeeE)

  Sheldon, RtHonR.

  Wilson, RtHon Sir H.(H'ton)

  Shore, RtHon Peter

  Wilson, William (C'trySE)

  Short, Mrs Renee

  Winnick, David

  Silkin, Rt Hon J. (Deptford)

  Woodall,Alec

  Silkin, Rt Hon S. C. (Dulwich)

  Woolmer,Kenneth

  Silverman,Julius

  Wrigglesworth, Ian

  Skinner,Dennis

  Wright,Sheila

  Snape, Peter

  Young, David (BoltonE)

  Soley,Clive

  Spearing,Nigel

  Tellers for the Ayes:

  Spriggs, Leslie

  Mr. George Morton and

  Stallard.A.W.

  Mr. Frank Haynes.

  Stewart, Rt Hon D. (W Isles)

  NOES

  Adley,Robert

  Buck,Antony

  Aitken,Jonathan

  Budgen,Nick

  Alexander,Richard

  Bulmer,Esmond

  Alison, RtHonMichael

  Burden,SirFrederick

  Ancram,Michael

  Butcher,John

  Arnold,Tom

  Cadbury,Jocelyn

  Aspinwall,Jack

  Carlisle, John (LutonWest)

  Atkins,Robert (PrestonN)

  Carlisle,Kenneth(Lincin)

  Baker,Kenneth(St.M'bone)

  Channon, Rt. Hon, Paul

  Baker, Nicholas (N Dorset)

  Chapman,Sydney

  Banks,Robert

  Churchill,W.S.

  Beaumont-Dark,Anthony

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

  Bendall,Vivian

  Clark, Sir W. (Croydon S)

  Bennett,SirFrederic(T'bay)

  Clarke,Kenneth(Rushcliffe)

  Benyon,Thomas(A'don)

  Clegg, Sir Walter

  Benyon.W.(Buckingham)

  Cockeram,Eric

  Best, Keith

  CoIvin, Michael

  Bevan, David Gilroy

  Cope,John

  Biffen, RtHon John

  Cormack, Patrick

  Biggs-Davison,SirJohn

  Corrie,John

  Body, Richard

  Costain,SirAlbert

  Bonsor,SirNicholas

  Cranborne,Viscount

  Bottom ley, Peter (W'wich W)

  Critchley,Julian

  Bowden,Andrew

  Crouch,David

  Boyson,Dr Rhodes

  Dickens,Geoffrey

  Braine,SirBernard

  Dorrell, Stephen

  Bright,Graham

  Doug las-Hamilton, LordJ.

  Brinton,Tim

  Dover,Denshore

  Brittan,Rt. Hon. Leon

  du Cann, Rt Hon Edward

  Brooke, Hon Peter

  Dunn, Robe rt(Dartford)

  Brotherton,Michael

  Du rant,Tony

  Brown, Michael(Brigg&Scn)

  Eden, RtHonSirJohn

  Browne,John(Winchester)

  Eggar,Tim

  Bruce-Gardynejohn

  Elliott,SirWilliam

  Bryan, Sir Paul

  Emery, Sir Peter

  Buchanan-Smith, Rt Hon. A.

  Eyre, Reginald

  449

  Faith, MrsSheila

  Kimball,SirMarcus

  Farr,John

  Kitson,SirTimothy

  Fell,SirAnthony

  Knight,MrsJill

  Fenner, Mrs Peggy

  Knox, David

  Finsberg,Geoffrey

  Lamont,Norman

  Fisher, Sir Nigel

  Lang, Ian

  Fletcher, A. (Ed'nb'ghN)

  Langford-Holt,SirJohn

  Fletcher-Cooke,SirCharles

  Latham,Michael

  Fookes, Miss Janet

  Lawrence,Ivan

  Forman,Nigel

  Lawson, Rt Hon Nigel

  Fowler, Rt Hon Norman

  Lee,John

  Fox, Marcus

  Lennox-Boyd,HonMark

  Fraser, Rt Hon Sir Hugh

  Lester, Jim (Beeston)

  Gardner, Edward (SFylde)

  Lewis,Kenneth (Rutland)

  Garel-Jones,Tristan

  Lloyd, Ian (Havant& W'loo)

  Gilmour, Rt Hon Sir Ian

  Lloyd, Peter (Fareham)

  Glyn, DrAlan

  Loveridge,John

  Goodhart,SirPhilip

  Luce, Richard

  Goodhew,SirVictor

  Lyell, Nicholas

  Goodlad,Alastair

  McCrindle, Robert

  Gorst,John

  Macfarlane,Neil

  Gow, Ian

  MacGregor,John

  Gower, Sir Raymond

  MacKay, John (Argyll)

  Grant, Anthony (HarrowC)

  McNair-Wilson,M. (N'bury)

  Greenway, Harry

  McNair-Wilson, P. (NewF'st)

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

  Madel, David

  Griffiths, Peter Portsm'thN)

  Major,John

  Grist, Ian

  Marlow.Antony

  Grylls,Michael

  Marshall, Michael (Arundel)

  Gummer,JohnSelwyn

  Marten, Rt Hon Neil

  Hamilton, Hon A.

  Maude, Rt Hon Sir Angus

  Hamilton,Michael (Salisbury)

  Mawby, Ray

  Hampson,DrKeith

  Mawhinney,DrBrian

  Hannam,John

  Mayhew, Patrick

  Haselhurst,Alan

  Mellor,David

  Hastings,Stephen

  Meyer, SirAnthony

  Havers, Rt Hon Sir Michael

  Miller,Hal (B'grove)

  Hawkins,Paul

  Mills, lain(Meriden)

  Hawksley,Warren

  Mills, Peter (WestDevon)

  Hayhoe, Barney

  Miscampbeil,Norman

  Heath, Rt Hon Edward

  Mitchell, David (Basingstoke)

  Heddle,John

  Moate, Roger

  Henderson, Barry

  Monro,SirHector

  Heseltine,RtHonMichael

  Montgomery,Fergus

  Higgins, Rt Hon Terence L.

  Moore,John

  Hogg,HonDouglas(Gr'th'm)

  Morris, M. (N'hamptonS)

  Holland, Phttip (Carlton)

  Morrison, HonC. (Devizes)

  Hooson,Tom

  Morrison, Hon P. (Chester)

  Hordern,Peter

  Mudd, David

  Howe, Rt Hon Sir Geoffrey

  Murphy,Christopher

  Howell, BtHonD. (G'ldf'd)

  Myles, David

  Hunt, David (Wirral)

  Neale,Gerrard

  Hunt,John (Ravensbourne)

  Needham, Richard

  Hurd, Rt Hon Douglas

  Nelson,Anthony

  Irvine,BryantGodman

  Newton,Tony

  Irving,Charles (Cheltenham)

  Nott, Rt Hon John

  Jessel,Toby

  Onslow,Cranley

  JohnsonSmith, Geoffrey

  Oppenheim, Rt Hon Mrs S.

  Jopling,RtHon Michael

  Page, John (Harrow, West)

  Joseph, Rt Hon Sir Keith

  Page, Richard (SWHerts)

  Kaberry,SirDonald

  Parkinson, RtHonCecil

  Kellett-Bowman,MrsElaine

  Patten,John(Oxford)

  Kershaw,SirAnthony

  Pawsey, James

  450

  Percival,Sirlan

  Stewart,A.(EFtenfrewshire)

  Peyton, RtHonJohn

  Stewart, Ian (Hitchin)

  Pink, R.Bonner

  Stokes,John

  Pollock,Alexander

  Stradling Thomas,J.

  Porter,Barry

  Tapsell, Peter

  Prentice, RtHon Reg

  Taylor, Teddy (S'endE)

  Price, Si r David (Eastleigh)

  Tebbit, RtHon Norman

  Proctor, K. Harvey

  Temple-Morris,Peter

  Raison, RtHonTimothy

  Thomas, RtHon Peter

  Rathbone,Tim

  Thompson,Donald

  Rees-Davies, W. R.

  Thorne,Neil(llfordSouth)

  Renton,Tim

  Thornton,Malcolm

  RhodesJames, Robert

  Townend, John (Bridlington)

  Rhys Williams, SirBrandon

  Townsend,CyrilD,(B'heath)

  Ridley,HonNicholas

  Trippier, David

  Ridsdale,SirJulian

  Trotter,Neville

  Rifkind, Malcolm

  van Straubenzee, Sir W.

  Rippon,RtHonGeoffrey

  Vaughan,DrGerard

  Roberts, M. (Cardiff NW)

  Viggers, Peter

  Roberts, Wyn (Conway)

  Waddington, David

  Rossi,Hugh

  Wakeham,John

  Rost, Peter

  Waldegrave,HonWilliam

  Royle,SirAnthony

  Walker, RtHon P.(W'cester)

  Rumbold, Mrs A. C. R.

  Walker, B. (Perth)

  Sainsbury,HonTimothy

  Walker-Smith, RtHon Sir D.

  St. John-Stevas, Rt Hon N.

  Waller, Gary

  Shaw, Giles (Pudsey)

  Walters, Dennis

  Shaw,Michael(Scarborough)

  Ward,John

  Shelton,William(Streatham)

  Warren,Kenneth

  Shepherd,Colin(Hereford)

  Wells, Bowen

  Shepherd,Richard

  WelIs,John (Maidstone)

  Shersby,Michael

  Wheeler,John

  Silvester, Fred

  Whitelaw, RtHon William

  Sims, Roger

  Whitney, Raymond

  Skeet, T. H. H.

  Wickenden,Keith

  Smith, Tim(Beaconsfield)

  Williams.D.(Monfgomery)

  Speller, Tony

  Wolfson,Mark

  Spence,John

  Young, SirGeorge (Acton)

  Spicer, Jim (WestDorset)

  Younger, RtHon George

  Spicer, Michael (SWorcs)

  Squire,Robin

  Tellers for the Noes:

  Stanbrook, Ivor

  Mr. Anthony Berry and

  Steen,Anthony

  Mr. Carol Mather.

  Stevens,Martin

  Question accordingly negatived.
  Question, That the proposed words be there added, put forthwith pursuant to Standing Order No. 32 (Questions on amendments), and agreed to.
  Mr. Deputy Speaker forthwith declared the main Question, as amended, to be agreed to.
  Resolved,
  That this House deplores any industrial action in the National Health Service especially that which puts at risk the health and safety of patients; notes that present offers will give increases of over six per cent to about half the work force in a service which enjoys secure and growing employment; and urges the trade unions to reconsider their position before taking any further action which could damage the National Health Service and the patient it serves.

  London Transport (Liverpool Street) Bill (By Order)
  Order for Second Reading read.
  Motion made, and Question proposed, That the Bill be now read a Second time.
  7.11 pm
  Mr. Ronald W. Brown: It is my pleasure to sponsor the Bill on behalf of the London Transport Executive. The Bill relates to work that is to be carried out by British Rail in redeveloping the Liverpool Street site, which is in my constituency. The hon. Member for City of London and Westminster (Mr. Brooke) is not in a position to move the Bill on behalf of the LTE and I have agreed to do so for him.
  It will assist the House if I go through the Bill—[Interruption.]
  Mr. Deputy Speaker (Mr. Bernard Weatherill): Order. Will hon. Members who are talking behind the Bar kindly leave the Chamber?
  Mr. Brown: Part I is the interpretation and the incorporation of general Acts. Part II sets out in paragraphs (a) and (b) in clause 4(1) the work to be done. The lands in respect of which compulsory acquisition powers are sought are delineated in the deposited plan which can be seen in the Library.
  Clause 5 seeks authority for the acquisition of easements or subsoil instead of land. I am advised that there is nothing unusual about it.
  Clause 6 adapts the Lands Clauses Acts to the acquisition of the subsoil easements. Clause 7 authorises temporary interference with so much of Liverpool Street, Old Broad Street and the Broad Street Buildings, as is within the limits of deviation, for the purposes of constructing new stations.
  Clause 8 authorises the LTE temporarily to divert traffic from the same length of the streets specified in clause 7 during the carrying out of work, subject to subsection (2) which ensures that there shall be reasonable access for foot passengers.
  Clause 10 incorporates earlier LTE legislation containing common form powers relating to the construction of the works. Clause 11 incorporates certain protective provisions taken from previous LTE legislation.
  Clause 12 seeks to modify, in certain minor respects, the planning permission which, without this clause, would automatically be given by a combination of the Bill, if enacted, and paragraph 12 of schedule 1 of the Town and Country Planning General Development Order 1977. The principal modification is to subject the planning permission to a time limit. Unless each of the works is begun within 12 years of the planning of the Act, the planning permission for that work will cease to have effect. That provision is contained in clause 12(2).
  Clause 12(3), however, ensures that the time limit does not apply to carrying out works of alteration, maintenance, repair and substitution where it is necessary from time to time. That provision reflects section 16 of the Railways Clauses Consolidation Act 1845 which applies to the new stations by reason of clause 3(1)(b) of the Bill.
  Clauses 13 and 14 are common clauses usually included in private Bills.
  452
  That completer; the summary of the Bill which I trust has assisted the House. I now turn to the petitioners. There were three petitioners on this part of the Bill, arising from which hon. Gentlemen blocked the Bill. These were Vinross Catering of 22–23 Liverpool Street, K Shoes of 24 Liverpool Street and the florist at 26 Liverpool Street. I understand that these petitioners fear that the erection of hoardings outside their shop fronts will make them less visible and keep customers away.
  I have visited the site to examine the proposals. Numbers 17 to 33 Liverpool Street cover a short length of the road with shops on the south side and railway offices and a hotel on the north side. The road is one way only with parking on both sides of the street. As a result, the shops and their: merchandise can be examined only by people walking in front of the shops on the south side of Liverpool Street. That facility will remain during the whole period of the work, which is estimated to be about two years from the expected starting date of 1984. AI no time will the pavement in front of the shops be obstructed and customers, likely customers or window shoppers will have free access to view the shops, enter and make their purchases.
  K Shoes has an advantage over the other two shops in that the shop has an entrance in Liverpool Street and also in the covered shopping arcade at the rear of the shops. The House will appreciate that shoppers and pedestrians use the arcade mach more than Liverpool Street because of the comfort of shopping. There is an infinitely greater number of shops to be seen and there is an entrance to the Underground at each end of the arcade. In inclement weather pedestrians and shoppers prefer to go through the arcade in the dry than round the outside of Liverpool Street.
  The hoarding will be erected in the kerb. At the request of the petitioners, it will be solid only up to a height of 6 ft and wire mesh will be erected a further 5 ft above so that daylight can get through. The object of the hoarding is to safeguard pedestrians while work is in progress.
  At any one time, a stretch of only 100 ft of Liverpool Street in front of the shops will be hoarded up. To satisfy the City corporation, the promoters have agreed to carry out the work on half the width of the road at any one time, thereby leaving Liverpool Street open to traffic. As each 100 ft length is completed., the hoarding will be taken down and moved to the next stretch of 100 ft. It is estimated that work on each stretch will take about three months. About 300 ft of the south side of Liverpool Street will be affected and three stretches of work will be carried out. Although each section will be boarded up for only three months, it will be nine months before all the work is completed.
  Work on the north side in front of the railway offices will also be completed in three stages and will take three months for each stage. Therefore, work on both sides of the street will be completed in 18 months. I stress that, as the hoarding is taken down from one stretch, it will be moved to another, as a result of which the shops that were affected will be free of it.
  When I visited the site, a mass of scaffolding had been erected along the frontage of the shops numbered 19 to 31 Liverpool Street. I understand that it was erected in May 1982 and resulted from the issuing of a dangerous structure notice. The licence to erect the scaffolding expires at the end of July. As I looked across from the north side, the fascia board of the K Shoes shop was totally obscured by

  453
  the scaffolding and could not be read or seen. Because of the cars and vans parked on the south side of the road, it was impossible to see the shop in any detail.
  In any event, the scaffolding makes it extremely difficult to walk along the pavement, and that is not made any easier by the fact that the florist uses about 3 ft of the public pavement to display merchandise. As far as I have been able to ascertain, no claim for compensation has been submitted, yet interference with shopping is very much greater than anything that will be experienced by the work envisaged in the Bill. Fortunately, the promoters have helped the florist obtain a licence of assign and change of use for an empty shop in the arcade. It is larger than the existing premises and will enable the florist to be located in the arcade, where it has always wanted to be.
  The promoters have offered to agree the following principles: first, to use their best endeavours not to carry out noisy work that would interfere with the business carried on in a particular shop during usual business hours; secondly, to preserve uninterrupted a minimum width of footway outside the shops of not less than 2 metres when they are open for business, except in emergencies; thirdly, to consult with an engineer appointed by the petitioners jointly as to the measures to be taken to avoid damage to the buildings without so far as practicable the LTE having to enter upon them; fourthly, subject to the consent of the highway authority to exhibit in a conspicuous place hoardings and direction signs stating the name of the occupier behind the hoarding, the nature of his business and how to get into his premises. In the case of K shoes, the address of its entrance in the arcade will also be given. Fifthly, they will be subject also to the consent of the highway authority to erect hoardings which, if above a height of 1½ metres, consist of wire mesh. Sixthly, a resident engineer will be appointed who will be furnished with a copy of the undertaking, will be readily available to receive complaints and will have power to instruct the executive's contractors to alleviate them if he is satisfied that some of the provisions of the undertaking have been broken. Seventhly, in the event of the executive having to take possession of any of the premises of the petitioners in order to preserve their stability, they will compensate the petitioners on the basis of the estimated loss of profits—in other words, compensation for disturbance.
  I believe that the executive has attempted to consult in the widest sense. It has shown itself willing to discuss any representations and to make every endeavour to find a satisfactory solution to any problems that arise. It is therefore with confidence that I ask the House to give the Bill a Second Reading.
  7.26 pm
  Mr. Mark Lennox—Boyd: I am happy to follow the hon. Member for Hackney, South and Shoreditch (Mr. Brown), who has done his duty by presenting the Bill. However, I do not agree with many of the suggestions that he made and I should like to touch on a few of them.
  I speak from a constituency interest. K Shoe Shops Ltd. is perhaps the most shining of the many jewels that adorn the Chief Whip's crown. The company comes from Kendal, has factories throughout Cumbria and one in the Lancaster area employing 120 people, some of whom must be my constituents.
  454
  I understand that the Chief Whip knows what I shall say and, indeed, wishes me to do so. I also understand that the hon. Member for Whitehaven (Dr. Cunningham) is unable to be present, but that he is equally anxious to support any action that will help maintain the interests of K Shoes because of its significant contribution to the economy of Cumbria.
  Of course the Bill should get a Second Reading. No one who has reservations about it would wish to deny it a Second Reading, but I wish to draw to the attention of the House—and the Committee that will consider it in due course—to various matters that must be considered in further detail.
  The problem for K Shoes in Liverpool Street is one of severe disruption. I too, visited the shop and am on a par with the hon. Member for Hackney, South and Shoreditch. I disagree with his observations. We are talking of a major construction site, and the work will take place over a two-year period. Enormous trenches will be dug into the road. As the hon. Gentleman said, they will be 100 ft long, and on occasions during that construction period they will be a few feet from the front shop window of K Shoes. It is astonishing to suggest that in no way will its business be undermined by the disruption that will inevitably take place. The noise, dirt, heat and unpleasantness must surely inhibit a customer from going to that shop.
  I shall not pursue that argument much further, as it must be argued in Committee. It is not for us to consider today. Irrespective of whether it is right or wrong, it leads to another argument. The shop has been there for 70 years. It wishes to carry on its business there. It does not wish to move, and it does not wish to be required to go elsewhere. It has been told and given the undertaking that the promoter—the London Transport Executive—will not try to occupy its premises unless it needs to do so for the construction works. It has been told that it will receive the compensation only if the promoter has to occupy the premises for the construction works. Therefore, it will not be entitled under the law, or under any undertaking that has been given by the promoter, to any compensation for a loss of profit that it might suffer.
  Let us hope that the hon. Member for Hackney, South and Shoreditch is right when he says that the shop will not suffer damage. That is extremely unlikely. However, if that is the case, and if suffering damage is merely a foolish fear that the shop entertains, it costs the London Transport Executive nothing to give the undertaking that it will protect the shop from any loss of profit and give it the compensation that it needs.
  It is sometimes said—I expect that it will be said in Committee—that it would be inappropriate to give such an undertaking, as the law of the land does not require any person who constructs a major work or building to compensate someone who is injuriously affected in circumstances such as this, so why should the London Transport Executive do so? My answer—the Committee should consider the matter carefully—is that the law is wrong. There should be a provision in law to give people compensation when they are injuriously affected by building works that take place on their doorsteps.
  While the Bill, being special and of limited and specialist concern, would not be the appropriate vehicle to provide redress to people who are injuriously affected generally, it is one that the London Transport Executive must see passed before it can commence work. Therefore,

  455
  Parliament is, in this case, able to protect people who are likely to suffer from the consequences of the building work—and Parliament should do so.
  Although I wish the Bill to receive a Second Reading, it raises deeply sceptical eyebrows. K Shoes is struggling at the moment, like so many manufacturing companies —especially those in the clothing and footwear industries. It is struggling against competition from imported shoes. It is an unusual business with both manufacturing and retailing companies. It manufactures its shoes in its factories and sells them in its shops. It is worth noting, in today's climate, that about 85 per cent. of the shoes that are sold in its shops are manufactured by the company. Moreover, about 90 per cent. of the shoes that are sold in its shops are made in Britain. The consequence of undermining the profitability or, indeed, destroying the business, if it came to that, of this one shop is not simply that the shop is put out of business. There will be repercussions in terms of the jobs of the company that makes the shoes.
  I hope that my comments will be observed by the Committee. It would be outrageous if the shop—one of K Shoes' important outlets—had its business ruined, and thereby the more general business of the company was threatened and undermined.
  7.34 pm
  Mr. Reg Race: It is somewhat unusual for the hon. Member for Morecambe and Lonsdale (Mr. Lennox-Boyd) and me to combine to oppose a Private Member's Bill, but oppose it we must for the simple reason that both of us have constituents who are affected by the proposed improvements to Liverpool Street Underground station.
  The constituents whom I represent are the proprietors of the arcade florists who occupy premises in Liverpool Street and will be directly affected by the Bill. I welcome the purpose of the Bill. As a London Member of Parliament I travel frequently on the Underground. I frequently pass through Liverpool Street Underground interchange. I can vouch, as can every other London Member of Parliament, for the inadequacy and ancient facilities of that interchange. I have absolutely no quarrel with the general purpose of the Bill. I wish it a fair hearing and hope that it becomes law.
  The only point of substance about which I am worried is the way in which my constituents are injuriously affected by the proposed works. The florist shop has been run for 32 years and continues to be run by two small shopkeepers—Mrs. Bayard and Mr. Parker. They have petitioned against the Bill. They obtain most of their trade from local businesses—banks, offices, insurance companies—and passing trade. They are completely dependent on the shop for their survival. They have no other source of income. They have no other shops or financial interests. They are extremely vulnerable. Any reduction of trade in their shop will undoubtedly reduce their personal incomes. We are, therefore, discussing a potential mischief for those individuals—the prospect of a substantial reduction in their personal income.
  The significant point is that according to the undertakings that have been offered to my constituents and to K Shoes part III(2)(a) of the undertaking links compensation to loss of profits, but only on the basis of occupation of the premises concerned. In other words, compensation would be calculated by the London
  456
  Transport Executive and no doubt, agreed with my constituents and K Shoes, if the premises were occupied but not otherwise.
  That leads me to question the works themselves. If the works were fairly trivial, it would not matter that compensation was to be given only if a shop was occupied. That is not so. The hon. Members for Morecambe and Lonsdale and Hackney, South and Shoreditch (Mr. Brown) have stated plainly that there is to be a major work across the entire width of Liverpool Street and down virtually its entire length. Et is to be a major excavation. There is to be a complete reconstruction of an Underground station, just below the level of the road. A substantial quantity of soil will have to be removed. There will be much machinery in the street simply to do the necessary work. No one disputes that. There will be hoardings of 11 ft in height—6 ft of wooden hoarding topped by 5 ft of wire mesh. That will obscure the entire road. Only the footpath between the shop and the hoarding will remain.
  There can be no question but that that is indeed a major work in that street. Therefore, it is not correct, especially in the case of one shop where the proprietors depend entirely on its profits for their income, for London Transport to say that they should be compensated for injury and nuisance only if the shop is occupied. The shop may well be occupied for a brief period. London Transport may have to drill through the floor up into the shop to undertake test borings or to reinforce structures that it is establishing underground. In that case, compensation will no doubt be paid.
  The real problem for my constituents, however, is that these major works will continue for nine months or a year. Let us hope that the period is indeed as short as that, as many of us believe that construction work is never completed on time. Even if the work is completed on time, however, it will take nine months to a year. That may be the major part of a trading year for my constituents.
  The possibility of a real reduction in my constituents' living standards in that year must therefore be taken extremely seriously. Figures have been produced, and no doubt will be adduced in Committee, about the reduction in trade consequent on major works being carried out in the vicinity of particular shops. K Shoe Shops has stated that a certain reduction in profits took place as a result of work conducted around other shops in its chain. I have no doubt that when the case is presented to the Committee counsel will refer to any such prospective reductions. I believe that the reductions may be extremely substantial, especially as they would all be concentrated on the earnings of one shop.
  We are dealing not with a substantial change in English law but with a private Bill that is opposed. We are dealing with one shopkeeper and one chain of shopkeepers who are injuriously affected. We are not asking for a substantial change in the law to make compensation payable on a different basis in every case. We ask that consideration be given to a change in compensation in this particular case because, in my view, it is clearly established that great injury will be done to the individuals concerned.
  I simply say to the hon. Member for Hackney, South and Shoreditch that, according to my information, my constituents are not satisfied with the offer of alternative accommodation that has been made, for the following reason. They appreciate the effort made to meet some of

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  their objections to the Bill, but in their opinion they could use the alternative accommodation only for storage and could not sell from it.
  My constituents have also drawn my attention to the fact that this is not the first occasion on which their business has been disrupted by the activities of London Transport, justified or otherwise. In the very recent past, London Transport enforced their departure from a previous shop, at 12 The Arcade, EC2. Just before London Transport asked them to leave, my constituents had refitted the shop at great personal expense, having been there for 28 years.
  They were given notice to quit under the terms of the lease and I understand that there is no suggestion that anything improper was done by London Transport. Having been at their present premises for only three or four years, they are now to be disrupted again and the activities of London Transport, which are ultimately for the public good, will for the second time in a very short period disrupt my constituents' livelihoods.
  In a letter sent to me some months ago before the Bill reached the Floor of the House, Mrs. Bayard said:
  "Our present premises were obtained at great expense, and needless to say we are just managing to get some return on our money. We are now forced once again0 to lose everything. My partner and I are not so young and will not be in a position financially to start again, especially as this is the second time in three years that we have been placed in this invidious position."
  I appreciate the efforts that have been made to meet some of the points made by my constituents and by K Shoe Shops. Nevertheless, further substantial progress must be made to meet the simple point that compensation should be paid to my constituents on the basis of loss of trade and not simply if London Transport occupies the premises. I hope that the Bill will receive a Second Reading, but I hope that this point will be considered very carefully in Committee and that substantial concessions will be made in order to avoid real hardship.
  7.46 pm
  The Under-Secretary of State for Transport (Mr. Reginald Eyre): It might assist the House if I intervene briefly at this stage to give an indication of the Government's views on the Bill.
  The Government have no objection in principle to the powers which the London Transport Executive seeks in the Bill—so long as the powers are strictly limited to those necessary to undertake the works in question. Nevertheless, I understand the concern that has been expressed about the possible effects of the works on the businesses operating in premises in Liverpool Street—particularly the points raised by my hon. Friend the Member for Morecambe and Lonsdale (Mr. Lennox-Boyd) with regard to K Shoe Shops Ltd. and those raised by the hon. Member for Wood Green (Mr. Race) with regard to his constituents, the florists.
  It might assist the House if I say something about the provisions for compensation payments in respect of loss of profits. It is, of course, well-established practice for private Bills conferring land acquisition powers to apply the standard compensation code, which reflects the development of practice and judicial thinking over many years.
  Clause 3 incorporates the Lands Clauses Acts. The effect of this is that the established body of statute and case
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  law generally known as the compensation code will apply to the acquisition of land under the powers sought in the Bill. Where business premises are acquired, I understand that it is open to the owners or lessees of the property to claim compensation reflecting not only the market value of their interest in the land but also, in appropriate cases, loss of profits and other expenses arising from the disturbance of their businesses.
  I am advised, however, that the compensation code does not provide for disturbance-only compensation to be paid to persons affected by public works on neighbouring land if their own land is not taken for the purpose, unless the execution of the works causes damage to trade or business, which as a result leads to depreciation in the value of an interest in land. In those circumstances, compensation can then be paid for the depreciation in value of the interest in the land even where no land is actually being taken from the owner or lessee.
  It will be of further interest to my hon. Friend the Member for Morecambe and Lonsdale and the hon. Member for Wood Green to know that there are other statutory provisions—for example, section 22 of the third schedule to the Water Act 1945, section 278 of the Public Health Act 1936 and sections 76 and 77 of the Highways Act 1980—in which there is entitlement to compensation for damage due to works carried out by statutory bodies on public highways. In these circumstances, damage has been held by the courts to include loss of profits to businesses on land other than that which may have been acquired.
  In all the circumstances disclosed by the debate this evening, it would appear to be reasonable that the Bill should be given a Second Reading. That is on the understanding, and for the purpose, that the Bill, and all the points causing concern that have been raised this evening—compensation and restriction upon interference—shall be examined in detail in Committee. I hope that it will be possible to agree with the petitioners over practical ways to minimise the impact of the works on their businesses.
  I fully appreciate the nature of the various concerns that have been expressed. I believe that the Committee will provide the forum necessary for the detailed examination of those matters. On that basis, I hope that the House will think it appropriate that the Bill should be allowed to proceed.
  7.50 pm
  Mr. Albert Booth: In considering the Second Reading of the Bill, the House is called upon to examine a serious conflict of interests. Normally, one would always say that the broader public interest should prevail. However, we cannot simply take the view that in allowing the broader public interest to prevail one should ignore or ride roughshod over the private, commercial or personal interests of those affected by any major public works.
  Public interest can be broadly described by saying that if British Rail and London Transport are allowed to proceed with the works covered by the Bill, a substantial contribution will be made to the lot of many commuters who use British Rail and London Transport by way of services that go to Liverpool Street every day. I hope that the majority of hon. Members would want to see such an improvement in that area of London Transport's and British Rail's services.

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  The conflict is that raised by the petitioners and voiced eloquently in the House tonight. It is the fear that, in the process of making those improvements for travellers, certain businesses will be ruined. Strangely, I declare a constituency interest. I do so only because I am regarded in the House as a transport spokesman. K Shoe Shops Ltd. has a factory at Askam in my constituency and I believe that a number of the ladies' shoes that are sold in the shop are made in Askam. I confess to being only too keenly aware of the fact that the shoe trade, and that particular factory, works short time and under pressure because of a restriction of its outlets, brought about in no small measure by the admittance into Britain of cheap imports. The situation will not be alleviated if there is a further loss due to the damage to trade at this particular shop.
  As the Minister has rightly said, there is a standard type of compensation clause in the Bill. It is worth noting that there has been litigation on this type of legislation. In a leading case on the subject of compensation, which arose out of similar circumstances—Argyle Motors v Birkenhead Corporation—Lord Dilhorne said:
  "It may well be that the execution of authorised works has inflicted a loss on the appellants which far exceeds the amount of compensation obtainable by them for injurious affection to their interest in the land on which they conduct their business. If that is so, they will suffer a hardship for which the law as it now stands does not provide a remedy. Extension of the right to compensation is a matter for Parliament and not for judicial decision."
  I do not always agree with Law Lords, but I agree entirely with that last sentence. This is a matter for Parliament. It is not a matter for judicial decision. It is not a matter on which we want to make general law, but a matter on which a special legal provision should be made that reflects the special circumstances of the case. Therefore, I join those who express the hope that in passing the Bill we do not do so because we think that it should go through the House unchanged, but in the belief that by passing its Second Reading we will commend it to a Committee which will examine carefully all the special circumstances that led to the promotion of the Bill and which will consider whether a special compensation provision needs to be attached to it before it has further consideration in the Chamber of the House.
  7.55 pm
  Mr. Neil Thorne: I do not wish to detain the House for long, but I wish to mention the importance of Liverpool Street station to my constituents. My constituency was, to a large extent, borne out of the railway line that runs from Liverpool Street towards Colchester.
  At the end of the last century various developers were given the opportunity to have railway stations constructed along the line. The railway company of the day required house developers to guarantee ticket office receipts of about £2,000 a year from each station for a period of five years before they would agree to construct each railway station. The builders in their turn then built most of the houses that now form part of my constituency. The train service that was provided from Ilford, Seven Kings nd Chadwell Heath gave large numbers of my constituents and their predecessors opportunity to travel quickly into the City, and this provided much of the clerical and managerial support for the City of London.
  I wish to welcome the introduction of the Bill and its Second Reading. In doing so, I must make a comment in
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  support of my hon. Friend the Member for Morecambe and Lonsdale (Mr. Lennox-Boyd) and the hon. Member for Wood Green (Mr. Race). My experience of British Rail in property matters leaves a lot to be desired. I had an unhappy experience as chairman of the central area board of the GLC. British Rail was extremely awkward, difficult and completely urco-operative.
  Mr. Deputy Speaker: Order. I hesitate to interrupt the hon. Gentleman, but the Bill does not deal with British Rail. It is the London Transport (Liverpool Street) Bill.
  Mr. Thorne: Thank you, Mr. Deputy Speaker. However, I feel that this has a bearing on the issue. It is important that the whole matter is tied together as quickly as possible for the benefit of everyone concerned. I hope that in the negotiations in Committee it will be borne in mind that a little generosity by way of compensation can be extremely helpful in advancing the matter. It can save a lot of time where large capital expenditure is being held up. I often find that large undertakings tend to hold up such matters over relatively small sums, when the matter could be progressed mere quickly if they could only see the advantage of agreeing reasonable compensation.
  Therefore, I hope that that matter will be carefully looked into and that the Bill will receive its Second reading and quickly pass into law. We shall then have a new combined station .at Liverpool Street of which we can all be proud.
  8 pm
  Mr. Ronald W. Brown: Given the last point made by the hon. Member for Ilford, South (Mr. Thorne), it should be borne in mind that the Bill assumes the success of the British Rail Bill currently before the Opposed Bills Committee. This Bill is concomitant with that development. If that development does not take place, neither will this.
  I hope that the Bill will receive its Second Reading, and I am grateful to hon. Members for their support. However, the British Rail side of the work must take place first. No one knows what the future holds for K Shoe Shops Ltd. However, the shop in question has two trading entrances. No doubt the hon. Member for Morecambe and Lonsdale (Mr. Lennox-Boyd) saw what I saw. Many people were shopping in one K Shoe shop from the arcade. The number of those from Liverpool Street was much smaller and those in the street were passers-by rather than shoppers. Therefore, I do not understand why it should be suggested that the whole emporium of K Shoes will be brought to its knees because a hoarding is to be placed outside the shop for three months. I do not wish to argue the point, but I should not like it to be thought that the promoters of the Bill had deliberately forgotten the primary importance of the interests of those involved.
  Mr. Lennox-Boyd: If K Shoes is not to suffer any damage, it will not cost the promoters anything to indicate that compensation will be available if there is damage. What does the hon. Gentleman have to say about that?
  Mr. Brown: I merely wish to establish that there is more trade from the arcade than from Liverpool Street. As the hon. Gentleman will know, the shop's presentation is oriented towards the arcade, and Liverpool Street is almost its back door.
  I was delighted when the Minister said that he wished to take a close interest in the compensation factor. I hope

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  that he will not use the Bill as the only vehicle for changing the law about compensation. The right hon. Member for Barrow-in-Furness (Mr. Booth) said that the law should be changed. But the Bill is not the vehicle for that. I welcome the Minister's view and take it that he is serious. I take it that there will be a change in the law on compensation.
  Local government will have to be brought into this. No doubt the Secretary of State for the Environment will be involved, because the whole procedure of local government for dealing with road works, sewers and pipelines will be changed. There will be enormous ramifications. That is why such action has not been taken.
  I hope that the Bill will not be used to do something that should be undertaken in general law, but I am delighted that the Minister is interested in the issue.
  Mr. Race: Whatever the merits of changing the law generally, surely the hon. Gentleman, as an experienced parliamentarian, must accept that that possibility is not before us. We are dealing with a specific Bill concerning one street in London in which injury will probably be caused to a few people. That involves a quite different principle from a general change in the law.
  Mr. Brown: That does not alter the fact that if the law is wrong, it is unreasonable to wait for a private Bill in order to take action. The Minister has said that he is concerned about the compensation and I welcome his interest. The Government can introduce legislation to put a new measure into force that would take account of such factors, and I doubt whether the House would hold up such a provision.
  I tried hard to get information from the promoters about the position of the florist. Having seen the shop, I accept what has been said. However, there is nothing to stop anyone from walking in front of the shop as it is. It is impossible to walk in the road, because lorries, cars and vans are parked there. Instead of the lorries, vans and cars parked in front of the florist there will be a temporary hoarding. I hope that the suggestion about the delay is wrong, but the hoarding will only be temporary, while the cars, vans and lorries are there every day of the week. Therefore, they form a barrier anyway. The promoters are doing nothing to hinder the walkthrough. Throughout the work there will be no change in that situation.
  The best information that I have is that the shop in the arcade is still the subject of negotiations by the owners of the florist's. I understand that we are talking, not about an extension for storage, but about a new shop. The promoters have leant over backwards to do everything possible to help. However, I am grateful to the House for its support. All hon. Members have voiced the hope that outstanding matters can be considered in Committee. I stress that the work is complementary to the main work to be carried out in Liverpool Street—British Rail's development of Liverpool Street station and the hotel. Finally. I am grateful to the House for welcoming the Bill
  Question put and agreed to.
  Bill accordingly read a Second time and committed.

  Members of Parliament (Salaries, Allowances and Travel Facilities)
  8.5 pm
  The Lord President of the Council and Leader of the House of Commons (Mr. John Biffen): I beg to move,
  That, in the opinion of this House, the salaries payable to Members of this House in respect of service on and after 13th June 1982 should be at the following yearly rates—

  (1) £14,510 for Members not falling within paragraph (2); and

  (2) £8,460 for Officers of this House and Members receiving a salary under the Ministerial and Other Salaries Act 1975 or a pension under section 26 of the Parliamentary and other Pensions Act 1972.

  Mr. Deputy Speaker (Mr. Bernard Weatherill): I understand that it will be convenient to take, at the same time, the following motions: No. 3,
  That the salaries payable to Members of this House in respect of service on and after 13th June 1982 should be at the following yearly rates—

  (1) £14,510 for Members not falling within paragraph (2); and

  (2) £8,460 for Officers of this House and Members receiving a salary under the Ministerial and Other Salaries Act 1975 or a pension under section 26 of the Parliamentary and other Pensions Act 1972.

  No. 4,
  That, in the opinion of this House, the limits specified in the Resolution of this House of 5 June 1981 in relation to the allowances payable in connection with a Member's office, secretarial and research expenses should be raised so as to make the limits—

  (a) in paragraph (a) of the Resolution (allowance in respect of aggregate amount of general office expenses and expenses on secretarial and research assistance), £8,752 for the year ending 31 March 1983 and £8,820 for any subsequent year; and

  (b) in paragraph (b) of that Resolution (provision for enabling a Member to make pension contributions in respect of persons in the payment of whose salaries expenses are incurred by him), £875 for the year ending 31 March 1983 and £882 for any subsequent year.

  No. 5,
  That in the opinion of this House, the facilities available to the spouse of a Member of this House for free travel in accordance with the Resolutions of this House of 7 April 1971 and 22 July 1975 on journeys within paragraph (a) or (b) of the said Resolution of 7 April 1971 should be extended to children of the Member under the age of 18; but any child's journey in respect of which facilities for free travel are provided in accordance with this Resolution should count against the number of journeys for which facilities for free travel are available to the Member's spouse.
  For the purposes of this Resolution a Member's children shall be taken to include step-children, adopted children, foster children and any other child living as one of the Member's family.
  No. 6,
  That the draft Ministerial and other Salaries Order 1982, which was laid before this House on 27 May, be approved.
  No. 7,
  That this House—

  (a) welcomes the Report of the Select Committee on Members' salaries which was ordered by this House to be printed on 17 February 1982;

  (b) agrees with the recommendation in that Report that a review of Members' pay be conducted by the Review Body on Top Salaries once during the fourth year of each Parliament and that, where a shortened Parliament precludes this, the Review Body should carry out a new review not later than four years after the rates of salary consequent on the previous review first became payable;

  (c) agrees with the view expressed in that Report that, between such reviews, Members' salaries should be adjusted annually by reference to increases in outside salaries, but does not accept the recommendation that

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  there should be an annual automatic adjustment by reference to figures taken from the Department of Employment's New Earnings Survey;

  (d) is of opinion that her Majesty's Government should instead, in the period between one such review and the next, move annual motions to effect changes in Members' salaries and in so doing should be guided by the average change in the rates of pay of appropriate groups in the Public Service over a relevant period.

  Before calling upon the Leader of the House to move the first of the six motions, I have to inform the House that the right hon. Member for Manchester, Openshaw (Mr. Morris) has asked permission to move amendment (b) to motion No. 2 and amendments (a) and (c) to motion No. 4 with figures differing slightly from those shown on the Order Paper. The proposed alteration in motion No. 4 would also involve two further amendments to that motion. Mr. Speaker has decided that it would be in the interests of the House to allow this to be done. Revised copies of pages 2864 and 2865 of the Order Paper have accordingly been placed in the Vote Office and a revised list of selected amendments has been placed in the Lobby.
  Mr. Edward du Cann: On a point of order, Mr. Deputy Speaker. I am sure that the House will appreciate your ruling, which is no doubt satisfactory from everyone's point of view. However, I wish to ask about the position at the conclusion of the debate. I do not know whether it is proposed to have any Divisions, but if so, would we take all the motions seriatim?
  Mr. Deputy Speaker: We shall take them in that manner. Matters are complicated when we debate motions together, but the Chair will make the subject of the Division clear.
  Mr. du Cann: I am much obliged. That is precisely the point that I had in mind.
  Mr. Biffen: We have to consider tonight two separate but related issues, one short-term and one long-term. The short-term issue concerns the increase in hon. Members' pay, in the secretarial allowance and in Ministers' pay in 1982. I shall deal with these matters first. The long-term issue concerns the way that hon. Members' pay is to be settled in future. It is an issue on which we have the report by the Select Committee on hon. Members' Salaries to assist us.
  I have already told the House about the Government's proposals for 1982, in answer to a parliamentary question by my hon. Friend the Member for Nelson and Colne (Mr. Lee). In the absence of recommendations by the Top Salaries Review Body this year, we considered that it was reasonable to increase hon. Members pay, hon. Members' secretarial and research assistance allowance and Ministers' pay by 4 per cent. each, in line with the pay factor included in Estimates. The reason why the TSRB was not asked to review hon. Members' pay and allowances this year is that at the time we would have had to make the request the Select Committee was still considering Members' pay and we did not wish to prejudge its conclusions. The Government's proposals are not generous, but in the circumstances—realism creeps through from time to time—I do not consider that they are unreasonable.
  Turning briefly to the specific motions, hon. Members will see that there are two dealing with their 1982 pay increase. The first is an amendable expression of opinion. The second bears the Queen's Recommendation and the
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  amounts on it cannot be increased. The House may recall from previous debates that the second motion is required because an effective resolution of the House is necessary to increase Exchequer contributions to the Members' pension fund and to increase the pay of the United Kingdom Members of the European Assembly in line with that of Members of the House. The effect of these motions would be to increase the pay of ordinary Members to £14,510 with effect from 13 June, and the parliamentary salary of Ministers and other office holders to £8,460.
  The motion on the secretarial allowance increases the maximum of the allowance in a full year to £8,820, with a further £882 available to enable an hon. Member to make pension contributions for his or her employee.
  It might be helpful for the general structure of the debate if at this point I were to comment on the amendments which give an alternative option to the House. The amendments tabled by the right hon. Member for Deptford (Mr. Silkin) would increase that sum by 6 per cent. Any chosen: figure is a matter of value judgment and a degree of arbitrariness. It would be appropriate for the House to stay with a proposal which is related to the pay factor in the Estimates and if this were to be seen to be leading to any significant fall in equitable levels of pay it would be subject to subsequent investigation and remedy by recommendation of the Top Salaries Review Body.
  The other amendments which have been tabled by the right hon. Member for Deptford and his associates concern the office, secretarial and research allowance. The amendments propose that there should be an increase of 8 per cent., double that which is proposed by the Government. That figure, however chosen, bears a certain arbitrary implication, but I cannot find it appropriate to recommend to the House a figure that is double that of the pay factor in the Estimates and which is a touch above the general level of settlement in both private and public sectors.
  Mr. D. N. Campbell-Savours: Does the right hon. Gentleman accept that a proportion of the amount that is provided for secretarial and research allowances goes o a other things which have little to do with pay; they are to do with purchases? Purchases can be far more directly related to the rise in the cost of living. Within that global figure, would it not have been better to have included some component to cover purchases and the substantially greater increases that relate to them?
  Mr. Biffen: Once one moves into that territory, the index that one would choose for purchases would not necessarily be the retail price index. It might be the index of wholesale prices. We would be in difficult territory if we began to base the argument on the refined statistical indices that could be secured for that fraction—
  Mrs. Elaine Kellett-Bowman rose—
  Mr. Biffen: —of the total spending on the office, secretarial and research assistance allowance which went to the purchase of goods and services.
  Mrs. Kellett-Bowman: I apologise to my right hon. Friend for jumping up rather precipitately. Would he not think it fair if a different allowance were made to Members' secretaries who serve only one Member and who are relatively underpaid compared with those who serve two, three or even four Members, who are in some cases grossly overpaid? Should there not be some differential?
  Mr. Biffen: My hon. Friend makes an important point which should not be squeezed into the reply that I was giving to the hon. Member for Workington (Mr. Campbell-Savours). All hon. Members must be profoundly conscious that broadly speaking we have a uniform system of allowances and yet immensely individual patterns of expenditure.
  Mr. Campbell-Savours: That is a platitude.
  Mr. Biffen: It may be a platitude but, my God, it is probably the truest thing that will be said this evening.
  All these matters should be considered further by the Top Salaries Review Body. I would far sooner that the study and the determination was undertaken by an organisation with an arm's length relationship with the House than that the House were to be seen obviously voting its emoluments and fringe benefits. When I come to the long-term considerations in the second part of my speech, I will touch upon the prospects of the Top Salaries Review Body being able to undertake just such a study that can reflect upon the problems that were mentioned by my hon. Friend.
  Mr. Alexander W. Lyon: The right hon. Gentleman has just expressed the fervent view that it was better that the Top Salaries Review Body should deal with our salaries at arm's length than for the House to deal with the matter itself. Will he give an undertaking that in future all the recommendations of the Top Salaries Review Body will be automatically accepted? Is not the alternative that the House should make up its own mind on the Government's advice?
  Mr. Biffen: There has to be an almost Augustinian approach to virtue in these matters. That is the ideal to which one aspires and I would have hoped that the experience of recent years might consolidate the view that this is something which for the future ought to be observed more faithfully than it has been in the past.
  Mr. Michael English rose—
  Mr. John Silkin rose—
  Mr. Biffen: Without wishing to be obsequious to Privy Councillors, the right hon. Member for Deptford was first on his feet.
  Mr. English rose—
  Mr. Biffen: I give way to the hon. Gentelman.
  Mr. English: Saint Augustine was the man who said "Lord make me chaste but not yet."
  Mr. Silkin: I shall leave the Lord President of the Council further unbattered if I may, because there has been a number of interventions.
  Mr. Biffen: I am glad that fraternity is still working.
  Mr. Peter Bottomley: If the House is to vote for this sort of recommendation which is tied to Government expenditure or Estimates some months ago, would it not be far better for us to determine in the autumn of the previous year our increase from 13 June? We would be setting an example rather than trying to set an example after most other pay has been settled. Secondly, should not a Top Salaries Review Body report at least be put to the House so that we can vote on it rather than it being modified by the Government and left as a take-it-or-leave-it issue?
  Mr. Biffen: I shall answer my hon. Friend's point about the timing of the Government's figure. This is intended to be for this year only. I am sure that my hon. Friend will realise that the motions before the House are designed to get away from that position for the future. He has made a fair point about the timing, but I am sorry that this year I have to present the position as it is.
  I did not entirely appreciate my hon. Friend's second point about the Top Salaries Review Body.
  Mr. Bottomley: My point was that it might not be possible for the Government to accept that the recommendation of the Top Salaries Review Body should be enacted. Would the Government consider and ensure that the recommendation is put to the House so that they could then try to lead as many as wanted to away from it rather than forbidding even the possibility of its being enacted?
  Mr. Biffen: My hon. Friend is asking me to anticipate the second part of my speech. However, at the end of the day the figure that is presented to the House is amendable. Therefore, if the House wishes to amend it in accordance with the review body's recommendation it is open to it to do so. That has always been the position.
  Mr. George Cunningham rose—
  Mr. Biffen: No, I shall not give way now.
  Mr. Cunningham: I should be most grateful on this point.
  Mr. Biffen: I know that the hon. Gentleman would be, but I wish to complete the reference to the amendments. I do not think that I have indicated any unwillingness to give way. However, I have a responsibility to the House more generally to make a speech with some degree of structure as well as satisfying those who enjoy the blood sport of pursuing the Leader of the House in these circumstances.
  The other amendment, which is quite an innovation, is the proposition that there should be a London weighting allowance for secretaries. The view has always been taken hitherto that a cash payment should be made and that how that is used in respect of secretarial services, either in London or in the provinces, or as between equipment and the employment of persons, should be left to the Member's discretion. Once the House begins to make judgments on how expenditures should be undertaken, it will move across a Rubicon which in the fullness of time it will regret having crossed. However, I have no wish to be seen to be obdurate. If the later motions are confirmed by the House and a review is established by the review body of allowances for Members, it is exactly the sort of problem that it can assess and upon which it can make recommendations.
  Mr. George Cunningham: A few minutes ago, and quite rightly, the right hon. Gentleman said that the House is always free to substitute its figure for one that is tabled by the Government in the opinion-expressing motion, and that that has always been the tradition of the House in dealing with this subject. That makes sense only if the Leader of the House is prepared also to say that when the House does pass—I do not think that it will do so tonight because I think that it will pass the opinion-expressing motion as it stands on the Paper—an amendment which raises the figure in the opinion-expressing motion, the

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  Government will accept that as a decision of the House, and will then that night or on another night bring forward an amended, perfected motion to reflect the amended opinion-expressing motion which the House will then carry. Can the Leader of the House tell us whether that is his attitude to how these matters should be handled?
  Mr. Biffen: No, I do not think that I can. I understand the point that the hon. Gentleman is making. The relationship between the House and the Government has not been at its happiest and most harmonious on these matters in recent years. I am proposing a modest step forward. I hope that it will take place in circumstances that will lead gradually to a better relationship that will not lead to the clashes that we have had in the recent past. There is nothing that I can say or pledge that will meet the hon. Gentleman's point in the way that he puts it. I think that the House will prefer me to say that in all candour. At the end of the day, these are matters in which the Government have a material political interest and they cannot abdicate the role which has often been performed by all Governments.
  I return to the text of my speech as opposed to dealing with the amendments on the Order Paper. As is usual, no motions have been tabled on Members' other allowances—namely, the additional cost allowance, the London allowance and the car mileage allowance. These allowances will be adjusted in the normal way following changes in the equivalent Civil Service allowances. However, there is one small change that I now propose concerning travel arrangements for Members' families. As things stand, Members' spouses are entitled to up to 15 free return journeys to Westminster on parliamenary business. My predecessor received representations from several hon. Members to the effect that, for Members with young families, the spouse could not generally travel to Westminster without bringing the children, and that the free travel warrant system for spouses should therefore be extended to children, within the existing limits.
  The Government accept that this is a reasonable proposition and the motion before the House provides for Members' children under 18 years to travel free to Westminster under the same conditions as currently apply to spouses. The total number of free return journeys available to Members' families will remain at 15 a year.
  The motion on Ministers' pay invites the House to approve the draft order which increases the pay of Ministers and other office holders by 4 per cent. The rates shown in the order for the Prime Minister and the Lord Chancellor are the rates that may be paid to the holders of these offices and will apply for pension purposes. However, as in previous years, my right hon. Friend and my right hon and noble Friend will draw only the same salary as their Cabinet colleagues.
  Mr. John Silkin: Is the Government's generosity towards the children of Members such that the number of free warrants will not be increased? Indeed, the Government will gain because in the majority of cases the children will have travelled for half price on the railway. The Government will be the gainer of half an adult's ticket.
  Mr. Biffen: The right hon. Gentleman makes a fair debating point. However, the request for this reform, if I may dignify it by that description, came from Labour Back Benchers. I do not think that they will be as dismissive of
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  its symbolism as the right hon. Gentleman is. However, it is true that the inuitlement is not increased as a result of this decision. The possibility of its utilisation may be further enhanced.
  Mr. Silkin: Surely the Government will gain by this piece of so-called generosity because two children will travel for the same price to the Government as one adult. Therefore, in giving a ticket to a child they are gaining half an adult's ticket.
  Mr. Biffen: I am grateful to know that in a previous Treasury incarnation I should be as pleased about the reform as I think I am pleased about it in my role as Leader of the House.
  Mr. Barry Sheerman: Surely the Government would have been more generous if they had considered carefully the basis of allowances for spouses and children. One of the penalties of being a Member of this place is being estranged from one's family. We should have free access to our children, and that is what most of us want. We are grateful for any flexibility in the system, but I have four children and I like to see them as much as possible. I do not think that I should be rationed on how often I can see them.
  Mr. Biffen: The House should reflect seriously before giving to itself privileges for children's travel which will be sought equally by those in many other occupations which involve the estrangement of families.
  Mr. Sheerman: How many?
  Mr. Biffen: The numbers argument is a most dangerous one to use in these circumstances. The way in which we treat ourselves is monitored most closely in the outside world. The fact that we are a mere 600-odd is not a material factor in the argument. I am distressed that what was an attempt to have a more generous interpretation of the spouse allowance has resulted in an attack on the Treasury Bench for apparent niggardliness.
  The last motion standing in my name on the Order Paper concerns the Government's proposals for dealing with Members' pay in the longer term. Before describing them, I should like to thank the Select Committee on Members' Salaries, whose report forms the starting point of what I shall have to say, for all its efforts. Members' pay is a notoriously difficult subject for the House and, even though I am not able to agree with all its conclusions in every respect, I consider that the Select Committee has presented the House with a most constructive report.
  The Select Committee recommended, first, that there should be a review of Members' pay by the Top Salaries Review Body once during the fourth year of each Parliament. If this were precluded by shortened Parliaments a new review should be undertaken not more than four years after the salaries derived from the previous review became payable. The Select Committee's second recommendation was that there should be annual automatic interim adjustments of salaries by reference to increases in the nearest percentile of the new earnings survey.
  The Government accept the first of these recommendations. There is, great value in having a completely independent review of Members' salaries. If the question were left entirely to the House, I suspect that we should have great difficulty in arriving at an acceptable figure. Moreover, there would certainly be some public suspicion

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  that we were treating ourselves too generously, even if precisely the reverse was the case. I believe that having the independent review towards the end of each Parliament is sensible. If, however, a shortened Parliament knocks us off course, there is nothing to stop us having two reviews separated by less than four years to get us back on it again.
  The coming year is the fourth of this Parliament. Subject to the views of the House, therefore, we propose to ask the TSRB to conduct a review in time for next year's debate on Members' pay. We should also ask it to review Ministers' pay, the secretarial allowance, and such other aspects of Members' pay, in the broad sense specified by the Select Committee, as may need to be looked at.
  How Members' pay is adjusted between reviews also poses a problem. The Government reluctantly accept that there should be some form of adjustment by reference to changes in outside salaries, that is, some form of linkage. We have no enthusiasm for the idea, but, in view of resolutions of the House on the subject in recent years and of what the Select Committee says, we accept it. However, we cannot agree that the link should be automatic or that it should be with the new earnings survey. Although there are examples of pay increases operated by an automatic formula, it is not a practice I believe should be further entrenched and certainly not in an area as sensitive as Members' salaries.
  Mr. Gregor MacKenzie: I am a little puzzled by the Government's reluctance to link pay with an outside body. A few moments ago the Leader of the House said that he was not able to tell us what car allowances and London allowances would be in the year ahead because he had to wait until those figures had been sorted out for the Civil Service. We seem to be linked to the Civil Service for our car and living in London allowances, but apparently it is obnoxious to the right hon. Gentleman to have similar linkage on salary. Some of us are a little puzzled about his attitude on the question.
  Mr. Biffen: The Select Committee was not proposing a linkage in respect of salaries. We are discussing the interim increases between the four-yearly review by the Top Salaries Review Body and what form of linkage would be appropriate for that practice. I should strongly discourage the concept that the House should expect for itself some kind of automatic pay increase that proceeded by some stealthy manner or some wholly irreversible manner—for that is what it would seem to do. If the House is not prepared to accept the responsibility of discussing these things once a year, then there will be a great deal of well-justified anxiety and suspicion about how we concluded these matters.
  As for the form of the link, whatever may be the relationship in the long run between average earnings and those in the public service, it is right in principle that MPs' pay should keep in step with that of public servants. Any other system would be certain to give rise to bad feeling. Moreover, the new earnings survey is published in November and covers earnings in the year ending with the previous April. The changes that it records are therefore, on average, over a year old when it is published. That could give rise to great difficulty in a period when the rate of increase in pay settlements was falling.
  As an alternative, we propose that between reviews the Government should move annual motions to effect
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  changes in Members' salaries and in so doing should be guided by the average change in the rates of pay of appropriate groups in the public service for the period concerned. There are several important points in that formulation. The first is that, as now, Members' pay would be adjusted following an annual debate. There would not be an automatic adjustment. The second is that, although the Government would be guided by the average increase for particular public service groups, and would normally expect to propose to the House an adjustment in Members' pay that corresponded to the average, there could be circumstances where that course could not be followed for one reason or another. In short, the Government reserve the right to respond flexibly to exceptional circumstances.
  The motion refers to
  "appropriate groups in the public service".
  The groups that I have in mind are the non-industrial Civil Service, primary and secondary teachers, National Health Service doctors, dentists and administrators. It is not necessary to make a final decision about the groups to be included at this stage. However, the general principles are clear. The groups should represent a widely based segment of the public services but particular groups to whom the Government have given special commitments, such as the Armed Forces and the police, should be excluded. As I envisage that the average pay increase for all groups would be weighted by numbers in the group, there would be little point in including numerically small groups. The groups that I have mentioned all have their settlement date on 1 April. That is useful as it means that, on the one hand, the changes in pay would be recent, unlike the new earnings survey link, and, on the other, that the settlements should have been concluded in time for a debate on Members' pay before the Summer Recess.
  The Government do not propose to apply linkage to Ministers' pay, or to the secretarial allowance. Between Top Salaries Review Body reviews those items would be revised on an ad hoc basis.
  Much passion is aroused by the question of linkage, but in the scheme that I have outlined and that recommended by the Select Committee it is of only secondary importance. The periodic reviews by the TSRB will be the chief means of keeping Members' pay on a satisfactory basis. Providing that those are undertaken regularly, it does not matter much if the interim arrangements are approximate rather than precise.
  Amendments have been tabled which concern these resolutions. The first, which deals with the important matters of pension and severance pay, was tabled by the right hon. Member for Deptford. The hon. Member for York (Mr. Lyon) tabled an amendment on pensions, but it was not selected. I understand the concern about severance pay, although it has been examined in the past. However, it would be appropriate, if the House votes for the Government motion this evening, that the Top Salaries Review Body should undertake this autumn a consideration of the matters that are dealt with in those amendments.
  There are other amendments in the name of the right hon. Member for Deptford (Mr. Silkin) and my right hon. and learned Friend the Member for Hendon, South (Mr. Thomas) that invite the House to accept the full Select Committee report without addition, adjustment or amendment. The House is confronted with a straight choice this evening in the Lobbies. The first is, about the comparita that will be used for calculating the interim

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  increases. I have explained our reservations about the new earnings survey as a means of securing the comparisons because we believe that the range of public sector settlements is more appropriate.
  The second is whether the increase that will be derived from the comparita should be automatic, as are the mileage allowance or the additional cost changes, or whether it should be the subject of debate, endorsement and confirmation by the House each year. It would be a most significant and dubious departure if we proceeded to a position whereby the annual increase was made automatically without any possibility of judgment in the House. That is why I believe that the arrangements for accepting much of the spirit of the Select Committee's report, buttressed by the Government's proposals, will enhance what is before the House. I hope that we can come to a broad and settled view. The Government's response to the Select Committee's recommendations has been sympathetic and is none the worse because it has not been an unconditional endorsement.
  If the House supports the proposals that I have outlined, we shall have taken a modest step in the direction of freeing Members' pay from the capricious circumstances that have attended it in recent years. No doubt we shall have our quota of problems in the future, but I hope that we can avoid the worst pitfalls. I am sure that the House will not expect a perfect arrangement, but I am convinced that the Government's proposals offer a modest and tangible way forward.
  8.43 pm
  Mr. Charles R. Morris: I beg to move amendment (a), to leave out "£14,510" and insert "£14,787".
  I understand that it will be convenient also to take the following amendments:

  (b), to leave out "£8,460" and insert "£8,618".

  (a) to motion No. 4, to leave out "£8,752" and insert "£9,022".

  (b) to motion No. 4, to leave out "£8,820" and insert "£9,158".

  (c) to motion No. 4, at end add

  "(c) additionally, that in those cases where individual Members can authenticate the expenditure they be reimbursed for the payment of an annual London weighting allowance of £1,087 to their secretaries".

  (a) to motion No. 7, to leave out from "1982" to end of motion and add

  "and agrees with the recommendations of that Report".

  (b) to motion No. 7, to leave out from "payable" to end and add

  '(c) agrees with the view expressed in that Report that, between such reviews Members salaries should be adjusted annually by reference to increases in outside salaries as indicated in the nearest percentile in the Department of Employment's New Earnings Survey.

  (d) does not accept the view in that Report that the question of Members' pensions and severence payments should be subsumed under the general heading of "Pay" to await consideration in the context of the next general review of Members' pay, but is of the opinion that, in the light of anomalies inherent in the present severance arrangements and the in creased insecurity attached to the role of a Member, the Top Salaries Review Body be requested to undertake an urgent review of pension and severance arrangements and make recommendations accordingly.' .

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  I preface my contribution to the debate by paying tribute to the Chairman and members of the Select Committee, whose report provides a valuable and helpful backcloth to the debate. If I have decided reservations about some features of their recommendations, that is in no way a reflection on the diligent and responsible way in which they have carried out their task. Having read their report, I also wish to express my appreciation of the oral evidence of the right hon. Member for Taunton (Mr. du Cann), my right hon. Friend the Member for Sunderland, North (Mr. Willey) and, of course, my hon. Friend the Member for Easington (Mr. Dormand) for the continuing work that he has undertaken on behalf of Labour Members.
  I have listened attentively to the Leader of the House. Parliamentary salaries should not be so generous as to be an attraction in themselves nor so low as to discourage able aspirants from seeking membership of the House. Members have a right to a fair and reasonable scale of remuneration and a salary sufficient to enable them to do what their constituents increasingly expect of them—to devote a major part of their time, if not their whole time, to their parliamentary duties. It is on the basis of that simple proposition that I take issue with the figures in the motion tabled by the Leader of the House on behalf of the Government.
  Right hon. and hon. Members on both sides of the House accept that parliamentary salaries cannot be fully protected, or indeed isolated, from the consequences of economic inflation. Nor is anyone in the House impervious to the political sensitivities, to which the Leader of the House referred, surrounding Members' pay and allowances. It is time we started distinguishing myth from reality in this issue.
  It is a myth that the sustained restraint and self-discipline which Members have exercised over many years in regard to parliamentary pay has ever persuaded anyone to follow our example. The reality is that, during the last 20 years, there is no recorded case of any group—administrative, professional or manual—ever following the lead in pay restraint demonstrated by Members of the House.
  If we take the operative date of the proposed annual interim increases, 13 June, in the context of the annual wage cycle, we are at the end of the queue. I suspect that we have been deliberately pushed to the end of the pay round so that parliamentary pay will not be taken as a lead—
  Mrs. Kellett-Bowman: Even if one were to accept the right hon. Gentleman's argument that people do not follow us when we are restrained, would he not agree that if we were unrestrained at a time when they are being restrained, it would have the opposite effect and we would be setting an extremely bad example?
  Mr. Morris: I can understand the feelings which have generated that thought in the hon. Lady's mind, but I cannot recall an occasion when increases given to Members and Ministers could ever be designated as unrestrained. I invite the hon. Lady or, indeed, any hon. Member, to name an occasion when any increase that we have ever accepted for ourselves could be designated in any way as unrestrained.
  Mr. Frank Hooley: The hon. Member for Lancaster (Mrs. Kellett-Bowman) is probably

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  still thinking in terms of Europe, where "restraint" is the last word which is ever used and "unrestrained" is the word one could apply.
  Mr. Morris: Indeed, my hon. Friend has made a valid point.
  The issue posed in the Government's motion on pay and allowances is not one of Ministers earnestly seeking partially to protect parliamentary salaries and allowances from the continuing erosion to which they have been subject as a result of Government policy over the last 12 months. The issue is essentially political. We have listened to Ministers day in, day out, and they never weary of preaching the virtues of free collective bargaining. But what they are embarked upon this evening is an exercise to impose on Members and their private secretaries the Prime Minister's wretched 4 per cent. pay policy.
  I felt that it might be helpful to our deliberations to establish just how many groups in the public sector have actually settled at 4 per cent. or less. I, as every hon. Member does, went into the Library and invited the able assistance of the House of Commons Library statistical section to find out just how many such groups had settled at 4 per cent. or less. I received the following reply:
  "You asked me to let you know which groups, particularly administrative and clerical groups, in the public sector have settled in the current round for 4 per cent. or less. I have not found any group which has settled for as little as 4 per cent. and Incomes Data Services (IDS) have also checked their files and found no such group."
  Having failed to persuade any other comparable group to settle for 4 per cent. or less, the Prime Minister and the Government have singled out hon. Members and their private secretaries on whom to impose what I can only describe as the Prime Minister's squalid pay policy obsessions.
  During the past year, settlements in the public sector, even if we exclude the recent massive awards to senior civil servants, senior Service officers and the judiciary, have varied between 6 per cent. and 13 per cent. The general body of civil servants, whom the Prime Minister appears to take a malevolent delight in clobbering, received 6 per cent. Members and their secretaries are offered 4 per cent., as will be seen from the motion on the Order Paper.
  Do Ministers believe that hon. Members and their families pay less for their food and the other essential prerequisites of life than civil servants? Does the Leader of the House accept that hon. Members and their private secretaries are in a better position to withstand the increases in mortgages, tube, bus and rail fares than secretaries in the Civil Service? That is the logic of the motions tabled by the Leader of the House.
  Last year, civil servants received an interim settlement of 7 per cent. plus £30. Hon. Members received an interim settlement of 5·73 per cent. This year civil servants were awarded 6 per cent. The Government motions envisage hon. Members and their secretaries receiving 4 per cent. How can that be justified?
  Mr. Geraint Howells: It would be wiser if we could clarify the position. The secretaries will not automatically receive a 4 per cent. increase. An extra 4 per cent. will be given to hon. Members as an allowance for secretarial and research work.
  Mr. Morris: I am grateful to the hon. Gentleman for reinforcing that point.
  It is neither equitable nor fair to accept the implications of the figure of 4 per cent. in the motions tabled by the Leader of the House. Not only have we fallen behind the movements in the retail price index and the average earnings index, but we are falling behind civil servants consistently year after year. The amendments that my right hon. Friend the Member for Deptford (Mr. Silkin), my hon. Friend the Member for Sheffield, Heeley (Mr. Hooley) and I have tabled seek to improve the figures that the Leader of the House has tabled to a modest 6 per cent. That is all we seek. We seek 6 per cent. for hon. Members and the secretarial allowance—a rate that has been conceded already by the Government to civil servants.
  In 1975 and 1980 the House went on record as being in favour of linking parliamentary pay with a Civil Service grade for salary purposes. At that time the Civil Service assistant secretary grade was selected as the nearest to the level of salary in operation for hon. Members. That Civil Service grade was selected for comparability purposes.
  Only those Members with an over-vivid imagination would aspire to the heights enjoyed by civil servants on assistant secretary grade. Their maximum pay is £19,612. With the inner London weighting allowance the salary is £23,288. That was the comparability that the House felt was fitting in 1979 and 1980.
  If we cannot aspire to compare ourselves with assistant secretaries, we must look at which Civil Service grade we could now equate ourselves with. A senior principal currently receives a maximum salary of £16,810. With the inner London weighting allowance, a senior principal receives £21,014. We cannot equate ourselves with senior principals. Perhaps we can equate ourselves with the principal grade. His current salary is £12,999. With the inner London weighting allowance, it is £17,035. If we cannot equate ourselves with him, who next? We go then to the senior executive officer who is on a salary of £10,000. With the inner London weighting allowance, he enjoys a salary of £13,056. I could continue.
  Under the Government, and the way that they think about the salaries of hon. Members, we shall be quickly down to the salary of the higher clerical officer. That is the reality with which hon. Members are confronted in the determination of salaries and secretarial allowances. I have read the Select Committee's report and listened to the Leader of the House dismiss the idea of a linkage with Civil Service grades. I have read the same arguments in the tendentious document published by a previous distinguished Leader of the House to hon. Members in October 1980 dealing with parliamentary pay and pensions. In that document he was dismissive of a linkage with Civil Service grades. It is done in France, Norway, Sweden and Denmark. What happens in the United States of America? Congress approved a motion that no civil servant would receive more in remuneration than that enjoyed by the Congressman. That is the reality of linkage. How can one dismiss the linking argument?
  The amendments in the names of my hon. Friend the Member for Heeley and myself dealing with Members' pay seek to increase Members' salaries by a modest 6 per cent. That is in line with that already conceded by the Government to civil servants. If we accept the Government's proposals for hon. Members' office, secretarial and research allowances, we shall be doing a

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  serious injustice to loyal and dedicated staff who, I believe, bring a real commitment to their jobs. I am referring to hon. Members' private secretaries.
  The hon. Member for Cardigan (Mr. Howells) made the point that secretarial allowances will increase by 4 per cent., but that that might not mean a 4 per cent. increase for the private secretaries. Let me tell the House a fact of life regarding secretaries. Hon. Members are not big spenders when it comes to recruiting private secretaries. In general, they do not give large salaries to their private secretaries. To single out the secretarial allowance, when I have demonstrated that no comparable group has accepted a settlement of 4 per cent. or less, is really a bit much.
  I have great admiration for the way that the Leader of the House carries out his responsibilities, both in his present role and in his previous ministerial roles. I hope that he will look again at secretarial allowances to see what he can do. Our secretaries get little or no redundancy pay. Their salaries do not attract London weighting. Most of them work with Members because of a shared political commitment, so it is a bit much that the House and Members have singled them out as the banner carriers for the Prime Minister's squalid 4 per cent. pay policy.
  I should like to mention future arrangements for Members' salaries. I have tabled two amendments to the motions on these matters. Having read motion No. 7—
  "Future arrangements for Members' salaries"—
  and listened to the Leader of the House, I am still at a loss to know what it means. The right hon. Gentleman said that he was restructuring and making provision for a modest improvement to ensure an organised interim uplifting. However, we should read paragraph (d) carefully, because I am convinced that it was drafted by a civil servant. I say that as a former Minister of State, Civil Service Department. Paragraph (d) states that this House
  "is of the opinion that Her Majesty's Government should instead, in the period between one such review and the next, move annual motions to effect changes in Members' salaries and in so doing should be guided by the average change in the rates of pay of appropriate groups."
  The Leader of the House was not very forthcoming about the groups with which we are to be compared, but, even if he had been, they were to be used only as a guide. In my opinion, that is not good enough.
  Then there is the Select Committee's suggestion of increases on an annual basis by reference to increases in outside salaries, given to the nearest percentages in the Department of Employment's "New Earnings Survey". That is a far more efficient way to do it, and I hope that the Government will look again at that suggestion.
  The amendment that we tabled shows that the Opposition do not accept the view in the Select Committee's report
  "that the question of Members' pensions and severance payments should be subsumed under the general heading of Pay to await consideration in the context of the next general review of Members' pay, but is of the opinion that, in the light of the anomalies inherent in the present severance arrangements and the increased insecurity attached to the role of a Member, the Top Salaries Review Body be requested to undertake an urgent review of pension and severance arrangements."
  Let us make no mistake: pension and severance arrangements are of crucial importance for every Member of the House. There are anomalies in severance arrangements. A teacher contributes to his pension entitlement about the same percentage of salary as does a Member of the House, but as a Member one does not get
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  a pension before the age of 65. A teacher is entitled to take his pension at the age of 60. Those are the anomalies that I believe should be seriously examined.
  As regards pension arrangements, one-sixtieth is nonsense. I do not know any parliamentarian who, having won a seat in the House to represent a constituency, can look to 30 years as a Member. We need a true rate which takes account of the hazards of parliamentary life.
  I recently read Lord Plowden's report on the Top Salaries Review Body's examination and recommendations on senior civil servants, senior Service officers and the judiciary. I was impressed that, in his preface, Lord Plowden referred to the objectives which his committee sought to establish. The objectives were to set limits that would ensure that the grades covered by the report are not affected by what he termed deep-seated feelings of unfairness. All I can say to that is bully for them if they have someone examining their salaries who does not want to leave them with a deep-seated feeling of unfairness.
  There is a widespread sense of unfairness among hon. Members on both sides of the House, and certainly among private secretaries employed by hon. Members, about the Government's proposals in these motions. That feeling also exists among those who watch events in this Chamber. I believe that hon. Members are entitled to expect better than the shabby treatment they have received so far.
  9.8 pm
  Mr. Peter Thomas: I shall confine my remarks to motion No. 7 and amendment (a) in my name, because I had the privilege of being Chairman of the Select Committee that produced the report. I am grateful to my right hon. Friend and to the right hon. Member for Manchester, Openshaw (Mr. Morris) for their kind remarks about members of the Committee. I pay tribute to those hon. Members on the Committee for their work and for their support in the production of the report. I am also grateful for the fact that my right hon. Friend, on behalf of the Government, said that he supports parts of the report, but I am disappointed that the major part of it has been abandoned by my right hon. Friend.
  The problems faced by the House over the years in its attempts to determine a fair and reasonable salary for hon. Members are well known and I shall not rehearse them. The Select Committee's report sets out the problems fairly and clearly. Whatever methods have been tried, difficulties have been encountered. In the view of successive Governments, the time for effecting an adequate increase is never convenient. At the same time, the House is always sensitive to adverse public opinion and anxious to set an example.
  There is no doubt that, over the years, hon. Members' pay has frequently lagged behind that which an objective assessor would regard as fair. Many examples can be given where variations in independent proposals, or delay in their implementation, have produced injustice, while the effect of such restraint as an example to the public has, to put it at its highest, been negligible.
  One of the sad effects of all this is that in every recent year the House has been forced into somewhat unseemly debate and many divisions of opinion have emerged on how or what we should pay ourselves. The task of the Select Committee was to try to find an alternative to this recurrent, bruising wrangle. We tried to agree on an equitable method of determining Members' remuneration

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  without being at the mercy of short-term considerations. At the same time, we had to bear in mind that the House cannot abandon its ultimate responsibility for determining its pay. This, as can be seen from our report, was no easy task. Every procedure suggested or considered has drawbacks. The problem is almost intractable and there is no comfortable answer. No method can be found that is likely to command the united support of both the public and the House. It is really a question of finding a solution with the least defects.
  I firmly and respectfully submit that the recommendations in our report are the least objectionable and the best form of compromise that could be devised and, as far as the House as a whole is concerned, infinitely preferable to the proposals in my hon. Friend's motion.
  What my right hon. Friend is proposing in paragraphs (c) and (d) is precisely what the Select Committee was seeking to avoid—a repetition of the annual, discredited public wrangle over Members' pay, an example of which may, I know not, probably be seen tonight.
  From the debate so far, it appears to be generally agreed that there should be an independent, in-depth review at the end of each Parliament. The House will then decide on the recommendations made by the review body. Updating between reviews will clearly be needed, and that appears to be generally agreed. But if we are to avoid the annual wrangle, it is clear that the updating must be a linkage that is automatic.
  The Select Committee recommends an automatic updating between reviews by reference to the average increases enjoyed by those in both the public and private sectors, receiving similar salaries. My right hon. Friend's motion—and this was reflected in his speech—wholly rejects any automatic linkage and suggests that the Government of the day should table
  "annual motions to effect changes in Members' salaries",
  certainly not linked to but
  "guided by the average change in the rates of pay of appropriate groups in the Public Service".
  My right hon. Friend described that as a modest step forward. In my submission, he is suggesting precisely what is happening today in the motions that have been put forward, which have led to the challenging speech of the right hon. Member for Openshaw and will probably lead to Divisions later tonight.
  I agree with what the right hon. Gentleman said about the wording in paragraph (d). It is so vague that, under whichever Government are in power, the interim years would clearly be at the mercy of political expendiency and we would be back to our embarrassing debates and Divisions.
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  Therefore, I urge my right hon. Friend and the Government to think again, in the interests of the dignity of the House. Our recommendation for an interim linkage to the nearest percentile in the Department of Employment's new earnings survey is modest. In no way can it affect the Government's present overall economic strategy. Were the Select Committee's recommendations accepted by the House, and were the review to take place next year and a decision taken by the House on the findings of the review body, the salary increase would operate in the next Parliament and the first automatic updating would become effective at least one year afterwards.
  It should also be remembered that this is not index linking with the cost of living, which I agree would be objectionable. The House has the responsibility and the burden of fixing its remuneration. What possible fair criticism could there be if the House were to state that, between reviews, Members' salaries were to be increased by no more and no less than the average increase of similar salaries throughout the country? I cannot believe that that would have an adverse public effect.
  I remind my right hon. Friend, as he has already been reminded by the right hon. Member for Openshaw, that the House has twice recently voted for automatic linkage, but not the interim linkage, such as we suggest, whereby the issue returns periodially to the House.
  The House has voted for permanent automatic linkage to a grade in the public service. Naturally, the Select Committee had to take that into account in our deliberations. We considered and appreciated the force of some of the objections and were in favour of complete linkage only if no better solution could be found. In the event, we mainly agreed that we had found that better solution. There were differences of opinion in the Select Committee, ranging from those who believed in complete linkage to those who had grave doubts about any form of linkage. Our report represents a consensus—that which the Committee as a whole agreed would substantially achieve its purpose in a way that most shades of opinion could accept.
  If my right hon. Friend and the Government persist in slamming the door shut on the modest interim linkage that has been recommended, we are effectively back to square one, and all the embarrassments and controversies of past years will continue. Members' pay and allowances are essentially a matter for decision by the House as whole on a free vote—I hope a truly free vote. Ministers have the responsibility of recommending expenditure, but it is the House that always has the final responsibility of approval. It is the opinion of the House in this unique domestic issue of pay that should guide whichever Government are in office. The Select Committee's recommendations offer an acceptable and just solution. I hope that the House will agree.
  9.18 pm
  Mr. Frank Hooley: I shall begin with a few words on behalf of those who, by the nature of the debate, are unable to speak for themselves—the secretaries, research assistants and other staff whose remuneration we are debating. The miserable 4 per cent. rise is an insulting proposition and wholly inadequate. The Leader of the House referred to comparable groups of workers who might be taken as guidelines for rises in Members' salaries and, presumably, rises in the salaries of secretaries.
  An offer of 6·4 per cent. has already been made to the nurses and been rejected by them as inadequate. It is reported today that ACAS, a completely independent tribunal, has awarded a 6 per cent. rise to the teachers. In the light of those examples, I cannot see how the House can honestly say to the men and women who serve it loyally and capably as secretaries, research assistants and others, that they are worth only a 4 per cent. rise, bearing in mind the way in which inflation and general costs have risen in the past 12 months and seem likely to continue to do so. It is an insulting proposition and I trust that the House will reject it and vote for our amendment.
  There are other considerations, apart from rates of pay, relating to conditions for secretaries. Those who are members of my union, APEX, made representations to the Leader of the House in March through their proper union machinery. I am sorry that the right hon. Gentleman refused to meet representatives from the union. It was out of character, as he is a civil and courteous person and I should normally have expected him to meet them. Nevertheless, he did not.
  Mr. Biffen: I do not wish there to be any misunderstanding. I saw members of APEX earlier this week.
  Mr. Hooley: I accept what the right hon. Gentleman says, of course. In the correspondence forwarded to me, however, he said explicitly that he saw no point in such a meeting. If he later changed his mind, I am glad that he did so and that he saw them. Nevertheless, that was his initial reply in April. He said that he was not prepared to see them as he saw no point in doing so.
  Mr. Biffen: I do not think that I was then Leader of the House.
  Mr. Hooley: In that case, I shall have to quote the letter. It is signed by the right hon. Gentleman himself.
  Mr. Biffen: In that case, I at once withdraw what I said—I must, indeed, have been Leader of the House.
  Mr. Hooley: Perhaps we should leave it at that. At any rate, I am glad that the right hon. Gentleman has seen the representatives. I am only sorry that he declined initially to do so.
  The points made by members of my union in their submission covered a number of matters relating to their conditions of service. They accepted that there had been some improvements recently—for example, in provisions
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  for pensions and in financial provision, allowing a Member to take on a substitute if the regular secretary is ill.
  They suggested particularly that secretaries should all be paid direct from the Fees Office. That can already be done, if the Member so chooses, and I do not think that it is a matter of great controversy.
  They suggested that the amount given be divided between secretaries and research assistants. Personally, I agree with the reply of the Leader of the House, that at is much better for this to be determined by the Member.
  They also suggested that there might be some form of incremental scheme for payments to secretaries. They further suggested the possibility of an allowance if secretaries were required to work late in the evening or at weekends, and an allowance for travel if they were required to go to the Member's constituency to carry out their work.
  Mr. George Cunningham: We can pay that.
  Mr. Hooley: My hon. Friend says that we can pay that. That is, of course, true if the total sum allows it. If, however, the sum is already committed in regular payments to secretaries, nothing is left over to make extra payments for unsocial hours. I merely put on record the requests and suggestions made by members of my union employed as secretaries in the House.
  A matter of greater substance is the request for London weighting. This is important. It seems anomalous that we accept London weighting for ourselves, in what is known as the London supplement for hon. Members who Live within so many miles of Charing Cross, but refuse it to our secretaries. Again, it is no use saying that a Member can give London weighting, because all Members have equal secretarial allowances. Clearly, those who live in London cannot give something extra compared with those living outside if the money does not allow for it.
  Mr. English: My hon. Friend is confusing the issue. It is a matter not of whether one lives in London but of whether one's secretary works in London. I pay the Civil Service rate, including London weighting, because my secretary works here. The same must be true for many hon. Members. It has nothing to do with whether I live in London.
  Mr. Hooley: Where an hon. Member lives obviously relates to where his secretary works. Almost by definition that will be in London. In that case, there should be some kind of weighting or allowance to reflect the extra cost of living, working and travelling in the Metropolis. That is why I support (c) amendment to motion No. 4. It would make provision for that.
  I return to the linkage of Members' salaries. This has been effectively clealt with by the right hon. and learned Member for Hendon, South (Mr. Thomas), the Chairman of the Select Committee. I am appalled that the Government have again rejected what was a modest compromise by the Select Committee. The Select Committee did not come out in favour of linkage, as I understand it. I simply came out in favour of a quadriennial review by the Top Salaries Review Body, or some such body, but with an interim linkage system, which would have dealt with some of the problems that we are dealing with now. The Government have rejected even that modest compromise. They have replaced it with the

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  gobbledegook in paragraph (d) to which my right hon. Friend the Member for Manchester, Openshaw (Mr. Morris) has already referred.
  The Chairman of the Select Committee is right when he says that this takes us back to square one. Whatever the meaning of the words in paragraph (d), the Government will do as they like. They can be "guided"—heaven knows what that means—by some other consideration, but in effect we are back to the present situation. The old problem that some hon. Members thought could be solved by a linkage scheme remains unresolved. We are back to the annual wrangle, distaste and feeling of injustice, which has gone on year after year.
  Everyone knows that successive Governments have refused to implement the findings of the independent review board. Until there is some automatic linkage mechanism, there will be an annual wrangle. I should be prepared to accept the compromise suggested by the Select Committee, at least for the time being, although I hope that eventually the proper linkage principle, which the House has emphatically declared in favour of on a number of occasions, will be fully and properly implemented.
  The Select Committee commented on pensions and severance payments in paragraph 26 of its report. It said:
  "We noted in paragraph 12 above that the House in July 1980 expressed the opinion that pension rights should be bettered, and in our view, this expression of opinion reflected a long-felt concern that pension and reverence provisions are not yet adequate to avert real hardship for some. These are matters which undoubtedly should and would be further examined".
  There is no indication in the Government's proposals that they will do anything serious about this situation. As my right hon. Friend the Member for Openshaw said, the age at which one can draw a pension should be reduced to 60, as is the case already in the Civil Service and in other professions. I also believe that the accrual rate should be increased from the one-sixtieth arrangement, although I am not sure whether one could jump to the one-fortieth arrangement all at once. On the figures presented by a previous Leader of the House, the average service in the House is 17 years. Although some hon. Members manage to remain Members of Parliament for 20 or 30 years, or more, that is the average length of service.
  There might well be some provision for the payment of a lump sum on retirement, as is done in the Civil Service. Further examination needs to be made of the arrangements for severance payments, although I accept that there are difficulties. At present, if a Member of Parliament loses his seat, or if his seat disappears as a result of redistribution, severance payment is payable. There may well be other instances—such as family circumstances, and so on—that would make it reasonable and logical for some form of severance payment to be made if someone ceased to be a Member of Parliament. That should be considered.
  The Government's proposals are mean, timid and unsatisfactory. The 4 per cent. rise offered to secretaries and hon. Members is thoroughly mean. As has been said, the statistical section of the Library could discover no other group that has settled for 4 per cent. or less. It is disgraceful that the Government should treat in this squalid way not only hon. Members—and it is our own fault if we do not vote against the proposals—but those loyal and devoted servants upon whom we depend for much of our work.
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  Given the Government's argument about comparability with the public sector, they know perfectly well that most groups in the public sector have settled, or intend to settle, for about 6 per cent. and have no intention of accepting the Government's miserable 4 per cent. increase, which is deliberately designed to reduce their standard of living.
  9.33 pm
  Mr. Edward du Cann: The greater part of the speech by the hon. Member for Sheffield, Heeley (Mr. Hooley) was concerned with secretarial allowances, and I shall deal with that matter in a moment.
  I characterise tonight's debate as the debate that should not need to take place and as the unnecessary debate. The fact that there are no fewer than 16 motions and amendments on the Order Paper is ample evidence of the unsatisfactory situation in which we find ourselves. The muddle of our arrangements and our obvious dissatisfaction with them has been evidenced this evening.
  As a matter of interest, we last discussed the remuneration and allowances of hon. Members and Ministers almost exactly one year ago—on 5 June 1981. That was the sixth debate on the subject in this Parliament. There was one debate on it in 1979, two in 1980 and no fewer than three in 1981. Therefore, this is the seventh debate of this Parliament. As my right hon. and learned Friend the Member for Hendon, South (Mr. Thomas) remarked in his typically able and clear speech, such occasions are not always the most dignified parliamentary moments. How right he was when he said that we had a duty to ourselves—and, I believe, to the nation—to ensure that we do everything possible to avoid wrangles on such subjects.
  It should not be necessary to debate such matters seven times during one Parliament. One should be enough. I have a consistent view. Not every hon. Member will agree with it. I gave it in evidence to the Select Committee, presided over by my right hon. and learned Friend the Member for Hendon, South. That view is that such matters should be settled at the end of a Parliament, to be valid in the next Parliament, and should not be fundamentally reviewed during the Parliament's lifetime.
  I do not accept the view that there should always be annual reviews. There are many who engage in employment for fixed periods for fixed remuneration. I do not see why that system should not apply to ourselves. Nor do I have much sympathy with the idea that it is necessary—perhaps some would argue essential—for these issues always to be referred to an outside body. In the end, we must make the decisions. It is a little cowardly always to ask others to settle our problems for us.
  I do not agree with the proposal made by my right hon. Friend the Leader of the House—echoed by my right hon. and learned Friend the Member for Hendon, South—that we should consider these matters every four years as a matter of routine. Many problems would arise if we were to accept that advice. The appropriate time to deal with these matters is at the end of a Parliament so that those coming into the new Parliament, whether as Members of Parliament or their servants, know exactly where they stand for the lifetime of that Parliament.
  Mr. John Silkin: Why is it "a little cowardly" for us to hand over the decision on our salaries to another body, but not cowardly for judges?
  Mr. du Cann: Judges do not have the responsibility of making the decision. The right hon. Gentleman knows that others make the decision for them. We have to make the decision. We ran to an outside body only because we were frightened to make the decision that we thought should be made by ourselves. That is how the process began.
  Considerable reference has been made to linkage. As my right hon. and learned Friend the Member for Hendon, South remarked, there are two sorts of linkage. There is permanent linkage with a particular profession—for example, an assistant secretary in the Civil Service or a lieutenant-colonel in the Army—and there is interim linkage. It is worth while reminding ourselves why linkage has been discussed. The proposal to link ourselves with a profession was made because we were certain that no Government would ever pay Members of Parliament properly. It was an attempt to force Governments to do so. We have now arrived at the idea of interim linkage, to which my right hon. Friend the Leader of the House referred in making some interesting and important proposals. That is the main feature of the Select Committee's report.
  My argument is that if salaries or allowances require minor revision during the lifetime of a Parliament, that should occur automatically by reference to an agreed formula. It is said that the effects of inflation should lead to a minor revision of salaries or allowances, but equally it is argued that parliamentarians should not be entitled to insulate themselves against inflation, it being to some extent the consequence of careless architects.
  I agree with my right hon. Friend that the survey recommended by the Select Committee is not right. It is out of date, and there are certain implications in adopting that procedure. However, I could not understand the force of his argument for linking us to a basket of professions—I have not quite understood his proposition and we shall want to read his words with considerable care—and treating us in one way while he wants to treat secretaries in another and Ministers in yet a third way. I cannot see the reason for that. I cannot see why the three categories should not be treated alike.
  If we are to have a form of linkage during the lifetime of a Parliament, let us accept one norm for everybody and adhere to it. In that way everybody will know where they are.
  Under my right hon. Friend's proposals, which no doubt we shall have the opportunity to discuss with him, it seems to me that we shall have perpetual argument—the wrangles to which my right hon. Friend the Member for Hendon, South referred—because different things will be done to different people at different times. That does not seem to be wise. Much embarrassment and difficulty, some parliamentary time and hardship would have been avoided if this sensible practice had been the norm in the past.
  We have a whole series of individual motions and amendments to consider. Broadly speaking, as my right hon. Friend remarked, they divide into two categories—the present and the future.
  The right hon. Member for Manchester, Openshaw (Mr. Morris) made an important speech. He devoted much of his speech to the present day and the Government's proposals that Members' and Ministers' salaries and the secretarial allowance should be increased by 4 per cent. That is the purpose of motions Nos. 2, 3, 4, and 6 on the Order Paper. In parentheses, it is right to remark that,
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  whatever the Government or the Opposition may propose in these matters, it is for hon. Members to decide. If there is anything wrong with the present position, the fault is ours.
  I remind the House that when levels of remuneration were set at the start of this Parliament, which was an uncomfortable affair, as we all remember, it was not envisaged that there would be any mid-term increase. That is an important point. That was the understanding of the House. Therefore, my right hon. Friend's proposals, which have been somewhat criticised by Labour Members, are a considerable advance on what was agreed and understood at the beginning of this Parliament. They are a considerable advance on 0 per cent.
  I was sorry that the right hon. Member for Openshaw spent so much time referring to this, that or the other group that had had this, that, or the other per cent. He and the hon. Member for Heeley, said that it was impossible to find any group that had had nothing over the past year or so. That is untrue. Many companies in the United Kingdom, because of the present economic stringency, have not been able to give their staff salary increases. By comparison, hon. Members are not doing too badly.
  There is another matter of which the House should be reminded. This proposal of 4 per cent. has been widely discussed. My right hon. Friend did not mention this, but he should have the credit for it. He has consulted widely and, as far as I know, what has been proposed has found a fair measure of acceptance. In the circumstances, I hope that the House will agree to what is being proposed and will support his proposals. That is why, although I am sorry not to agree with the right hon. Member for Deptford (Mr. Silkin), for whose views I normally have the greatest respect, I cannot go along with the amendment that he and his hon. Friends have tabled.
  Furthermore, the 4 per cent. that is proposed has a particular advantage that we should bear in mind. A small improvement now lessens the substantial gap that has opened in past Parliaments between the level of salaries at their opening and at their closing, measured in real terms. We all recall that on occasions that gap has been so substantial that in more than one Parliament in past years Governments have cowardly—that is an offensive word to use, but I use it deliberately—failed to bridge them. Here, the ad vice given has been heeded, and I repeat my gratitude to my right hon.. Friend for what he has done in this respect.
  Mr. Michael McGuire: The right hon. Gentleman seems to be criticising his earlier point. As I understand it, he would be in favour of the plan that, at the end of the life of a Parliament—which, after all, is in the gift of the Prime Minister to a great extent—if one could determine what the salary should be for the incoming Members, they would know precisely where they stood, and would not wish these annual increases.
  The right hon. Gentleman is, in his last point, demonstrating that if there is no adjustment, the gap is so wide that Governments baulk at what would be the natural progression over four or three years. I am trying to fathom out which course he favours, because he seems to be contradicting himself.
  Mr. du Cann: The hon. Gentleman is right to make the point that he does. My view is clear. I should prefer to set the salary for the whole. Parliament. If we are to have

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  adjustments—it appears to be the wish of the House that we should have adjustments—they should be fixed by reference to a specific norm, which would be the same for everyone. That course has some incidental advantage.
  We should remind ourselves of the circumstances of the introduction of allowances. That owed much, if not everything, to the failure of successive Governments to pay Members adequately. There were pay increases in 1975, 1979, and 1980. As the Select Committee report said, Members' salaries have not been fully up-to-date since 1972. Successive Administrations foolishly believed that further specific allowances would be more tolerated by the public than higher remuneration for Members of Parliament. There was an attempt to fudge the issue of how much Members were costing.
  My right hon. Friend the Leader of the House has tabled motion No. 5 and we appreciate the spirit in which it has been introduced. I hope that he will not mind if I tell him that I cannot get excited about the proposal for a limited amount of childrens' travel allowance—travel, I hasten to say, at the expense of the wife's opportunity to be with her husband. There is a sort of mad Irish logic about this proposal. The more children one has, and the more often one sees them, the fewer the chances there will be for the husband and wife to cohabit at the taxpayer's expense. But the fewer children one has, the greater will be the opportunity for husband and wife to come together.
  My right hon. Friend said that there had been representations about this, but to my knowledge they did not come from the Parliamentary Labour Party, and they certainly did not come from the 1922 Committee. He was wise to say that we must be careful when awarding ourselves allowances which most people do not have. If one works for a company, one cannot charge one's childrens' travel as a justifiable expense. I repeat that the only reason why we have the allowance is that we do not give ourselves enough cash in the first place. I hope that we shall not pass this motion tonight. We should not waste time on such trivialities.
  Mr. English: Why did the right hon. Gentleman not protest about car allowances, because the same is true there? This merely applies to rail the same principles that already apply to car travel.
  Mr. du Cann: I have always expressed a consistent view on these allowances, as the hon. Gentleman will privately acknowledge. I merely make a point about the foolish complexities when allowances become more important than salary. It is also unfortunate that our system encourages various lobbies. That is not a healthy development.
  The question of the adequacy of allowances for secretaries and research assistants is a legitimate subject for the most careful consideration, but I am surprised by the proposal for the London weighting allowance, in part for the reason adduced by the hon. Member for Nottingham, West (Mr. English) in an intervention and for other reasons with which I need not trouble the House. We have a problem with secretarial allowances because no two Members' responsibilities or activities are equal. However, we should decide two matters. First, to avoid potential embarrassment, payment should always be made by the Fees Office and not by Members. Secondly, allowances such as salaries should be set at the outset of
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  Parliament and should be adjusted by reference to an accepted yardstick as a matter of routine, as so many of our allowances.
  The position of Members of Parliament has improved markedly since in 1978 an agreed view was formulated between the leadership of the Parliamentary Labour Party and the 1922 Committee and was then put to the elected leadership of both the major parties. Despite Governments, much has been agreed and achieved. I am in sympathy with the spirit of amendment (b) to motion No. 7. As the hon. Member for Sheffield, Heeley said, we must pay attention to many other matters. Much more must be agreed and achieved.
  Severance pay is one matter. Members and Ministers' salaries, despite the recommendations of the Top Salaries Review Body, are markedly too low by any yardstick. If we consider overseas legislatures and salaries paid in commerce, that is obviously true. The right hon. Member for Openashaw put it very well when he said that salaries must not be so high as to be an attraction by themselves, nor so low as to cause hardship. That is correct. Members' salaries should be at least £25,000 a year and Ministers' pay should be considerably higher.
  Of course, there should be an element of sacrifice in public life. That is healthy and appropriate, but the sacrifice can sometimes be too great. I do not wish to mention names, but every hon. Member knows of a colleague who died recently. The only reason why he remained a Member of the House when he had a serious physical disability was that the pension that he might have drawn had he retired would not have been adequate for his needs. We all know of other cases. The pension scheme is still in need of considerable improvement. The opportunity to buy extra years has been a great help, but we must work towards a fraction of fortieths rather than sixtieths.
  Last, but by no means least, we must reconsider our physical facilities, which are far from satisfactory. This building, which should be almost exclusively ours, is being invaded increasingly by employees. It would be much better if we could make a start on the new building in Bridge Street which is long overdue.
  As you often remind us, Mr. Speaker, from your distinguished Chair, it is an honour to serve here. The public who elect us to this place trust us to do our work confidently and adequately. We can only ever do that if we ensure that we have adequate conditions in which to perform those duties well.
  My right hon. Friend the Leader of the House, who is an outstanding member of the Administration and a man of immense intellect and competence, has taken over his responsibilities in what has begun to be a reforming Parliament. We have begun to reform, for example, the ways in which we keep the Executive under better and more continual surveillance. I hope that he will take from this debate the inspiration and encouragement to ensure that we reform not only the ways in which we do our work but the facilities we provide for ourselves and the remuneration we afford ourselves and our servants who help us.
  9.56 pm
  Mr. George Cunningham: May I begin by picking up the last point that the right hon. Member for Taunton (Mr. du Cann) made in his speech? He said that we were gradually improving

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  the methods by which the House of Commons has exercised surveillance over and controls the Executive. In my view, it is not by procedural changes primarily that we exercise any greater control over the Executive than we have done in the past—goodness knows, we have made very little change in that respect—but it is by Members quite simply choosing to exercise the powers that they have got, whatever the procedural background is.
  That is not irrelevant to the subject matter of the debate. If Members are not prepared to overrule the Treasury Bench, with which this subject has got nothing to do, on this matter, they are not likely to exercise their proper constitutional function of controlling the Executive in any other matter.
  I am only sorry that the right hon. Member for Taunton was not with us on the Select Committee. Had we had the honour of his presence on that Select Committee, the Select Committee report might have been better and it might had had a greater chance of being accepted by hon. Members. He in the position that he holds and also the chairman of the Parliamentary Labour Party should have been on that committee.
  May I pick up one detailed point that he mentioned on the subject of children's allowances? I, like him, am totally uninterested in that degree of detail. I happen to be not affected by that allowance. He gave the impression that that particular facility is one which would not be accorded to persons working for companies or in other ways of life. I do not think that is so. There are very few jobs where there are two places of work. Where that exists, then this kind of facility tends to be provided. I think only of the sphere that I know in diplomatic life. Of course, there is out of public funds provision for children to visit their parents when they are on a diplomatic mission abroad. So do not let us give the impression that even in one tiny respect we are doing for ourselves something very different from what is normal outside.
  More generally on the debate, here we are again. In the light of what has happened and what has brought us to this point, namely, the Select Committee report, here we are going to be again and again and again without any prospect of the situation changing as a result of what has happened.
  These are not decisions which should be taken or allowed to be taken by Ministers. Of course, Ministers will always hold a view and they should put their view as the Government, but it is up to Members to vote on the matter. I think this will be my swan song because after eight years of being active on the matter inside the House and outside, I have just about had enough, so I say this for the last time probably to the House.
  What sickens me about the subject is not that Governments decline to suggest, which is all they can do, to the House that it should implement recommendations made to the House or to the Government, but that Members allow themselves to be persuaded or bullied or cajoled by successive Governments—this one is no worse than the previous one; they are a great deal better in many respects on this subject—into not doing what they actually want to do. If that goes on being the case, there is no solution to the problem. They may blame the Government at this stage in the debate for making a suggestion that they do not like, but after the votes are taken tonight, no blame will attach to the Government—
  It being Ten o'clock, the debate stood adjourned.

  Members of Parliament (Salaries, Allowances and Travel Facilities)

    BUSINESS OF THE HOUSE
    Ordered,
    That, at this day's sitting, the Motions relating to Members' Salaries (Expression of Opinion), Members' Salaries, Members' Office, Secretarial and Research Allowance, Travel Facilities for Members' Children and Future Arrangements for Members' Salaries may be proceeded with, though opposed, until any hour.—[Mr. Archie Hamilton.]
    Question again, proposed.
    Mr. Cunningham: After the Divisions tonight, if there are any, which is up to hon. Members, not the Government, no blame will attach to the Government. All the blame for whatever happens or whatever does not happen will attach, on this issue as on so many others, to hon. Members and not to the Government.
    The present salary that the House thinks is appropriate for a Member of Parliament is absurd: there is no other word for it. It is not a salary that is regarded as natural in other Parliaments, with rare and inappropriate exceptions. It is not a salary which compares at all with what has been decided by the House on several occasions in the past.
    If hon. Members will look at page 18 of our report, in an amendment that I sought to move but which was, of course defeated, they will see that I pointed out that if we take the figure that the House decided was right in 1964 and inflate it by one of two possible indices—one for the retail price index and another for average earnings—the salary at the time the report was written, just a few months ago, is 21·7 per cent. lower, taking the RPI, and 44·2 per cent. lower, taking average earnings.
    The next occasion after 1964 when there was a major decision as to what the appropriate level was was in 1971. It came into effect at the beginning of 1972. The present figure is 16·8 per cent. lower than the 1972 figure, going by the RPI, and 28·9 per cent. lower, going by average earnings. If the figure was right in 1964, it is certainly too low now, by a long way. If it was right in 1972, it is too low now.
    The significant thing about the work of the Select Committee and the evidence that was given to it was that most people—the right hon. Member for Taunton was an exception—who gave us evidence—I regret that that included those who in the past have played a principal part in the working of the Top Salaries Review Body—felt that the present salary of hon. Members was about right, but—I think that these are the words—perhaps somewhat too low. In other words, those witnesses felt that the salary appropriate to a Member of Parliament ought to be lower than the salary that they thought appropriate in 1964 and 1972, to which the House agreed on those two occasions.
    The main point that the House must face up to in debating and considering the issue is that the salary is too low and that it has got too low as a result of the process that tonight the Government are asking us to perpetuate In the end and in the beginning it is not a decision for the TSRB to take as to what the rough salary ought to be. It is a decision for the House to take a view upon. The House did take a view. In 1975 the House passed a resolution by a large majority in favour of linking our salary to that of a specified grade in the public service. By a tiny majority it specified the grade that it would like to choose, which was that of an assistant secretary in the Civil Service. Again, in 1980, we passed a resolution saying simply that we approved of linkage to a specified grade in the public service.

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    It was therefore my view, the House having twice by considerable majorities expressed its opinion in favour of linkage, properly speaking, that what we should do is to put that issue to the House once again, and if the House repeated that decision that should be regarded as the end of the matter. We should then proceed in future upon that basis. The argument that is mounted against that is that the job of a Member of Parliament is unique and, therefore, one cannot possibly link the salary to any basket or anything of that nature. Of course the job is unique. All jobs are unique, but that does not stop one from having a view as to where roughly any unique job stands in the spectrum of what ought to be poorly paid jobs and highly paid jobs.
    The job of the Clerk of the House is unique. Can anyone think of any other job in the country comparable with that of Clerk of the House? It actually is unique. There is only one of him and there are 635 of us, but his salary is not just plucked out of the clouds. It is related to Civil Service salaries. I think it equates to that of a permanent secretary, not because he does the job of a permanent secretary but because it is thought that roughly that is where that kind of job fits into the salary spectrum.
    There is no problem whatsoever in that degree and that kind of linkage. Those of us who have gone for proper linkage over the years have had that attitude to it. We do not deny the claim that the job of a Member of Parliament is unique.
    Another mistake that we commonly make in discussing the subject is to feel that what we are doing is deciding our own salaries. Of course we are, but we are also doing something rather more important. We are discussing what the salary of a Member of Parliament ought to be. We may not be the people who should be here. It may be that by setting the salary at its present level we are cutting out the people who ought to cut us out. There are many people in the country who would not seek to become Members of Parliament, because the salary is too low. There are some people who, when they become Members of Parliament, achieve a salary which they have not previously enjoyed, but there are fewer and fewer of them. There are far, far more people who, when they become Members of Parliament, suffer a reduction in their standard of living and, more important, who face that reduced standard of living to an intensifying extent for the rest of their lives.
    That is the mistake that we are making. We are cutting Parliament out as a possible, or remotely attractive, proposition for a very large number of people who ought to be willing to come here. Once again, I tried to put a passage into our report which made that point, but naturally it did not attract a majority of my fellow members of the Committee. Until the House takes that broader approach to its decisions, we shall always go on in the mess that we are in now, and we shall always go on undervaluing ourselves and, more important, undervaluing the job which we are imperfectly doing.
    I think, Mr. Speaker, this is my swan song on the subject. I am heartily sick of it and I am heartily sick of the way in which it is hon. Members, and not the Government, who will not do what needs to be done. I cherish the fond thought that perhaps some day there will come a change of heart and that a greater respect for the House of Commons will come about, and with a greater recognition of the status that hon. Members should enjoy in the spectrum of other jobs and salaries.
    10.09 pm
    Mr. Mark Wolfson: I shall confine my remarks, not to the current situation but to the future, because I was a member of the Select Committee, chaired by my right hon. and learned Friend the Member for Hendon, South (Mr. Thomas), and I am glad to have had the opportunity to sit on that Committee.
    Again, the Government are casting their baleful eye on the matter of Members' salaries. The record of successive Governments in this regard has been, to put it mildly, disappointing. Progress was achieved when the chairmen of the 1922 Committee and the Parliamentary Labour Party Committee worked jointly on the problem. In my view, the involvement of the Top Salaries Review Body has been generally beneficial, and I welcome the Government's commitment to a review next year by that body.
    Disappointment has arisen because successive Governments have too often intervened to cut back or delay the implementation of the recommendations of the Top Salaries Review Body. It was very much in the minds of the members of the Select Committees at all stages of their discussions and in the taking of evidence that we could have little confidence, based on the record of Governments, that the Government would implement adequately the recommendations made by the Top Salaries Review Body. That is the reason, or one of the reasons, why the Select Committee took the view that it would not be good enough merely to leave the situation to a four-yearly review by the Top Salaries Review Body, but that in addition we should have a mild form of linkage to maintain the salary position within reason during the four years between the major reviews. If we had more confidence in the Government to accept the full recommendations of the review body, such linkage would not be necessary. Again I make the point that the work of the Select Committee, its deliberations and its decision were based on what we believed would be practical and reasonable and would therefore commend itself to Members of this House and also—sadly, in vain—to the Government of the day.
    There were two simple recommendations. As hon. Members will have realised, not everyone on that Committee necessarily agreed that the recommendations went far enough. They were a compromise, but in my opinion they were a balanced and practical compromise, and I am extremely disappointed that the Government have not accepted them in full.
    As my right hon. and learned Friend the Member for Hendon, South said, we are back to square one. We have not progressed. In my view, the salary base now is too low, as my right hon. Friend the Member for Taunton (Mr. du Cann) and the hon. Member for Islington, South and Finsbury (Mr. Cunningham) said. Perhaps I am not as bold as my right hon. Friend the Member for Taunton was in putting forward his figure, but I would say that £20,000, as of now, is a reasonable figure. A recommendation of the correct salary will be made by the Top Salaries Review Body next year, and I, for one, am likely to be happy with that recommendation.
    I make the point to my right hon. Friend the Member for Taunton that it is not the Top Salaries Review Body that decides. It recommends, and it is for Parliament to decide. However, I believe that it is right to have an outside body to look at the problem. My right hon. Friend

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    suggested that perhaps Parliament ought to settle its own salaries without the benefit of outside advice. I cannot see that as a practical proposition, based on the difficulties that have arisen over the years in that respect.
    The key question remains. We get a recommendation next year, but will the Government accept it? If the jump from the present figure to the new figure is, in the Government's view, too large, we know from experience—if the previous record is anything to go by, and I fear that it is—that they will limit or delay the recommended increase. Therefore, I appeal most strongly for Members to have confidence in themselves, in the job that we do here, and in our standing as elected public servants. Based on an outside review body's objective recommendation, we must vote for an adequate salary for the job in hand.
    If the House supports the Treasury Bench motion and thereby rejects the second recommendation of the Select Committee, we are as Members once again severely exposed to the vagaries of Government decisions on this issue. Our intention on the Select Committee was to provide, through the recommendation for annual reviews linked to the new earnings survey, a safeguard against the continuing problem of Members' salaries becoming seriously out of line between major reviews. If we throw away that safeguard, I am seriously worried that we shall never do an adequate catching up job.
    I repeat that our recommendations were modest. They were not for full index linking. The only index linking that we suggested was to be based on the average increase of similar salaries throughout the country and the fact that it would be based on an historic comparison adds weight to our recommendation. We are not asking for something that would be slap up-to-date. We are asking for a comparison with a survey, the material of which would be about a year behind.
    If those interim reviews resulted in the salary becoming too high, when the Top Salaries Review Body did its job at the end of four years it would be in a position to recommend that there should be no major increase. As my right hon. Friend the chairman of the Select Committee said, by throwing out this modest recommendation for keeping salaries reasonably in line between the four-year major reviews the whole problem of total linkage, voted on at least twice by the House, will erupt again. It is my firm contention that, unfortunately, the Government are again making a grave mistake, as they have done in the past, on this matter of Members' salaries and arrangements for the future.
    10.19 pm
    Mr. Hugh D. Brown: It is a pleasure to follow the hon. Member for Sevenoaks (Mr. Wolfson). I think that I am the only Labour Member of the Select Committee who has spoken so far. Obviously, I speak only for myself and do not pretend to represent the views of any large body of opinion.
    It is, however, tempting to refer to some of the points that have already been made by the hon. Member for Islington, South and Finsbury (Mr. Cunningham) and the right hon. Member for Taunton (Mr. du Cann), but that would serve no purpose, because the only theme that I am aware of is that of total opposition to what the Government are proposing. So far, not a word has been spoken in support of the Government.
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    I shall not be provocative, because I want us to win. I know that the Leader of the House was not the Prime Minister's first choice for the job, but clearly he will need to do better if lie wants to enhance his well-founded reputation for being a liberal thinker. He certainly has not shown that in this debate. Without being too uncharitable, let me amplify what I mean.
    I am not suggesting that we should set up machinery comparable with that in a factory, nor am I suggesting that we should have shop stewards, a convener or anything as proletarian as that. However, we badly need some kind of machinery that will avoid these distasteful annual debates which, as other hon. Members have said, are quite out of keeping with the problems with which we should be concerned.
    The Minister hoped that the recommendations of the Top Salaries Review Body would be observed more faithfully in the future. He has not made a very good start. What hope is there that any Government—Labour Governments were just as bad, if not worse—in future will accept any recommendations from the Top Salaries Review Body?
    The right hon. Gentleman said that the suggestion that travel facilities should be extended to children came from the Opposition. It certainly did not come from me. I do not think that I am past the age of creating children, but my wife assures me that she is past the age of child-bearing. Therefore, I have no vested interest in this matter. To the best of my knowledge, this question was not discussed widely even among Opposition Members. It is a trivial issue to bring forward in the light of the Select Committee report which genuinely tried to do a job.
    Probably out of courtesy and formality, the Government say that the Select Committee's report was very constructive. It was bound to be. I pay tribute to the Chairman. Not only was he able and courteous, but he had good members including myself, who genuinely sought to achieve a consensus that would be acceptable not only to the House but to the Government. That is a fair point to make. It is always annoying when people do not recognise that we have genuinely tried to prepare a report that was acceptable, even in difficult circumstances, to all Governments. That is something that should be borne in mind.
    When the right hon. Gentleman says that the Government reluctantly accept linkage and annual review, it is almost a slap in the face to the Select Committee. It is the only Select Committee on which I have served, and it is not a good advertisement. I feel that we have just been used. It was a means of pushing a problem to the side after an embarrassing vote about 18 months ago, and here we are back to square one.
    This is a difficult problem, otherwise we would not have such debates so frequently. It would be churlish not to accept that here have been many improvements. The hon. Member for Sevenoaks has only been here since 1979. I have been here for 18 years. All of us who have been here that long, or longer, recognise that there have been many improvements. We used to have to pay for telephone calls, postage and secretaries. There are many allowances. There has been a vast improvement, not only in our conditions but also in the services that are provided for us, either by those whom we employ or those who have some contribution to make. Nevertheless, there has still been a failure with regard to salary. It is the key question. It is not a party issue.

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    We are unique. The hon. Member for Islington, South and Finsbury (Mr. Cunningham) asked what is unique about a Member of Parliament. No two individuals are alike. No two Members of Parliament are alike—thank God. I do not wish to be compared with some hon. Members. The job is unique to the extent that not only are we different as individuals but also no two constituencies are identical in size, in the number of electors or the types of problem that arise. The job is unique in that sense and it is almost impossible to define an adequate salary for it. I said so in the Select Committee.
    In my constituency I am probably regarded as being well-off—"loaded", in Glasgow parlance. That does not apply to many hon. Members. If a Member's salary was his sole income, he would be regarded as being way down the social and economic scale in many constituencies. Of course it is difficult to make adequate comparisons. But we all agree that the salary is too low. That is not a Select Committee recommendation, but it is generally accepted.
    What is the role of Government? I am in the minority in my party. I believe in an incomes policy. All Governments operate an incomes policy—certainly in the public sector. Irrespective of what party wins the next general election, there will be an incomes policy of one type or another. We must be realsitic. I have great respect for the hon. Member for Islington, South and Finsbury with his Calvanistic Scottish background and impeccable logic. But he is not dealing with a decision that will be made by the House of Commons. The decision on salaries will be made by a Prime Minister. It does not matter which party is in power. There is always the need to be seen, or to be thought to be seen to set an example. There are bound to be differences of opinion about incomes policy and wages.
    The Select Committee went out of its way to take account of all the problems that face any Government. Governments make the decision. Whether we like it or not—I usually do not—Governments have the power, if they are so minded, to present the matter to the House in such a way that makes party votes inevitable. The Select Committee genuinely tried to produce some form of working arrangement that would make sense to the House and make it easier for the Government to do what I hope at least some Members of any Government also want—improvement.
    Of course there must be public scrutiny of Members' salaries. I do not see many in the Press Gallery tonight. They will scrutinise what we do. They are probably filling in their expense accounts, for all I know. There is not one qualified journalist who does not earn more than a Member of Parliament.
    Mr. Peter Bottomley: I remember asking James Fenton, when he was working for the New Statesman, what he was paid. He was then earning half of what a Member of Parliament was paid.
    Mr. Brown: It must have been some other job, or there was something wrong with the finances of the New Statesman
    Mr. English: The hon. Member for Woolwich, West (Mr. Bottomley) must have forgotten that Mr. Fenton was allowed to earn money outside the New Statesman at the same time.
    Mr. Brown: I cannot think that any member of the NUJ would work for half the salary that a Member of Parliament now receives. I think that it is a trick question and I shall not follow it.
    Of course we have a right to expect public scrutiny of what we do here. That is the whole purpose of getting some kind of linkage. My interpretation of the Select Committee report was that the Top Salaries Review Body would carry out a four-yearly job evaluation, as it were, to see whether there had been any significant change in the life style or work style of Members of Parliament. For example, some of my hon. Friends think that we shall be out of the EEC in a few years. Perhaps the salaries should then go down again if the work load is lessened. It seems to me quite reasonable that the Top Salaries Review Body should carry out a four-yearly general review of changes in the work load of Members of Parliament in one way or the other.
    In between times, clearly there should be modest increases, linked not to the cost of living—no one could accuse the Government of accepting something that would be embarrassing to them—but at least linked to some comparable group of salaries that would make sense to us and to the public. I do not think that those are revolutionary proposals and I am disappointed that the Government have not found it possible to understand or appreciate the thinking behind the Select Committee report and to accept its findings.
    Finally, I hope that the Minister will give some indication that he accepts the urgency of examining pensions and severance pay. I know that it was not included in the remit of the Select Committee and the Select Committee rather strained its remit in drawing attention to this, but it was legitimate because the subjects are to some extent linked. I hope that if we do not win tonight—I assume that we shall be voting on this—the Minister will at least give some indication that in future there will be a greater possibility of accepting the Top Salaries Review Body and that in the meantime urgent action will be taken to improve pensions and severance pay.
    10.33 pm
    Mr. Geraint Howells: You will be well aware by now, Mr. Speaker, that we are still able to defend and stand up for our rights in this Chamber. I therefore intend to make a plea on behalf of those who cannot defend themselves in the Chamber—our secretaries.
    Before doing that, I, too, pay tribute to the members of the Select Committee and to the right hon. and learned Member for Hendon, South (Mr. Thomas) who chaired it to the best of his ability. I am proud of the recommendations that it made, and it is a great pity that the Government have not taken full heed of them.
    Many of the secretaries have worked very hard for us over a long period. They have given of their best and they have worked long hours for little pay. The present allowance of £8,400 is supposed to cover secretarial, research and office expenses, although many people outside believe that a secretary working for a Member of Parliament qualifies for the whole of that amount.
    It is regrettable that there are many hard masters in the Chamber and outside who are not paying their secretaries what they are entitled to. There are many secretaries who should be earning at least £8,000 for working for us but

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    who are getting only, the meagre sum of £2,000, £4,000 or £5,000. It would be interesting to know how many hon Members pay the full sum of £8,400 to their secretary.
    Mr. Keith Best: There is great validity in the hon. Gentleman's arguments. However, he should acknowledge that the opposite can also be true. If an hon. Member were to pay his secretary the full amount, which is meant to encompass part-time research assistants as well as secretaries, it would be difficult for other hon. Members to fund both a secretary and a research assistant, even part-time, because there is no clear division between the two amounts. Does the hon. Gentleman agree that the fairest approach would be for an hon. Member to have two separate allowances, one for a secretary, and one for a full-time research assistant?
    Mr. Howells: I am sorry to have to inform the hon. Gentleman that I disagree with him. It is up to each one of us to defend our rights and what we should pay our secretaries.
    Allowing for the employer's national insurance contribution of 13 per cent., there is only enough money for one full-time secretary. An increase of 4 per cent. would give her or him a meagre increase of 4 per cent. if the employer passed it on, which I do not doubt he would.
    Even in the public sector, settlements are near to 6 and 7 per cent. The Opposition Front Bench has tabled an amendment suggesting 8 per cent. I agree with that, although there are before us proposals for greater increases.
    Many secretaries do not receive overtime pay, luncheon vouchers, or London weighting. If an hon. Members keeps money aside for office expenses and research, his staff are hardly existing on what he pays them, unless he has private means. It is undemocratic that those with extra money should be able to give their constituents a better service than those without, though that happens in Britain.
    The most important proposal being discussed tonight is that for the payment of London weighting. The figure mentioned by the Government of £1,016 per annum is in line with what civil servants receive. I should like that London weighting to be paid direct to the staff concerned by the Fees Office although the motion does not mention that.
    If the Opposition Front Bench want the support of the minority parties in the House they should be more specific about how staff will qualify for the weighting. That is not clear. Perhaps the Shadow Leader of the House will clarify the position.
    My plea on behalf of those secretaries who work so hard and diligently for hon. Members is that they should have a reasonable wage of £8,400. I hope that all hon. Members will ensure that they are paid that money in full in the years to come.
    10.39 pm
    Sir Walter Clegg: I shall not go down the road taken by the hon. Member for Cardigan (Mr. Howells), but I thank him for his words of praise about those of us who were members of the Select Committee on Members' Pay. I must confess that I was a very reluctant member of the Committee, because I thought that it was an invidious job for that Committee to have to judge our pay. However, having been appointed a member of the Committee, I attended its deliberations. I greatly
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    appreciated the remarks made—both in Committee and in the House—by the hon. Member for Glasgow, Provan (Mr. Brown).
    I remind the House of our remit. It is simply
    "Ordered, That a Select Committee be appointed to give further consideratio a to the desirability and possible method of conducting reviews of Members' salaries by an independent body once during the first Session of each Parliament and of adjusting such salaries during the periods between such reviews by reference to increases in the remuneration of a designated group of outside occupations, and to make recommendations to the House."
    We fulfilled all that was asked of us. We offered the Government the !east that hon. Members would accept. However, that has been turned down. I take a somewhat cynical view of the way in which the Government turned down the Select Committee' s report. Why on earth did the Government set us up in those terms if they were then to reject the very modest measure suggested? The Government's alternative leads me to think—as perhaps I should have thought from the beginning—that no Government will give away the right to say "No" to a pay offer from the review body or to a formula to regulate pay between reviews. There are all sorts of incomes policies—be they written, formal or informal. I have a feeling that all Governments will say that they will ultimately decide how much Members of Parliament should get, because it will affect their standing in the country. Why w as the Select Committee set up if our recommendation was only going to be thrown on one side without something similar, and more positive, in its place? To some extent, the hon. Member for Islington, South and Finsbury (Mr. Cunningham)—whose contributions I always listened to with great respect in Committee—adopted a romantic view. I have never done so, but I confess co the Leader of the House that I am very disappointed with the result.
    10.42 pm
    Mr. English: I shall briefly refer to three of the motions. However, I should like first to welcome the Leader of the House. I know that this is not the first time that he has spoken in his capacity as Leader of the House, but it must be the first time that he has spoken on a subject that is so deeply personal to hon. Members. It is the baptism by fire that all Leaders of the House have to go through.
    The Leader of the House was unfairly treated in relation to motion No. 5. The right hon. Member for Taunton (Mr. du Cann) said, in a somewhat carping way, that the motion did not come from the 1922 Committee or from the Parliamentary Labour Party. Of course it did not; it came from the Floor of the House. It was mentioned in one of the six previous debates that the right hon. Gentleman mentioned. It was clearly said that there was an anomaly if hon. Members could collect a car allowance and pop their children into the back of the car but could not benefit in the same way if travelling by rail. My right hon. Friend the Member for Manchester, Openshaw (Mr. Morris) mentioned this matter on a previous occasion, because representations had been made to him. [Interruption.] The Chairman of the Conservative Party seems to want to have a debate of his own. I think that the Leader of the House will not mind my saying that the previous Leader of the House thought out the details. Therefore, the present Leader of the House is being unfairly treated for a perfectly sensible and generous gesture.

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    There is one feature of Members' secretaries' salaries that has not so far been mentioned. The first van Straubenzee report, as it is familiarly known, said that the proper way to pay our secretaries would be to treat them in exactly the same way as Civil Service secretaries and secretaries of Officers of the House. The unanimous recommendation of that all-party report was that our secretaries should be put on the Exchequer payroll at the same rates of pay as Civil Service secretaries and secretaries of the Officers of the House.
    Some Members pay their secretaries whatever is the appropriate Civil Service rate. Some Members pay more and I regret to say that some probably pay less. Some secretaries work for one Member, while others work for more than one. It is all a mess.
    Secretarial allowances are paid in cash. It would be much better, as has been recommended by a Select Committee, if we like others outside in business had our secretaries paid for by the "company", as it were. Someone who works for ICI and has a secretary does not pay his secretary's salary personally. The company pays and it pays the standard rate. This is the arrangement for Officers of the House, civil servants and Ministers. Why should we not do the same? Nothing has been done by successive Governments to implement the Select Committee's report.
    The Government are making two assumptions. The Chancellor of the Exchequer has stated publicly that the 4 per cent. pay increase this year was negotiable. The Lord Privy Seal and Leader of the House of Lords, the Baroness Young, also said that in her capacity of being in charge of the Civil Service. In the first year of the Government's administration civil servants were given a 26 per cent. pay increase. The increase for Members of Parliament was also quite generous. It was awarded in a year when those in outside industry could only afford about 8 per cent. It was somewhat invidious that central Government should be paying its own staff rather more than those in outside industry could afford to pay its staff in a bad year, but that is what happened.
    When the Chancellor of the Exchequer and the Baroness Young said that 4 per cent. this year would be negotiable, they meant, apparently, that, unlike last year's 6 per cent. increase, which was not negotiable, more would be paid if a trade union argued. That is what has happened. Our secretaries do not have a trade union to represent them and nor do Members, and because of that we shall be the only two groups in the country to be subjected to the 4 per cent. increase. It seems that "negotiable" meant that it would be open to people to negotiate with power. In effect, the Government were saying "You cannot expect the Government to be reasonable. If you happen to have a strong trade union at your back, we shall give you more than the 4 per cent. that we offered originally. If you do not have a trade union at your back, you will get only 4 per cent." That is what has happened.
    I hope that everyone will take on board the implications of that policy. I am rather surprised that the Government should wish to convey that impression. It strikes me as rather odd that they should wish to encourage the trade union movement in that way. It is not the normal line of approach that one gathers from certain members of the Government.
    It is clear from motion 7 that we are modest in our claims. The Select Committee is similarly modest. There
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    is at least one democracy, the United States, where by Act of Congress it is stated that no civil servant shall be paid more than a senator or congressman. Some people are. The United States Cabinet is, the Supreme Court is, and various other people are, but the civil service is not, because the United States, as a democracy, makes the assumption that if people have taken the trouble to elect a legislature it is of some importance. In this country we regard the legislature as secondary to not merely Permanent Secretaries but a large chunk of the Civil Service, the Armed Forces, the judiciary, Ministers and so on.
    This is very interesting. I do not know whether it is simply because it is that in London it is possible for people to earn money outside Parliament. It may be that we should have a two-tier structure and say that we should have a higher salary than the people technically subordinate to us if we do not have an outside job. It is much more difficult in Washington to have an outside job because Washington is not New York. One cannot simply go and work in a merchant bank in Washington.
    Perhaps we should take a leaf out of the book of the Common Market. The right hon. Member for Glasgow, Hillhead (Mr. Jenkins) gets a certain sum from the Common Market, which would be reduced if he earned more than a certain amount from an outside source. This is a very legitimate system, which should be encouraged. It may be that we should have an adjustable system of salaries—I do not know. I do not object to people having jobs outside the House of Commons, but if the fact that some people have outside jobs will limit the salary of all the Members of the House of Commons that is wrong and perhaps we should take a leaf from the book of the Common Market in that regard.
    There is another respect in which even the Select Committee was extraordinarily modest. Why on earth should we say that the Top Salaries Review Body should determine this amount once every four years or however often it may be? It is extraordinary. This is an appointed body—the great and the good, chosen by the permanent secretary to the Treasury or the head of the Civil Service or the appropriate Minister, the Leader of the House or the Prime Minister. I should much rather have an appointed body, appointed by somebody else.
    I should rather have a body where nearly half of it, for example, was chosen by the CBI, and an equal number chosen by the TUC, but not by the Government in either case. Perhaps there might be a self-employed person as chairman, or something of that character. Why should we assume that the appropriate body to fix our salaries is a body chosen by the Government of the day. It is improper. It should be chosen by people dissociated from the Government of the day and dissociated from Parliament for that matter.
    When we come to the Government's amendments to the Select Committee's report, I can only say that I am amazed by paragraph (d). According to this, we are eventually supposed to be of the opinion
    "that Her Majesty's Government should instead, in the period between one such review and the next, move annual motions to effect changes in Members' salaries and in so doing should be guided by the average change in the rates of pay of appropriate groups in the Public Service over a relevant period".

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    As has already been said, the vagueness of that is incredible. The period must be relevant, the grouping must be appropriate and then there is an average of what is appropriate.
    Do we mean judges? Or do we mean secretaries? What do we mean, because the rates of pay have been vastly different? Do we mean the relevant period of the first year of this Government, when civil servants got a 26 per cent. pay increase, the second year when they got 6 per cent. pay increase, the third year when they were offered a 4 per cent. pay increase and got something approaching 5·9 per cent. or 6·1 per cent. or whatever. The vagueness is incredible. It would be much more appropriate if we got the average of the whole of the people that we represent in this country or something of that character, which was the proposal of the Select Committee, not the average of people in the public service fixed in an arbitrary up and down way by a Government who clearly do not understand their own pay policy. I do not just mean this Government. Previous Governments had extraordinary pay policies as well—I am quite prepared to admit that. I am not making a party point. To say that it should be related to the public service in that way implies that the Civil Service is more important than Members of Parliament. It also implies that the Civil Service is more important than everyone else in the country who may not be getting as much or who may be getting more in a given year. Surely, if we relate it to anything, it should be to the whole country and not just to a section of it.
    10.55 pm
    Mr. Peter Bottomley: My right hon. Friend the Leader of the House was both courteous and forthright when he opened the debate. He referred to the debate as a blood sport. It is not a blood sport but ineffective. All the debates that we have had on Members' pay in the seven years that I have been in the House have been ineffective. As the hon. Member for Islington, South and Finsbury (Mr. Cunningham) said, the reason is that Members of Parliament have not taken control. We are here to control the Government. Although I shall give full-bodied support to my right hon. Friend at the end of this debate, I should prefer to do so wholeheartedly. Now that I have given that assurance, he will probably switch off, as with many other hon. Members, having had only six hours sleep in the past 60 hours.
    My right hon. Friend must consider the future. Hon. Members should ask themselves whether a general practitioner should be elected to the House without a drop in salary. Should the headmaster of a large comprehensive school be elected to the House without a large drop in salary? Should someone such as the hon. Member for Islington, South and Finsbury be able to transfer to the House from the Civil Service, where he had a distinguished career, without a substantial drop in salary, let alone whatever promotion he might have achieved? Should an assistant director of leisure services of a London borough be elected to the House without a substantial drop in salary? I could continue by mentioning a series of jobs in industry and commerce.
    Even with our present salaries, most people who are elected to the House will be earning more, if we take the average earnings in Britain. Here we are on the horns of a dilemma that is normally exposed unintentionally by the right hon. Member for Down, South (Mr. Powell), who says that more people are trying to enter Parliament than
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    there are places and d that we are paying too much. That is a fractious argument, because one could put a tax of £3,000 a year on a Member of Parliament and end up with 635 candidates. I doubt whether the right hon. Member for Down, South or anyone else would be satisfied with all such people in the House of Commons.
    The test is the one that I put a few moments ago, and I take the general medical practitioner as an example. If a general practitioner were to enter Parliament, he should earn £23,000 a year. That figure is also suitable because I derive it from page xviii of the Select Committee report and the clause proposed by the hon. Member for Islington, South and Finsbury, which was not approved. If we relate the 1964 figure to average earnings, the present salaries are 44 per cent. too low. To restore its value would mean a 79 per cent. increase.
    Not even Members of Parliament should expect to get the full increase. The big mistake that we have allowed our trade unions to make is to believe that all sections of society can be restored at the same time to their peak level. I shall take off 20 per cent. and instead of increasing Members' pay by 79 per cent. let us increase it by 59 per cent. The pay would then be £23,000 and that figure should be accepted.
    The motions are basically acceptable. There is no dispute that we will and should settle for 4 per cent. this year. In an intervention that my right hon. Friend allowed me to make earlier I made the point which I have made in previous debates that, if we are to take the norm, we should do so at the beginning of the pay round and not at the end.
    As I understand it, there is no great debate about the secretarial allowance. Clearly that will go up by 4 per cent. or whatever the Government figure is. There is no significant argument about that increase, although there are arguments about what the future level should be.
    Mr. Charles R. Morris: The hon. Gentleman keeps on making the general assertion that there is no debate. He cannot have listened to the debate that has taken place so far. There has been major debate about why we should not accept 4 per cent. for uplifting Members' salaries and 4 per cent. for the secretarial allowance.
    Mr. Bottomley: What I was saying was that there is no doubt about what we will accept. If the right hon. Gentleman was serious about the point he has made. he would have recruited more of his hon. Friends both to be here and to vote. We know that they are not here and that they will not vote. I was here at the beginning of the debate and have been here for two-thirds of it.
    Mr. Lewis Carter-Jones: Was the hon. Gentleman here when my right hon. Friend the Member for Manchester, Openshaw (Mr. Morris) made his speech?
    Mr. Bottomley: Yes.
    Mr. Carter-Jones: Was he here for all of it?
    Mr. Bottomley: No, I was not here for all of it.
    The point I am making is that there is no doubt that the 4 per cent. will and should be accepted and that the Government proposals for the secretarial allowance will also be accepted. The children's travel allowance is of no consequence and provides an option for Members of Parliament. I am all in favour of people having options.
    There is much doubt about the future. But there is no doubt about the Government motion or the Select

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    Committee proposal. It is about whether Members will say what they believe the figure should be. More than that, it is also a question whether the Government will say in a reference to the Top Salaries Review Body what they believe it should be. So far we have allowed the Top Salaries Review Body to do its work and the Government emasculates it. Then the House debates it and normally we are left to confirm what the Government have proposed, or we do something different and the Government ignore US.
    We must be much more open. We must follow my right hon. Friend the Leader of the House and, in as courteous a way as possible, be blunt. The Government should be blunt and say what they think the figure should be. The pay of Members of Parliament should be settled in the old Parliament before the beginning of a new one. I do not care very much about what the increases are during a Parliament, but at the beginning of each Parliament the salary should be at such a level that someone in the sort of professions I referred to earlier could become a Member without significant loss of earnings.
    Mr. English: When the hon. Gentleman said that there was no doubt about the 4 per cent., that might have been true when the Government first enunciated it. But the Government have since paid their own secretaries on average 6 per cent.—it is about 4·8 per cent. at the bottom of the scale and rather more at the top of the scale. The point is that it is a lot more than 4 per cent. in any case. Since there is a doubt, imported by the Government into this, because they accepted a reasonable negotiation and put on an extra 2 per cent. in round figures, why should they wish the secretaries of Members of Parliament to be paid 2 per cent. less than their own?
    Mr. Bottomley: I am sure my right hon. Friend the Leader of the House can answer that question later. I choose not to.
    The hon. Member for Cardigan (Mr. Howells) said that there was one group who could not speak for themselves—the secretaries. He is not right. There is another group who cannot speak for themselves—the Ministers. The argument that I put forward about Members of Parliament applies equally to Ministers. I ask my right hon. Friend the Leader of the House to consider how the interests of Ministers can be considered.
    Mr. Biffen: Hear, hear.
    Mr. Bottomley: Instead of just saying "Hear, hear", my right hon. Friend might come up with an answer, not necessarily tonight but for future years. While he is considering Ministers, will he consider London weighting for Members who represent London seats? That is one of the worst anomalies. London weighting for secretaries is not an important issue because the salary that they are paid for working in London presumably has a London weighting element in it, although it is not specified as such.
    With regard to pensions, it is ludicrous, given the average age at which people come into the House, and the disturbance to alternative careers that they might have to return to if they leave after 5 or 10 years or after 15 or 20 years, for them to be treated as if they were a civil servant or even an ordinary employee in industry, who expects to
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    get half his salary after 40 years or two-thirds after 40 years. It is also wrong to expect Members of Parliament to wait until they are 60 or 65 to draw a pension.
    I hope that the Government will make sure that the House gets the opportunity of putting forward its view. The Government can put forward their view, and if necessary present it to a review body. Let the Government be as plain and blunt as I am. I am giving them my support. I hope that they will support my suggestions.
    11.6 pm
    Mr. Alexander W. Lyon: I am concerned not about our current pay and allowances, but about another matter. I agree with the right hon. Member for Taunton (Mr. du Cann). The real answer to the question is that the House should determine its own pay and have the guts to recognise that we have underpaid ourselves for many years and get it right. However, we are right to say that we do not have the guts to do that. Therefore, we look for palliatives and other alternatives.
    The reason why we do not have the guts to do that is shown best by the speech that we have just heard from the hon. Member for Woolwich, West (Mr. Bottomley). He has got to the stage where, if the Government say something, he must do as the Government tell him. If he has got to that stage so early in his career in the House, we know exactly why we are in this mess.
    I prefer the churlishness of the hon. Member for Islington, South and Finsbury (Mr. Cunningham). I would go with him into any Lobby, because it is clear that he thinks about what he will do before he votes. He does not just do what the Leader of the House tells him.
    As long as we are in this situation we shall not be paid the salary that we should receive. The sum of £14,000 for a Member of Parliament is ridiculous. Members of Parliament in Botswana are better paid than we are, even though it is among the 25 poorest countries in the world. We are the seventeenth richest country in the world, yet we dare not pay ourselves a decent salary.
    I pass from that point, because for the moment my perception is that our most important need is not to deal with current salary and allowances, but to recognise that the status of Members of Parliament has so changed that any of us who leave this place after the age of 40 are unlikely to work again for a long time, and may never work again.
    At the general election, 45 Labour Members of Parliament lost their seats. At least 12 had to apply for help to the Parliamentary Labour Party benevolent fund, which is about as low as one can get. Eight of them went on asking for help for a considerable time. I know that four of them have not worked since the election and there may be more.
    I know from my experience that many ex-Labour Members of Parliament have taken jobs that were non-jobs. One is going round trying to sell Labour Weekly. Another man, in 1970, went back to his post as a printer in Fleet Street but was not allowed to become a printer. He was left to sweep the floor.
    It used to be the case that to enter the House was to achieve a status which, when one left, meant that one could always command a job. I suppose that the majority of Conservative Members can still do so, although, as I understand it, it is not so easy now. It is manifestly much more difficult for a great many of my hon. Friends.

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    The most important thing that the House has to recognise is that when we come here we seriously damage our job prospects. Not only do we take cuts in salary but we lose chances of promotion. If I had stayed out of the House, I should probably have been a judge. As a judge, the Government would be giving me a rise of 18 per cent., even though they recognise that after 15 years, however old I was, I should receive a full pension and not a mere forty-sixtieths. Yet the Government think that it is necessary to pay judges 18 per cent. in order to maintain recruitment.
    I believe that we are worth more than that. We are worth a decent pension when we reach the age of 65. We have to recognise the fact that when we leave the House—especially if we leave it as a result of an electoral whim—we may not be able to earn a decent living. We owe it not only to ourselves but to our families to ensure that some kind of assurance is given for that time. What that assurance should be is a matter for discussion.
    I am sorry, Mr. Speaker, that you did not select my amendment, which would have allowed us to put to the vote the general principle, but I recognise that the amendment, as I tabled it, has some defects. It should be possible to devise a pension scheme that applies for as long as ex-Members remain unemployed. If that unemployment continues until the end of their working lives, they should be paid a pension until then.
    If that is difficult to construct I suggest that there should be a pension after a period of at least two Parliaments. I should be willing to say one Parliament, because many of the hon. Members who lose their seats have been in the House for only one Parliament, having been elected to marginal seats. There might of course be difficulties about that. As a result of a by-election, a Liverpool Member entered the House the day before a general election. Had he lost the seat the following day under such a scheme he might have left with a pension for life, but there are ways of overcoming that difficulty.
    I have looked for precedents. Researches in the House have not shown me alternatives elsewhere, but some of my hon. Friends who have wide experience of Europe tell me that in Holland and Germany there are precedents for people receiving a pension for a period. Even in this country there are the judges, to whom I have referred, policemen and many people in the public service who receive a pension at an age lower than the retirement age.
    We should recognise that our job is so unique, and our job prospects when we leave here so difficult, that we should have that assurance. I am glad that the Leader of the House said that the Top Salaries Review Body would look at the matter. When it does, I hope that it will consider seriously what should be done to deal with this difficulty.
    Mr. Harry Greenway: There is the interesting example, which the hon. Member for York (Mr. Lyon) has not given, of a field marshal. That is a unique distinction to achieve and he retires on full Service pay for the rest of his life, on the basis of the principle that he is not expected to do any other work. It is worth putting that into the maelstrom of the interesting and important remarks of the hon. Member for York.
    Mr. Lyon: There are other examples. There is the Lord Chancellor. I was too sensitive to mention Mr. Speaker.
    The Speaker: Order. He does not.
    Mr. Lyon: I am sorry that I have been misled. However, the principle is perfectly clear. What worries me is that colleagues who have had the status of a Member of Parliament, whom we regard in this House as hon. Members and who have given of their lives to the House of Commons and the service of their country, should go on to what is virtually an unemployment job heap, and not be given the opportunity of some kind of assurance.
    Mr. Carter-Jones: I wonder whether it would be possible for the right hon. Member for Taunton (Mr. du Cann) and the hon. Member for Easington (Mr. Dormand) to get together and arrange a coalition with those of us who are over 60? When one reaches 60, one has one's pension, it is reduced, and it is difficult, but normally one's family has grown up. My hon. Friend the Member for York is right when he says that many people leave this House at the age of 40 or 45 and never have another chance of employment. Perhaps those of us who are over 60 should form a coalition and vote something down when the next chance occurs.
    Mr. Lyon: I would prefer it if not only the chairmen of the respected parliamentary parties formed a coalition but if Members of the House did so. If we voted, we could put that lot in their place. the reason why we do not vote was given by the hon. Member for Islington, South and Finsbury. I only wish that we had the chance to vote tonight.
    Dr. Alan Glyn: Perhaps I might correct the hon. Gentleman. My hon. Friend the Member for Ealing, North (Mr. Greenway) spoke about a field marshal retiring. I remind the House that a field marshal never retires. He continues on active Service pay.
    11.16 pm
    Mr. Michael McGuire: I should like to take up the theme of the hon. Member for Islington, South and Finsbury (Mr. Cunningham), whom I used to refer to as my hon. Friend. He said something that must strike a chord in the hearts of all those who normally take part in these debates. One sees the same team batting, from both sides. The hon. Member said. "Here we go again", and that when we come round again, whatever the review body decides, we shall be back at square one, because Members of Parliament lack the courage to do what they know should be done. I entirely agree with the hon. Member.
    I came here in 1964. It has been said today that we should know when we come here what the salary is likely to be. On that occasion—for the first time, as far as I know in the history of paid parliamentarians, which goes back to 1911; I have never believed in the hair shirt philosophy that Members of Parliament should not have reasonable or above-average salaries—it was decided that the salary was to be the figure set by Lloyd George in 1911. In 1963, when Lord Home was the Prime Minister, he and the Leader of the Opposition, my right hon. Friend the Member for Huyton (Sir H. Wilson), because the salaries of Members of Parliament had not been increased for six years since 1957, and to save party rancour and stop hon. Members from standing up and saying that we need to set an example, it was agreed that, for the first time, our salaries would be taken out of parliamentary hands and be given to Sir Geoffrey Lawrence, Q.C. We knew that, at the beginning of the new Parliament in 1964, Members of Parliament would get a salary increase. It was almost

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    double. It had to be, because the salary was £1,750. That is what Members got in 1964. For Back Benchers it went to £3,250. However, again, it was fudged. The Labour Party, which was in power, decided to make a grand gesture in respect of Ministers' salaries. Actually, there was a delay of six months, deferring to what we call the pension lobby, before Cabinet Ministers and junior Ministers got their salary increases.
    But Back-Bench Members of Parliament picked up the £3,250. Another seven years went by. Our late colleague, Charles Pannell—Lord Pannell as he subsequently became—in coalition with my noble Friend Lord Houghton, tabled a Private Member's Bill. The then Leader of the House persuaded them to withdraw the Bill and said that we would once and for all stop the fudging and mudging and introduce the Top Salaries Review Body. It was a sensitive issue for Members—I believed that we could deal with it—to be determining our own salaries during periods of wage restraint, and so on.
    Every time that Parliament has dealt with the matter—the hon. Member for Islington, South and Finsbury is right—the Government have interfered. The Government, with the power of the payroll vote and party loyalty, which we all recognise, manage to get their way and substantially to interfere with what we have given to an outside body to do because we are frightened to do it ourselves. Unless we grasp the nettle, that interference will continue.
    None of the suggested remedies will work. They have all been tried before. The right hon. Member for Taunton (Mr. du Cann) said—I intervened in his speech to point out an obvious contradiction—that he favoured letting Members know their salaries in advance. We cannot determine the last year of Parliament because that is within the gift of the Prime Minister. It could be at the end of this year. No one can say. Everyone knows that Government's seize what they consider to be the best moment to go to the country to enhance their own prospects. They would be barmy not to do so. We do not know when the Government will go to the country. My belief is that it will be next year.
    Let us assume that one could declare what the salary will be for Members. The Government can rightly say that they are getting inflation down to single figures, which is what it was when they came into office, but in a period of rapid inflation, unless we adjust by some mechanism, preferably annually, the last agreement suggested for Members, we shall again have an enormous gap and Governments will fudge the issue once more. For instance, they fudged it when the Prime Minister suggested on the last increase that we should have the increase spread over three years. Due to some pressure through what is known as the usual channels the Government were gracious and said that we could have half the increase, with two quarters later on and have the adjustments in between.
    I believe there is only one way to tackle this issue. We must go for linkage. The House freely voted on linkage. That linked figure has got so far out of sight that nobody, not even the most independent minded man with no fear of any consequences from his electors, would say that we should get to that figure now, because that increase would be £7,000 or £8,000. We cannot have that. That is the problem we shall face. My right hon. Friend the Member for Manchester, Openshaw (Mr. Morris) followed on the
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    theme that the hon. Member for Islington, South and Finsbury set when he last spoke from the Opposition Front Bench, that we should not compare ourselves with the Clerk of the House, although he effectively demolished the argument about uniqueness. He went through the list. He got down to a low position in the strata of Clerks. They have plenty to aim at. They are not subject to reselection. They do not face the vagaries of Government policies. They have little explaining to do. I say this respectfully because I want to keep them on my side. If anyone needs help, it is the hon. Member for Ince. They have a good job, but when the hon. Member for Islington, South and Finsbury read down the list, I was staggered at the low level with which we could be compared. I do not know how things have changed since then, but it has obviously altered in our disfavour.
    My right hon. Friend the Member for Openshaw was searching for a comparison. I am a working class Member of Parliament sponsored by the miners. The miners have a saying "Leave it to the brusher up". When my right hon. Friend next tries to compare the scales, we shall probably be with the brusher-up unless we grasp the nettle. That is how far we shall slip, because we cannot restore our position at one fell swoop as electorally the consequences would be disastrous.
    I said earlier that we do not give ourselves a proper increase because we wish to set an example. No one has ever yet said to me in an election or elsewhere "You lads are setting a wonderful example". There is a pending factory closure in my constituency with a severe reduction in employment. Obviously it is not the most convenient time to broach the subject of pay guidelines. However, on a previous occasion when another factory did close, the guidelines were broached because at that time there was much publicity about Members getting a relatively modest increase to catch up, although in percentage terms it looked a lot more than the norm that was set by the then Labour Government.
    One man challenged me in homely terms. He said "You are feathering your own nest while you are down there instead of fighting for us". Another colleague was with me who represented the Left-wing view of the party, but I dealt with the man's challenge and afterwards he asked "Is that all you fellows are on?" Even when I told him what we would get what was then regarded as a substantial increase, he did not believe me but said "Pull the other leg, Michael".
    The point is that no one takes a blind bit of notice of our sacrifices and examples. Anyone worth his salt knows that. People already think that we are getting three times more than we are. It is not that the public wants our salaries to be pitched at about £11,000, £12,000 or £13,000. It is simply that people do not believe the salary that we now receive.
    Mr. Alexander W. Lyon: Does not my hon. Friend agree that the right way to get rid of this so-called adverse publicity, which always seems to frighten us, would be to tie ourselves to the pay of Fleet Street editors, because then it would never be mentioned?
    Mr. McGuire: My hon. Friend made a telling contribution on severance pay and the hazards of life that hon. Members now face. He has now dealt even more eloquently with this nonsense about our pay. The question of Fleet Street pay and the publicity given to Members'

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    increase was effectively dealt with by Bill Price, a former Member of the House. I think that he was a former journalist, and he effectively demolished that argument.
    No one notices the sacrifices that we make. People could not care less. In fact, the general reaction seems to be "If you are daft enough, keep on doing it but it ain't going to stop me from going for what my union feels is a proper increase".
    I was once a member of the NUM. I stood unsuccessfully against Joe Gormley in 1961 for the secretaryship of the Lancashire miners. I can say truthfully, but perhaps a little immodestly, that had I kept on I would have succeeded Joe in that job and I would be enjoying far better conditions and pay, without the hazards of reselection. Even the unions that indulge in reselection have a fall-back clause whereby, once one has tested the temperature twice, one does not have to do so again. I agree with that. There is some sense in it. They do not unremittingly demand reselection. If one has gone a few times and reached a given age, one can continue in the job.
    We believe, sometimes more on these Benches than on the Government side, that the unions are looking at Members' pay with envy and malice. Most members of unions feel that if we cannot fight for ourselves we cannot fight effectively for anyone else. I agree with that. A short time ago, my union, under the leadership of Joe Gormley, said that they must cease their hair shirt philosophy, and put the pay of officials equal to managers of the NCB. They did not believe that their resolution and resolve would be strong enough to improve the pay and conditions of their members if they treated themselves poorly. Joe Gormley said that they should be aiming for the top. The matter got through with little discussion. The members who attend meetings say to themselves "I have a chance to get up there and if he is making a reasonable job for me, all the better." Miners' officials therefore allied themselves with the top Coal Board officials, but not with the chairman—even the members would find that a little difficult to swallow. Nevertheless, they have a reasonable salary structure that does not depend on a hair shirt philosophy. It certainly does not depend on a balmy notion of setting an example upon which we seem to place too much faith.
    What should be our attitude towards pensions? My hon. Friend the Member for York (Mr. Lyon) touched upon the matter. Many hon. Members know that I am a Member of the Council of Europe. After a committee there one day, the chairman paid tribute to a German colleague. He announced that the report in question was the last one that would be produced by our distinguished German colleague. I had been on the committee only about 24 months.
    Later, when my colleague and I were in the cloakroom washing our hands, I said that I understood that it was his last report and that I had enjoyed the others. Like so many Germans, this chap spoke faultless English. He said, "Thank you very much, Michael. Yes, I am packing up." I said, "Are you packing up because you have not been put on the list, because you are not to be reselected, or are you just packing up?" He said that he was 57 and had been in the German Parliament for rather a long time.
    My German colleague had not been a member as long as me, but I did not have the shame to tell him so. He said that he had been a member for 15 years, that he would never make the front bench and was content to be a good back bencher. I asked him whether he could get a pension.
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    He said that conditions were reasonable and that he could get one. I said "I am interested in the subject. Can you tell me how reasonable they are?" "Well", he said, "with my years of service"—he thought that it was an exceptionally long time—"I will qualify for 75 per cent. of my salary." His salary was light years ahead of ours. But I shall leave that aside for the moment: as my point concerns the percentage of salary that my colleague there received as pension. In addition to the 75 per cent., to ease him back into civilian life, he said that he would receive a full salary for three years. No doubt that was to soften the blow. I said that it sounded very good. My hon. Friend the Member for York said that he would like some pension arrangement to take effect after one Parliarnent and he gave the reasons for so thinking. I came here rather early from a mining area at the age of 38. The idea of having to go to 68 to get half pay makes me extremely angry. The pension scheme should be structured for hon. Members who come here at an average age of about 3.5. The system should not be based on a pension scheme which a person joins at age 18 or 20 or as a graduate of 23. It should be structured to the fact that the average age at which a person becomes an MP is about 35 to 40.
    Dutch Members of Parliament have a salary far in excess of ours, but I am talking about the principle. After serving four years in the Dutch Parliament, if a person does not get a job, in the first year out he receives 90 per cent. of the parliamentary salary, from which a pension deduction is taken. At the end of four years, if he has still not acquired a job, he will receive about 75 per cent, of full salary. Since four years' pension contributions have been deducted from that salary, he qualifies for eight years' pension rights. That is sufficient to provide him with about one-third of his salary and such an arrangement would cover the point made by my hon. Friend the Member for York.
    One calculation will appeal to hon. Members. We discuss this matter only once a year, so I hope that hon. Members will not be too fidgety if I take longer than 10 minutes. Hon. Members have received a document containing comparative wealth figures for Common Market countries. The top of the tree for purchasing power is Luxembourg with a figure of 120. The German figure is 116. France, Holland and the Benelux countries are ahead of us. The figure for Great Britain is 96. Greece is at the bottom of the scale. Just above Greece, with a figure of 76, is the Republic of Ireland.
    Irish Member; are troubled about how to settle their pay. The right hon. Member for Taunton made a joke about the Irish. The only people one can now insult racially are the poor old Irish. I happen to be Irish. I take great exception to such insults. Spleen is vented upon us because people cannot comment upon other races. Irish jokes are a standby for comics, and sometimes for hon. Members. The right hon. Gentleman talked about a mad Irish logic. I wish that we had some of that here because the Irish have dealt with the matter sensibly. They have asked an outside body to decide the proper rate of pay for Members of Parliament and nationalised industries.
    With their mad Irish logic, they have said that the Government should not interfere but that there should be a self-denying ordinance on the cowboys who, for political advantage if elections are near, want to say that they voted against such a move and that they spoke for the nurses, doctors or any other currently popular group. All the Government are required to do is to put the proposals to

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    the House. No debate is required. I am talking of a country which is second to the bottom of the scale in terms of prosperity, cost of living and purchasing power in the Community. The Irish pension scheme is based on fortieths. Thus, if a man serves 27 years in the Dail he receives 27-fortieths, and he cannot contribute any more. Moreover, he can draw that pension, I think that this meets one of the points raised here today. If he has served for 10 years and is over the age of 50, he leaves with those years of accrued service and pension. That is why I say that if we could have a little more mad Irish logic on this we might do a lot better.
    We might even have a little mad English logic. What we have tried in the past has not worked, for the simple reason that when Members of Parliament face the reality of doing what they know in their hearts is right, we fudge it and run away and then blame the Government when we know in our hearts that we should be blaming ourselves.
    I hope that the Leader of the House will take on board the fact that hardly anyone who has spoken in the debate has welcomed the proposals. There was some comment about welcoming the children's transport facilities, allowing them the same number of tickets. That might have been of use to me a few years ago, but my youngest is now 18. Nevertheless, if hon. Members feel that it is of value, I shall not vote against it. The Leader of the House should take on board the fact that nobody has welcomed the proposals in general. I believe that there is a deep reluctance to accept them. We know that we have sold the pass yet again and that the 4 per cent. is an insult.
    I hope that the Leader of the House will take the mood of the House and will quickly ensure that instructions are given to the review body and that they reflect the mood of the House. We want substantial alterations in the pension arrangements. We must have a better system for the rate at which pension rights can be accrued. At present, a person who has served 30 or 40 years has to wait until the age of 65, although I understand that if he has 25 years service and is 62 years old he can surrender a little and go out. The arrangements must be brought into line with those prevailing in most Western democratic Parliaments.
    Further, I hope that the Leader of the House will give instructions that the question of linkage be examined, as it is the only remedy. Otherwise, as has been said, we shall face this problem time and again and we shall fudge it time and again.
    11.42 pm
    Mr. John Silkin: There has been much talk about lack of guts and courage, the cowardliness of Members of Parliament, and so on, but no mention has been made of the fact that, to the best of my knowledge, no debate on this matter ever takes place in prime time. It is always late in the day, preferably after 10 o'clock at night, although we had something of a reprieve today in that we began at eight o'clock, so it is usually too late for the press and the public to hear the debate. I suppose that it is rather cowardly, really.
    The hon. Member for Woolwich, West (Mr. Bottomley) and my Independent hon. Friend the Member for Islington, South and Finsbury (Mr. Cunningham) reached roughly the same conclusion about what we
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    should pay ourselves. The hon. Member for Woolwich, West achieved this by discounting a little—in my view, unfairly.
    While all this was going on, I had time to do a little calculation. When David Lloyd George introduced the first payment for Members in 1912, Members of Parliament were paid £400 per year. At that time, the old-age pension was five shillings per week for a single person and the average wage was £75 per year. The average wage today is £7,500 per year, so it has increased 100 times, and the old-age pension has increased by more than that. On that basis, the salary of a Member of Parliament should be £40,000 per year. That might well be the correct figure, but, however brave we might be, I do not think that any of us would suggest that our pay should be raised to that level. Perhaps we should therefore try to aim eventually for the discounted figure suggested by the hon. Member for Woolwich, West.
    Frankly, I do not believe that that gap will be bridged at all. Here we are meekly listening to the Leader of the House suggesting 4 per cent. Some hon. Members are bravely suggesting 6 per cent. That is a difference of 2 per cent.—less tax, of course. We will sneak out like thieves in the night, hoping that the press and the country have not heard us, because some might say that we do not deserve a decent rate of pay.
    I do not think that that is true. The work load has gathered enormously in importance and in the effort that it requires since Lloyd George's day. We have to be welfare officers as well, which Members of Parliament never were at that time. Our days are much fuller, and our work is much harder.
    In the light of that, I do not understand why there should be such an objection to getting some other body to decide the matter for us. We have not the guts to do it ourselves. We all accept that we are underpaid. Why on earth do we not let some other body do the work for us?
    Several precedents have been given us. I did not know about the Republic of Ireland, but I did know about Norway, Sweden, Denmark and the United States of America. I take the point made by my right hon. Friend the Member for Manchester, Openshaw (Mr. Morris) that Congress has a splendid resolution saying that no civil servant may be paid more than a member of Congress. That is the way to get a high salary for a Member of Parliament. The civil servants will then ensure that we are paid properly.
    Let us have an automatic linkage and work it out properly. There are the beginnings of that in the Select Committee report, although it does not go as far as I would have liked. It certainly did a great deal of work, and rather more speedily than the Government either knew or wished. I congratulate the right hon. and learned Member for Hendon, South (Mr. Thomas), the Chairman, and his Committee on having produced it so rapidly and opportunely.
    In the light of a long debate, I think it wise to concentrate on just a couple of items. All the rest have been dealt with strongly. Those items on which I shall concentrate have not really had their full measure of discussion. The first is the question of secretaries' pay and inner London weighting.
    The hon. Member for Cardigan (Mr. Howells) asked for an explanation of annual London weighting allowance of £1,016 for secretaries. Incidentally, that figure is now out of date. I gather that it should be £1,142, based on the

    511
    London weighting for secretaries in the Civil Service who work alongside our secretaries in the House. It applies to anyone who works in the Inner London area. It is as simple as that.
    There is a distinction between a secretary who works in Inner London and one who works in the provinces. There are hon. Members who represent constituencies in the provinces and who have secretaries there. Of course, the cost of living is more in London. We have all accepted that. We accepted it for ourselves. There is nothing unusual about that.
    Mr. Terence Higgins: Hon. Members who do not have London constituences but who live in London and have no other residence do not get a London weighting.
    Mr. Silkin: That is perfectly true, but on the other hand they get allowances that London Members do not get, as the right hon. Gentleman knows.
    Mr. Higgins: The right hon. Gentleman is wrong. Those hon. Members in the circumstances that I have just described do not get any allowance whatever.
    Mr. Silkin: I stand corrected. I am astonished. I thought that London Members did rather worse than provincial Members. Perhaps the Leader of the House can enlighten us on this, I see that he remains seated. I thought that he, as the Leader of the House and a provincial Member must know. Perhaps we can compromise the issue. I do not want to take up too much time.
    If the Inner London allowance is paid to London Members, it strengthens the case for a large Inner London allowance for provincial Members. Perhaps the right hon. Member for Worthing (Mr. Higgins) will begin to press for that. I am astonished that he has not tabled an amendment on that.
    Mr. Biffen: My silence was intended to be a mercy to the House. I should explain that I am certain that the circumstances of my right hon. Friend the Member for Worthing (Mr. Higgins) are quite different from mine, as a Member of Parliament for a rural area and as an office holder. However, I think that I fully understand my right hon. Friend's point.
    Mr. Silkin: The right hon. Member for Worthing (Mr. Higgins) has had his fun, but next time he should table an amendment. He should speak on it in the relevant context. We are discussing, not payments to hon. Members, but payments to secretaries. We are discussing why they should receive Inner London weighting. They work alongside secretaries who receive Inner London weighting. Inner London weighting is not unusual. Let us consider the allowance. We have an extraordinary idea of what a top salary is. Can it be that £14,000 is a top salary? That is our salary and it is subject to the Review body on Top Salaries. We have a most extraordinary idea of a top salary.
    We must do something about our secretaries. As the Leader of the House said, the relationship between a Member of Parliament and his secretary is an important, personal political relationship. However, it is a financial relationship in which the secretary gives of her time and career so that she can assist the Member of Parliament. It is not right that secretaries should have to take what little there is available. If, as the right hon. Member for Taunton (Mr. du Cann) said, we were paid sufficiently, we could
    512
    pay our secretaries out of that amount. No doubt that was true in David Lloyd George's day. However, the modern equivalent of £400 in 1912 is £40,000 a year. 1 would willingly make that exchange.
    We have not debated the subject of severance payments in detail, but I shall spend three minutes on it. Any hon. Member who leaves the House can get a severance payment, subject to age and length of service, ranging from six to 12 months. However, the conditions vary slightly. For example, if one's constituency disappears in a major boundary redistribution one becomes eligible. the difference between a major and a minor redistribution might be only two constituents. If an hon. Member is defeated in an election he is also eligible. However, any hon. Member can make himself eligible, even if there is no major redistribution and even if he does not contest his seat. He need put down a deposit of only £150 in any constituency. He need take no part in the election, but he is then entitled. 1 am over 50—although hon. Members may not have guessed it—and have been a Member of Parliament for more than 15 years, although hon. Members will be unaware of that fact. Therefore I am entitled to a year's severance pay. I need only contest a constituency such as Oswestry at the next election to get a year's severance pay. How ridiculous.
    In other words, the House has said that if an hon. Member wants to get his severance pay he can do so. Why not say that every hon. Member—whether he retires, is defeated or is the victim of a boundary redistribution—should receive severance pay on the scale laid down. It is not a generous scale. If we slightly amended the Congress resolution and provided that no civil servant may do better in any way than a Member of Parliament, there would be a great difference. Civil servants do extremely well in comparison with us when it comes to retirement pensions.
    I conclude by saying that I think that there are three issues on which Me House should divide. These issues are the percentage increase for Members of Parliament—I believe that it should be 6 per cent. and not 4 per cent.—the secretarial allowance and severance pay. There will be free votes, of course, and I cannot bind anyone. I do not wish to do so.
    Mr. Biffen: This has been a fairly lengthy debate, although not particularly so by the standard of debates on this subject. The debate has had its nuances and changes of mood. It was much enlivened in its later stages by the hon. Member for Ince (Mr. McGuire), who must have been inspired by the consideration of the Northern Ireland Bill. The hon. Gentleman brought to our proceedings an encyclopaedic consideration of our problems, which added to the charm and compelling nature of his case. Alas, I cannot accept his arguments on linkage.
    The hon. Member for Nottingham, West (Mr. English) said that this was a baptism of fire for me, and that is probably true. Given that there is real diffidence about considering these matters in the House, the debate has proceeded in a good, measured and constructive fashion. For all our allegations of cowardice and almost total reluctance to address ourselves to these great issues on pay, it seems that we overcame our inhibitions. In doing so we were immensely assisted by my right hon. and learned Friend the Member for Hendon, South (Mr. Thomas) and by all those who served with him on the Select Committee.

    513
    It is proposed in the motion that Members' pay and the secretarial allowances should increase by 4 per cent., which reflects the pay factor in the Estimates. This has not been universally welcomed in the House, but I was reinforced by the support that I received from my right hon. Friend the Member for Taunton (Mr. du Cann). I note that the right hon. Member for Deptford (Mr. Silkin) intends to divide the House on Members' pay. The increase of 4 per cent. is a value-judgment figure. It is somewhat less than generous, but it is defensible.
    Mr. Mike Thomas: Is there a group of workers covered by the Estimates which has been offered 4 per cent. and accepted it?
    Mr. Biffen: There is not. If I had had such evidence, I should have used it.
    The proposals for the secretarial allowance have given rise to a sharp feeling of anxiety. I take note of the speeches of the right hon. Member for Manchester, Openshaw (Mr. Morris) and of the hon. Member for Sheffield, Heeley (Mr. Hooley). I accept that there is concern about the comparison to be drawn between what happens to those who are employed in the Civil Service and work alongside secretaries employed by Members and what happens to Members' secretaries themselves. The differences in terms and conditions give rise to problems. That is why it is important that the review body should have an early remit to consider the allowances. In that context, I also took note of the argument put forward by the hon. Members for Cardigan (Mr. Howells) and for Nottingham, West, that not only the sums, but the way in which the sums are paid are matters for consideration by that body.
    The debate has also ranged widely on matters other than pay. Perhaps the most significant single topic that featured in the speeches was that of pensions. My right hon. Friend the Member for Taunton has made his views on this subject clear on many occasions. I am sure that the House was pleased to have those views reinforced this evening. He again marched in step with the right hon. Member for Openshaw.
    The hon. Member for York (Mr. Lyon) made a particularly effective and poignant speech, in which he referred to some of the difficulties faced by our colleagues after their defeat at the last election. I sense that this is something on which feelings in the House are not only strong, but are rising. Although the TSRB has recently examined pensions, it is appropriate that this should again be one of its early considerations.
    The hon. Member for Glasgow, Provan (Mr. Brown) made a powerful speech on the problems of severance. The matter was also mentioned by the right hon. Member for Deptford. Although I sound as though I am passing the ball down the line, it is a fact that no really effective judgments can be made on these matters until we have the measured judgment of the TSRB. The important thing is to have these matters remitted to it as speedily as possible so that it can begin its work this autumn.
    Needless to say, during the debate the question of the general level of Members' pay was raised. My hon. Friend the Member for Woolwich, West (Mr. Bottomley) made a distinguished speech. It was the only one that supported my position, and I am extremely grateful to him for so
    514
    doing. He said that the absolute level of Members' pay was unacceptably low, and he hoped a remedy would soon be found. I enjoyed his powerful contribution.
    The item that formed the core of the debate, notwithstanding the importance of the 4 per cent. issue was the report of the Select Committee. I welcomed the words of the right hon Member for Deptford on the importance of the TSRB. One or two previous remarks by his hon. Friend the Member for Norwich, South (Mr. Garrett), could at least bear the interpretation of his being somewhat less than enthusiastic about it.
    We shall not proceed to a more settled consideration of these matters unless the review body has the fullhearted support and confidence of the House. Central to the recommendations of the Select Committee is the role of the review body.
    Mr. George Cunningham: That sticks in the craw of many of us a great deal. Apart from the fact that Governments have on many occasions rejected the recommendations of the Committee, in this Parliament the Prime Minister gave a promise to the review body that the Government would implement what it next recommended. She went back on that promise, and the right hon. Member voted in the Cabinet to support her.
    Mr. Biffen: If the hon. Gentleman feels that there has been a deplorable standard of conduct by successive Governments in respect of the review body, I only hope that at this hour he will feel sufficiently uplifted by my charitable comments about the body to take encouragement and not repudiate me as though I were here to perform a cynical exercise.
    As to the work of the Select Committee and the Government's reaction to it, I understand that the authors of the report are rather disappointed that it has not been accepted in full by the Government, but I doubt whether the Government's reaction merits some of the language used in the debate. The hon. Member for Provan said that the Government's reaction was a "slap in the face" to the Select Committee. My hon. Friend the Member for North Fylde (Sir W. Clegg) said that the Government's reaction was "cynical". My hon. Friend the Member for Sevenoaks (Mr. Wolfson) said that he was unwilling to trust the Government—I do not mean that in the harsh sense—in the light of their past behaviour.
    The difficulty has been the Government's reaction to the choice of comparator for the linkage and whether the figure produced by the comparator should be automatic or should come to the House for authority. My right hon. and learned Friend the Member for Hendon, South, the Chairman of the Committee, said that the House could not abandon its ultimate responsibility for determining Members' salaries. Are the Government entitled to say "We accept the principle of linkage, although we have a different comparator from the new earnings survey, but we believe that it would be unwise to establish the precedent of automatic pay increases during a four-year period where the House did not have the responsibility or was not required to make a judgment on those matters."
    The comparator of the new earnings survey is not the most satisfactory. I gave some reasons for that in my opening speech. I inquired about the percentage change in earnings within the lifetime of this Parliament. The new earnings survey comes up with a figure of plus 53 per cent., against average earnings of plus 36 per cent. If that

    515
    was believed to be the means whereby an automatic pay increase would be secured, the position would be politically embarassing and would demonstrate the wisdom of having another comparator and of the House being entitled to have a view on the matter.
    For those reasons, I ask my hon. Friends to support the Government's adjustments to the Select Commitee report, because I believe that that is the best way in which to proceed.
    Question put, That the amendment be made:—
    The House divided: Ayes 41, Noes 136.

    Division No. 201]

    [12.09 am

    AYES

    Atkinson,N. (H'gey,)

    McDonald,DrOonagh

    Bagier,Gordon A.T.

    McGuire,Michael(Ince)

    Benn, Rt Hon Tony

    McKay, Allen (Penistone)

    Booth, Rt Hon Albert

    McNamara,Kevin

    Brown, Hugh D. (Provan)

    Mitchell,Austin(Grimstone)

    Campbell-Savours,Dale

    Morris, Rt Hon A. (W'shawe)

    Carter-Jones, Lewis

    Morris, Rt Hon C. (O'shaw)

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

    Price, C. (Lewisham W)

    Cohen,Stanley

    Sheldon, Rt Hon R.

    Cook, Robin F.

    Silkin, Rt Hon J. (Deptford)

    Cowans, Harry

    Snape, Peter

    Crowther,Stan

    Soley,Clive

    Cunningham,G. (Islington S)

    Spearing,Nigel

    Davis, Clinton (Hackney C)

    Stoddart,David

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

    Straw,Jack

    Dormand, Jack

    Walker, Rt Hon H.(D'caster)

    Evans, John (Newton)

    Whitehead, Phillip

    Foster, Derek

    Woolmer,Kenneth

    Garrett, John (Norwich S)

    Harrison, Rt Hon Walter

    Tellers for the Ayes:

    HomeRobertson,John

    Mr. Michael English and

    Howells,Geraint

    Mr. Frank Hooley.

    Lyon,Alexander(York)

    NOES

    Alison, Rt Hon Michael

    Fraser, Peter (South Angus)

    Ancram,Michael

    Garel-Jones,Tristan

    Baker, Kenneth (St.M'bone)

    Glyn,Dr Alan

    Baker, Nicholas (N Dorset)

    Goodhew,SirVictor

    Beaumont-Dark, Anthony

    Goodlad, Alastair

    Berry, Hon Anthony

    Greenway, Harry

    Best, Keith

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

    Biffen, Rt Hon John

    Hamilton, Hon A.

    Blaker,Peter

    Hamilton,Michael (Salisbury)

    Boscawen,Hon Robert

    Hampson,DrKeith

    Bottomley, Peter (W'wich W)

    Havers, Rt Hon Sir Michael

    Boyson,Dr Rhodes

    Hawkins,Paul

    Brittan,Rt. Hon. Leon

    Hayhoe, Barney

    Brooke, Hon Peter

    Heseltine, Rt Hon Michael

    Bruce-Gardyne,John

    Higgins, Rt Hon Terence L.

    Bryan, Sir Paul

    Hogg,HonDouglas(Gr'th'm)

    Buchanan-Smith, Rt. Hon. A.

    Howe, Rt Hon Sir Geoffrey

    Buck,Antony

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

    Butcher,John

    Hurd, Rt Hon Douglas

    Cadbury,Jocelyn

    Jenkin, Rt Hon Patrick

    Carlisle,Kenneth (Lincoln)

    Jopling,Rt Hon Michael

    Chalker, Mrs. Lynda

    Joseph, Rt Hon Sir Keith

    Channon, Rt. Hon. Paul

    King, Rt Hon Tom

    Chapman,Sydney

    Lamont,Norman

    Clark, Sir W.(Croydon S)

    Lang, Ian

    Clarke,Kenneth (Rushcliffe)

    Lawrence, Ivan

    Clegg, Sir Walter

    Lawson, Rt Hon Nigel

    Cope,John

    Lee, John

    du Cann, Rt Hon Edward

    Lyell,Nicholas

    Dunn,Robert(Dartford)

    Macfarlane,Neil

    Edwards, Rt Hon N. (P'broke)

    MacGregor,John

    Eggar,Tim

    McNair-Wilson,M.(N'bury)

    Eyre,Reginald

    Major,John

    Fenner, Mrs Peggy

    Marlow,Antony

    Finsberg,Geoffrey

    Marten, Rt Hon Neil

    Fletcher,A (Ed'nb'gh N)

    Mather,Carol

    Fletcher-Cooke,SirCharles

    Mayhew,Patrick

    Forman,Nigel

    Mellor,David

    Fowler, Rt Hon Norman

    Miller,Hal(B'grove)

    516

    Mills,Iain(Merdien)

    Sims, Roger

    Miscampbell,Norman

    Skinner,Dennis

    Milchell,David(Basingstoke)

    Stewart, A. (E Renfrewshire)

    Moate, Roger

    Stewart, Ian (Hitchin)

    Moore,John

    StradlingThomas,J.

    Morrison, Hon C. (Devizes)

    Tebbit, Rt Hon Norman

    Morrison, Hon P. (Chester)

    Thomas, Rt Hon Peter

    Myles, David

    Thompson,Donald

    Nelson,Anthony

    Thornton,Malcolm

    Newton,Tony

    Townend, John (Bridlington)

    Onslow,Cranley

    Trippier,David

    Page, Richard (SW Herts)

    Vaughan, Dr Gerard

    Parkinson, Rt Hon Cecil

    Viggers, Peter

    Patten,John(Oxford)

    Waddington,David

    Pawsey, James

    Wakeham,John

    Percival,Sir Ian

    Waldegrave,Hon William

    Pollock,Alexander

    Walker, Rt Hon P.(W'cester)

    Raison, Rt Hon Timothy

    Waller, Gary

    Rathbone,Tim

    Ward,John

    Rees, Peter (Dover and Deal)

    Warren,Kenneth

    Rees-Davies, W. R.

    Wells, Bowen

    Rhys Williams,Sir Brandon

    Whitelaw,Rt Hon William

    Ridley,Hon Nicholas

    Wiggin,Jerry

    Rifkind, Malcolm

    Winterton,Nicholas

    Roberts, M. (Cardiff NW)

    Wolfson,Mark

    Roberts, Wyn (Conway)

    Young, SirGeorge(Action)

    Rossi, Hugh

    Younger, Rt Hon George

    Sainsbury,Hon Timothy

    Shaw,Michael(Scarborough)

    Tellers for the Noes:

    Shelton,William(Streatham)

    Mr. David Hunt and

    Silvester, Fred

    Mr. Selwyn Gummer.

    Question accordingly negatived.
    Main Question put and agreed to.
    Resolved,
    That, in the opinion of this House, the salaries payable to Members of this House in respect of service on and after 13th June 1982 should be at the following yearly rates—

    (1) £14,510 for Members not falling within paragraph (2); and

    (2) £8,460 for Officers of this House and Members receiving a salary under the Ministerial and Other Salaries Act 1975 or a pension under section 26 of the Parliamentary and other Pensions Act 1972.—[Mr. Biffen.]

    MEMBERS' SALARIES
    Queen's Recommendation having been signified—
    Resolved,
    That the salaries payable to Members of this House in respect of service on and after 13th June 1982 should be at the following yearly rates—

    (1) £14,510 for Members not falling within paragraph (2); and

    (2) £8,460 for Officers of this House and Members receiving a salary under the Ministerial and Other Salaries Act 11975 or a pension under section 26 of the Parliamentary and other Pensions Act 1972.—[Mr. Biffen.]

    MEMBERS' OFFICE, SECRETARIAL AND RESEARCH ALLOWANCE
    Motion made, and Question proposed,
    That, in the opinion of this House, the limits specified in the Resolution of this House of 5th June 1981 in relation to the allowances payable in connection with a Member's office, secretarial and research expenses should be raised so as to make the limits—

    (a) in paragraph (a) of the Resolution (allowance in respect of aggregate amount of general office expenses and expenses on secretarial and research assistance), £8,752 for the year ending 31st March 1983 and £8,820 for any subsequent year; and

    (b) in paragraph (b) of that Resolution (provision for enabling a Member to make pension contributions in respect of persons in the payment of whose salaries expenses are incurred by him), £875 for the year ending 31st March 1983 and £882 for any subsequent year.—[Mr. Biffen.]

    Amendment proposed: (a), to leave out '£8,752' and insert '£9,022'.—[Mr. John Silkin.]
    Question put, That the amendment be made:—
    The House divided: Ayes 44, Noes 132.

    Division No. 202]

    [12.22 am

    AYES

    Atkinson, N.(H'gey,)

    McKay, Allen (Penistone)

    Benn, Rt Hon Tony

    McNamara, Kevin

    Booth, Rt Hon Albert

    Mitchell, Austin(Grimsby)

    Brown, Hugh D. (Provan)

    Morris, Rt Hon A. (W'shawe)

    Campbell-Savours,Dale

    Morris, Rt Hon C. (O'shaw)

    Carter-Jones, Lewis

    Price, C. (Lewisham W)

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

    Roper, John

    Cohen, Stanley

    Ross, Ernest (Dundee West)

    Cook, Robin F.

    Sheldon, Rt Hon R.

    Crowther, Stan

    Silkin, Rt Hon J. (Deptford)

    Cunningham, G. (Islington S)

    Skinner, Dennis

    Davis, Clinton (Hackney C)

    Snape, Peter

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

    Soley, Clive

    Dormand, Jack

    Spearing, Nigel

    Evans, John (Newton)

    Stoddart, David

    Foster, Derek

    Straw, Jack

    Garrett, John (Norwich S)

    Thomas, Mike (Newcastle E)

    Greenway, Harry

    Whitehead, Phillip

    Harrison, Rt Hon Walter

    Winterton, Nicholas

    HomeRobertson, John

    Woolmer, Kenneth

    Howells, Geraint

    Lyon, Alexander(York)

    Tellers for the Ayes:

    McDonald, DrOonagh

    Mr, Michael English and

    McGuire, Michael(Ince)

    Mr. Frank Hooley.

    NOES

    Alison, Rt Hon Michael

    Hamilton, Michael (Salisbury)

    Ancram, Michael

    Hampson, Dr Keith

    Baker, Kenneth(St.M'bone)

    Havers, Rt Hon Sir Michael

    Baker, Nicholas (N Dorset)

    Hawkins, Paul

    Beaumont-Dark,Anthony

    Hayhoe, Barney

    Berry, Hon Anthony

    Heseltine, Rt Hon Michael

    Best, Keith

    Higgins, Rt Hon Terence L.

    Biffen, Rt Hon John

    Hogg, HonDouglas(Gr'th'm)

    Blaker, Peter

    Howe, Rt Hon Sir Geoffrey

    Boscawen, Hon Robert

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

    Bottomley, Peter (W'wich W)

    Hurd, Rt Hon Douglas

    Boyson, Dr Rhodes

    Jenkin, Rt Hon Patrick

    Brittan, Rt. Hon. Leon

    Jopling, Rt Hon Michael

    Brooke, Hon Peter

    Joseph, Rt Hon Sir Keith

    Bruce-Gardyne, John

    King, Rt Hon Tom

    Bryan, SirPaul

    Lamont, Norman

    Buchanan-Smith, Rt. Hon. A.

    Lang, Ian

    Buck, Antony

    Lawrence, Ivan

    Butcher, John

    Lawson, Rt Hon Nigel

    Cadbury, Jocelyn

    Lee, John

    Carlisle, Kenneth (Lincoln)

    Lyell, Nicholas

    Chalker, Mrs. Lynda

    Macfarlane, Neil

    Channon, Rt. Hon. Paul

    MacGregor, John

    Chapman, Sydney

    McNair-Wilson, M.(N'bury)

    Clark, Sir W. (Croydon S)

    Major, John

    Clarke, Kenneth(Rushcliffe)

    Marlow, Antony

    Clegg, Sir Walter

    Marten, Rt Hon Neil

    Cope, John

    Mather, Carol

    du Cann, Rt Hon Edward

    Mayhew, Patrick

    Dunn, Robert (Dartford)

    Mellor, David

    Edwards, Rt Hon N. (P'broke)

    Miller, Hal (B'grove)

    Eggar, Tim

    Mills, Iain (Meriden)

    Eyre, Reginald

    Miscampbell, Norman

    Fenner, Mrs Peggy

    Mitchell, David(Basingstoke)

    Finsberg, Geoffrey

    Moate, Roger

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

    Moore, John

    Fletcher-Cooke, Sir Charles

    Morrison, Hon C. (Devizes)

    Forman, Nigel

    Morrison, Hon P. (Chester)

    Fowler, Rt Hon Norman

    Myles, David

    Fraser, Peter (South Angus)

    Nelson, Anthony

    Garel-Jones, Tristan

    Newton, Tony

    Glyn, Dr Alan

    Onslow, Cranley

    Goodhew, Sir Victor

    Page, Richard (SW Herts)

    Goodlad, Alastair

    Parkinson, Rt Hon Cecil

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

    Patten, John (Oxford)

    Hamilton, Hon A.

    Pawsey, James

    518

    Percival, Sir Ian

    Thornton, Malcolm

    Pollock, Alexander

    Townend, John(Bridlington)

    Raison, Rt Hon Timothy

    Trippier, David

    Rathbone, Tim

    Vaughan, Dr Gerard

    Rees, Peter (Dover and Deal)

    Viggers, Peter

    Rees-Davies, W. R.

    Waddington, David

    Ridley, Hon Nicholas

    Wakeham, John

    Rifkind, Malcolm

    Waldegrave, Hon William

    Roberts, M. (Cardiff NW)

    Walker, Rt Hon P.(W'cester)

    Roberts, Wyn (Conway)

    Waller, Gary

    Rossi, Hugh

    Ward, John

    Sainsbury, Hon Timothy

    Warren, Kenneth

    Shaw, Michael (Scarborough)

    Wells, Bowen

    Shelton, William(Streatham)

    Whitelaw, Rt Hon William

    Silvester, Fred

    Wiggin, Jerry

    Sims, Roger

    Wolfson, Mark

    Stewart, A.(ERenfrewshire)

    Young, Sir George(Action)

    Stewart, Ian(Hitchin)

    Younger, Rt Hon George

    Stradling Thomas, J.

    Tebbit, Rt Hon Norman

    Tellers for the Noes:

    Thomas, Rt Hon Peter

    Mr. David Hunt and

    Thompson, Donald

    Mr. Selwyn Gummer.

    Question accordingly negatived.
    Main Question put and agreed to.
    Resolved,
    That, in the opinion of this House, the limits specified in the Resolution of this House of 5th June 1981 in relation to the allowances payable in connection with a Member's office, secretarial and research expenses should be raised so as to make the limits—

    (a) in paragraph (a) of the Resolution (allowance in respect of aggregate amount of general office expenses and expenses on secretarial and research assistance), £8,752 for the year ending 31st March 1983 and £8,820 for any subsequent year; and

    (b) in paragraph (b) of that Resolution (provision for enabling a Member to make pension contributions in respect of persons in the payment of whose salaries expenses are incurred by him), £875 for the year ending 31st March 1983 and £882 for any subsequent year.—[Mr. Biffen.]

    TRAVEL FACILITIES FOR MEMBERS' CHILDREN
    Resolved,
    That, in the opinion of this House, the facilities available to the spouse of a Member of this House for free travel in accordance with the Resolutions of this House of 7th April 1971 and 22nd July 1975 on journeys within paragraph (a) or (b) of the said Resolution of 7th April 1971 should be extended to children of the Member under the age of 18; but any child's journey in respect of which facilities for free travel are provided in accordance with this Resolution should count against the number of journeys for which facilities for free travel are available to the Member's spouse.
    For the purposes of this Resolution a Member's children shall be taken to include step-children, adopted children, foster children and any other child living as one of the Member's family.—[Mr. Biffen]

    PARLIAMENT
    Resolved,
    That the draft Ministerial and other Salaries Order 1982, which was laid before this House on 27th May, be approved.—[Mr. Biffen]

    FUTURE ARRANGEMENTS FOR MEMBERS' SALARIES
    Motion made, and Question proposed,
    That this House—

    (a) welcomes the Report of the Select Committee on Members' Salaries which was ordered by this House to be printed on 17th February 1982;

    (b) agrees with the recommendation in that Report that a review of Members' pay be conducted by the Review

    519
    Body on Top Salaries once during the fourth year of each Parliament and that, where a shortened Parliament precludes this, the Review Body should carry out a new review not later than four years after the rates of salary consequent on the previous review first became payable;

    (c) agrees with the view expressed in that Report that, between such reviews, Members' salaries should be adjusted annually by reference to increases in outside salaries, but does not accept the recommendation that there should be an annual automatic adjustment by reference to figures taken from the Department of Employment's New Earnings Survey;

    (d) is of opinion that Her Majesty's Government should instead, in the period between one such review and the next, move annual motions to effect changes in Members' salaries and in so doing should be guided by the average change in the rates of pay of appropriate groups in the Public Service over a relevant period.—[Mr. Biffen.]

    Amendment proposed: (a), to leave out from '1982' to end of motion and add
    `and agrees with the recommendations of that Report' .—[Mr. Peter Thomas.]
    Question put, That the amendment be made:—
    The House divided: Ayes, 49. Noes, 117.

    Division No. 203]

    [12.34 am

    AYES

    Atkinson, N.(H'gey,)

    McNamara, Kevin

    Benn, Rt Hon Tony

    Miscampbell, Norman

    Booth, Rt Hon Albert

    Mitchell, Austin (Grimsby)

    Brown, Hugh D. (Provan)

    Morris, Rt Hon A. (W'shawe)

    Campbell-Savours, Dale

    Morris, Rt Hon C. (O'shaw)

    Carter-Jones, Lewis

    Price, C. (Lewisham W)

    Clegg, Sir Walter

    Rees-Davies, W. R.

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

    Roper, John

    Cohen, Stanley

    Ross, Stephen (Isle of Wight)

    Cook, Robin F.

    Shaw, Michael (Scarborough)

    Crowther, Stan

    Silkin, Rt Hon J. (Deptford)

    Cunningham, G.(Islington S)

    Soley, Clive

    Davis, Clinton (Hackney C)

    Spearing, Nigel

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

    Stoddart, David

    Dormand, Jack

    Straw, Jack

    Evans, John (Newton)

    Thomas, Mike (Newcastle E)

    Foster, Derek

    Thomas, Rt Hon Peter

    Garrett, John (Norwich S)

    Ward, John

    Greenway, Harry

    Whitehead, Phillip

    Harrison, Rt Hon Walter

    Winterton, Nicholas

    Home Robertson, John

    Woolmer, Kenneth

    Hooley, Frank

    Wrigglesworth, Ian

    Howells, Geraint

    Lawrence, Ivan

    Tellers for the Ayes:

    Lyon, Alexander(York)

    Mr. Michael English and

    McDonald, DrOonagh

    Mr. Mark Wolfson.

    McKay, Allen (Penistone)

    NOES

    Alison, Rt Hon Michael

    Chapman, Sydney

    Ancram, Michael

    Clark, Sir W.(Croydon S)

    Baker, Kenneth(St.M'bone)

    Clarke, Kerneth(Rushcllffe)

    Baker, Nicholas (N Dorset)

    Cope, John

    Beaumont-Dark, Anthony

    Dunn, Rober(Dartford)

    Berry, Hon Anthony

    Eggar, Tim

    Best, Keith

    Eyre, Reginald

    Biffen, Rt Hon John

    Fenner, Mrs Peggy

    Blaker, Peter

    Finsberg, Geoffrey

    Bottomley, Peter (W wich W)

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

    Boyson, Dr Rhodes

    Forman, Nigel

    Brittan, Rt. Hon. Leon

    Fowler, Rt Hon Norman

    Brooke, Hon Peter

    Fraser, Peter (South Angus)

    Bruce-Gardyne, John

    Garel-Jones, Tristan

    Bryan, Sir Paul

    Glyn, Dr Alan

    Buchanan-Smith, Rt, Hon. A.

    Goodhew, Sir Victor

    Butcher, John

    Goodlad, Alastair

    Cadbury, Jocelyn

    Gummer, John Selwyn

    Carlisle, Kenneth (Lincoln)

    Hamilton, Hon A.

    Chalker, Mrs. Lynda

    Hamilton, Michael (Salisbury)

    Channon, Rt. Hon. Paul

    Hampson, DrKeith

    520

    Havers, Rt Hon Sir Michael

    Pollock, Alexander

    Hawkins, Paul

    Raison, Rt Hon Timothy

    Hayhoe, Barney

    Rathbone, Tim

    Heseltine, Rt Hon Michael

    Rees, Peter (Dover and Deal)

    Hogg, Hon Douglas(Gr'th'm)

    Ridley, Hon Nicholas

    Howe, Rt Hon Sir Geoffrey

    Rifkind, Malcolm

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

    Roberts, M. (Cardiff NW)

    Hunt, David (Wirrai)

    Roberts, Wyn (Conway)

    Hurd, Rt Hon Douglas)

    Rossi, Hugh

    Jenkin, Rt Hon Patrick

    Sainsbury, Hon Timothy

    Jopling, Rt Hon Michael

    Shelton, William(Streatham)

    Joseph, Rt Hon Sir Keith

    Silvester, Fred

    King, Rt Hon Tom

    Sims, Roger

    Lamont, Norman

    Skinner, Dennis

    Lawson, Rt Hon Nigel

    Stewart, A.(ERenfrewshire)

    Lee, John

    Stewart, Ian (Hitchin)

    Lyell, Nicholas

    Stradling Thomas, J.

    Macfarlane, Neil

    Tebbit, Rt Hon Norman

    MacGregor, John

    Thompson, Donald

    McNair-Wilson, M.(N'bury)

    Thornton, Malcolm

    Major, John

    Townend, John (Bridlington)

    Marten, Rt Hon Neil

    Trippier, David

    Mather, Carol

    Vaughan, Dr Gerard

    Mayhew, Patrick

    Viggers, Peter

    Mellor, David

    Waddington, David

    Miller, Hal(B'grow)

    Wakeham, John

    Mills, Iain(Meriden)

    Waldegrave, Hon William

    Mitchell, David(Basingstoke)

    Walker, Rt Hon P.(W'cestor)

    Moate, Roger

    Waller, Gary

    Moore, John

    Warren, Kenneth

    Morrison, Hon P. (Chester)

    Wells, Bowen

    Myles, David

    Whitelaw, Rt Hon William

    Nelson, Anthony

    Wiggin, Jerry

    Newton, Tony

    Young, Sir George(Action)

    Onslow, Cranley

    Younger, Rt Hon George

    Page, Richard (SW Herts)

    Parkinson, Rt Hon Cecil

    Tellers for the Noes:

    Patten John (Oxford)

    Mr. Ian Lang and

    Pawsey, James

    Mr. Robert Boscawen.

    Percival, Sir Ian

    Question accordingly negatived.
    Amendment proposed: (b), to leave out from 'payable' to end and add—
    `(c) agrees with the view expressed in that Report that, between such re views Members salaries should be adjusted annually by reference to increases in outside salaries as indicated in the nearest percentile in the Department of Employment's New Earnings Survey.
    (d) does not accept the view in that Report that the question of Members' pensions and severance payments should be subsumed under the general heading of "Pay" to await consideration in the context of the next general review of Members' pay, but is of the opinion that, in the light of the anomalies inherent in the present severance arrangements and the increased insecurity attached to the role of a Member, the Top Salaries Review Body be requested to undertake an urgent review of pension and severance arrangements and make recommendations accordingly.'.—[Mr. John Silkin.]
    Question put, That the amendment be made:—
    The House divided: Ayes 35, Noes 111.

    Division No. 204]

    [12.45 am

    AYES

    Atkinson, N.(H'gey,)

    Foster, Derek

    Benn, Rt Hon Tony

    Garrett, John (Norwich S)

    Booth, Rt Hon Albert

    Harrison, Rt Hon Walter

    Brown, Hugh D. (Provan)

    HomeRobertson, John

    Campbell-Savours, Dale

    Howells, Geraint

    Carter-Jones, Levis

    McDonald, Dr Oonagh

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

    McKay, Allen(Penistone)

    Cohen, Stanley

    McNamara, Kevin

    Cook, Robin F.

    Morris, Rt Hon A. (W'shawe)

    Crowther, Stan

    Morris, Rt Hon C. (O'shaw)

    Davis, Clinton (Hackney C)

    Roper, John

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

    Ross, Stephen (Isle of Wight)

    Dormand, Jack

    Silkin, Rt Hon J. (Deptford)

    English, Michael

    Skinner, Dennis

    Evans, John (Newton)

    Soley, Clive

    521

    Stoddart, David

    Straw,Jack

    Tellers for the Ayes:

    Whitehead,Phillip

    Mr. Frank Hooley and

    Woolmer,Kenneth

    Mr. Nigel Spearing.

    Wrigglesworth,Ian

    NOES

    Alison, Rt Hon Michael

    Hayhoe, Barney

    Ancram,Michael

    Heseltine, Rt Hon Michael

    Baker,Kenneth(St.M'bone)

    Hogg, Hon Douglas(Gr'th'm)

    Baker, Nicholas (N Dorset)

    Howe, Rt Hon Sir Geoffrey

    Beaumont-Dark,Anthony

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

    Berry, Hon Anthony

    Hurd,Rt Hon Douglas

    Best, Keith

    Jenkin,Rt Hon Patrick

    Biffen,Rt Hon John

    Jopling, Rt Hon Michael

    Blaker, Peter

    King, Rt Hon Tom

    Bottomley,Peter(W'wich W)

    Lamont, Norman

    Boyson,Dr Rhodes

    Lang, Ian

    Brittan,Rt. Hon. Leon

    Lawson,Rt Hon Nigel

    Brooke, Hon Peter

    Lee, John

    Bruce-Gardyne,John

    Lyell,Nicholas

    Buchanan-Smith, Rt. Hon. A.

    Macfarlane,Neil

    Butcher,John

    MacGregor,John

    Cadbury,Jocelyn

    Major,John

    Carlisle, Kenneth (Lincoln)

    Marten, Rt Hon Neil

    Chalker, Mrs. Lynda

    Mather,Carol

    Channon, Rt. Hon. Paul

    Mayhew,Patrick

    Chapman,Sydney

    Mellor,David

    Clarke,Kenneth (Rushcliffe)

    Miller,Hal(B'grove)

    Cope,John

    Mills,Iain(Meriden)

    Dunn, Robert(Dartford)

    Miscampbell,Norman

    Eggar,Tim

    Mitchell, David (Basingstoke)

    Fanner, Mrs Peggy

    Moate, Roger

    Finsberg,Geoffrey

    Moore,John

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

    Morrison, Hon P. (Chester)

    Forman, Nigel

    Myles, David

    Fowler, Rt Hon Norman

    Newton,Tony

    Fraser, Peter (South Angus)

    Onslow,Cranley

    Garel-Jones,Tristan

    Page, Richard (SW Herts)

    Glyn, DrAlan

    Parkinson, Rt Hon Cecil

    Goodhew,SirVictor

    Patten, John (Oxford)

    Goodlad,Alastair

    Pawsey, James

    Greenway, Harry

    Percival,Sir Ian

    Gummer,JohnSelwyn

    Pollock,Alexander

    Hamilton, Hon A.

    Raison, Rt Hon Timothy

    Hampson,Dr Keith

    Rathbone,Tim

    Hawkins, Paul

    Rees, Peter (Dover and Deal)

    522

    Ridley, Hon Nicholas

    Viggers, Peter

    Rifkind, Malcolm

    Waddington,David

    Roberts, M. (Cardiff NW)

    Wakeham,John

    Roberts, Wyn (Conway)

    Waldegrave,Hon William

    Rossi, Hugh

    Waller, Gary

    Sainsbury,Hon Timothy

    Warren,Kenneth

    Shelton,William(Streatham)

    Wells,Bowen

    Silvester,Fred

    Whitelaw,Rt Hon William

    Sims, Roger

    Wiggin,Jerry

    Stewart,A(ERenfrewshire)

    Winterton,Nicholas

    Stewart, Ian (Hitchin)

    Wolfson,Mark

    StradlingThomas,J.

    Young,SirGeorge(Action)

    Tebbit, Rt Hon Norman

    Younger, Rt Hon George

    Thomas, Rt Hon Peter

    Thompson,Donald

    Tellers for the Noes:

    Thornton,Malcolm

    Mr. Robert Boscawen and

    Trippier, David

    Mr. David Hunt.

    Vaughan,DrGerard

    Question accordingly negatived.
    Main Question put and agreed to.
    Resolved,
    That this House—

    (a) welcomes the Report of the Select Committee on Members' Salaries which was ordered by this House to be printed on 17th February 1982;

    (b) agrees with the recommendation in that Report that a review of Members' pay be conducted by the Review Body on Top Salaries once during the fourth year of each Parliament and that, where a shortened Parliament precludes this, the Review Body should carry out a new review not later than four years after the rates of salary consequent on the previous review first became payable;

    (c) agrees with the view expressed in that Report that, between such reviews, Members' salaries should be adjusted annually by reference to increases in outside salaries, but does not accept the recommendation that there should be an annual automatic adjustment by reference to figures taken from the Department of Employment's New Earnings Survey;

    (d) is of opinion that Her Majesty's Government should instead, in the period between one such review and the next, move annual motions to effect changes in Members' salaries and in so doing should be guided by the average change in the rates of pay of appropriate groups in the Public Service over a relevant period.—[Mr. Biffen]

  Obstetric and Neonatal Care
  Motion made, and Question proposed, That this House do now adjourn.—[Mr. Thompson.]
  12.55
  Mr. Lewis Carter-Jones: Shall we now return to reality and forget Members' salaries?
  Earlier in the week when I asked the Minister whether the minimum standards of obstetric and neonatal care had been referred to the maternal services advisory committee for consideration, the answer was "No". As recently as two days ago the Minister was saying that he had not referred the question of minimum standards to the appropriate committee.
  In 1976 I started a campaign to reduce perinatal mortality and handicap. I had a substantial amount of support from a wide variety of organisations and people. First, I should like to pay tribute to the Table Office, which assisted me from time to time to table innumerable questions on the problems. The questions revealed that it was a vital issue.
  The second group of people to whom I want to pay tribute are those from RADAR, such as George Wilson and Peter Mitchell, who helped me with my researches. In addition, there are the people from MENCAP, who are very concerned about mental handicap. In that context I must also refer to Brian Rix and Mary Holland. I pay tribute also to Tim Yeo and Amanda Jordan of the Spastics Society. One could say that it was the Spastics Society which took up the campaign in 1978. Next week it enters the third phase of the campaign.
  It would be wrong to pretend that we have not been able to bring down substantially the perinatal mortality rate in Britain. It has come down from about 17 deaths per thousand to 13 per thousand. That is a big improvement, but it is not good enough. One must accept that there should be a minimum standard of care for the pregnant woman and her new-born baby. That is the only means by which we can make comparisons.
  The House and a variety of Ministers have been deceived by the Minister's Department. From time to time it would say that it would cost too much to collect that information. The low-weight, pre-term baby is the one at greatest risk. After a battery of questions and much support from the Library and the Table Office, I was told that it would be too costly to collect this information. I thought that I was asking the Minister to share information with me. The reply was that it would be too costly to collect the information.
  The Minister will be very surprised to know that a professor in Liverpool, who had followed the questions, told me that he could not understand why I had not been told the information, and he supplied the answer that had been provided by the Minister's Department. I do not know why the Minister or Parliament should be denied information on minimum standards of care, On the basis of the minimum standard we can make our judgments about what should be done. I can understand the Department's concern about not interfering in the activities of area health authorities and regional health authorities. However, we are saying that that is the minimum standard. Anything more would be very welcome.
  I intend to raise this issue over and over again. I shall speak briefly, for a Welsh Non-conformist. I shall speak
  524
  for only 10 minutes. That will give the Minister twice as much time as me. En that time, I expect him to give a full answer and I expect to be able to intervene briefly, Over the years we have tried to obtain minimum standards. I have been involved since 1976. The Spastics Society has been involved since 1978. The Minister will find report after report from 1945 onwards. The Opie report, the Court report, the Short report, the Black report and the Peel report all say that there must be minimum standards.
  I have a substantial number of friends in the Department, but, strangely, the section that deals with the prevention of handicap among the new-born seems to be evasive. I could say that it tells lies. If one severely disabled baby survives it costs the State £½ million. I would willingly pay that. Life is important. However, if the handicap was avoidable and someone did not insist on minimum standards, someone must be called to account. That is the point.
  After all these years, after eminent report after eminent report stressing the importance of minimum standards, why have we not got them? The all-party group met the Secretary of State following the publication of the Short report. The Secretary of State said that the Government had announced their intention of establishing minimum standards in a debate on 5 December. Which 5 December? It was 5 December 1980. It may sound unkind, but some civil servants will have been drawing their pensions for five to eight years, while minimum standards have not been laid down. I would settle tonight if the Minister said that the Government would implement minimum standards with effect from now. I would accept that and I would feel that the debate at this late hour had been worth while.
  I am concerned about the fact that complacency is creeping in. The campaign that has been conducted since 1976 reveals that there has been a fall from 17·7 cases of infant mortality per 1,000 births in England and Wales to 13·3 per 1,000 in [980. The figures are good, but they are not good enough. One of the answers is that a standard that is acceptable must be laid down.
  From time to t me the Department has been sceptical about what is called positive discrimination in favour of those at risk. There are certain women who become pregnant and who are at risk. These women must be identified at an early stage. The Department has said "No. We are not sure that your facts are right." Immigrant women, for example, could be in difficulty. It was said repeatedly that positive discrimination has been applied in Sweden and that the women of the poor Mediterranean countries have a better rate of perinatal mortality than Swedish women.
  At long last we have evidence in Britain that at Sighthill in Edinburgh, where a policy of positive discrimination for those who are weakest in our community who are pregnant is pursued, it is possible to achieve dramatic results. After the debate the Minister will have to return to his Department to say "The Spastics Society, MENCAP, RADAR, the professionals and the House have proved that positive discrimination reduces perinatal death and handicap. It brings in the community midwife and gives her a vital and positive role to play in our society. We must employ her skills to the maximum capacity. At the end of the day, when this has been done, there is a fall in mortality rates and a dramatic improvement in health."

  525
  Will the Minister now say "Yes, I will implement our promises to produce a much better standard of minimum care throughout the country"?
  1.8 am
  The Under-Secretary of State for Health and Social Security (Mr. Geoffrey Finsberg): I shall try to give as full an answer as the hon. Member for Eccles (Mr. Carter-Jones) has requested. He will realise already that he exceeded the 10 minutes to which he undertook to restrict himself. I shall give him as broad a picture as I can.
  The hon. Member's interest in perinatal mortality and the prevention of handicap is well known to the House. When we last discussed this topic he claimed already to have tabled about 500 questions on the subject and to judge from my recent "in" tray he must be well on the way to his sixth century.
  The hon. Gentleman has raised the question of establishing minimum standards in the maternity and neonatal services. He has voiced the suspicion that we may be seeking to get out of the undertaking that we gave about 18 months ago, or that we are taking an inordinate time over its implementation. I hope to be able to cover both these points.
  To begin with, I ask him to recognise that the setting of minimum standards has been a novel departure by this country, in which we have few precedents to guide us. I know that there are some people who look on minimum standards as little more than another name for central prescription, who make no secret of their distrust of the freedom accorded to health authorities to decide their own local priorities, and who see minimum standards as a means of limiting their exercise of this discretion in an important field. However, this has not been the Government's view of the matter, nor do I believe that it is a view held by the House.
  We had, therefore, to think long and carefully both about what sort of standards would be most helpful and how they should be drawn up and promulgated. We looked at the French decree on minimum standards, which has frequently been quoted as an example, and found that it was largely concerned with requirements so basic—things like running water and electric light, the availability of an operating theatre, and so on—that, thankfully, we could largely take them as read where NHS hospitals are concerned.
  We studied other suggestions helpfully offered to us from various quarters but found that these were often concerned mainly with questions of professional opinion and good practice which, while important in themselves, were in our judgement rather matters for consideration by the professions concerned than for prescription by central Government. Nor, in our view, should minimum standards be concerned, except occasionally, with the siting of services or overall levels of provision. These are decisions which are best taken on the spot, in the light of local circumstances and needs. A minimum set by reference to the pattern of needs in one area can so easily be quite inadequate for the needs of another, and grossly excessive somewhere else.
  The conclusion to which this led us was that minimum standards should be concerned essentially with the quality of the services provided—to provide an up-to-date yardstick of the staffing and equipment on which every
  526
  woman admitted to a maternity unit should be able to rely, for her own safe delivery and for the care of her newborn child. On this basis we approached the professional bodies informally last year for their advice on the level at which such standards should be pitched. We did not want to set standards so high that health authorities could not hope to match them in the foreseeable future, but equally there was no point in setting them so low that they would provide no stimulus for improvement. On the basis of much detailed and helpful professional advice we prepared a first draft set of minimum standards.
  By this time, however, the maternity services advisory committee was fully established and getting down to work. It soon became apparent to us from reports of its progress that in its study of antenatal care the committee would be tackling authoritatively a number of the subjects which we had at first envisaged including among the set of minimum standards.
  To prevent unnecessary and confusing duplication of advice, and to avoid pre-empting the committee's judgments in later stages of its work, we have, therefore, been endeavouring during the past few weeks to eliminate the overlap between the work of the committee and the draft standards. We are now close to producing a core of standards relating to the staffing and equipment of maternity and neonatal units while the committee will, we hope, produce a series of authoritative guides as to the uses to which they should be put.
  I can assure the House that it is our intention to put our draft minimum standards to the maternity services advisory committee before the House rises for the Summer Recess. We should expect its comments in the autumn, and a revised draft will then be put out for wider consultation to professional bodies, the National Health Service, and to representatives of the consumer interest, as we have already agreed.
  These last would include both the Spastics Society, to whose long-standing interest in these matters I wish to pay tribute, and the maternity alliance, a more recently established body with which my hon. Friend the Minister for Health recently had an outstandingly constructive meeting.
  The Government see the raising of standards in maternity care as a continuing process in which public opinion, Parliament, the Government and the health services all have a part. I am encouraged by what has been achieved during recent years and by the increased awareness and debate among the professions and the public on what might be done to improve maternity service further. The discussion in newspaper and magazine articles and on radio and television programmes were generated to a large extent by the 1980 report of the Social Services Committee on perinatal and neonatal mortality which was produced under the chairmanship of the hon. Member for Wolverhampton, North-East (Mrs. Short).
  The Government welcomed the Committee's report and shared its concern to achieve further reductions in perinatal mortality and handicap. More recently, early in 1981 our policy handbook "Care in Action" reaffirmed our decision to accord a high priority to achieving those aims by the improvement of maternity and neonatal services and our undertaking to establish minimum standards of staffing and equipment that are attainable within a reasonable time and with reasonable staffing and finance.
  I am pleased to agree with the hon. Gentleman that the pace of the reduction in the perinatal mortality figures has

  527
  quickened in recent years. After registering a reduction of about 25 per cent. between 1974 and 1979 there was nearly a 10 per cent, fall between 1979 and 1980 from 14·6 per 1,000 births to 13·3. That was the biggest percentage fall in a single year since records began in 1928. There were two other interesting and encouraging developments. The difference between the least and most favoured health regions continued to narrow, from 7·9 points in 1974–23·6 to 15·7 per 1,000 births—to 4·5 points in 1980–15·3 to 10·8 per 1,000 births.
  Mothers in social class V had a large improvement in perinatal mortality rates in 1980 compared with 1979 from 18·7 to 17·0, leading to a narrowing in the social class gradient so that the ratio of perinatal deaths in social class V to those in social class I is now 1·75 as compared with 1·82 in 1979.
  Mr. Carter-Jones: Is not the Minister arguing my case, namely that we need positive discrimination, because the difference for social class V is still enormous although there has been an improvement? Will he now consider much more carefully the question of positive discrimination for those at risk?
  Mr. Finsberg: I have an open mind, and of course I shall consider the hon. Gentleman's point. However, he does not do his case, which he has argued eloquently, strongly and with great passion for many years, as much good as he might wish by dismissing the advances. The facts show that with the work that is being done, we are narrowing the gap. I shall consider what he said, but I should need to be convinced that what we are doing is right before I consider a major switch in policy.
  It is also pleasing to note that national neonatal mortality rates for England and Wales have reduced from 9·7 per 1,000 live births in 1976 to 7·6 in 1980. I am sure that many different factors have contributed to those reductions in perinatal and neonatal rates, but the devoted work of many NHS medical, nursing and midwifery staff have undoubtedly been among them.
  Having made substantial progress we want to keep up the momentum so that further advances can be made. Advances do not always necessarily depend on the injection of extra money; a more effective use of available resources and a stringent examination of established procedures can lead to greater efficiency and job satisfaction as well amongst staff and, very important, a more effective and humane service to the expectant mother. The House knows that the maternity services advisory committee was set up last year to look at the maternity and neonatal services. The committee was asked first to look at ante-natal care because this was an area of particular concern to the professions, organisations and individual women who had expressed dissatisfaction at overcrowded clinics and impersonal care.
  The committee, under its first-rate chairman Mrs. Alison Munro, has responded with energy and enthusiasm, and its work on ante-natal care is approaching completion.
  528
  We look forward to its report, and to inviting it to move on to the next stage of considering care in labour. It is our intention that the committee's reports will get a wide distribution and we will expect health authorities to respond positively to action recommended in them. My right hon. Friend the Secretary of State will be discussing progress with the health authorities under the recently introduced arrangements for annual review meetings between Ministers and regional health authority chairmen.
  The importance which we attach to ante-natal care is further underlined by the support we are giving to the Health Education Council for its national campaign to make women more aware of the need for early and regular ante-natal care. In this financial year we are giving the council nearly £½ million specifically for this "Mother and Baby" campaign. The importance of ante-natal care is also a part of many local health education campaigns in association with the national efforts of the council.
  Many health authorities have recognised the importance of obtaining a clear picture of what is happening at local level in the maternity services as the first step in tackling problems and reducing perinatal and neonatal mortality. I commend these initiatives. I should like to see more such regional and district surveys, and in order to encourage authorities that have not yet carried out such surveys but who might be helped by information held at a central reference source my Department has funded a project of the national perinatal epidemiology unit to establish an archive of locally based perinatal surveys.
  I hope, without being considered complacent, that we can therefore claim to have made considerable progress in tackling many of the problems of the maternity services, but it is, of course, the Government's intention that health authorities should continue to give priority to these services. We can play our part centrally by supporting the work of the Maternity Services Advisory Committee, by funding the Health Education Council and by research, but the standard of service both in the human and technical senses is primarily a matter for health authorities and the professions in their day-to-day approach to the expectant mother and her needs.
  The hon. Gentleman should be satisfied with what I have been able to tell him. I do not say "wholly satisfied", because I know enough of him to understand that nothing will satisfy him until we have reduced the mortality rate to zero. I fear it will be not only civil servants who will be drawing their index-linked pensions by then but also some of our children or grandchildren. The hon. Gentleman does a service to the House by raising these matters. I hope that at 1·23 am he has not too much of a guilty conscience for keeping you in the Chair, Mr. Speaker, for a rare but welcome appearance at adjournment debates. I hope that he will feel content at what I have been able to say.
  Question put and agreed to.
  Adjourned accordingly at twenty-four minutes past One o'clock.

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  National Health Service (Staff)
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  Nurses
  Nurses
  Family Planning (Departmental Guidance)
  Family Planning (Departmental Guidance)
  Brent Sickle Cell Society
  Brent Sickle Cell Society
  Single Payment Limit
  Single Payment Limit
  Supplementary Benefit
  Supplementary Benefit
  Disabled Persons
  Disabled Persons
  Health Service Pay
  Health Service Pay
EDUCATION AND SCIENCE
  Women Overseas Students
  Women Overseas Students
  Redundant Workers
  Redundant Workers
ENVIRONMENT
  Mobile Homes
  Mobile Homes
  Local Authority Services (Privatisation)
  Local Authority Services (Privatisation)
  Property Services Agency (Chief Executive)
  Property Services Agency (Chief Executive)
  Building Research Establishment
  Building Research Establishment
  Radioactive Waste Management Advisory Committee
  Radioactive Waste Management Advisory Committee
  International Garden Festival (Liverpool)
  International Garden Festival (Liverpool)
NATIONAL FINANCE
  Anglia Building Society and London and South of England Building Society
  Anglia Building Society and London and South of England Building Society
  Building Societies
  Building Societies
  Public Expenditure
  Public Expenditure
AGRICULTURE, FISHERIES AND FOOD
  Farm Prices
  Farm Prices
  Livestock Auctions
  Livestock Auctions
  Farm Incomes
  Farm Incomes
  Milk Producers
  Milk Producers
  Fishing Industry
  Fishing Industry
  Sea Fish Industry Authority
  Sea Fish Industry Authority

Preamble
The House met at three of the clock: The LORD CHANCELLOR on the Woolsack.
Prayers—Read by the Lord Bishop of Peterborough.

Industrial Competitiveness
Baroness Elliot of Harwood: My Lords, I beg leave to ask the Question which stands in my name on the Order Paper.
The Question was as follows:
To ask Her Majesty's Government what is the latest information on competitiveness in British industry.
The Minister of State for Defence Procurement (Viscount Trenchard): My Lords, United Kingdom cost competitiveness (as measured by the IMF index of relative normalised unit labout costs) improved by about 10 per cent. between the first and fourth quarters of 1981. This reflects a change in the path of the exchange rate but also a considerable reduction in the rate of growth of United Kingdom unit wage and salary costs last year. The latter stemmed from increased productivity and continued moderation in pay settlements.
Baroness Elliot of Harwood: My Lords, while thanking the noble Viscount very much for that most encouraging reply, may I also ask whether he welcomes the fact that productivity in manufacturing is rising at record levels and that over-manning has been virtually eliminated in much of British industry?
Viscount Trenchard: My Lords, I agree with my noble friend. Compared with the fourth quarter of 1980, the first quarter of 1982 shows a 12 per cent. increase in productivity in manufacturing industry. This is indeed at a record level for all time, and it is in spite of volume having improved only a little in the second half of last year and still being at roughly the same level as in the first quarter of this year. As the House will know, increasing productivity by those amounts without a volume increase of a substantial order is a remarkable achievement for British industry.
Lord Beswick: My Lords, as we are doing so well, can the noble Viscount say why we cannot afford to give more than 4 per cent. to the hospital workers?
Viscount Trenchard: My Lords, the noble Lord does not, I think, need to be reminded of the amount of competitiveness that we have lost over many recent years and of the need to regain that in comparison with other countries. We still have a long way to go, but we are certainly moving, and moving in a real way.
Lord Cledwyn of Penrhos: My Lords, is the noble Viscount aware that these figures about competitiveness and improved productivity are very welcome but
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that what concerns us on this side of the House, and indeed throughout the House, is that while we have these record levels in one field, there is a record level of high unemployment in another field? Can he say whether these encouraging figures mean a prospect of high unemployment being brought down, and can he say what plans the Government now have, on the basis of these good figures, to bring down unemployment?
Viscount Trenchard: My Lords, indeed it is a fact that employment levels inevitably follow levels of competitiveness and shares of world markets that this country wins. If we can keep these trends up there is no doubt but that unemployment will also turn, but at a distance behind the economic factors. I would add, as one factor not yet mentioned, the extremely good progress (though it has not yet reached levels of which we should be really proud) in the fight against the basic causes of inflation.
Viscount St. Davids: My Lords, will the noble Lord comment on the fact that over-manning was believed to be somewhat over 20 per cent. and that unemployment is by no means at such a height, so it would appear that a lot of those who have lost their jobs have subsequently become employed in a better manner elsewhere?
Viscount Trenchard: My Lords, although there has been rising unemployment in some industries, particularly those where we have been uncompetitive for a long while, there is solid evidence of rising employment in those industries which are competitive.
Lord Molloy: My Lords, would the noble Viscount the Minister not agree that, if we could take some real action against the cheats and the spivs who make multi-millions from the black economy, the picture he has described this afternoon would be even better?
Viscount Trenchard: My Lords, I believe that if the economy becomes fully healthy again, as it is now beginning to do, the advantages of any black economy will be less and it will decline.
Lord Soames: My Lords, would the noble Minister agree that the question put to him by the noble Lord, Lord Beswick—namely, that he would like to see an increase in wages for the public sector higher than that which has been offered by the Government—denotes that he has learnt nothing from what has happened in the last few years and that he would like to go back to all the bad old practices which the last Government pursued?
Viscount Trenchard: My Lords, I agree with my noble friend, and his point enables me to add that, while our unit labour cost last year rose by only 22½ per cent., which was better than the figures for the United States or France, it was still behind those for Germany and Japan. We have therefore a major backlog of uncompetitiveness which we still have to make up.
Lord Avebury: My Lords, if workers in the public sector, and particularly those in the health service,

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are expected to set a good example in exercising restraint, why have the Government recently approved enormous increases for judges and generals? Does the Minister not think that the Top Salaries Review Body has set an appallingly bad example, of which workers in the health service will have taken note and which they cannot be expected to ignore?
Viscount Trenchard: My Lords, the Question refers to the competitiveness of British industry and I take that to be both the private sector and the competitive part of the public sector. I think the noble Lord's question is largely on other matters.
Lord Balogh: My Lords, would the noble Viscount the Minister tell us the figures on which he bases his optimism? The figures do not show any improvement; on the contrary, the trend is still to higher unemployment.
Viscount Trenchard: My Lords, I am afraid that my affliction always makes it slightly difficult to hear the noble Lord, Lord Balogh. But I think that the balance of economic points which I have already mentioned is an indication that, although slow, the foundations have been laid for a real economic recovery for this country.
Lord Balogh: My Lords, the noble Viscount the Minister merely asserts, but I am asking a direct question. He should give us the basis of his assertion that improvement is obvious. It certainly is not at all obvious here.
Viscount Trenchard: My Lords, I note that the noble Lord does not find the signs that I have mentioned as obvious as I believe we on this side of the House do.

Profit Sharing and Share Option Schemes
3.14 p.m.
Lord Monk Bretton: My Lords, I beg leave to ask the Question which stands in my name on the Order Paper.
The Question was as follows:
To ask Her Majesty's Government how many employees are covered by profit sharing or share option schemes compared with the level of 1979.
Lord Lyell: My Lords, information is not available in the precise form requested by my noble friend. However, under approved profit sharing schemes, shares were appropriated to 145,000 employees in the tax year 1979–80, which was the first year of operation of the legislation, and to 270,000 in the tax year 1980–81. For approved share option schemes, which were introduced by the Government in the 1980 Finance Act, the first full year of operation was the tax year 1981–82. Reliable estimates of the number of employees granted options in that year are that they are believed to exceed 50,000.
Lord Monk Bretton: My Lords, I thank my noble friend for that reply. May I ask him whether he is reasonably satisfied with the degree of increase in profit sharing that we have seen, bearing in mind the difficult time it has been for profits worldwide? Does he agree, now that we have better fiscal incentives, that care and thought are still necessary before the introduction of schemes which are tailored properly to the interests of the individual businesses concerned? May I also ask whether he can tell us how many profit sharing schemes were approved in 1979 and how many there are now in 1981–82?
Lord Lyell: My Lords, the answer to my noble friend's first supplementary question is, yes. I very much agree with the contents of his second question. In reply to my noble friend's third question, I understand that there were 30 approved schemes in 1979 and the latest total that we have is in excess of 440.
Lord Rochester: My Lords, are the Government prepared to consider suggestions as to how, through appropriate legislative means, still more share ownership schemes can be encouraged?
Lord Lyell: My Lords, we shall always be pleased to receive any comments, or any possible ameliorations, in respect of this scheme.
Lord Orr-Ewing: My Lords, can my noble friend consider seriously the suggestion from the Liberal Benches that the Government of the day should really look at the disincentives and the complexities, which are now necessary in share option schemes, and which appear to be derived from a desire by the Treasury to make sure that nobody gains anything worthwhile? Is it not an important part of industrial relations that share option schemes should be encouraged in every possible way, so that people have a greater interest in the company for which they work?
Lord Lyell: My Lords, we are seeking every possible way in which to publicise the ease of share option schemes for all employees in their own companies. Indeed, there are two very useful leaflets which are freely available from the Inland Revenue, one for the employees and one for the employers.
Lord Campbell of Alloway: My Lords, would my noble friend the Minister agree that it is appropriate that the Government should take a positive initative, not only as regards share option schemes but also as to guidelines for voluntary worker participation?
Lord Lyell: My Lords, the purpose of all profit sharing provisions, be they profit sharing schemes or share option schemes, is to encourage all employees to identify their own interests with those of the company employing them. This is the major objective of the Government.
Baroness Seear: My Lords, are the Government prepared to study the Loi Monory scheme in France, which would make a very considerable extension of share ownership throughout industry to people who do not at present have the advantages of sharing in the profits of industry?
Lord Lyell: My Lords, we are prepared to make further studies in the direction of the Loi Monory scheme, but we think that this concept breaks the essential link, in which we believe, between the employee and his own company. Nevertheless, we are prepared to study this French case to see whether there is anything which we could learn.
Lord Oram: My Lords, while we should recognise that profit sharing schemes make some modest contribution to democracy in industry, may I ask whether it is not a mistake to believe that they can make any really significant contribution, since worker shareholders can all too readily be outvoted by other shareholders? Is it not the case that democracy in industry can be found only in those enterprises which are operating on the basis of one shareholder/one vote, rather than on the basis of one share/one vote?
Lord Lyell: My Lords, I do not wish to enter into a philosophical argument. Nevertheless, I believe that the figures which I quoted in my original Answer to my noble friend's Question are indicative of the great success of the schemes that we have in operation at the moment.
Lord Monk Bretton: My Lords, may I ask my noble friend whether or not it is vital to achieve a proper balance in these matters: to preserve employees' security, which is the first thing they need, then to improve employee involvement and then to be careful to avoid discouraging the risk taker? Without the risk taker we are nowhere. Does not this necessitate the continuation of voluntary schemes, with fiscal aid, upon which the Government have embarked?
Lord Lyell: My Lords, the main thrust of all these profit sharing schemes is directed towards associating employees with their own companies. If there is any fiscal benefit, we believe that this is by-the-by. It is possibly an associate benefit. But the main thrust should be that the employee may associate himself and his savings with his own company.

European Parliamentary Elections: Franchise
3.21 p.m.
Lord Chelwood: My Lords, I beg leave to ask the Question which stands in my name on the Order Paper.
The Question was as follows:
To ask Her Majesty's Government whether they will introduce legislation in ample time before the 1984 elections for the European Parliament to enable all citizens of the United Kingdom and Colonies and their spouses resident in any Community country outside Britain to make a declaration and vote by proxy, whether or not it is decided to conform with a uniform Community electoral procedure.
The Parliamentary Under-Secretary of State, Home Office (Lord Elton): My Lords, in accordance with the Community treaties, which require member states to
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adopt a uniform electoral procedure if it is unanimously recommended by the Council of Ministers, consideration is currently being given by the Council to proposals which have recently been recommended by the European Parliament and which cover the issue of extending the franchise to Community nationals resident in other Community countries. It would therefore be premature to legislate on this issue in isolation before agreement has been reached on the package as a whole.
Lord Chelwood: My Lords, I am grateful to my noble friend for his Answer. May I ask him whether he is aware that the Government's continued prevarication is making many people wonder whether the Government are in favour, even in principle, of giving the vote to some 300,000 British subjects living in other Community countries? If the Government are in favour, why on earth should we wait for the Council of Ministers to make up their mind—something which they are not at all good at doing and about which they are most unlikely to be unanimous—rather than following in the footsteps of seven out of nine of the other Community countries which have already acted in this field?
Lord Elton: My Lords, the footsteps of the seven out of nine do lead in slightly divergent directions and will have to be brought back to the same path when the Council of Ministers agrees. When the Council of Ministers agrees it will have been a waste of parliamentary time if we spend time now legislating upon something which immediately we have to undo and replace with something else.
Lord Underhill: My Lords, would not the noble Lord agree that it is unwise to make a very important electoral change of this kind just for one series of elections, that this matter would affect the Representation of the People Act and that it ought to he considered by a Speaker's Conference—and not just for one election?
Lord Elton: My Lords, as to the process by which we reach agreement within this country, I should not like to commit the Government. However, the noble Lord will have noticed the strength of feeling among my noble friends. I agree that it is important that we should get it right and that it would be a mistake to legislate twice upon it.
The Earl of Onslow: My Lords, is it not true that the unanimity of voting procedure is supposed to be in force by the second parliamentary election to the European Parliament? Judging by my noble friend's comment, that the seven feet of the different Ministers are all going in different paths—
Lord Morris: Fourteen feet, surely!
The Earl of Onslow: Fourteen feet my noble friend tells me, this is unlikely. Surely, therefore, it would be wise to disabuse people of this injustice which is happening by reason of the 300,000 people who are disfranchised?
Lord Elton: My Lords, I am tempted to follow my

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own image a little further and to go metric. The feet in question are the feet of the populations of the seven countries. The Ministers are trying to converge. Then their populations will have to follow them. How long this will take I cannot honestly undertake to let your Lordships know, because it is not in the power of the British Government to deliver decisions among the Council of Ministers. When that decision is delivered we shall know what to do.
Lord Stewart of Fulham: My Lords, is it not a fact that some of our citizens are suffering an injustice which the citizens of seven countries in the Community have been delivered from by the action of their Governments in one way or another? In view of that and in view of the fact that agreement among all the countries in the Community at the time of the next election is unlikely, would it not be reasonable at least to have some draft legislation ready?
Lord Elton: My Lords, with the greatest respect to the noble Lord, I am not confident that there is quite such a discrepancy between what binds our own citizens and that which relates to the citizens of other countries. Our own citizens can vote when abroad in exactly the same way in a European election as they can in a general parliamentary election. I see that the Luxembourgeois, to start with the smallest, have to attend in Luxembourg in order to vote. I see that the provisions in Belgium relate to citizens of 18 or over whose principal residence is still in Belgium, and that in Denmark the power to vote again relates to citizens temporarily resident abroad who maintain close links with Denmark and who are registered there. I believe that the concern which my noble friend has expressed stretches much wider than those people—to people who are resident permanently abroad, some of whom, if we are not careful with definitions, will have never resided in the United Kingdom.
Lord Saint Oswald: My Lords, having asked a very similar Question to this of an earlier Government before the earlier European elections, I have fewer questions to ask than my noble friend who has put down the Question today. There seems to me to be less reason for delay now than there was then. Does not my noble friend the Minister agree that those who by circumstance are residents and who tend to know more about the subjects in hand than do the residents of this country should not be excluded, as they are at present being excluded, from the possession of the vote in our elections?
Lord Elton: My Lords, I am grateful to my noble friend for his patient exposition of his very impatient feelings. As to the ability of residents in other countries who are citizens of this country to affect the tide of opinion in this country about affairs which relate, as to nine parts to ten, to other countries, I would not wish to take issue with him. However, the Government are aware that there is a desire for a movement in this direction. I undertake to bring the strong feelings of my noble friends to the attention of my right honourable friend, but I cannot be more encouraging than that.
Lord Chelwood: My Lords, I am very grateful for what my noble friend has just said, but is he aware that so far as I am concerned I have absolutely no patience whatsoever so far as this matter is concerned? May I ask him to answer a question which I find it hard to know the answer to: Why are the Government so very keen, apparently, to do exactly the same thing as our Community partners in this one particular field where the election is concerned, whereas they have not the slightest intention of falling into line with the other Community countries where the general electoral procedures and systems are concerned
Lord Elton: My Lords, without pursuing my noble friend into too much detail, this is an area upon which from the outset it was agreed that there should be uniformity.

Whitehall Demonstration: Police Action
3.28 p.m.
Lord Monson: 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 by what authority the police ordered the removal of the Union flag from a building in Whitehall on 23rd May and ordered the playing of the National Anthem to cease.
Lord Elton: My Lords, I understand from the Commissioner of Police of the Metropolis that the police acted under difficult circumtances and in accordance with their duty to prevent a breach of the peace.
Lord Monson: My Lords, I thank the noble Lord for his Answer. Is it not, however, deplorable that our flag and our National Anthem should be banned merely because they annoy communists and members of the Socialist Workers' Party, particularly when these latter parties, together with other pro-Argentinian and pro-IRA groups, have complete freedom to demonstrate noisily as often as they wish and, what is more, can evidently get away with burning and trampling upon the Union Jack with complete impunity?
Lord Elton: My Lords, the Union Jack was neither burned nor trampled upon on this occasion. The police were acting under difficult circumstances and had to act to prevent what appeared to be an imminent and considerable breach of the peace. We should recall that the actions of the police were based solely on the need to keep the peace. It is not their business to weigh the merits of one cause against another. Neither did they do so. Noble Lords will recognise that this degree of impartiality requires considerable self-discipline, and they will realise from the events to which the noble Lord has referred that the police are fully able to command it.
Lord Elwyn-Jones: My Lords, will the noble Lord the Minister tell the House what happened?
Lord Elton: My Lords, if I may summarise for the benefit of the noble and learned Lord, at the point we are considering the head of the procession had passed—
Lord Soames: What procession?
Lord Elton: My Lords, I had assumed a greater degree of knowledge among my noble friends and others than there appears to be. There was a procession and a rally organised by something calling itself the Ad Hoc Committee for Peace in the Falkland Islands numbering about 4,000 people. It assembled in one place and marched to another, and the latter place was Trafalgar Square. As the marchers approached Trafalgar Square, the head of the procession passed, I believe, No. 21 Whitehall—although I am not sure of the number.
Lord Shinwell: My Lords, while respecting—
Lord Elton: My Lords, I think I should complete the account for which many noble Lords have asked me, even if it makes a longer answer. As the procession passed this point, things were thrown on the people in the street below. As this section of the procession arrived outside that building, windows were thrown open, banners with proclamations upon them were hung out of the windows, as was the Union Jack, and music was played. The procession began to slow down. At that point, about eight people appeared on the roof and started shouting at the people below. They were joined by the crowd surrounding the procession. The procession began to halt and events became extremely tricky. The police decided, rightly in my view, that the only catalytic factor they could remove was the people on the roof. They did so and they also removed their belongings, which were t he banners and also the flag to which the noble Lord has referred—and that is normal practice. As the police left they also turned off the electric switches, as they should have done, and that silenced the music.
Lord Shinwell: My Lords, while not uttering a word of offence or criticism of the general conduct of the police, of whom we are, generally speaking, proud, may I ask whether this event seems to indicate that some sections of the police force are now yielding to the hypocritical pacifism and so-called humanitarianism that has disgraced our society recently during our troubles?
Lord Elton: Absolutely not, my Lords. I should add that 13 people whose views were exactly contrary to those of the people to whom we have just referred were arrested on the same day.
Lord Inglewood: My Lords, may I ask my noble friend—because I do not think he has yet made it clear—whose band this was and which was the building in Whitehall? While not disputing that the police have to make difficult decisions all the time, would he not agree that this was the sort of occasion about which, surely, Members of this House are entitled to seek information?
Lord Elton: My Lords, I have given the House copious information. I will add to it by saying that the band was recorded and I do not know what was on the label of the disc. Now I have clean forgot what the second question was.
Lord Soames: Whose building was it?
Lord Elton: It was in Whitehall, and my recollection is that it passes under the address of Nos. 21 to 31.
Lord Soames: Whose building is that?
Lord Boyd-Carpenter: The Home Office?
Lord Elton: Well, my Lords, at least people not very friendly to the Ad Hoc Committee for Peace in the Falkland Islands.
Lord Chalfont: My Lords, although this matter seems to have been treated with a certain amount of levity and amusement, may I ask the Minister whether it is not a bizarre state of affairs that, while the Armed Forces of the Crown arc engaged in hostilities in defence of Britain, it should he forbidden to display the Union Jack and to play the National Anthem, even allowing for the fact that great difficulties were confronting the police? If in future a choice has to be made between a demonstration of that kind and one which gives aid and comfort to the enemy, would it not be better to ban the latter and not the former?
Lord Elton: My Lords, may I add to my previous reply that the building was Nos. 27 to 31 Whitehall. Although the arresting officers did not have occasion to make inquiries at the time of the people they arrested in that connection, I believe it is associated with something called the Coalition for Peace through Security. As to the noble Lord's separate question, I find myself in a difficult position because I think it a very glorious thing that in a democracy under stress it is still possible to allow those who criticise the defence of democracy to have their voice. If one resorts to absolutely silencing critical views, one is beginning to do what it is that one is trying to defeat. On the other hand, as, I hope, a not unpatriotic Member of your Lordships' House, I find some of the sentiments thus expressed extremely offensive to me personally. That is why I have such unbounded admiration for the police, who always determine these issues with strict impartiality; not on what the demonstration is about but on whether or not the Queen's peace is in danger.
The Lord Bishop of Norwich: My Lords, is the noble Lord the Minister encouraged by the fact that, either in preparation for this Question, which I believe he has answered so well, or because it is the natal day of the Commodore General of the Royal Marines, Whitehall is today lull of Union Jacks?
Lord Elton: My Lords, I believe that is an admirable sentiment with which to conclude what has become rather a lengthy debate.

Business
Lord Denham: My Lords, at a convenient moment after 3.30 p.m. this afternoon my noble friend Lord Trenchard, with the leave of the House, will repeat a Statement which has been made in another place on the Falkland Islands. It may be for the convenience of the House if I announce that Dinner will be available this evening at the usual time. The Report stage of the Local Government Finance (No. 2) Bill will be adjourned at approximately 6.45 p.m. for approximately one hour, and during this adjournment the Third Reading of the Social Security and Housing Benefits Bill will be taken.
Lord Shinwell: My Lords, may I ask the Chief Whip a question arising from his announcement that a Statement made this afternoon in another place on the events which have occurred in the past 24 hours will be repeated here? Does he consider it sufficient in the circumstances, because of what has happened and because of those who may be regarded as responsible for what has occurred, to content ourselves with a few questions from selected individuals in your Lordships' House? Would it not be better, in all the circumstances, because this is a most deplorable event which cannot be ignored or covered up in any sense, to have a debate on the matter? In the circumstances, why should we not meet tomorrow, or at least on Monday, for the purpose of discussing the matter in a full debate?
Lord Denham: My Lords, I do not want to pre-empt anything that my noble friend will repeat by way of a Statement. The noble Lord, Lord Shinwell will be aware that normally such matters are discussed between the usual channels and not on the Floor of the House. However important the occasion is, I believe it would be a pity for the well-running of your Lordships' House if we should depart from this usual practice.
Several noble Lords: Hear, hear!

Local Government Finance (No. 2) Bill
3.39 p.m.
Reports received.
Clause 3 [Substituted rates and precepts]:
Lord Hill of Luton Lord Hill of Luton moved Amendment No. 1:
Page 2, line 22, leave out subsection (4) and insert—
(" (4) Where a precept is substituted by virtue of this section any authority which has made a rate by reference to the original precept—

(a) shall under subsection (1)(a) above make a substituted rate by reference to the substituted precept; and

(b) shall be entitled to recover from the precepting authority—

(i) its administrative expenses in making repayments and allowing credits under subsections (5) and (6) below in respect of the original rate; and

(ii) any increase attributable to paragraph (a) above in its rate collection expenses for the financial year;

and in relation to the substituted rate made pursuant to paragraph (a) above the estimated product of the original rate shall for the purposes of subsection (2) above be treated as reduced
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by the difference (if any) between the estimated products of the original and the substituted precepts.").

The noble Lord said: These amendments stem from the Committee stage of the Bill. In the special circumstances that a county council as a precepting authority made precepts on its district councils before 1st April, when this legislation becomes law with its retrospective qualities the money collected from the district councils will have to be returned by the precepting authority to those councils and the councils will have the responsibility of distributing the excess rates that flows from that supplementary precept to the ratepayers. The point I raised was that this could prove a very expensive business. It is inevitable, it is right, but it is difficult.
Some people have paid their rates for the year in question to their district council, some have paid nothing, some have paid some instalments but not others; some people have lived for a time in the area of the district council but have departed to other areas, and vice versa. I raised the point that the cost of this complicated and rather expensive process should not fall on the district council, which did no more than obey a precept and transfer money to the county council, the precepting authority.
The noble Lord, Lord Bellwin, promised to examine the point, so that no unfair burden should fall on a district authority for something for which it had no responsibility whatever but acted properly in obeying the precept at the time it was issued. To help in the process of finding a solution, I set down Amendment No. 1, with which is closely associated Amendment No. 48, which makes the parallel changes in the schedule. Without going into wearisome details—and I ought to say that I am indebted to the department for helping in this complicated process of drafting—the first amendment is to Clause 3, which repeats the existing provision, and adds a new provision to give rating authorities power to recover from a precepting authority the additional rate collection costs arising from substitution of a new rate for an old one. The second amendment, No. 48, which should be discussed in association with the first, inserts a new paragraph in Schedule 1 dealing with the recovery of costs in transitional cases on the same principle.
So I would hope that the Minister will find himself able to accept these amendments, as providing a way of avoiding the imposition of an improper burden on district authorities, whose only sin was to pay promptly to the precepting authority, and whose task now is not only to repay that money but to repay the excess rates that have followed in the district because the precept involved money which could only be raised by the annual rate. That was the problem, and I venture to put forward these amendments as a solution to that problem, placing the responsibility where it fairly belongs, on the precepting authority, and not upon the individual authorities who have done no more than follow the proper practice of obeying precepts. I beg to move.
The Parliamentary Under-Secretary of State, Department of the Environment (Lord Bellvvin): My Lords, as the noble Lord, Lord Hill, rightly reminds us, I said previously, when he originally raised this matter, that I was sympathetic to the point of view he then

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expressed, and I did undertake to look into the matter. May I say at once how much I applaud his assiduity in pursuing this? He has clearly given the most careful consideration to the matter, and I consider his approach to be most constructive. I think I would perhaps add to what he has said that the concern here is about the equity of additional costs falling on the rating authorities in the circumstances which he has outlined, and that that concern is clearly understood. I am very pleased, without more ado, to say that the Government entirely accept this and we are pleased to accept these amendments to the Bill.
Baroness Birk: My Lords, before this is entirely accepted as it is, it seems to me that it is not quite so clear and straightforward as appears. There are three questions I should like to ask the Minister which I think should be cleared up. First of all, on the question of definition, who is to say what are the increased costs incurred by the rating authority in issuing a revised rate as a result of a substituted precept? Secondly, how are the administrative expenses going to be defined? That is rather a wide phrase. Then, it would seem to me there is a problem in disentangling the rates and the precepts. For instance, what happens when both the rate made for the district council's own purposes and the precept are substituted? How will the extra costs be apportioned?
Earlier Government amendments resulting in Clause 4(3) of the Bill increased the likelihood of substituted rates and precepts. I think we all agreed that substituted precepts will be, Clause 4(3) not withstanding, a rare occurance, and that costs of rate collection are part of the district council's expenditure for block grant purposes. Therefore, the district council will receive grants on the extra costs anyway. On the other hand—and this might be the case in Bedfordshire—the expenditure might attract penalties.
Thirdly, if all the districts in the country have to go through this exercise, the cost to ratepayers remains the same; it is only a question of whether the cost is in the precept or the rate. I should have thought, therefore, that the amendment was not necessary. All it does is further to complicate this already complex Bill. I must tell the Minister that if I had had another day I would have given him notice of these points that I was going to raise, but no doubt he will have them in mind himself. We on this side of the House are very doubtful whether these amendments are necessary and whether they do not further complicate something which is already complicated enough.
Viscount Ridley: My Lords, I think I would be expected, on behalf of the county councils, to oppose quite strongly this amendment, but I cannot do so because there is a great deal of merit in the equity, as the noble Lord, Lord Hill has said, and it is difficult to argue against principles. But I think it is a pity that this amendment has been brought forward very late in the day. The noble Baroness, Lady Birk, has given many of the objections to it, and I would endorse what she has said. Secondly, I think there could have been much more consultation on the detail. Finally, I would say that it only serves to highlight what we have pointed out so often: the totally unsatisfactory nature of the precepting system. I hope that this will be the last occasion w hen we have to
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debate it and that something can be put in its place so that it is not necessary. I have one further question. How it is it to be determined whether a supplementary precept is the fault of the county council or something beyond its control?
Lord Bellwin: My Lords, if I may, with the leave of the House, speak again, may I say that if one looks at the basic intention behind what we are proposing, it is in any case to take up the very point that my noble friend Lord Ridley made—namely that, if we did not have supplementary rates and precepts, then there would not be a problem such as we are finding now to put the situation back into shape satisfactorily. Of course, that is the Government's intention and we make it quite clear that we wish to see the abolition of the right to impose supplementary rates and precepts. Once that has been done, presumably on this Bill receiving Royal Assent, then the problem will not arise.
We have a specific situation here which we looked into carefully after this matter was raised, as it was, by the noble Lord, Lord Hill; and, as I have said, we felt that there was equity in what he was saying, that it was right and that therefore we should be willing to accept it. That is why we are so doing.
As to cost, unhappily at the end of the day the costs will fall on the ratepayers anyway, as they always do, but it seems fair to us that in this instance the expenditure should be borne by the precepting authority rather than the rating authority and count against the block grant target of the former rather than the latter. We feel that it would not be right to penalise the rating authority in such cases. Clearly there will have to be some discussion with the parties on the way in which the nuts and bolts of this will be sorted out.
The noble Baroness, Lady Birk, is right to raise the question of how exactly we shall deal with it, and she clearly says that that is something into which I cannot go. At least, I cannot give her a satisfactory answer today, but I am sure she knows that we will pursue it and, when we get further clarification on this, we will make sure that she is kept informed.
Lord Davies of Leek: My Lords, may I ask the noble Lord a question, through I am not sure whether or not it is relevant? There is now a tendency for local authorities to borrow from overseas. Would this Motion that we have had put before us, which seems to have been accepted, in any way affect borrowing from overseas? No local authority in history has ever reneged on paying. How would this affect foreign borrowing by local authorities? If it does, or if it has nothing at all to do with that, will the noble Lord please let me know?
Lord Bellwin: My Lords, I do not know whether I come to speak yet a third time, other than to say that to the best of my knowledge in no way would that be a problem.
Lord Bruce of Donington: My Lords, may I question the noble Lord a little further on this point? It will be only a very short point. My noble friend asked him how he was going to define "administrative expense", a term which will appear in the Bill in due course; and of course under Clause 12 of the Bill the auditors will require some specific particulars on how this is

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defined. I wonder if the noble Lord could deal with that, or would he prefer to leave it until Third Reading?
Lord Bellwin: I rise for the fourth time, my Lords, to say that quite clearly I would prefer this to be dealt with at Third Reading.
On Question, amendment agreed to.
3.53 p.m.
Lord Gainford Lord Gainford moved Amendment No. 2:
Page 3, line 11, at end insert—
(" ( ) Where a person as tenant or licensee of any premises—

(a) is liable to make payments (whether as part of his rent or otherwise) which vary or may vary according to the rates chargeable in respect of those premises; or

(b) is entitled to make deductions from his rent in respect of those rates,

he shall, where a rate affecting those premises is substituted by virtue of this section, be entitled to recover or, as the case may be, liable to make good so much of any payment or deduction as he would not have been liable or entitled to make if the original rate had corresponded to the substituted rate; and any sum which he is entitled to recover as aforesaid may, without prejudice to any other method of recovery, be deducted by him from any rent payable by him to the person by whom that sum was received").
The noble Lord said: My Lords, first I must apologise for an error which appeared on the Marshalled List of Amendments. My name has been printed as "The Earl of Gainford", and this may have caused some confusion when I heard what I thought was my name being called out in the slight melee of noble Lords leaving the Chamber at the beginning of the Business. In moving this amendment I wish to speak also to Amendment No. 46. My noble friend the Minister introduced into the Bill at the Committee stage in this House amendments which, among other things, ensure that refunds are made to ratepayers where a rate or precept is found to be invalid and a lower rate is substituted when the original one or supplementary rate or precept falls on Royal Assent.
I would like to commend my noble friend and his colleagues for the care they have taken in drawing up Clause 3 and Schedule 1. I understand that local authority associations have been fully consulted to ensure that they will be workable. However, I feel that they are lacking in one respect and that there is nothing to ensure that a rate refund reaches a tenant where the tenant does not pay rates directly to the rating authority but pays a rent inclusive of rates to his landlord. One would hope that in the normal way the landlord would ensure that the tenant would get his refund, and in the case of most tenants in the private as well as the public sector I am sure this would be so.
If it were not so, however, the tenant might be forced into all the problems and expense of a court case because, as I understand it, he has no clear right simply to withhold from his regular rent payments the excess which he has paid. This does not seem right and I would hope that my noble friend could accept my amendment which ensures the tenant's right to get his money back when a refund has been made to his landlord. I will explain this in more detail. The addition to Clause 3 allows the tenant or licensee to recover from his landlord, for example by making deductions from future payments of rent,
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any amount that has been overpaid because a new and lower rate has been substituted for the original rate. It also makes provision for the converse situation where, perhaps because the landlord has omitted to pay the rates, the tenant is making deductions from his rent, having had to pay the rates direct to the rating authority.
I have had experience of this myself. About 25 years ago I happened to be a tenant of a landlord who either could not or would not pay the rates, and so I received demands from the local authority. I dealt through my solicitor whenever a rent or rate demand came. I sent it to my solicitor who then wrote back telling me exactly what I should pay and he kept a check on my payments. However, in the case where too much has been deducted the tenant will receive the refund directly and must make good the excess to the landlord. The equivalent addition to Schedule 1 ensures that the tenant can get back sums paid in respect of supplementary rates. I hope that noble Lords will find this in no way contentious and that my noble friend will be able to agree that it merely takes the existing amendment the necessary step further. I beg to move.
Lord Bruce of Donington: My Lords, we on this side of the House are generally in support of the sentiments which have been expressed by the noble Lord, Lord Gainford, in moving, but we have some questions to ask which I am quite sure the noble Lord will be able to answer. Could it be the case that is given by the noble Lord who moved the amendment that the tenant would have his own rights under common law in any event if excessive deductions had been made or, on the other hand, the authority would have the right on the basis of the deductions being insufficient? I just wonder whether the noble Lord could answer that point and say that it may perhaps depend upon the nature of the contract between the landlord and tenant anyway.
Lord Bellwin: My Lords, may I say first of all that we consider this is a helpful proposal and I am grateful to my noble friend Lord Gainford. The intention here extends the protection afforded by Clause 3 and Schedule 1 to those ratepayers who do not pay their rates directly to the rating authority but pay them instead as an addition to, or as part of, the rent payment to their landlord. Clearly since the Bill as it stands gives the landlord, if he is a direct ratepayer, a right to recover excess payments, it is only fair that these should be passed on to the tenant if he originally footed the Bill. I agree with my noble friend that there can be no contention over that.
I would hope that in nearly all cases where this is necessary the refunds would come about by voluntary agreement between landlord and tenant. Nevertheless, I accept that if there are problems without the amendment it is not clear that the tenant would have the right to make good his loss either by deduction from future rent payments or in some other way by making deductions; for example, he might put his contract with the landlord at risk because the circumstances in which rent may be withheld are extremely limited.
The area of landlord and tenant law is extremely complicated, and so I am relieved to find that the amendment proposed is so simple. It merely states

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the entitlement of the person who originally paid a sum towards the rates to receive any excess refundable and ensures that, if necessary, rent may be withheld to make good the excess. This is, of course, without prejudice to any more agreeable method of achieving a satisfactory refund.
The amendment also deals satisfactorily with the situation where a rate has to be replaced, or falls on Royal Assent. The amendment to Clause 3 deals with the case where the rate has to be replaced and the addition to the transitional schedule deals with other cases. With regard to the point which the noble Lord, Lord Bruce of Donington, made about whether the tenant in any case would not have certain rights under common law, I point out that of course tenants do have rights under common law, but it can do no harm to make it explicit in this way on this point, and I am sure that the noble Lord would be happy about that. My officials have looked carefully at the amendments and I am content that they add to the provisions of the Bill without further complicating unnecessarily the whole difficult area of landlord and tenant law. Therefore, I am happy to tell my noble friend that the Government are willing to accept these amendments.
On Question, amendment agreed to.
Baroness Birk Baroness Birk moved Amendment No. 3:
Leave out Clause 3.
The noble Baroness said: My Lords, I beg to move Amendment No. 3 which is to delete Clause 3. I wish to make it clear right away that there arc other amendments down which deal specifically with the Bedfordshire problem with which the Minister has assured the House Clause 3 is not largely concerned. Although the Bill is not very welcome anyway, Clause 3 is even more unwelcome than a lot of the rest of it. It does two things. It clarifies the law on substituted rates and precepts, and in the light of the legal uncertainty following recent cases I must say that that part is to be welcomed.
However, it goes very much further than that. It is a negation, or at least a postponement at its very best, of local democracy. A local authority will make its rate or precept in March. In May it will go to the electorate on the strength of that rate or precept. Let us suppose that it is a Conservative authority which has kept down its rate or precept at the expense of services. The electorate may, one hopes, reject that administration and return instead a council prepared to reinstate levels of services which have been reduced and to levy a rate to pay for them. What can that newly-returned Labour administration do in the circumstances of this Bill, if this clause becomes part of it? The answer is, nothing—at least until the following year. It must live for the rest of the year with the budget prepared by its predecessors no matter what the wishes of the electorate might be. The authority cannot make a higher substituted rate or precept.
The other side of the coin is a little different. Let us suppose that a Labour administration is ousted by a council sharing the views of the present Government. There is a clear electoral preference to reduce expenditure and reduce rates. This clause enables that preference to be implemented straightaway.
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A lower substituted rate or precept can be made and refunds paid to ratepayers. Hidden in this clause then among the arcane rating law is what I find to be a distasteful piece of political chicanery because it allows democracy to function only in one way; the present Government's wishes can be implemented, but not the other way round. Whatever the Government feel about it or whatever one may feel about the advent of the particular political party that may be elected in the local authority, it should be a two-way system. Democracy should not be just a one-way system.
Our objections to this clause go further than that. We are not satisfied that the rating law in this clause is necessarily good law. Subsection (5)(b) requires refunds to be made on request. This is and certainly can become an administrative nightmare. Any excess, no matter how small, shall be repaid and that is on request. This is, of course, as a by-product, likely to increase the costs of administration to the local authority enormously. There is also the problem of ratepayers who might be in debt for past years or for other hereditaments. Refunds still have to be made to them and cannot be offset against other debts. Recalculation of instalments and rate rebates will also present great problems for rating authorities and these problems, quite frankly, do not seem to have been thought out in a Bill which requires a completely substituted rate or precept to be made for only very small changes. It is for that reason that my friends and myself find this clause both objectionable and bad law. I beg to move.
Lord Bellwin: My Lords, I am sorry that the noble Baroness wishes to wreck the package of amendments which the Government tabled—tabled may I remind her after full consultation with the local authority associations—at Committee stage. I do not propose to repeat all that I said when the House discussed the issues on that occasion, but I thought 1 made it clear that the package was designed to clarify the position of rating and precepting authorities and of ratepayers, especially where a rate or precept was found to be unlawful.
Our aim was and is an entirely constructive one: to resolve doubts over such matters as the powers of rating authorities to reduce their rates and to make refunds. The noble Baroness, however, is clearly anxious that these doubts should remain by deleting the provisions concerned. Indeed, if Clause 3 were deleted, precepting authorities, because of the time limits on the issue of precepts, would not be able to issue a new precept at all to replace an invalid precept. The precepting authority would be left entirely without any way of financing their expenditure for the year in question.
The noble Baroness complains that Clause 3 would enable an authority to substitute a lower rate but not a higher one. She talked of political chicanery. Let me make it absolutely clear, as I hope your Lordships are now aware, that the ban on supplementary rates and precepts is designed to protect ratepayers from the further depredations of irresponsible local authorities after the start of the financial year. As I indicated at Committee on 10th May, it would hardly be consistent with that basic policy objective to let authorities substitute a higher rate part-way through the year.

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The noble Baroness and the House will not be surprised to know that as far as we are concerned this amendment is quite unacceptable to the Government.
Lord Denham: My Lords, I do not know how long the noble Baroness may be in her reply, but I think that probably the House would wish the Statement to be taken now.

The Falkland Islands
4.9 p.m.
Viscount Trenchard: My Lords, I should like to repeat the Statement made by my right honourable friend the Secretary of State in the other place. It reads as follows:
" Since I reported to the House on 26th May British forces have moved forward to positions surrounding Port Stanley and are in firm control of high ground on an arc surrounding the town.
" Earlier on 29th May, 2 Battalion the Parachute Regiment supported by units from the Royal Marines, Royal Artillery and the Royal Engineers captured Darwin and Goose Green. This action against a greatly superior force was a remarkable feat and our forces displayed great determination, valour and fighting skill. At the same time units of 3 Commando Brigade liberated the settlements at Teal and Douglas. Whilst these actions were in progress 5 Infantry Brigade came ashore without incident and the QE2 which carried them is due back in Southampton tomorrow.
" In order to move forward elements of 5 Infantry Brigade as rapidly as possible to the Port Stanley area and given the appalling weather which was making the logistic problems difficult for helicopters, the force commander moved some forces with heavy stores and equipment around the coast by landing ships.
" When the weather cleared on 8th June all but the last elements had moved forward successfully. But the sea movement coincided with better weather and the Argentines at this time renewed their air attacks on our forces. Our latest assessment is that during these attacks at least seven Argentine aircraft were destroyed and maybe another four, making 11 in all.
" One air attack was launched against two landing ships, 'Sir Galahad' and 'Sir Tristram'. Both ships were hit. The 'Sir Tristram' had virtually completed off-loading, and she was not severely damaged. The 'Sir Galahad' had already started unloading but still had some men embarked.
" Having consulted the military authorities, I am not prepared at this stage to give the total numbers of our casualties and indeed to do so could be of assistance to the enemy and put our own men at greater risk. Meanwhile next of kin are being informed and I will give further information as soon as reasonably possible.
" In another incident, Argentine aircraft attacked a small landing craft. Four Royal Marines and two Naval personnel were killed; their next of kin are being informed. In this incident, all four attacking
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Mirage aircraft were intercepted by our Sea Harriers and were shot down.
"HMS 'Plymouth' sustained an attack on the other side of East Falkland, in the Sound. Five Royal Naval personnel were injured and their next of kin have been informed. The ship was damaged but she remains operational.
The losses which we have sustained in these incidents are tragic ones and as soon as we can give further information to the families we will do so. I would like to express my tribute to the bravery and skill of those who were involved in the rescue of our men, particularly the helocipter pilots and crews who, in extremely hazardous conditions, were responsible for saving a great many lives by removing men from the damaged ships.
" I must tell the House that the task force commander's plans have not been prejudiced by these attacks, and the losses of stores and equipment are already being made good from other stocks held ashore".
My Lords, that completes the Statement.
Lord Peart: My Lords, we are all grateful to the noble Viscount for repeating the Statement. First, of course, the whole House joins with the noble Viscount in expressing our deepest sympathy to the relatives and friends of those who lost their lives on Tuesday. I should also like to pay our warm tribute to the great courage and resourcefulness of all our troops, on land, on sea and in the air.
I should like to ask some questions on this grave incident. In the light of these serious new attacks by the Argentine Air Force, have the Government reassessed the quality of our troops' equipment to deal with such attacks? Secondly, in view of the persistent rumours in the press, is it possible that the Argentines have been reinforced by sophisticated weapons from elsewhere? We were glad to have the noble Viscount's assurance that some losses were made good from stocks ashore, and this we welcome. However, to what extent does the damage to the ships and the equipment affect the progress of operations and the plans to bring hostilities to an end by taking Port Stanley?
As the Government also promised military, economic and diplomatic means to ensure a cessation of hostilities with minimum loss of life, is this not the time for the British Government to table a new resolution to the Security Council? This should be designed to achieve a cease-fire linked with the implementation of the Security Council's Resolution 502, indicating our willingness to achieve a negotiated settlement linked with the withdrawal of Argentine forces and with future negotiations.
Lord Mayhew: My Lords, is the noble Viscount aware that my noble friends and I share to the full the sympathy that he and the noble Lord, Lord Peart, have expressed? I think that we also feel for the Force Commander who, up to this point, had handled these difficult disembarkations with brilliant success in spite of a failing of aircraft early warning for which he himself cannot possibly be blamed.
On the subject of the announcement of casualties, only the Government can judge the operational wisdom or unwisdom of making such an announcement

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at this time. Is the noble Viscount aware that the whole House would, I am sure, wish that information to be handled so as to minimise distress, not only to next of kin but to relatives and families of all those operationally involved in the Falkland Islands? Nevertheless, I am sure that no one would press the Government to release any information which might in any way increase the dangers to which our servicemen are exposed in the Falkland Islands.
Finally, the task force and the Ministry have sustained a setback operationally and administratively, but this should not lessen our admiration for the magnificent success overall of the military and logistic achievements out there in the Falkland Islands.
Viscount Trenchard: My Lords, I thank both noble Lords for the support which they have given to the task force in their remarks and will, when he has a moment, draw them to the attention of the commander. I believe that we are satisfied, in the main, with the equipment that we have on our ships. It is true to say that in a wide area and outside the range of support from land-based aircraft, prevention against the possibility of sneak attacks by determined pilots in the three dimensions of the air is not really a possibility.
We have followed all the information and all the speculation about the movements of weapons. I do not think that the noble Lord would expect me to say anything in public on that, and we have taken every step that we can to ensure that the weapons of the aggressor are not replaced.
I think that the Statement makes clear the answer to the question asked by the noble Lord, Lord Peart, as to the degree of setback in two respects: first, that this imaginative move, which was surprised only in its last stages, was designed to cut down the time required in the appalling weather conditions and, I think it is no secret to say, mud that exist in the Falkland Islands.
I doubt whether the House would agree with the thought that this is the moment for a new resolution at the Security Council, though this, of course, is in the field of my right honourable friends the Prime Minister and the Foreign Secretary. But that in the end there has to be a settlement, after hostilities, is something that we still all know, and we have talked before in this House with, I think, a good degree of unanimity about the need. It is a question of timing.
I understand and, if I may say so, I would fully endorse the noble Lord, Lord Mayhew's, balance of sentiments in relation to the need to cause the minimum distress to the families who are related to those taking part in the task force, but I am obliged to say that it is the Government's view that, where there is a clash for a period of between that and any possible military disadvantage, with the risk of further casualties, then the latter has to be supreme.
4.20 p.m.
Lord Kennet: My Lords, we on these Benches associate ourselves with what has been said about the loss of life on this occasion, and of course respect the reasons why the Government do not wish to specify in any detail the extent of what appears to have been a rather grave setback. The noble Viscount is always very generous in giving the House information about what are strictly Foreign Office affairs as well, and
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since this is the first time we have been able to address the matter, even briefly, since the Recess, I should like to raise the question, possibly for pursuit at a later date, about the veto that Britain placed on the UN resolution last weekend.
The reason given out for this was that it did not clearly link an Argentinian withdrawal with the ceasefire, or not clearly enough. But if one reads that resolution the link does appear to be rather clear. While I would not go so far as the noble Lord, Lord Peart, in calling for a British resolution to be introduced at this point, yet I hope that the Government will he careful not needlessly to veto resolutions coming from other quarters when they do quite clearly link a cease-fire with Argentinian withdrawal, as did the last one they vetoed.
Viscount Trenchard: My Lords, I thank the noble Lord, Lord Kennet, for his understanding about the comparatively small amount of detail that we can release at this stage. So far as his point is concerned about the recent veto at the United Nations, yes, indeed, the reason was the lack of a link with Argentine withdrawal. I think I would be able to go further without in any way stepping out of line with my right honourable friend the Foreign Secretary by saying that one needs, particularly when dealing with the Argentine, a degree of feeling of guarantee that words will be turned into action; and to get that in the time available and at the speed necessary, bearing in mind the weather and conditions in which our forces are operating, is not an easy task. I can only ask the noble Lord to believe, first, that we know that in the end we need settlement and peace in the South Atlantic, but, secondly, that we have to put first the security of our task force and take account of the reliability, in terms of turning words into action, of the people who have invaded the Falklands.
Lord Hill-Norton: My Lords, is the noble Viscount aware that a large number of people outside your Lordships' House do not share the welcome given by the noble Lord, Lord Peart, and others to the Statement which has just been made? And neither do I. It is my judgment, and that of many other people outside the House, that too many such Statements have been made. I would ask the noble Viscount if he would discuss with his right honourable friends whether perhaps we are not overdoing the amount of information we give, and the amount of opportunity we give for words to be spoken which are deeply resented by those in the task force who have been given a military job to do, and should be given the opportunity to carry it out without constant threats that their efforts may have proved in vain.
Viscount Trenchard: My Lords, I have decided that it is quite impossible for my right honourable friend the Secretary of State to please everybody in relation to information in a state of hostilities when the country is not at war. There are those who ask him for more; there are those who ask him for more earlier. There are those who tell him to give less, and to give it later. I am certain that whatever my right honourable friend does he will be open to criticism. There are important factors of every kind. The military ones

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are supreme, and the safety of the task force is supreme; but there are factors which affect the backing for the operation in this country and abroad, and they are important, and they have to be taken into account in terms of the kind of information that is given.
I take this opportunity of saying that the much publicised suggestion by certain correspondents with the Second Battalion of the Parachute Regiment that the Ministry of Defence revealed a forthcoming attack on Darwin and Goose Green, as far as I can see, is completely without foundation. My right honourable friend caused an inquiry to be made immediately and we can find no evidence of any such revelation. It is true that in all areas of the media, in a situation of free media, there was speculation that the most likely place for a first attack, which one look at the map would reveal, was Darwin and Goose Green, and there was a great deal of speculation, including a World Services BBC programme. I believe that the correspondents concerned have confused speculation with what was issued by the MoD, which in fact was late, was after the event, and we were criticised for the fact that it was late.
Lord Shinwell: My Lords, would not the Minister agree that in view of the frequent statements issued by the Ministry of Defence about an imminent assault on Port Stanley and the surrounding area, the events recorded in the last 24 hours are unexpected and exceedingly disturbing? Would he not agree that much of the trouble has occurred because of political intervention not only in the United Kingdom but in the Security Council and the United Nations, and from oscillations in American attitude, and also the frequent mischievous statements that have appeared in the press media?
Although every one of us is agreed that casualties are bound to have occurred in the circumstances, although naturally we do not ask for details, would he not agree that those of us who are disturbed by what has happened and expected events to be other than those that have occurred, would prefer, until the Ministry of Defence inquiry into the circumstances that occurred, the unexpected appearance of sophisticated aircraft, and the like, to refrain from asking questions, however important? Although in the opinion of some of us those questions have to be asked at some time, in the circumstances we had better let the thing pass for the next 24 hours.
Viscount Trenchard: My Lords, may I start by fully agreeing with, and thanking, the noble Lord, Lord Shinwell, for his call for restraint in questions, which I very much appreciate. I do not think, however, that the Ministry of Defence has ever issued statements of imminent assault. I do, however, understand, I believe, what is in his mind when he talks about political intervention and mentions the media also. Certainly we have discussed, both my noble friend and I in this House following these statements, the movements of international opinion and the logicality, or lack of logicality, for them. I do not think it would be helpful for me to go over that ground again today. I should like to say to the noble Lord that although, as the Statement makes clear, this is a setback, my right honourable friend has always warned that there
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would be casualties, that there would be setbacks, but that we will achieve our objective; and that is still his view and our view.
Lord Chalfont: My Lords, may I ask the noble Viscount some questions and assure him that I ask them in the full knowledge of their implications? Is it not a fact that some of the tragedies which have taken place in the Falkland Islands have been the result of setting aside, for one reason or another, the fundamental military principle that every effort should be made to protect those in the operational area from attack by the enemy by air? May I ask Her Majesty's Government—I ask this in all seriousness and solemnity —for how long they can sustain a policy which appears to grant total immunity to the bases from which those air attacks are made?
Viscount Trenchard: My Lords, it is not accurate for the noble Lord to say that the military advisers to the Secretary of State, the Secretary of State himself or the Government have for one moment set aside the principle of the need to get the greatest degree of air superiority that is possible in any area of conflict. Indeed, the noble Lord will recall not only the aircraft casualties of the Argentine but the percentages; up to 70 per cent. of the aeroplanes sent out by the Argentines in a day destroyed. I believe it is true to say that, even beyond the range of support from land-based aircraft, we have achieved a very high degree of air superiority. But it is never, or very rarely, total, and, as I have said, an aircraft can always get through. May I ask the noble Lord to remind me of the second part of his supplementary, which was important?
Lord Chalfont: The second part contained the whole point of the question, my Lords; namely, that one of the elementary ways of achieving air superiority is to attack the bases from which the air attacks are made. I recognise that there are difficulties but I am asking a serious question. For how long can Her Majesty's Government sustain that policy?
Viscount Trenchard: My Lords, my right honourable friend and I have replied to a similar question before and I really have nothing to add to the statement that we shall keep all military options open, and we shall continue to do that. The practicality of the course of putting an airfield of any kind, even a small one with one airstrip, out of action is well known to the military experts on each side. It is not an easy task. Thus, the military practicalities of the course, leaving out any question of an extension of the conflict, have to be very carefully considered.
Lord Kilbracken: My Lords, it is only as a former wartime pilot in the Fleet Air Arm that I presume to ask the noble Viscount some questions. Are not the disasters of Tuesday one more piece of evidence of the folly of sending the task force to the Falklands with the protection of no more than 20 fighter aircraft?—no more than I personally commanded on one small carrier in 1945. Apparently those were the only aircraft available for the purpose in the Fleet Air Arm, and they have now had to be supplemented by RAF planes. Is he aware of the extraordinary stresses

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under which the pilots of those planes have been operating and the extremely high rate of casualties they have suffered—perhaps two dozen, I do not know how many; two dozen pilots to fly 20 aircraft was about what we used to have—and that those casualties are now approaching perhaps 50 per cent? Can he assure the House that he is fully appreciative of the extreme gallantry and devotion to duty shown by the pilots of the Fleet Air Arm who flew those Harriers, which was in the highest tradition of the service?
Viscount Trenchard: My Lords, the noble Lord does not have his facts right, and I am not prepared to put them right. There has been mention of reinforcement of Harriers by one ship or another going to the South Atlantic. We have never given total numbers and I assure the noble Lord that his facts are not right in terms of numbers. Furthermore, he will be aware that these days aerial warfare is fought not only by aeroplanes but by missiles also, and we have inflicted very heavy losses on the enemy by surface to air missiles. I would remind him that we have not lost a single Harrier in air combat, although the Harriers have shot down the greatest proportion of over 60 combat aircraft which the Argentines have lost. My previous statement—that we have achieved a fair measure of air superiority—is accurate. Of course, we do pay, and always have paid, the highest tribute to the pilots of the Harriers and to all of those who have been manning the missile systems under attack on Her Majesty's ships.
The Earl of Selkirk: Whether or not we are making too many statements, my Lords, would my noble friend agree that we should leave the task force in no shadow of doubt of our deep and profound admiration for the manner in which they have conducted their affairs, the hardships they have endured, the courage they have shown and the skill of the commander in carrying out an extremely difficult campaign, as well as of our profound assurance that they will be supplied with all they require in order to bring the campaign to a successful conclusion?
Viscount Trenchard: My Lords, I would merely say, "Hear, hear".
Lord Gladwyn: My Lords, may we assume that, before any decision is taken, if it should be taken, to bomb the bases on the mainland of the Argentine, Parliament will be consulted as to the advisability of so extending the war?
Viscount Trenchard: My Lords, I have nothing to add to what my right honourable friend the Secretary of State and I have said before on the subject.
Lord Lovat: My Lords, what steps, if any, have been taken to seek out and destroy the Argentine aircraft carrier, the "Vienticinco de Mayo"? If we are not to attack the mainland bases, is it not possible that a good many aircraft are flying from that carrier?
Viscount Trenchard: Again, my Lords, I would rather not go into military details. I believe we have taken
314
every practical step to date to safeguard our task force in all practical ways that the military have advised.
Lord Hankey: My Lords, before we leave—
Lord Denham: My Lords, I know the House would not grudge any time to the seriousness of this occasion, but I wonder whether any more questions would be helpful to the task force, and whether possibly we might leave it there?

Local Government Finance (No. 2) Bill
Report stage resumed, on Amendment No. 3.
4.38 p.m.
Baroness Birk: Returning to a more local matter, my Lords, I am speaking following the Minister's reply to my moving of Amendment No. 3, and I must at the outset apologise for omitting to say that it would he convenient to discuss at the same time Amendment No. 49 and Manuscript Amendment No. 8A. I do not think that omission on my part caused the Minister any difficulty because we have an agreed grouping of amendments. No. 49 seeks the deletion of Schedule 1 and the manuscript amendment is necessary because a small subsection which was overlooked must be deleted if Schedule 1 is to be removed.
I suspect that whatever I say in response to the Minister's comments will not make much difference to his view, so I shall not delay the House on the matter. Although Schedule 1 concerns Bedfordshire, it could be used against other authorities which, between now and Royal Assent, attempted to do something similar. Other amendments are down which deal specifically with the Bedfordshire problem, and so here I am dealing with the wider-ranging aspects of Schedule 1 and the reasons why it should be deleted in its entirety.
What I might call the "non-Bedfordshire" objections to the schedule centre on the concentration of powers being given to the Secretary of State, as in so many instances in the Bill. Paragraph 5 of Schedule 1 gives the Secretary of State sweeping powers to adjust a rate or precept to be made in substitution for one made illegal by the schedule. There does not seem to be any real reason why that should be done, except again the giving to and the retention by the Secretary of State of the powers. We do not know what criteria the Secretary of State will adopt in making the adjustment, and similarly paragraph 6(3) gives the Secretary of State powers to adjust the rates.
In answer to what the Minister said a little while ago —before we embarked upon the Statement—to the effect that all of this was not necessary in the past, I would say that the balances were more generous in the past and there was proportionately more money for local authorities to spend on social services, education and other services. The reason that we seek the deletion of the clause and the schedule is that they are really so bad that short of doing an enormous reparation job, which I cannot see the Government doing, it seems better to delete them entirely.
There is one small point that I wish to add. So far as Schedule 1 is concerned, it seems that the proof readers have rather thrown up their hands about it all.

315
Part of line 18 on page 25 reads: "for a supplementary rate of precept", but I imagine that that is meant to read: supplementary rate or precept ". I should like to feel, though without a great deal of foundation, that whoever was reading it by then thought, "God! I can't read any more of this", and so the error crept in. Of course, that is no reason for deleting the whole clause. However, the purpose of the three amendments is the deletion of Clause 3, together with the deletion of Schedule 1, and I should like to test the feeling of your Lordships by dividing the House.
4.40 p.m.
On Question, Whether the said amendment (No. 3) shall he agreed to?
Their Lordships divided: Contents, 63; Not-Contents, 113.

DIVISION NO. 1

CONTENTS

Airedale, L.

Kilbracken, L.

Amulree, L.

Leatherland, L.

Balogh, L.

Listowel, E.

Barrington, V.

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

Beaumont of Whitley, L.

Beswick, L.

Lovell-Davis, L.

Birk, B.

MacLeod of Fuinary, L.

Bishopston, L.

Mayhew, L.

Blease, L.

Molloy, L.

Blyton, L.

Oram, L.

Boston of Faversham, L.

Peart, L.

Briginshaw, L.

Phillips, B.

Bruce of Donington, L.

Ponsonby of Shulbrede, L. [Teller]

Caradon, L.

Chitnis, L.

Rochester, L.

Collison, L.

Sainsbury, L.

Cooper of Stockton Heath, L.

Segal, L.

Davies of Leek, L.

Shinwell, L.

Davies of Penrhys, L.

Simon, V.

Donnet of Balgay, L.

Stedman, B.

Elwyn-Jones, L.

Stewart of Alvechurch, B.

Evans of Claughton, L.

Stewart of Fulham, L.

Gaitskell, B.

Stone, L.

Gladwyn, L.

Strabolgi, L.

Hampton, L.

Thurso, V.

Hanworth, V.

Underhill, L.

Houghton of Sowerby, L.

Wallace of Coslany, L.

Irving of Dartford, L.

Wells-Pastell, L.

Jacobson, L.

White, B.

Jacques, L.

Wilson of Langside, L.

Jeger, B.

Winstantly, L.

John-Mackie, L.

Wootton of Abinger, B.

Kennet, L.

NOT-CONTENTS

Airey of Abingdon, B.

Chelwood, L.

Alexander of Tunis, E.

Clitheroe, L.

Alport, L.

Cockfield, L.

Ampthill, L.

Colwyn, L.

Auckland L.

Cork and Orrery, E.

Avon, E.

Cottesloe, L.

Belhaven and Stenton, L.

Cromartie, E.

Bellwin, L.

Cullen of Ashbourne, L.

Beloff, L.

Daventry, V.

Belstead, L.

Davidson, V.

Bessborough, E.

Denham, L. [Teller.]

Boardman, L.

Dilhorne, V.

Boyd-Carpenter, L.

Drumalbyn, L.

Caccia, L.

Eccles, V.

Campbell of Alloway, L.

Elles, B.

Campbell of Croy, L.

Elliot of Harwood, B.

316

Elton, L.

Morris, L.

Faithfull, B.

Newall, L.

Ferrers, E.

Northchurch, B,

Fortescue, E.

Onslow, E.

Fraser of Kilmorack, L.

Orkney, E.

Gainford, L.

Pender, L.

Gainsborough, E.

Penrhyn, L.

Gardner of Parkes, B.

Platt of Writtle, B.

Garner, L.

Rankeillour, L.

Glanusk, L.

Renton, L.

Glenarthur, L.

Ridley, V.

Haig, E.

Robbins, L.

Hailsham of Saint Marylebone, L.

Rochdale, V.

Rugby, L.

Hawke, L.

St. Aldwyn, E.

Henley, L.

St. Davids, V.

Hill of Luton, L.

St. John of Bletso, L.

Hornsby-Smith, B.

Saltoun, Ly.

Hylton-Foster, B.

Sandford, L.

Ilchester, E.

Sandys, L. [Teller.]

Inglewood, L.

Seebohm, L.

Ironside, L.

Selkirk, E.

Kemsley, V.

Sempill, Ly.

Killearn, L.

Skelmersdale, L.

Kinross, L.

Soames, L.

Kitchener, E.

Somers, L.

Lane-Fox, B.

Spens, L.

Lindsey and Abingdon, E.

Stradbroke, E.

Long, V.

Strathspey, L.

Lovat, L.

Suffield, L.

Lyell, L.

Terrington, L.

McFadzean, L.

Teviot, L.

Mackay of Clashfern, L.

Thorneycroft, L.

Macleod of Borve, B.

Trefgarne, L.

Mancroft, L.

Trenchard, V.

Massereene and Ferrard, V.

Vivian, L.

Merrivale, L.

Wakefield of Kendal, L.

Mersey, V.

Westbury, L.

Milverton, L.

Windlesham, L.

Monk Bretton, L.

Wise, L.

Montagu of Beaulieu, L.

Young, B.

Resolved in the negative, and amendment disagreed to accordingly.
Clause 4 [Proceedings in respect of rates and precepts]:
4.50 p.m.
Lord Bellwin Lord Bellwin moved Amendment No. 4:
Page 3, line 31, after (" rate ") insert (" on any of the grounds mentioned in subsection (2) above or in respect of a ").
The noble Lord said: My Lords, this is a minor drafting amendment to make absolutely clear the intention of subsection (3) of Clause 4. Clause 4, which your Lordships accepted at Committee stage of this Bill, provides that the validity of a rate or precept can only be challenged on certain grounds by application for judicial review—that is, in the High Court—and that where relief is granted the court shall quash the rate or precept entirely. Subsection (4) makes it clear that this does not in any way prejudice the making of an application for judicial review on other grounds, where the possibility of such a challenge already exists; for example, a challenge as to the validity of a rate in reference to a particular hereditament.
I should also like to take this opportunity to clear up a point made by the noble Lord, Lord Bruce of Donington, at Committee stage on 10th May (col. 48) about the effect of subsection (3), to which the amendment relates. The noble Lord suggested that the effect would be that:

317
" If the precept in any one, small, material particular can be declared…to be invalid, one is faced with the necessity for invalidating the whole precept, even though the amount involved might be quite trivial".
I should make it absolutely clear that Clause 4 does not alter the existing law that remedies on an application for judicial review are discretionary. Clause 4(3) only requires the rate or precept to be quashed,
" If on an application for judicial review the court decides to grant relief ".
As a matter of discretion the court would be unlikely to decide to grant relief in the circumstances mentioned by the noble Lord. Indeed, in the recent Kensington and Chelsea challenge to the GLC precept for 1982–83, to which the noble Lord alluded, the court indicated that, since the remedy of judicial review is discretionary, if an item of expenditure found to be unlawful is small in relation to the total precept, the court would not quash the precept. The noble Lord's fears about the clause are therefore not well founded.
However, there is a slight ambiguity of a quite different sort which we have discovered in the wording of subsection (3), and, although I am almost certain our intention could never be misinterpreted, I should like to take this opportunity to clarify the text beyond all doubt. Subsection (3) is intended to apply only in the case of a challenge to the validity of a rate on an application for judicial review if the application is made on one of the grounds mentioned in subsection (2), which are all general grounds for challenging the validity of a rate. It is just possible, however, that as it stands the subsection could be taken to mean that whatever the grounds for applying for judicial review the whole rate should be quashed if relief is granted, even if the application relates to the validity of the rate as it applies to a particular hereditament.
Your Lordships will appreciate how absurd that would be, and this is why I feel sure that the risk of such an interpretation by a court is small. However, our purpose here is to ensure that the legislation we pass on to another place is as good and as clear as we can possibly make it, and I therefore seek your Lordships' agreement to the drafting amendment standing in my name, which puts the meaning of Clause 4(3) beyond doubt. I beg to move.
Lord Bruce of Donington: My Lords, as the noble Lord has indicated, this matter was discussed in Committee and the noble Lord gave some explanation of the position then. We are most grateful for the further explanation he has given today, and for his additional clarification. We feel that the amendment he has made adds to clarity. We are most grateful to him for it, and we on this side of the House will support the amendment.
On Question, amendment agreed to.
4.56 p.m.
Lord Bellwin Lord Bellwin moved Amendment No. 5:
After Clause 5, insert the following new clause:
(" Rate relief in enterprise zones. 1980 c. 65.
.—(1) At the end of paragraph 27(1) of Schedule 32 to the Local Government, Planning and Land Act 1980 (exemption from rates of certain hereditaments situated in areas designated as enterprise zones) there shall be added the words "or in respect of any part of an exempt hereditament as regards any
318
period during which the area in which that part is situated is so designated."
(2) In paragraph 28 of the said Schedule 32 (mixed hereditaments)—

(a) in sub-paragraph (2) (mixed hereditament to be rated as a dwelling of the appropriate rateable value), for the word "dwelling" there shall be substituted the word "dwelling-house"; and

(b) for sub-paragraph (3)(b) (extension of power to make regulations about appeals) there shall be substituted—

" (b) the reference to the occupier or person treated as occupier of the hereditament being dissatisfied by the view taken by the rating authority included a reference to the occupier, the person aforesaid or the rating authority being dissatisfied by the view taken by the valuation officer; and ".
(3) After the said paragraph 28 there shall be inserted—
" Hereditaments partially, within enterprise zones
28A.—(1) As regards any period during which part only of an exempt hereditament (within the meaning of paragraph 27 above) is situated in an area designated as an enterprise zone, the valuation officer shall determine the portion of the rateable value of the hereditament attributable to the part of the hereditament situated outside the enterprise zone.
(2) Where a determination in respect of a hereditament has been made under sub-paragraph (1) above, the amount of any rates payable in respect of the hereditament shall (subject to sub-paragraph (3)(b) below) he the amount which would be payable in respect of it if its rateable value were equal to the portion of the rateable value which was determined under sub-paragraph (1) above.
(3) Where the hereditament in respect of which a determination has been so made is a mixed hereditament—

(a) the valuation officer shall also determine the portion of the rateable value of the hereditament attributable to any part of it which is used for the purposes of a private dwelling or private dwellings and is situated within the enterprise zone; and

(b) if such a determination is made, the amount of any rates payable in respect of the hereditament shall he the aggregate of the following amounts, namely—

(i) the amount payable under sub-paragraph (2) above, and

(ii) the amount which would be payable in respect of it if it were a dwelling-house of a rateable value equal to the portion of the rateable value determined under paragraph (a) above.

(4) Section 48(6) of the 1967 Act shall, with modifications corresponding to those contained in paragraph 28(3) above, apply also in relation to questions as to the portions mentioned in sub-paragraphs (I) and (3)(a) above." ").
The noble Lord said: My Lords, in speaking to this amendment I speak also to Amendments Nos. 6 and 53. These amendments expand the provisions for exemption from rates for certain hereditaments in enterprise zones which are contained in Part IV of Schedule 32 to the Local Government, Planning and Land Act 1980 in order to deal with an anomaly in those provisions. Paragraph 27 of that schedule provides for the exemption from rates of, essentially, non-domestic properties situated inside enterprise zones. It should logically be the case, and was the intention, that where a property straddled the boundary of an enterprise zone rates should be payable only on that part which lay outside the zone. However, the Act does not make provision for this.
Following representations from local authority associations, the CBI and business organisations, these amendments remedy the omission in the existing legislation with effect from the current financial year. They provide a procedure whereby the valuation officer will be empowered to determine what part of the rateable value is attributable to the part of the hereditament outside the zone. This is the portion on which rates will be payable. An additional determination

319
will be made in the case of a mixed hereditament, so that rates are also payable on any part inside the zone used as a private dwelling. There is also a power to make regulations about appeals from the valuation officer's determination where the ratepayer or the rating authority objects to the apportionment.
For 1981–82, when it has not been possible to grant partial rate relief to straddling hereditaments extra-statutory payments are being made through the agency of rating authorities. These arrangements were announced by my right honourable friend the Secretary of State in another place on 21st April.
The amendments also include a technical improvement to paragraph 28 of the schedule and correct an omission to afford the rating authority, as well as the occupier, the opportunity of appealing against the valuation officer's determination in respect of a mixed hereditament. These amendments have been foreshadowed in another place, and I hope noble Lords will agree that they provide a necessary and useful extension of the existing provisions which give rate relief to businesses located in enterprise zones. I beg to move.
Baroness Birk: My Lords, I think there is a certain amount of merit in this amendment because, as the Minister pointed out, there has been a problem in some enterprise zones where factories have straddled boundaries. Reaching agreement on the amount of relief, if any, for these straddling hereditaments has, it is true, become a problem, albeit a minor problem, and this amendment, I think quite sensibly, leaves it to the judgment of the valuation officer. This seems to make more sense.
But, of course, it still does not alter the basic fact about enterprise zones and the argument that still continues about them. It is more and more felt that they are probably a misguided experiment—and this is not thought only on party political grounds—and I should like to ask the Minister to tell us when he replies whether he knows what has been the impact on rent levels in enterprise zones of the fact that there are no rates. They should, practically speaking, not be any higher, or be lower, because there are no rates; but economic theory (and, I understand, some of the practice) suggests that they rise to offset any advantage to industrialists—in other words, the rent will fill up the vacuum that is caused by the reduction of rates—and this seems to negate what has been considered to be the inducement to people to set up in enterprise zones.
Nevertheless, these amendments tidy up the administrative problems that have occurred in the granting of rate relief; but if the Minister has any knowledge on that (I am sorry; this is something that occurred to me while he was speaking, so I could not give him any prior notice of it) I would be very interested to know.
Lord Bellwin: My Lords, with the leave of the House, I could say that there is some evidence of what the noble Baroness says: that, in some instances, rents in some zones have tended in some cases to be higher than one might have expected or one might have anticipated. We shall have to watch this. It is all part
320
of the monitoring that we consider so vital in everything to do with enterprise zones. The noble Baroness will know that we have expressly set up people to do just that and as soon as they are able to report, I am sure that the particular point that she mentioned will be included in the monitoring and report.
On Question, amendment agreed to.
Clause 6 [Interpretation and commencement of Part I]:
Lord Bellwin Lord Bellwin moved Amendment No. 6:
Page 4, line 42, after (" 3 ") insert (" and (Rate relief in enterprise zones) (1) and (3) ").
The noble Lord said: My Lords, I have already spoken to this amendment. I beg to move.
On Question, amendment agreed to.
5.3 p.m.
Baroness Birk Baroness Birk moved Amendment No. 7:
Page 4, line 42, leave out ("relation to").
The noble Baroness said: My Lords, in moving Amendment No. 7, I should like to speak also to Amendment No. 45, since they go together. The first of these amendments makes Sections 1 to 3 (dealing with the prohibition of supplementary rates and precepts, et cetera) applicable only in any year after 1st April 1982. Therefore, the supplementary precept made by Bedfordshire before 1st April 1982—on 9th March—in relation to 1982–83 does not fall. The second amendment makes Schedule 1 apply only to supplementary rates and precepts made after the 1st April 1982.
The reason we are seeking these is because, after procedural problems, Bedfordshire County Council passed on 9th March a supplementary precept to enable their budget to be implemented at the level which was the wish of the current ruling coalition of Labour and Liberal groups on the county council. The advice received from legal counsel was that such a supplementary precept made for the whole year and made before 1st April 1982 would not have fallen foul of the Local Government Finance (No.2) Bill as then drafted. On 25th March, Mr. King, the Minister of Local Government, made a statement to the committee in another place dealing with the Bill that the legal advice that he had received was to the contrary. He said:
" I should like to confirm the legal advice that I have received, namely, that the Bill will invalidate retrospectively any supplementary rates or precepts made in respect of 1982–83, that this includes those made before 1st April and that Bedfordshire County Council's supplementary precepts will therefore fall on Royal Assent ".
At this stage, it was a legal struggle between the Minister's and Bedfordshire's counsel respectively. The Government, clearly, on, presumably, their counsel's advice, had second thoughts, for at Committee stage the Minister in this House tabled what is now Schedule 1 to the Bill, which relates clearly to Bedfordshire. Paragraph 1, when he is talking about whether before or after the 1st April 1982 and the supplementary precept in respect of a period beginning on or after that date, can only be about Bedfordshire. It will be interesting to know from the Minister how many other county councils have ever issued a supplementary

321
precept in respect of a whole financial year before the start of the year—that is, how many have done as Bedfordshire did.
The purpose of banning supplementary rates and precepts is, as the Minister has told us often enough, to enable ratepayers to know where they stand before the start of the financial year. That criterion is met in the case of Bedfordshire's supplementary precept. The ratepayers would have known where they stood had it not been for Mr. King saying that the precept would fall on Royal Assent of this Bill. Even now, the people do not know and, as we shall see later, Amendment No. 8 in the name of the noble Lord, Lord Hill of Luton, is directed at making the situation absolutely clear, so that evidently he and those who agree with him do not feel that it is clear as it is drafted at the present time.
The effect of the Government's actions in relation to Bedfordshire is to make retrospectively unlawful an act by a single local authority which, first, the Government admitted was lawful at the time it happened and, secondly, the Government now tacitly admit would not necessarily have been made unlawful under the original draft of the Bill, which was all that was available when the supplementary precept was made by the county council. Thirdly, the Government admit that they never envisaged this, as Mr. Tom King said in the Planning Committee on 16th March and, fourthly, the original Bill was not designed to invalidate this.
This represents a fundamental breach of principle and of trust. The administration of Bedfordshire has been thrown into confusion by the Government. The least they can do is to permit the Bedfordshire County Council to rate at the level that the majority of its councillors wish. This can be achieved by making these amendments. These are not wrecking amendments. They are not only to clarify but to make quite sure that the prohibition which the Government can exercise under this Bill is at least limited in the way that the amendments set out. It also will enable ratepayers to know exactly where they are, which, under the Bill as it now is, they will not necessarily be able to do.. I beg to move.
Lord Evans of Claughton: My Lords, from these Benches, I support the amendments moved by the noble Baroness. I think she indicated the position that democratically the majority of the council in Bedfordshire wanted a certain kind of rate to be levied. By an unfortunate accident at an earlier meeting of the council, because of the absence of certain members for curious reasons, the Conservative minority managed to carry a rate which did not represent the views of the majority of the councillors, namely, the Labour and the Liberal councillors. What they did was to restore what was the view of the minority. Therefore, I think it would be inappropriate and contrary to democratic practices, which I am sure the noble Lord the Minister himself supports, if the majority of the councillors are not allowed to have the rate that they require. This would ensure that this happened and, therefore, this amendment in all equity, fairness and democratic practice should be carried so that the wishes of the majority of the elected members of Bedfordshire should carry the day.
Lord Bellwin: My Lords, the first amendment that we dealt with today, the one by the noble Lord, Lord Hill of Luton, touched on this area. I then made the Government position clear and I think I indicated our attitude to this Bedfordshire situation by the decision we took to accept that amendment. Amendments Nos. 7 and 45 are designed to ensure that the anomalous situation—and that is what it is—in Bedfordshire persists after Royal Assent. As the House is aware, the county council issued this supplementary precept in March for 1982–83. As the Bill stands, it will be invalidated on Royal Assent and the rating authorities and the Bedfordshire ratepayers will get their money back. Under the amendments, it will remain valid and the rating authorities and the ratepayers will be unable to get their money back. At least, I am pleased to see that noble Lords opposite have at last acknowledged that these words that they wish to delete (and which I must say have been in the Bill from the beginning, although originally part of Clauses 1 and 2) make it clear that the Bill applies to any actions taken in relation to the financial year 1982–83 whether or not they took place before 1st April 1982. That must be right.
We made it clear that our policy is to ban supplementary rates and precepts for 1982–83 and subsequent financial years. This means what it says. This is what the Bill does. There can be no question of exceptions. We believe that Amendments Nos. 7 and 45 are inconsistent with our policy objective and that is why they are not acceptable. The noble Baroness referred to Amendment No. 8. I am not sure whether the noble Lord, Lord Hill of Luton, wishes to deal separately with that. I hope I am not treading on his territory if I may refer to that now. The noble Baroness touched on the point and it is fundamental to the argument put forward. No doubt the noble Lord will tell me—
Lord Hill of Luton: My Lords, the noble Lord is giving the explanation which I sought in my amendment. In due course, at the appropriate time, I propose to withdraw my amendment.
Lord Bellwin: My Lords, I am most grateful to the noble Lord. I thought that was so; but perhaps I should say a word on the point now because the noble Baroness raised it and the noble Lord, Lord Evans, also touched on the principles. We have made it clear on a number of occasions that Clauses 1 and 2 will retrospectively invalidate any supplementary rates and precepts made for 1982–83, whether before or after 1st April, and therefore Bedfordshire's supplementary precept will fall on Royal Assent.
I can also confirm that Clause 3 and Schedule 1 will apply to all actions taken in relation to 1982–83. In view of what has transpired, I know the noble Lord will not want to proceed. He has given us that intimation. I know precisely what noble Lords opposite are concerned about. The noble Baroness wonders whether I can tell her how many county councils have issued supplementary precepts before the start of the year. I do not know whether any others have done so. It is clearly unusual. It arises from unusual circumstances that the noble Lord, Lord Evans, reminded us took place. I have known situations of that kind to

323
happen, with other matters, not specifically to do with rates, in those kinds of circumstances.
It is true that usually—but not always—the authority in question takes the first available opportunity to put it right. Here we are talking about something which is a fundamental concept of what the Government believe has to be done; that is, to ban the making of supplementary rates. Therefore, whether there were others who have done it before does not bascially alter our position in the matter. That is why we cannot accept the amendment.
Baroness Birk: My Lords, the Minister started off by saying on Amendment No. 1 that the Government had made the postion quite clear. It was not clear. There were a number of points that I, the noble Viscount, Lord Ridley, and my noble friend Lord Bruce raised. It was put to the Minister that it would be better to come back on Third Reading. What we meant was that the amendment would not be accepted but would be brought forward in a clearer form on Third Reading. He grasped that branch and said he would like to explain it on Third Reading. That itself was not good enough.
Now to say that the position was made quite clear on Amendment No. 1 is not right. It was not made clear. The noble Lord, Lord Hill of Luton, thanked the department for the help in drafting Amendment No. 1. That was grasped with gratitude by the Government. We find the Minister's reply to the amendments moved by myself and my friends, joined by the noble Lord, Lord Evans, extremely unsatisfactory. I shall not rehearse the arguments.
We discussed this in Committee, and I have put forward the case again now. In Committee, my noble friend Lady David put forward an extremely detailed and well-argued case. She did not get much of a convincing reply, either. We seem to have taken this argument and discussion as far as we can go. Therefore, the only course left now is for us to divide the House on this amendment.
5.15 p.m.
On Question, Whether the said amendment (No. 7) shall be agreed to?
Their Lordships divided: Contents, 58; Not Contents, 106.

DIVISION NO. 2

CONTENTS

Airedale, L.

Elwyn-Jones, L.

Amulree, L.

Evans of Claughton, L.

Beaumont of Whitley, L.

Gaitskell, B.

Bernstein, L.

Gladwyn, L.

Birk, B.

Gregson, L.

Bishopston, L.

Hampton, L.

Blease, L.

Houghton of Sowerby, L.

Blyton, L.

Irving of Dartford, L.

Boston of Faversham, L.

Jacobson, L.

Briginshaw, L.

Jacques, L.

Bruce of Donington, L.

Jeger, B.

Collison, L.

John-Mackie, L.

Cooper of Stockton Heath, L.

Kilbracken, L.

David, B.

Leatherland, L.

Davies of Leek, L.

Listowel, E.

Davies of Penrhys, L.

Llewelyn-Davies of Hastoe, B.

Donnet of Balgay, L.

Lovell-Davis, L.

324

MacLeod of Fuinary, L.

Stewart of Fulham, L.

Mishcon, L.

Stone, L.

Molloy, L.

Strabolgi, L.

Oram, L.

Tordoff, L.

Peart, L.

Underhill, L.

Phillips, B.

Wallace of Coslany, L. [Teller.]

Ponsonby of Shulbrede, L. [Teller.]

White, B.

Rochester, L.

Wigoder, L.

Sefton of Garston, L.

Wilson of Langside, L.

Shinwell, L.

Winstanley, L.

Simon, V.

Wootton of Abinger, B.

Stewart of Alvechurch, B.

Wynne-Jones, L.

NOT-CONTENTS

Abercorn, D.

Kinross, L.

Airey of Abingdon, B.

Kintore, E.

Alexander of Tunis, E.

Kitchener, E.

Ampthill, L.

Lane-Fox, B.

Avon, E.

Lindsey and Abingdon, E.

Balfour of Inchrye, L.

Long, V.

Belhaven and Stenton, L.

Lucas of Chilworth, L.

Bellwin, L.

Lyell, L.

Beloff, L.

McFadzean, L.

Belstead, L.

Mackay of Clashfern, L.

Bessborough, E.

Macleod of Borve, B.

Boardman, L.

Mancroft, L.

Boyd-Carpenter, L.

Massereene and Ferrard, V.

Caccia, L.

Merrivale, L.

Campbell of Alloway, L.

Mersey, V.

Chelwood, L.

Milverton, L.

Clitheroe, L.

Monk Bretton, L.

Cockfield, L.

Morris, L.

Colwyn, L.

Newall, L.

Cork and Orrery, E.

Northchurch, B.

Cottesloe, L.

Onslow, E.

Cullen of Ashbourne, L.

Orkney, E.

Daventry, V.

Pender, L.

Davidson, V.

Penrhyn, L.

Denham, L. [Teller.]

Peterborough, Bp.

Dilhorne, V.

Platt of Writtle, B.

Drumalbyn, L.

Portland, D.

Eccles, V.

Rankeillour, L.

Elles, B.

Ridley, V.

Elliot of Harwood, B.

Rochdale, V.

Elton, L.

St. Davids, V.

Faithfull, B.

St. John of Bletso, L.

Ferrers, E.

Saltoun, Ly.

Fortescue, E.

Sandford, L.

Fraser of Kilmorack, L.

Sandys, L. [Teller.]

Gainford, L.

Selkirk, E.

Gainsborough, E.

Sempill, Ly.

Gardner of Parkes, B.

Skelmersdale, L.

Garner, L.

Spens, L.

Glanusk, L.

Stradbroke, E.

Glenarthur, L.

Strathspey, L.

Haig, E.

Suffield, L.

Hailsham of Saint Marylebone, L.

Swinfen, L.

Thorneycroft, L.

Harmar-Nicholls, L.

Trefgarne, L.

Hawke, L.

Trumpington, B.

Henley, L.

Vaizey, L.

Hill of Luton, L.

Vivian, L.

Hornsby-Smith, B.

Wakefield of Kendal, L.

Hylton-Foster, B.

Westbury, L.

Ilchester, E.

Windlesham, L.

Inglewood, L.

Wise, L.

Kemsley, V.

Young, B.

Killearn, L.

Resolved in the negative, and amendment disagreed to accordingly.
Clause 7 [Adjustments of distribution of block grant]:
[Amendments Nos. 8, 8A, 9, 10, 11, 12, 13 and 14 not moved.]
Baroness Birk Baroness Birk moved Amendment No. 15:
Page 6, line 1, leave out subsection (4).
The noble Baroness said: I beg to move Amendment No. 15 and I hope that the Minister and the House will hear with me if I speak also to Amendments Nos. 16, 17 and 18, or at least speak round them. I have tried to keep to the groupings, but it is rather difficult because there is such a difficult link between these, and so I have tried to save time and avoid repetition. The reason I have not moved Amendments Nos. 9 and 12 and why I probably shall not move No. 22 is because they all lead up to the main Amendment No. 15, which is linked with Amendments Nos. 16, 17 and 18. Actually, I hope the noble Viscount, Lord Ridley, will excuse my mentioning Amendment No. 17, which is actually in his name, but it is one of the amendments in the group, so I hope he will not think I have taken over that amendment if I touch upon it. As I say, they are all linked together.
Clause 7(4) allows the Secretary of State to disregard expenditure of any description or amount for the purposes of determining compliance with his expenditure targets. This is a very broad power, subject only to the safeguard that the ideas for disregard must come from the local authority side. For 1981–82 the Secretary of State has announced his intention to disregard for penalty purposes expenditure below grant related expenditure, urban programme expenditure, expenditure incurred in connection with last summer's riots and winter emergency expenditure. For 1982–82 he has so far announced only the GRE exemption. If we are to have a penalty system, then these disregards—what an awful word that is—and especially the urban programme and riot exemptions are welcomed; but the fear that local authorities have over this subsection is the power it appears to give—I do not think it just appears to give—to the Secretary of State to manipulate the grant system. An amendment which is in the name of the noble Lord, Lord Evans, while not itself restricting this power, makes the Secretary of State accountable to Parliament for his decisions in this area.
Although they find abhorrent the powers of the Secretary of State to manipulate the grant system, what local authorities object to even more is uncertainty about their grant; and wherever there is an element of uncertainty it makes life very difficult for the finances and for the programming of the local authority. The worry is that the Secretary of State would change the rules on grant distribution after the start of the financial year. He can do this by way of a supplementary report in a discriminatory fashion. Clause 7(4) seems to give him that power—a power which he was seeking earlier in earlier drafts of the Bill but was forced to drop. That was known as the differential super holdback—another absolutely elegant phrase. This power, together with the prohibition of supplementary rates and precepts, could result in the Secretary of State determining the expenditure levels for individual local authorities. By allowing disregards to be specified only in the main rate support grant report—that is, before the start of the year—the amendment of the noble Viscount, Lord Ridley, seeks to restore local authority grants, and for that reason is very much welcomed. However, it would enable only some disregards to be legalised in future years—the type that can be foreseen,
326
such as the GRE exemption or urban programme expenditure.
It would not allow the Secretary of State to disregard and thus protect from penalty the type of expenditure which affected many urban areas last year: riots or the natural emergencies of last winter which affected many rural areas. This is why the amendment in the names of myself and my noble friend Lord Bruce differs from the others and from that of the noble Viscount. It goes rather further. Our concern is to give local authorities some certainty, to restrict the actions of the Secretary of State and at the same time to permit exemptions that would be useful to local authorities. By restricting supplementary report disregards to emergency or disaster expenditure—this is under Section 138 of the 1972 Act—the amendment would then seem to achieve that objective.
The other problem with the noble Viscount's amendment is that it would not allow the Secretary of State to legalise the exemptions which he has already promised for 1981–82 and 1982–83, as the main rate support grant reports have already been made for those years. But perhaps this would be the Government's problem rather than the noble Viscount's. I am afraid that I have gone into detail over some of the other amendments, because we believe that none of them gives the safeguards which we think should be incorporated in the Bill. It is for that reason that we believe that the best thing to do is to leave out subsection (4) entirely. My Lords, I beg to move.
The Deputy Speaker (Lord Ampthill): My Lords, I should point out to your Lordships that, if this amendment is agreed to, I cannot call Amendments Nos. 16, 17 and 18.
Lord Bellwin: My Lords, of course, I welcome the grouping together in this way, although I think that Amendment No. 17, of my noble friend Lord Ridley is slightly different. Therefore, the noble Baroness will understand if I do not touch on that, but reserve my remarks on it until my noble friend moves it. While I will gladly comment upon Amendments Nos. 15, 16 and 18 together, I suppose it ought fairly to be said that, in a way, the amendments are alternatives, as I am sure the noble Baroness appreciates.
The Government have already made it clear that without subsection (4) it will be impossible to give any exemptions from holdback—including the GRE exemption. I cannot believe that this is what your Lordships—or, indeed, the local authorities themselves—actually want. I have said before that there is no question of the Government's going back on their intention to implement holdback. The question is whether or not we can grant the exemptions which the authorities themselves have asked us to make. Anyone who voted in favour of this amendment would horrify a great many authorities who stood to benefit from the exemptions which we have already announced.
Your Lordships will not imagine that without this subsection the Government will abandon their holdback proposals. It will still be necessary for the Government to act, in face of the undeniable failure of local government to comply with our public expenditure guidelines. We cannot ignore or minimise the amounts involved. I repeat that the total over

327
spend in 1982–83 is about £1½ billion; the Government cannot continue to support overspending on this scale with the taxpayer's money. The Government certainly hope that the effects of any overall reduction in grant will be distributed in as fair a manner as possible; and subsection (4), by ensuring that the Government can respond to representations about holdback, provides one way in which that can be achieved.
Deleting the subsection might appear, at first sight, as an attractive political gesture, but it would have disastrous consequences for many authorities, and I hope that noble Lords will consider very carefully the consequences of that. If the Government are prevented from responding to the representations about holdback, and if the necessary grant reductions have, in consequence, to be made in a comparatively undiscriminating way, then it will be clear where the responsibility lies.
Amendments Nos. 16 and 18 are interesting ones. As the noble Baroness, Lady Birk, said, they would restrict the power of the Government to respond in the future to representations about holdback. Admittedly they would take effect only from the year 1983–84, and so would not prevent the Government from giving the exemptions which we have already announced for 1981–82 and 1982–83. But for 1983–84 and future years they would prevent the Government from exempting any expenditure, other than that incurred as a result of emergencies or disasters involving destruction of or danger to life or property.
This is a very narrow discretion. It would prevent us from giving a GRE exemption, or an exemption for some urban programme expenditure, as we have agreed to do in respect of 1981–82. There are many similar exemptions that have been urged upon us, which we have been able to consider, even though, in the end, we have felt unable to accept them. But these amendments would rule them out altogether.
The most important consequence would be the end of the GRE exemption. This was first announced in September, 1981, as a response to the argument, strongly expressed by many authorities, that it was unfair to treat authorities, which, on objective criteria, had comparatively low levels of expenditure, in the same way as those which, on the same criteria, appeared as overspenders. This argument commended itself to the Government, and the GRE exemption for 1981–82 was the result. The Government have since proposed extending the same principle to 1982–83, and in the current year as many as 141 authorities may gain partial or complete exemption from holdback as a result.
I can see no good reason for preventing the Government from granting such exemptions in the future. Subsection (4) of the clause makes it clear that the power to respond to representations can be used only to disregard expenditure; in other words, it can be used only to the benefit of authorities. Subsection (6) ensures that holdback will have to be done in accordance with principles to be applied to all local authorities; in other words a Government would not be able to single out a particular authority for special treatment. Subsection (8) of the clause ensures that the principles on which any differential holdback scheme would
328
operate will have to be spelled out in the rate support grant report for the year in question. So there is no question of differential holdbacks being increased mid-year, when it is too late for an authority to reflect it in its rates. That is a point which the noble Baroness, Lady Birk, touched upon, when we were talking originally about super-holdback and so on. But we have taken care of that.
So in that context —when the discretion of the Government is already severely limited—I do not think that the power to respond to representations is drawn too widely, or that it can be said to give the Government too broad a discretion. Noble Lords opposite are worrying too much about this. Subsection (4) cannot be used to impose additional differential holdback. It is simply a power to give exemptions in response to representations. We have already shown how—in respect to 1981–82 and 1982–83—this power can be used in a reasonable way to the benefit of a considerable number of authorities. These amendments would prevent it from being used in the same way in the future. That is why we cannot accept the amendments.
Lord Evans of Claughton: My Lords, I have listened with great interest to what the noble Lord the Minister has said, and, while we do not approve of the penalty system, if there is a penalty system one must welcome the exclusion of rioting and so on. But what concerns people in local government is the uncertainty about what will be exempted in the future when they are making their arrangements. They will be totally uncertain, because, as I understand it, the Secretary of State has given no indication of what his proposals will be for the present year. He has indicated—and it is very acceptable—what he will be exempting or disregarding in the last year. It is the uncertainty which concerns us. The Minister has gone some way towards reassuring me, but there is a fear in local government, of which the Minister is probably aware, that this clause will be used to manipulate the grant system in a way which might at some point be used—not by the noble Lord the Minister or, indeed, by his right honourable friends but by some future Government—in an irresponsible, divisive and selective way. It is those two points—first, the uncertainty and, secondly, the fear of manipulation—which concerns many of us about the effect of this clause.
Lord Bellwin:My Lords, may I, with the leave of the House, say that I understand absolutely what the noble Lord, Lord Evans of Claughton, has said. In an attempt to try to get the kind of certainty to which he refers, I submit that one would have to give up the flexibility to manoeuvre which would be of benefit to local authorities. What the noble Lord has said is true: it could be abused. I believe, however, that it is vitally important that the flexibility should be retained. The examples of the exemptions which have been given illustrate what would happen if we were to specify only those things. There may even be changes to those exemptions, which I agree adds to the uncertainty. Nevertheless, so long as local government knows the position before it starts its rate-making procedure—my right honourable friend in another place conceded this point, and that is why we made the changes which we did—I feel that there is no need to

329
be concerned. The converse is the point which I have already made: that to forgo the right to make exemptions would be far too much to give up. As I see it, this would he to the disadvantage of local government.
Baroness Birk: My Lords, out of this group of amendments to which I spoke originally and to which the Minister has replied, by far the most important is the amendment which I moved; namely, Amendment No. 15. At the end of the Committee stage we had a very general discussion on what was the old Clause 4. Clause 4 was dealt with separately because it appeared so late. The answers given then were very unsatisfactory. There was a great deal of disquiet about the exemptions which were proposed by the Government to alter Clause 4. Much as we disliked Clause 4 originally, we disliked even more the amendments put forward by the Government.
We feel that the only way to deal with the matter is to dig out the core, which is embodied in Amendment No. 15. If Amendment No. 15 were to be accepted by the House, some of the other amendments which for the moment I have not moved but which lead up to it—to insert again the other pieces—and the amendments which follow would not be so necessary, because the central point, which was argued so well just now by the noble Lord, Lord Evans of Claughton, would be covered. The Government's reply is unequivocal. There is nothing ambiguous in what the Minister has said. He quite firmly turned it down. Therefore, I shall have to ask the House to divide on the amendment.
5.45 p.m.
On Question, Whether the said amendment (No. 15) shall be agreed to?
Their Lordships divided: Contents, 60; Not-Contents, 93.

DIVISION NO. 3

CONTENTS

Airedale, L.

Listowel, E.

Beaumont of Whitley, L.

Llewelyn-Davies of Hastoe, B.

Bernstein, L.

Lovell-Davis, L.

Birk, B.

MacLeod of Fuinary, L.

Bishopston, L.

Mayhew, L.

Blease,L.

Mishcon, L.

Blyton, L.

Oram, L.

Boston of Faversham, L.

Peart, L.

Briginshaw, L.

Phillips, B.

Bruce of Donington, L.

Ponsonby of Shulbrede, L.

Collison, L.

Rochester, L.

Cooper of Stockton Heath, L.

Sefton of Garston, L.

David, B. [Teller.]

Shinwell.L.

Davies of Leek, L.

Simon, V.

Davies of Penrhys, L.

Stamp, L.

Elwyn-Jones, L.

Stedman, B.

Evans of Claughton, L.

Stewart of Alvechurch,B.

Gaitskell, B.

Stewart of Fulham, L.

Gregson, L.

Stone, L.

Hampton, L.

Tordoff, L.

Harris of Greenwich, L.

Underhill, L.

Hooson, L.

Wallace of Coslany, L. [Teller.]

Houghton of Sowerby, L.

Howie of Troon, L.

Wedderburn of Charlton, L.

Irving of Dartford, L.

White, B.

Jacques, L.

Wigoder, L.

John-Mackie, L.

Wilson of Langside, L.

Kennet, L.

Winstanley, L.

Kilbracken, L.

Wootton of Abinger, B.

Kirkhill, L.

Wynne-Jones, L.

Leatherland, L.

330

NOT-CONTENTS

Abercorn, D.

Kemsley, V.

Alexander of Tunis, E.

Killearn, L.

Ampthill, L.

Kinross, L.

Avon, E.

Kitchener, E.

Balfour of Inchrye, L.

Lane-Fox, B.

Belhaven and Stenton, L.

Lauderdale, E.

Bellwin, L.

Lindsey and Abingdon, E.

Beloff, L.

Long, V.

Belstead, L.

Lucas of Chilworth, L.

Bessborough, E.

Lyell, L.

Boardman, L.

McFadzean, L.

Brougham and Vaux, L.

Mackay of Clashfern, L.

Caccia, L.

Macleod of Borve, B.

Campbell of Alloway, L.

Mancroft, L.

Chelwood, L.

Massereene and Ferrard, V.

Cockfield, L.

Merrivale, L.

Colvilieof Culross, V.

Mersey, V.

Colwyn, L.

Monk Bretton, L.

Cork and Orrery, E.

Morris, L.

Cottesloe, L.

Northchurch, B.

Craigavon, V.

Onslow, E.

Crathorne, L.

Orkney, E.

Daventry, V.

Pender, L.

Davidson, V.

Peterborough, Bp.

Denham, L. [Teller.]

Platt of Writtle, B.

Dilhorne, V.

Portland, D.

Drumalbyn, L.

Rankeillour, L.

Eccles, V.

Renton, L.

Elles, B.

Rochdale, V.

Elliot of Harwood, B.

St. Aldwyn, E.

Elton, L.

St. Davids, V.

Faithfull, B.

Sandys, L. [Teller.]

Ferrers, E.

Skelmersdale, L.

Fortescue, E.

Spens, L.

Fraser of Kilmorack, L.

Stradbroke, E.

Gainford, L.

Strathspey, L.

Gainsborough, E.

Suffield, L.

Gardner of Parkes, B.

Thorneycroft, L.

Glanusk, L.

Trefgarne, L.

Glenarthur, L.

Trumpington, B.

Haigh, E.

Vaizey, L.

Hailsham of Saint Marylebone, L.

Vivian, L.

Wakefield of Kendal, L.

Hawke, L.

Westbury, L.

Henley, L.

Windlesham, L.

Hornsby-Smith, B.

Wise, L.

Hylton-Foster, B.

Young, B.

Resolved in the negative, and amendment disagreed to accordingly.
5.52 p.m.
The Deputy Speaker: My Lords, before calling Amendment No. 16 I should point out that, if it is agreed to, I cannot call Amendment No. 17.
[Amendment No. 16 not moved.]
Viscount Ridley Viscount Ridley moved Amendment No. 17:
Page 6, line 5, leave out from (" 1980 ") to end of line 7.
The noble Viscount said: My Lords, I have no intention of going through the immensely complicated struggles over what was Clause 4, because at Committee stage I recognised that I was defeated by the Government in this matter and I do not want to raise the issue again. The point I am trying to raise in Amendment No. 17 is slightly different. I believe it is a much more reasonable point and I cannot see why the Government could not accept it. It seems to me totally sensible and I will try to explain it as briefly as I can.
If we accept subsection (4), as we have done now, I believe we have to look very carefully at subsection (4)(b) which really says that the Government can take

331
these powers to hold back the grant and so forth,
" in a supplementary report made for any year under section 61 of that Act ".
This means that the Government can come back after the authority has fixed its rates, and after the rate support grant has been announced in a special supplementary report, and tinker with the whole operation all over again. Part 1 of the Bill makes it quite clear—it is perfectly clear to me anyway—that the supplementary rate was something that had to go and that authorities had to decide at the beginning of the year what money they wanted and make a rate accordingly. At the same time, under this nasty little subsection, the Secretary of State can take the power himself to fiddle about with the thing half way through the year and upset the whole apple-cart all over again. I think this is totally wrong.
The authorities must know where they stand when they fix their rate. They must know what their grant will be. Although there are some advantages in the hold-back provisions, I know, having read the debates at Committee stage, that it is certainly not acceptable to the associations. They feel that to allow a supplementary report to come in later is opening all kinds of possible doors, fiddling about with the thing, and tinkering with the main rate support grant. I believe this would be quite wrong and I hope that the House will agree to remove that little piece.
It may be said that there should be provision for emergency situations such as riots or snow—especially heavy snowfalls—and that the Government should have powers to compensate authorities for something unforeseen of this nature. 1 would say that that is a tine theory hut the Government could use these powers for matters which are not emergencies. Who is to define what is an emergency and one that requires such tremendous interference with the system? Any local authority with any financial prudence at all has a contingency fund and balances for just this very purpose of meeting unforeseen emergencies. The Government should be able to put the matter right, if they so wish in their wisdom or otherwise, and to compensate these authorities the following year under the main rate support grant order, and so correct the things that went wrong under the emergency.
The other argument which I see my noble friend Lord Bellwin preparing against me—I shall try to destroy his missiles before they reach me—is that the Government have promised to make exemptions to all this in the current financial year, which is now two months old. That may be so, and if I am successful the Government may have to go back on that, but again I believe the Government could put that right in the 1983–84 rate support grant, under the main order. Secondly, I believe it is wrong to legislate on this sort of matter for one particular year. This is a matter of great importance to local authorities and, to my mind, legislation should not be geared to what may or may not be done in one particular year. I am talking about the future and not about the current year; that there should not be provision in the future for the Government to mess about with the system. The Government should take their decisions once and for all on the rate support grant, which they have every right to
332
do, and having taken those decisions they should stick to them. I beg to move.
Baroness Platt of Writtle: My Lords, I should like to support my noble friend Lord Ridley. I do not think that I need to add any words to what he has said, except to underline his remarks with considerable sincerity.
Lord Bruce of Donington: My Lords, we on this side of the House would like to support the amendment moved by the noble Viscount, Lord Ridley. Throughout the whole passage of this Bill, the noble Lord the Minister has in the most reasonable and reasoned terms repeatedly assured the House that what the Government really want to do in their benign fashion is to bring an element of certainty into local government affairs. He uses his arguments most persuasively—sometimes, almost with an air of injured innocence, which completely belies any intention to injure any local authority at all or to operate anything to the detriment of local authorities. In fact, the noble Lord has almost appeared to be injured at any suggestion that the thought should be in his mind that there should be any uncertainties so far as local authorities are concerned. If the noble Lord really means this, he must surely agree with the amendment that has been put forward by his noble friend Lord Ridley.
In this Bill the Government have taken almost unprecedented powers to intervene in the affairs of local authorities, in ways which local authorities would not have imagined 15 years ago—those nostalgic years to which the noble Lord himself has referred. So far as local authorities are concerned, this Government are a thoroughly interventionist Government; intervening in every conceivable matter of detail that they can. This must undoubtedly reflect the basic philosophy of his right honourable friend that local authorities really cannot be trusted to do anything at all. Hence the insertion of this offensive subsection (4)(b) in this particular clause. As if all the powers he has taken unto himself in the Bill are not enough, the noble Lord's right honourable friend must still have some reserve powers. He must still have the right to think again if things do not seem to be going quite his way. This really will not do. I am quite sure—almost to adopt the manner of the noble Lord opposite—in his own mind, as a local government man, the noble Lord must himself be inwardly repelled by all the implications of subsection (4)(b). Therefore, I beg of him—as if the powers he is taking in other sections of the Bill, and even other parts of this particular part, are not enough—to say to himself, "Well, this argument has been put forward with authority by the noble Viscount, Lord Ridley, and by some of his friends and by the associations, I will on this occasion give way to it"—because this is completely unnecessary. I hope, therefore, that the noble Lord will see fit to accept the amendment of his noble friend. If his noble friend cares to take the matter to the Division Lobby, which I sincerely hope he will in following his own principle to the utmost, we shall have no hesitation in supporting him.
Lord Evans of Claughton: My Lords, may I briefly lend such support as I can to the noble Viscount's

333
amendment. I think the noble Lord the Minister must be having a frisson of doubt, if not fear; the noble Viscount, Lord Ridley, represents the Association of County Councils, which you could not say was an organisation dominated by the extreme Left, by a crowd of Reds, which no doubt he believes the AMA is. If this objection is coming from the true blue Association of County Councils surely he must be saying to himself that there must be something in this. I hope, therefore, that he will take this amendment very seriously and perhaps accept it in some form, or give the reassurances the noble Viscount is looking for.
6.2 p.m.
Lord Bellwin: Well, my Lords, talk about coming under pressure from all sides—but not for the first time on these matters. May I say, first, that I appreciate the way in which my noble friend Lord Ridley put his amendment, just as I would have expected of him. Indeed,for that matter, although I want to comment on one or two of the specific points the noble Lord, Lord Bruce, made, he, too, put it from where he sees it fairly enough.
The fact is that we cannot accept these amendments. Let me explain why. I hope your Lordships will listen very carefully, because I am absolutely convinced that the real implications of what this means are not understood. The first effect of the amendment would be to rule out any exemption in respect of 1981–82 and 1982–83, since none was spelled out in the main rate support grant reports for either year. This means that there would be no urban programme exemption, no exemption for expenditure incurred as result of last summer's riots, no exemption for expenditure incurred as a result of the winter's bad weather, and, above all, no exemption for authorities spending below their GRE. Let there be no misundertsnding about this. The whole question of the control of public expenditure is far too important for it to be any kind of game. The Government are wholly committed to their policy. We simply cannot allow local government, we cannot afford to allow local government, to disregard the overall expenditure guidelines with impunity. This is the nub of this particular amendment. If this amendment is carried, first of all the Government will not quietly disregard and abandon the holdback proposals. The aggregate amount of rate support grant will still have to be reduced; we cannot ask taxpayers to go on subsidising overspending of the order we have seen in the past two years.
If there is a Division and if this amendment is carried, it will simply mean that for 1981–82 and 1982–83 the Government will not be able to allow any exemptions from holdback. The loss of the GRE exemption alone means—I hope my noble friend notes this carefully, and also my noble friend Lady Platt—that 23 shire counties would find themselves liable for holdback in respect of 1981–82 and at least 26 shire counties in respect of 1982–83. I simply cannot believe that that is what they or my noble friend want. My noble friend Lord Ridley says, "Well, the Government can put it right next year", but he knows, with his vast experience, how accounts work on a year-to-year basis, how rates are made on a year-to-year basis, and you cannot just put it right in that way, especially as the amounts of money concerned, depending on the size of the authority, can be very considerable.
334
The noble Lord, Lord Bruce, says that if I had the interests of local government at heart, I would accept this amendment. How could I equate having the interests of local goverment at heart with being willing to see 23 or 26 authorities having to forego holdback? I see a lot of those who come to make representations for exemptions of one kind or another. When we made the original exemptions on the basis of GRE I can tell your Lordships we were flooded with letters of gratitude and relief, because the concern had been so great. I am here asked to contemplate a measure which means going back on that. I fear very much when I am assailed on all sides of your Lordships' House, but frankly I would fear much more if I had to go back and see 26 individual deputations saying, "What on earth are you doing; how come you are going back on what you said?"
The other effect of my noble friend's amendment would be to rule out in future years any exemptions that were not announced in advance in the rate support grant report for the year in question. This in a way touches on the point that the noble Lord, Lord Evans, made, when I was saying to him how important it is to retain flexibility, to retain the right to benefit— and that is the point; it is only to benefit, and not to disadvantage a local authority. How can you give up that right, that opportunity, to benefit them? I just do not understand how anyone can put it the way that they do. It would not only make it difficult but probably impossible to disregard the unpredictable and unpredicted items of expenditure that on the face of it have the strongest case for being disregarded in calculating a holdback. If expenditure is foreseen, it can be taken into account by an authority in making its budget and setting its rate. It is those uncovenanted items of expenditure that come too late for offsetting savings to be made elsewhere that on the face of it have a good claim to be considered for exemption from holdback, and it is just those items which would in practice be ruled out by my noble friend's amendment.
The noble Lord, Lord Bruce, referred to what he called a thoroughly interventionist Government; that by what we do we say that local authorities cannot he trusted to do anything at all. Those are the very words he used. All I would say, as I have said many times before, and it makes me sad to say it, is that through all the years, when local government always worked within the parameters set down, there was no such need. But when you are faced with an over-spending of £l½ billion, and it is more than in the previous year, no Government can run their financial affairs without doing something at least to try to bring local authorities to have some control. When you look more closely at the make-up of this £1½ billion you find that there are some 260 or 270 local authorities who do work within the guidelines, who do say, "All right, whether or not we like what you are laying down, we accept that the Government must govern". Therefore are we to say to those authorities, "You may have no exemptions. We will take away from ourselves the power to give you exemptions "?
It is not a starter and we cannot accept it. It is not a question of tinkering with grant entitlements to the disadvantage of the authority. I hope that my noble friend will not feel obliged to divide, because I hope he will be persuaded by what I have said. As a last

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word before I sit down, let me say that these changes that can be made under subsection (4) during the year can only be to the benefit—and I hope this is noted carefully—and cannot be to the disadvantage of any local authority; and that, frankly, is game, set and match.
Viscount Ridley: My Lords, before my noble friend sits down I wonder whether he would answer one question. Would he speak differently if the amendment were so worded that it did not come into effect until, say, 1st April 1984? By this means the promises that were made in the current and last financial years can be honoured—because I accept his argument in that respect. I was talking about the future, not the past. I wonder if he would accept a Third Reading amendment dealing with the future only.
Lord Bellwin: My Lords, clearly the point I made about the present is absolutely critical but I thought that the philosophy of what I was saying applied in general. What we need and what we get from this subsection is the right to be able to give exemptions when the unforeseen, the unpredictable, comes about. That is all it is. That is why, frankly, I am astonished that the ACC powers-that-be are unwilling to see that that is what it means. We are at one stage from the last stage of this Bill and I hope that my noble friend will perhaps again at least read what I say and again discuss with his colleagues whether we are right or wrong. If he can convince us that we are wrong, then of course we will listen; but I assure him that we have thought deeply about this because we had a Division on it last time, and we do not take those things lightly. We feel that the principle of the right to be able to give these benefits should the need arise is fundamental at any time.
Viscount Ridley: My Lords, I have one crumb of comfort. It would be wrong to divide the House, but I may well return to this on Third Reading. Therefore, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 18 not moved.]
Lord Evans of Claughton Lord Evans of Claughton moved Amendment No. 19:
Page 6, line 13, at end insert—
(" ( ) The Secretary of State shall publish in a supplementary report for the relevant year under section 61 of that Act his detailed reasons for acceptance or rejection of any representations made to him under this subsection; and any association of local authorities or any local authority may appeal to the Secretary of State if, in their view, his response to their representations made to him under this subsection, does not take full account of their statutory duties under existing legislation.").
The noble Lord said: My Lords, this amendment seeks to persuade or require the Government to give reasons and explanations for the actions which they have taken, which we debated earlier today. It seems to me a very reasonable amendment, given that the Government are quite adamant, as is the noble Lord the Minister himself, about the retention of the holdback provision. It merely seeks to require the Government to publish in great detail their reasons for exempting any item of expenditure, and indeed for not ex
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empting any item which a local authority may have asked to be left out in calculating the hold-back.
As noble Lords will see from my amendment, there is then an opportunity for the local authority, or local authority association, to appeal if they are not satisfied with the reasons which the Secretary of State has published for refusing exemption of the item of expenditure. I think the noble Lord the Minister has made very clear to even the most stubborn of us that he will insist on retaining this right to act, but it does not prevent the Government from retaining this power which they seem so anxious to have. It ensures only that the Government will have to explain the reasons for their action: and when Government has to explain reasons for their action it might possibly persuade him to move with more care and circumspection than if there was no requirement to give a full account of the reasons for their decision.
It seems to me, in all fairness and all reasonableness, that local authorities are entitled to a full, clear and specific explanation as to why things have been done and why exemptions have or have not been made. It seems to me, therefore, that this is a perfectly reasonable and, I would have hoped, acceptable amendment slightly to mitigate the pains and uncertainties local authorities will have under this new legislation. I beg to move.
Lord Bellwin: My Lords, the Government have some sympathy with the objective here, and I myself am absolutely committed to openness, accountability, to explanation and so on, at all levels of Government. I believe we cannot have too much of it. Many of the measures which we passed in the 1980 Act were directed in that way and much of what we are talking about through the Audit Commission and so on, and much of the requirement now for the greater presentation in accounts, is all in that direction and I am in favour of it. Therefore, in terms of the philosophy behind this amendment I am not against that, but there are problems here.
We have considered all the representations that have been put to us about hold-back and we have borne them carefully in mind in making this proposal. It is no secret that the hold-back exemptions we have already announced have been framed in response to representations. Similarly it is no secret that there were other representations we were unable to accept. But the Government cannot bind themselves to be obliged to publish all the reasoning in each instance and if the noble Lord will consider carefully I believe he would accept that in practical terms this is not a starter.
If I may adapt an old adage, where there are 400 authorities there will be 400 different opinions, and to publish a reasonable account of all the hundreds of different options that have been presented would really be an impossible task; but even then, if that were the end of the story, there could be an argument but it would also be an unnecessary task because any exemption which the Government agree to accept will have to be spelled out in a rate support grant report or supplementary report, and the principles on which they will operate will have to be set out there in detail.
It is true, of course, that the report will not have

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to list all those suggestions that it has not proved possible for us to accept but individual authorities will know how we responded to their individual cases. Whenever we meet deputations from authorities—and I speak from experience of seeing very many of them—we have a chance to discuss the points that they put to us. We and they welcome the opportunity to discuss the points that they put to us, and I believe I may fairly say we are equally responsive to written representations; but to record all these discussions at length in the report would mean that we would never finish the job. I suspect that the noble Lord, Lord Evans, who understands these things, realises that very well and if he will reflect I suspect that he will not be unsympathetic to what I am saying on this. What is superficially a very reasonable amendment can have some fairly devastating effects, and I suspect we shall be more than wrapped up in red tape; but on the substantive point I can reassure noble Lords that the Government will not act in an unprincipled or unreasonable way.
The clause as it stands already, I submit, contains sufficient safeguards to ensure that. Nor will we fail to act in the face of convincing argument that action is needed. Frankly, that is a political imperative, not a legal one, and we do not need any red tape to bind us to that. I hope that from what I have said the noble Lord will feel that there is at least a reasonable argument in what I have put forward, and perhaps will not want to press the amendment.
Lord Bruce of Donington: My Lords, the noble Lord has made very heavy weather of the amendment that has been moved by the noble Lord, Lord Evans of Claughton. All that the noble Lord's amendment asks for is the publication—that is all. The work has already been done. The actual work of determining and the reasoning has all been done. Of course, if the Ministry is functioning properly, minutes will have been kept and memoranda will have been written explaining and arguing the various reasons and the various matters that have been taken into account. All that work has to be done in any event if the Ministry is doing its work properly. Certainly it must be done, Various matters that were discussed at a meeting with representatives or at staff meetings that the Minister holds are not all left to vague memory. It is very carefully minuted.
The Minister will have in his possession all the detail that has been requested by the noble Lord, Lord Evans of Claughton. All that the noble Lord is asking for is publication. This is not a vast matter requiring any very detailed work at all. All the detailed work has been done. All the noble Lord, Lord Evans, is asking for is that what the Minister has done and the reasoning behind it shall be made public. That is all.
Lord Evans of Claughton: My Lords, I must say that I understand the reservations of the noble Lord the Minister and I can understand that, from a ministerial point of view, he has to say that this proposal would cause a great deal of bureaucracy and red tape. I am greatly obliged to the noble Lord, Lord Bruce of Donington, for the points that he made because, as the noble Lord said, the work has been done. The
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point I make is that if you are taking draconian measures to control local authorities and interfering with their freedom, then you ought to be prepared to be accountable to them and to explain your reasons, and be willing to have them examined and re-examined and listen to appeals.
In my opinion, the Government are taking an extremely serious measure restrictive of local government freedoms as the noble Lord the Minister has heard me and other noble Lords say several times, and therefore I shall not repeat them with even greater emotion on this occasion. I believe that with these restrictions the Government are left with the holdback provisions, the exemptions and such things and with the kind of powers that, if not openly used, could be extremely dangerous and could be abused.
I seek to prevent abuse, to try to ensure that there is accountability, and to give local authorities the opportunity to explain—if the type of things that the Government do to them regarding their grant are explained—that they need the money because they cannot otherwise carry out their statutory duties and obligations. Quite frankly, I feel that the Minister has his power in spite of our objections, and I think that the Government are being a little small-minded and rather petty in now refusing local authorities the right—not the privilege—to have a clear and precise examination of the reasons behind the Government's decision. I feel sufficiently strongly about this to test the opinion of the House.
6.23 p.m.
On Question, Whether the said Amendment (No. 19) shall be agreed to?
Their Lordships divided: Contents, 55; Not-Contents, 83.

DIVISION NO. 4

CONTENTS

Airdale, L.

Kirkhill, L.

Banks, L.

Llewelyn-Davies of Hastoe, B.

Barrington, V.

Lloyd of Kilgerran, L.

Beaumont of Whitley, L.

Lovell-Davis, L.

Bernstein, L.

MacLeod of Fuinary, L.

Birk, B.

Mayhew, L.

Bishpston, L.

Mishcon, L.

Blease, L.

Oram, L.

Blyton, L.

Peart, L.

Boston of Faversham, L.

Ponsonby of Shulbrede, L. [Teller.]

Bruce of Donington, L.

Collison, L.

Rochester, L.

David, B.

Sefton of Garston, L.

Davies of Leek, L.

Shinwell, L.

Davies of Penrhys, L.

Simon, V.

Eiwyn-Jones, L.

Stamp, L.

Evans of Claughton, L.

Stewart of Alvechurch, B.

Gaitskell, B.

Stewart of Fulham, L.

George-Brown Hampton, L.

Stone, L.

Tordoff, L.

Hooson, L.

Underhill, L.

Houghton of Sowerby, L.

Wallace of Coslany, L.

Irving of Dartford, L.

Wedderburn of Charlton, L.

Jacques, L.

White, B.

Jeger, B.

Wigoder, L. [Teller.]

John-Mackie, L.

Winstanley, L.

Kilbracken, L.

Wootton of Abinger, B.

Kilmarnock, L.

Wynne-Jones, L.

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NOT-CONTENTS

Abercon

Lindsey and Abingdon, E.

Avon, E.

Long, V.

Balfour of Inchrye, L

Lucas of Chilworth, L.

Bellwin, L.

Lyell, L.

Beloff, L.

McFadzean, L.

Belstead, L.

Mackay of Clashfern, L.

Bessborough, E.

Macleod of Borve, B.

Boardman, L.

Mancroft, L.

Broadbridge, L.

Massereene and Ferrard, V.

Brougham and Vaux, L.

Merrivale, L.

Caccia, L.

Mersey, V.

Campbell of Alloway, L.

Monk Bretton, L.

Chelwood, L.

Morris, L.

Cockfield, L.

Moyola, L.

Colville of Culross, V.

Northchurch, B.

Colwyn, L.

O'Neill of the Maine, L.

Cork and Orrery, E.

Onslow, E.

Cottesloe, L.

Orkney, E.

Craigavon, V.

Pender, L.

Crathorne, L.

Peterborough, Bp.

Daventry, V.

Platt of Writtle, B.

Davidson, V.

Portland, D.

Denham, L. [Teller.]

Rankeillour, L.

Drumalbyn, L.

Ridley, V.

Eccles, V.

Rochdale, V.

Elliot of Harwood, B.

St. Aldwyn, E.

Elton, L.

St. Davids, V.

Ferrers, E.

St. John of Bletso, L.

Fortescue, E.

Sandys, L. [Teller.]

Gainford, L.

Shannon, E.

Gainsborough, E.

Skelmersdale, L.

Gardner of Parkes, B.

Spens, L.

Glanusk, E.

Stradbroke, E.

Glenarthur, L.

Strathspey, L.

Haig, E.

Suffield, L.

Harmar-Nicholls, L.

Trefgarne, L.

Hornsby-Smith, B.

Trumpington, B.

Hylton-Foster, B.

Vivian, L.

Kemsley, V.

Wakefield of Kendal, L.

Kinross, L.

Wise, L.

Kitchener, E.

Young, B.

Lane-Fox, B.

Resolved in the negative, and amendment disagreed to accordingly.
6.31 p.m.
Lord Evans of Claughton Lord Evans of Claughton moved Amendment No. 20:
Page 6, line 39, at end insert (" and any grant thus removed from any local authority shall be redistributed to all other authorities ").
The noble Lord said: My Lords, as I think is perfectly clear from its wording, this amendment seeks to ensure that if any authority or authorities have suffered a loss of grant because of holdback or for whatever reason, instead of the money being returned to the Government's coffers it should be redistributed to all the other authorities, thereby encouraging authorities that keep within the rules and regulations to do so because they would benefit in the long run by obtaining grant withheld from other authorities. In other words, I am suggesting that once grant has been allocated, it should remain within the local authority pool and not be extracted and returned to Government coffers. I beg to move.
Lord Bellwin: My Lords, I, too, shall not say too much about this because, as I am sure the noble Lord recognises, the amendment strikes not only at the heart of the holdback proposals but at the Government's duty under Section 54 of the 1980 Act to determine the aggregate amount of rate support grants. As I said a few moments ago on another amendment, this is
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one area where there can be no doubt about the Government's overriding responsibility, for it is here that the potential conflict of interest between ratepayers and taxpayers is most obvious and where, as I said before, no responsible Government could abandon their duty to fix and, if necessary, to redetermine the overall level of grant support.
At first glance the amendment looks not unattractive; that is, for the grant withheld from overspending authorities to be redistributed as, if you like, a welcome windfall to the majority who have gained protection from holdback. But there is another side to the coin; the fact is that holdback is necessary because the country cannot afford to subsidise excessive levels of total expenditure. Therefore, it starts from the need to reduce the aggregate amount of grant.
The amendment would make it impossible to use Clause 7 in the one circumstance which it is designed to meet—when it can be used to make sure that as far as possible those responsible for the excessive levels of spending suffer the consequences of an overall reduction in the grant aggregate. I am surprised if that is what the noble Lord, Lord Evans, really wants here. I did say—did I not?—a few moments ago that, by and large, some 260 or more authorities do their best to work within the guidelines. It is only a few—some of the balance of the authorities do not go very far over—who go excessively over. Why on earth the others should, if you like, have to bear the brunt of all that, I just do not know.
Perhaps more important in the context of this particular amendment is the point that the Government simply set out what they say, and do this whole thing because they believe that this is all the country can afford. That is what holdback is about. There is the differential point, but this amendment directs itself to the principle of the totality of the spending, and that is why we are unable to accept this amendment.
Lord Evans of Claughton: My Lords, I must say that that does not come as an entire surprise to me. I felt that I was probably tilting at a windmill, but I still think that the money that has been allocated to local government expenditure should be used in local government. I understand the Minister's point, and I shall not detain your Lordships' House any longer, because I suspect that there is still quite a large number of more controversial amendments to come. Therefore, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
6.36 p.m.
Lord Evans of Claughton Lord Evans of Claughton moved Amendment No. 21:
Page 7, line 5, leave out (" 1981 ") and insert (" 1983 ").
The noble Lord said: My Lords, dealing with a very important principle, I believe that this is a very much more serious and important amendment than the previous amendment that I moved, because its purpose is to delay the possible use of holdback from 1st April 1981 to 1st April 1983. It is to prevent the use of retrospective legislation, about which many of your Lordships feel very strongly, which my party has a record of opposing going back very many years, and which to most people in a democratic society is an abhorrent, discriminatory and unfair kind of legislation. In my

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belief it is calculated to undermine the forward planning of local authorities and their financial management. So think that the present legislation is particularly abhorrent in that it introduces this element of "retrospectivity" and uncertainty to local authorities.
It is also particularly important as all block grant for the year 1981–82 has already been paid to local authorities; they have actually received it. So if holdback is to be used for that year, then the grant penalties for the year 1981–82 will, as I see it, have to be deducted from the local authorities' 1982–83 block grant entitlement. In addition to any holdback for 1982–83—the financial year in which we arc now, and in respect of which local authorities will have already set their budgets and sent out their rate demands—it seems that in 1981–82 and 1982–83 they will be open to the imposition of penalties for which they will not have the protection of the procedures set out in subsections (2) and (7) of the clause, which will have to be gone through in subsequent years. So for 1981–82 the money has already been distributed; for 1982–83 the budget has been set and the rate demands have gone out. In those two years the very detailed and complex procedures, from which local authorities will benefit in subsequent years in subsections (2) and (7), will not he available to local authorities for those years.
In all fairness, I should have thought that this amendment would get rid of "retrospectivity" (if there is such a word, and I think there is) and would also enable local authorities to deal with their forward planning with more certainty; their financial management would not be subject to the tremendous uncertainty in which the legislation for those two years will leave them, without the protection given for subsequent years. Therefore, it seems to me that this is a reasonable amendment. I beg to move.
Baroness Birk: My Lords, I should like to support the amendment which has just been moved by the noble Lord, Lord Evans. It is this wretched retrospection which is again involved, and very clearly so. By accepting this amendment retrospection would be taken out of Part II. At present we have it running through Part I and Part II. This is all that the amendment seeks to do. I would add my plea to that of the noble Lord, Lord Evans, that the Government give this amendment a favourable hearing.
Lord Bellwin: My Lords, this amendment too, on the face of it, is very straightforward and it would mean, as the noble Lord, Lord Evans, said, that holdback could not be implemented for 1981–82 or 1982–83. May I preface the relatively few remarks I want to make on this by saying yet again that the Government's position is clear. We cannot turn away from the overspending in those two years, 1981–82 and 1982–83: the amounts in question are just too great. Furthermore, as I have been saying on the last two or three amendments, without the powers to implement differential holdback provided by Clause 7 the Government would be forced by the general economic situation and the action of some authorities to implement an across-the-board holdback scheme. This would affect all authorities regardless of their individual performance. I say again that I cannot believe that this is what most authorities want.
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So far as 1981–82 and 1982–83 are concerned, may I only say that although the Bill has not yet been enacted we have always abided by the spirit of the limitations which Clause 7 will impose. There has been full consultation with authorities. All the exemptions proposed for 1981–82, including the GRE exemption, were introduced following representations from local authorities. On this matter of retrospection, although there was no statutory requirement to publish details of holdback in the rate support grant report, my right honourable friend the Secretary of State for the Environment warned authorities before —and this is the point—they set their rates for 1981–82 that there might have to be a holdback scheme if they over-budgeted. He spelt out in detail what that might mean for individual authorities when he called for revised budgets in June 1981. For 1982–83 he published in December 1981, at the same time as the settlement, full details of the differential holdback scheme he proposes to implement in England.
There is no reason why we should not accept the proposals that have been made for 1981–82 and 1982–83. They are fair. They have been developed in the light of representations which have been made to us, and they have been spelt out in sufficient time to allow their effect to be taken into account by authorities when determining their budgets and settling their rates. This is why we are not able to accept the amendment. I hope that the noble Lord, Lord Evans, will accept that from me, and perhaps not wish to press this amendment.
Lord Evans of Claughton: My Lords, my heart sinks whenever I hear the noble Lord the Minister say, "I have some sympathy for the amendment that the noble Lord is moving ", because then 1 know that it is all up. I should like to thank the noble Baroness, Lady Birk, for reminding me that the correct word for retrospectivity is "retrospection", and not this new word that I invented in my speech just now, but I am so overcome by emotion about this that I occasionally lose the mot juste.
I should like to think about what the noble Lord the Minister has said. I appreciate that local authorities have had warnings. I accept that. I think that the noble Lord probably appreciates the abhorrence which I, and I am sure many other noble Lords, have for the concept of retrospective legislation, but I should like to think about this matter again. I do not wish to divide the House, and I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 22 not moved.]
Baroness Birk Baroness Birk moved Amendment No. 23:
Page 7, line 9, leave out (" or 1st April 1982 ").
The noble Baroness said: My Lords, this amendment refers to subsection (11) of Clause 7. This plumbs new depths of retrospection, which is the point we are on. I would not have thought that one could do that. It is trying to find some other phrase for dealing with this awful spectre of retrospection that runs through this Bill.
The guidance on expenditure for the purposes of this Bill appears to include anything that the Secretary

343
of State might have said even before the Bill was drafted.
We have had a lot of discussion about the years, and we recognise that the year 1981–82 has now ended, and we also accept that it would be churlish to make the Secretary of State go around consulting local government and issuing fresh guidance. Our amendment does not affect 1981–82; it is 1982–83, and that is a different matter. The year is just over two months old. It is certainly not too late for the Secretary of State to hear representations about what authorities feel, if they do so feel, is the unreasonableness of the 1982–83 targets. All this amendment seeks to do is to make him go through that process for the year 1982–83. I beg to move.
Lord Bellwin: My Lords, I am sorry that the noble Lord, Lord Evans, is not in his place, because I should like him to have heard me say that this is one amendment for which I do not have sympathy, and which does not appeal to mc. Yet again I feel I have to remind your Lordships that the Government amendment was a correction of a drafting error, or, more accurately, an error that arose as a result of the passage of time since the clause was first drafted. Subsection (11) of the clause provides that references to guidance are to include references to guidance issued before the passage of the Act. The Government amendment agreed by the Committee extended this provision to include the guidance issued in relation to 1982–83, which was actually issued last February. The amendment now before us would take us back to the position whereby references to guidance issued before the passage of the Act referred only to that issued in respect of 1981–82.
I am happy to see that the noble Lord, Lord Evans, is now in his place, and therefore to be able to tell him that although I cannot accept this amendment I do so without sympathy for it, and I am sure that the noble Baroness fully understands that.
Baroness Birk: My Lords, in view of the time and the Chief Whip's beady eye on me, and so that I can look at it again, I beg leave to withdraw this amendment in order to have a chance to think about it and perhaps take it further on Third Reading.
Amendment, by leave, withdrawn.
Lord Denham: My Lords, I think that this is the time that we agreed that we should go on temporarily to the next business. Although we have other business in the dinner adjournment, it is probably useful if I say that we will not recall the House to this particular Bill before 8 o'clock. I beg to move that further consideration on Report be now adjourned.
Moved accordingly, and, on Question, Motion agreed to.

Social Security and Housing Benefits Bill
6.48 p.m.
Lord Denham: My Lords, I have it in command from Her Majesty the Queen to acquaint the House that
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Her Majesty, having been informed of the purport of the Social Security and Housing Benefits Bill, has consented to place her prerogative and interest, so far as they are affected by the Bill, at the disposal of Parliament for the purposes of the Bill.
Bill read a third time, with the amendments.
Clause 1 [Employer's liability]:
The Parliamentary Under-Secretary of State, Department of Health and Social Security (Lord Trefgarne)The Parliamentary Under-Secretary of State, Department of Health and Social Security (Lord Trefgarne): moved Amendment No. 1:
Page 2, line 6, leave out ("of a kind which he might") and insert ("which he can").
The noble Lord said: My Lords, this is a technical amendment which brings the wording of the definition of a "day of incapacity for work" for statutory sick pay purposes precisely into line with the national insurance definition which is contained in Section 17(l) of the principal Act. The slight difference in the wording caused some concern in another place in case this should allow a different interpretation—less favourable to the employee—to be put on the definition for statutory sick pay purposes. The amendment is beneficial in that it ensures that the existing interpretation by the statutory authorities as to what work a person can reasonably be expected to do will apply in the context of the SSP scheme. I beg to move.
On Question, amendment agreed to.
Clause 7 [Rate of payment]:
6.50 p.m.
Lord Banks Lord Banks moved Amendment No. 2:
Page 5, line 26, at end insert—
("; together with an additonal £0·80 for each child of the employee").
The noble Lord said: My Lords, I must apologise to the House for the fact that I have unfortunately lost my glasses and therefore find it extremely difficult to see my notes. However, I hope that what I say will have some connection with what I have written. With this amendment we are returning for the third time to the question of benefits for children. At present, there is a child dependency addition with national insurance benefit but there is no child addition provided in the Bill with statutory sick pay.
We agree it is desirable that eventually child benefit should be the sole means of providing for children, and I made that clear in our previous discussions of this issue. But we oppose the Government policy of reducing—or, as in the case of statutory sick pay, removing altogether—the child dependency additions without an increase in the real value of child benefit to compensate for the loss. Of that Government policy, the Social Security Advisory Committee said in their first report:
" In principle, we fully support the objective of successive Governments that child benefit should replace dependency additions to short-term contributory benefits, but we are equally clear that the present method of achieving this is wrong ".
The Social Services Select Committee in another place described it as:
" a shift in public policy which is entirely in the wrong direction ".

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To maintain the overall value of child support, we tabled in Committee an amendment which would have added 85p to statutory sick pay for each child. That was to replace the present 80p per child dependency addition, but we increased it to 85p to take account of the fact that it was to be subject to national insurance contributions, which arc not at the moment paid on national insurance sickness benefit.
In his reply, the noble Lord, Lord Trefgarne, made several points. He said first that child benefit was the way to help and he thought we were all agreed on that. He added that in his opinion it was:
" inconsistent to introduce an addition which is higher than the present National Insurance benefit child dependency addition ".
I have explained that we added it to offset the national insurance contribution. Nevertheless, we have accepted his stricture and in the present amendment we have stuck to 80p; replacing the present 80p with exactly the same sum.
The noble Lord then said that it would complicate the administration to have a benefit for children. I should have thought that all one had to do would be for the employee to give to the employer the numbers of child benefit books that were held in his familly, and the employer would submit that information when seeking a refund from the Department of Health and Social Security. If the employee did not wish to apply for any benefit, he need not do so; if he was worried about his employer knowing about the number of children he had, he would not have to reveal that.
The second point made by the Minister was that to have that addition for children would cause intrusive inquires, and he said:
" It has never been the practice for payment from employers to reflect family circumstances ".
I have explained that the employee need not apply, if he does not wish to, for benefit for children. It is true that employers have been concerned with benefits paid to families and on the number of children there are in the family. For one thing of course, many employers require an employee to let them know precisely what they have received in national insurance benefit so that that amount may be deducted from their sick pay scheme. So far as pensions are concerned most pension schemes provide for death-in-service benefits to be paid entirely at the discretion of the employer. The employer may pay them to the widow, but he does not necessarily have to do so; he may choose some other dependents to whom to pay them. He could not make that decision—it may in fact be the trustees of the scheme who make the decision, but they always include representatives of the employer—without having the details of the family. It is perhaps not entirely correct, therefore, to say that it has never been the practice for payment from employers to reflect family circumstances. And of course there are schemes which provide for orphans.
In so far as those arguements about complications of the administration and intrusiveness of inquiries have any validity—and I have suggested that they have very little validity—they seem to me to be powerful arguments in those circumstances against transferring from the present system, which copes with the administration and does not involve employers in family details. The Minister went on to say that there was always supplementary benefit if people
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should be worse off or in an unsatisfactory position as a result of the levels fixed for statutory sick pay. But we want to avoid putting more people on to supplementary benefit. There are too many people having to rely on that at the moment.
As the Minister said that the matter should be dealt with through child benefit, on Report we tabled an amendment to increase child benefit to compensate for the loss of the child dependency additions. The noble Lord, Lord Trefgarne, said in reply, if I understood him aright, that the proposed level of statutory sick pay approximated to the level of income replacement which would otherwise be available from taxed sickness benefit. It does not approximate to the amount now paid to a family with children, and that was the point we were making. The Minister made two statements, one in Committee and one on Report, which seemed to point in opposite directions. In Committee he said:
" Turning to the other point of the amendment, which seeks to add a child dependency addition to statutory sick pay, I have already mentioned the Government's belief that child benefit, and not child dependency additions, is the proper way to provide for children ",
And on Report the noble Lord said:
"The proposition inherent in the amendment—that child benefit should be used as a device to enhance the level of support provided under the statutory sick pay proposals—seems to me to be wrong ".
We are to solve the problem through child benefit and we are not to solve the problem through child benefit. He pointed out that to do it through an increase in child benefit of the kind we proposed would cost £440 million. I suggested in reply that that could be justified—because other people would he helped as well as those on statutory sick pay—but I agreed that perhaps it was not right to introduce that additional expenditure as an amendment to the Bill.
Consequently, we have returned to day to the modest concept of adding the child dependency addition of 80p for each child which is now paid under national insurance sickness benefit. We want to add that amount to statutory sick pay. If the Government cannot afford to increase child benefit to compensate for the removal of child dependency additions, then in our view the child dependency additions should for the time being be retained. Not to do that is to continue to follow a policy condemned by the Social Security Advisory Committee. My Lords, I beg to move.
Lord Wallace of Coslany: My Lords, I rise very briefly to support the noble Lord, Lord Banks, and to congratulate him on the masterly way in which he overcame his temporary handicap. The noble Lord has presented a very clear case—
Lord Trefgarne: Rear, hear!
Lord Wallace of Coslany:—and I note the applause from the noble Lord, Lord Trefgarne. On the question of child benefit he and I must of course declare an interest. He is the proud father of two very active sons, I am the proud grandfather of three very active grandsons, and we both know how expensive they can be, in particular in regard to footwear, apart from any other items of clothing. When we have a case of the breadwinner of the family being sick, the burden

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imposed on the housewife, who is mainly responsible to look after the family, is very heavy indeed. There is every moral justification for the amendment to be accepted, and I am very pleased to support it.
Lord Kilmarnock: My Lords, I, too, should like to support the noble Lord, Lord Banks—and very briefly indeed, since he has made his exposition in his usual masterly way. At the Committee stage the noble Lord, Lord Trefgarne, pointed us in the direction of child benefit as the proper vehicle for the solution of the problem. Then, by setting himself against the child benefit vehicle the last time that we debated the matter, at Report stage, he boxed himself into a corner; that is to say, back into the corner of dependency additions. The noble Lord cannot have it both ways. If it cannot be done under child benefit, then we shall have to go back to the dependency addition principle. As the noble Lord, Lord Banks, has pointed out, if we do not go back to the dependency addition principle, then we shall end up again with increased demands on supplementary benefit, which is highly undesirable because it is now involving a great deal of work for which it was not originally designed. On those grounds, I should like to give my support, and that of my party, to the amendment, which, as the noble Lord, Lord Banks, has said, is a modest one.
Lord Trefgarne: My Lords, as the noble Lord, Lord Wallace of Coslany, pointed out, despite the absence of his spectacles the noble Lord, Lord Banks, has explained the purpose of the amendment with his usual clarity. Indeed, as at least two noble Lords have already said, we debated the question of the level of child benefit itself at Report stage. All parties are agreed on the importance of maintaining, and the desirability of improving, the value of the benefit. As I said during that debate, the Government have made great efforts to protect its value in difficult circumstances. We are honouring the undertaking given in July 1980 by the then Secretary of State for Social Services that its real value would be maintained. This is a considerable achievement in the circumstances, especially because, as your Lordships know, child benefit is very expensive. Much as we should like to increase its value in real terms, the extra resources needed are simply not available.
However, in the context of statutory sick pay, the noble Lord's argument, with respect, is rather less convincing, and there are two aspects that I should like to clarify. First, there is the question of principle and practicability as to what the structure of SSP payments should be. The Government have explained in previous debates on this Bill, both in your Lordships' House and indeed in the other place, that in the April 1980 Green Paper we consulted specifically on the question whether there should be a higher rate of SSP for employees with dependent children. The overwhelming response received was that there should not. It was represented to us that this would greatly complicate the administration of the scheme, and that dependency additions would be inappropriate as part of a payment of sick pay by employers. The complication would of course come from the fact that the weekly rate payable would vary depending on the
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employee's family circumstances. Instead of the three rates of statutory sick pay which we at present envisage in the Bill, there would be six, nine or even 12 rates, depending upon the numbers of children in a particular family.
It is misleading to regard SSP as directly akin to state benefit. Although it will replace benefit for the first eight weeks of sickness, SSP is not itself a benefit. It is essentially a continuation of earnings—a statutory minimum level of occupational sick pay, if one wishes so to call it. It has never been the practice for payments from employers to their employees to reflect family circumstances. Then there is the question of privacy. It has been argued that an employee would not be compelled to reveal his family circumstances to his employer if he was willing to forgo the dependency increases. But that would place him in an invidious position. It is better that, like wages and other contractual remuneration, SSP should depend only upon the contract between employer and employee, and not on the employee's family circumstances.
The noble Lord, Lord Banks, suggested that the employee could present the benefit books of the children for whom he wished to claim the addition, but I am sorry to tell the noble Lord that in fact only one book per family is normally issued. I say that without advice from my officials because I know that in my own case, with three children, we have one book, from which it is immediately apparent for how many children we are being paid our child allowances.
The first point that I want to make is that the Government have accepted the representations made that SSP should not be tailored to family circumstances, and we feel that this is the logical decision, given the nature of these payments. The second point to be made is that the child dependency additions lost to employees during the first eight weeks of sickness have been fully taken into account in setting the rates of SSP; and they have been taken into account at current benefit levels—that is, at 80p a week.
During the debate on amendments to the clause at Report stage, I gave a rather lengthy (I fear), but I hope helpful, explanation of how the SSP rates have been set to ensure that employees, as a group, will be broadly in the same net position as if sickness benefit were taxed. The full amount of the benefit savings, including child dependency additions at current benefit levels, together with the extra national insurance contributions which employees will pay, have been taken into account in setting the rates. As a group, employees on statutory sick pay are not losing the value of the child dependency addition. Nevertheless, both tonight and on earlier occasions, noble Lords have sought to argue that individuals will lose. That brings us back to the position of a man with dependent children, whose wife is also dependent on him. I dealt at length with this point during our Report stage, because it is important to reassure your Lordships that such an individual will not be materially worse off, or forced on to supplementary benefit, as a result of the scheme. I hope that I reassured your Lordships on that occasion, and perhaps you will prefer that I spare you a repetition of the arguments that I then deployed.
In view of the two points—first, that it is not appropriate, or administratively sensible, to include child

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additions in the SSP scheme; and, secondly, that the amounts that will be lost in benefit by way of child dependency addition have been fully taken into account in setting the rates—I hope that the noble Lord will not wish to press his amendment further. However, if he is tempted to do so, I should like to tell him that, as drafted, it does not, I fear, have the effect that he intended. It provides for payments even in respect of adult children, and not just for dependent children. I fear that the making of this amendment at this late stage in the Bill's progress would also create serious difficulties in view of the doubt that it might cast on the meaning to be placed on other connected clauses; for example, the meaning of the "entitlement limit" defined in Clause 5(4) to be
" an amount equal to eight times the appropriate weekly rate",
or the calculation of the daily rate payable, defined in Clause 7(2). Neither would it be clear what should happen if an employee's family circumstances were to change during a period of entitlement to SSP.
The amendment would have far-reaching consequences for the drafting of the Bill, which would need to be altered further if this amendment were to be made and accepted in another place. Unfortunately, the opportunity for those additional amendments has now passed. I hope that, in the light of these rather grave shortcomings, the noble Lord will wish to reconsider whether or not he should press his amendment.
Lord Banks: My Lords, I should like to thank the noble Lord, Lord Wallace of Coslany, and the noble Lord, Lord Kilmarnock, for the support which they have given to this amendment. I see that I ought to declare an interest. In my case it is two granddaughters. The noble Lord, Lord Trefgarne, said that the real value of child benefit had been maintained, and it has been in this year, though no't over the period that the Government have been in power. But that is really beside the point. The fact is that if you do away with a particular benefit you ought to increase child benefit in order to compensate, and that is the argument that was being put forward by the Social Security Advisory Committee.
As far as the question of complication is concerned, I do not think it is terribly complicated to provide the basic rate, which is one of the three which are already in the Bill, plus 80p for each child. It would not take us very long to produce the table for that if we were to set it now as an examination question. I do not think that would present much difficulty.
The noble Lord objected to the fact that I had said that an employee need not apply for the child addition if he did not wish his family circumstances to be known. The noble Lord said that in that case he would not have this additional benefit, he would have to forgo it. Still, he would at least have the opportunity of getting it, whereas at the moment he does not have the opportunity of getting it. So I would have thought that his position, if not 100 per cent. satisfactory in those circumstances, would be better than at the present time. With regard to child benefit books, all you need have is a number for each child. It does not really matter if you have one book or more. You need to have a number for each child and to
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submit that number— a very simple piece of administration, I would have thought.
I think there is a fundamental difference of opinion here. As to the difficulties which the noble Lord has said there would be if this amendment were made to the Bill, I am not quite sure whether he is saying that it would be quite impossible to secure, before the Bill became law, that the amendments which he said would be consequential were made; that it would be impossible to put them in in any place.
Lord Trefgarne: My Lords, if I may intervene again with the permission of your Lordships, I have to say that the remaining stage after the Third Reading here in your Lordships' House tonight, assuming that the Bill is passed, is consideration of your Lordships' amendments in the other place. In that situation, it is of course not open to the other place to do anything other than accept or reject our amendments, or possibly offer amendments in lieu. It is certainly not open to the other place to introduce new amendments.
Lord Banks: My Lords, having considered what the noble Lord has said, and with very great regret—because I think there is an important issue of principle here, an important division between us, and I think that some of the arguments which have been put from this side of the House have not been answered—I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 18 [Claims for sickness and other benefits: provision of information by employers]:
7.15 p.m.
Lord Trefgarne Lord Trefgarne moved Amendment No. 3:
Page 15, line 29, after ("Act") insert ("or of regulations made under paragraph 1 of that Schedule").
The noble Lord said: My Lords, this is a technical amendment. It is consequential upon the amendment made to Schedule 1 on Report, enabling regulations to be made providing circumstances (other than those listed in paragraph 2 of that schedule) in which a period of entitlement to statutory sick pay will not arise. The effect of this amendment is to include such circumstances among those in which an employer is obliged to furnish information in connection with his employee's claim for state benefit. I apologise for the fact that the need for this consequential amendment was overlooked at Report stage. I beg to move.
On Question, amendment agreed to.
Clause 28 [The statutory schemes]:
The Earl of Gainsborough The Earl of Gainsborough moved Amendment No. 4:
Page 23, line 13, at end insert—
(" (3) Regulations under subsection (1) above shall provide that in ascertaining for the purposes of a rate rebate, a rent rebate and a rent allowance the weekly income of a person to whom this Part of this Act applies and his spouse, if any, there is a total disregard of war disablement pension and war widow's pension.").
The noble Earl said: My Lords, in the absence of my noble friend Lord Sandford, who is unable to be here because of his ecclesiastical duties elsewhere, I beg

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to move Amendment No. 4. This amendment seeks to provide for a mandatory total disregard of war pensions for the purposes of a rent or rate rebate which may be granted by a local authority. It would enable a local housing authority or other authority administering this matter to obtain the 90 per cent. subsidy in respect of the payments of rebate or allowance for this purpose. We appreciate—that is to say, my noble friend and myself, and the local authority associations with which we are connected—that this power may exist for giving a rent rebate. But, of course, the total cost of that would have to be paid for by the local authority, which would not receive the normal 90 per cent. which is given by central Government in respect of the payment of rebate or rent allowances.
I understand that the noble Lord is not likely to accept the amendment, but I hope he will be able to explain and to answer the point that I have made. This is a matter which affects people in receipt of war disablement pensions or war widows' pensions, and therefore it is an important matter in respect of which local authorities would like to be able to make the same payment all over the country, and not different payments in different areas because of varying legislation. I beg to move.
Lord Wallace of Coslany: Very briefly, my Lords, I would support this amendment because I note—
Lord Trefgarne: Surprise, surprise!
Lord Wallace of Coslany: Surprise, surprise, most certainly, my Lords. As an ex-serviceman I am very pleased indeed to support it. The reason why I support it is that I prefer it very much to Amendment No. 6, which the noble Earl, Lord Avon, will no doubt very shortly come forward to move. That is a permissive amendment, in that some local authorities may apply a total disregard and others may not. That is not exactly a fair deal to war pensioners, which is why I prefer the first amendment. I will not delay your Lordships any further, but will merely indicate our support for it.
Earl Haig: My Lords, I should like first to explain that because of Legion commitments in Scotland I was absent when these matters were discussed previously. On those occasions great concern and interest was shown in the welfare of ex-servicemen, and it was because of the strong support given to an amendment moved by my noble friend Lord Kinross that the noble Earl, Lord Avon, on behalf of the Government, agreed to bring forward an amendment in similar terms at Third Reading. It is the Government amendment which has our support today, rather than that under the name of my noble friend Lord Sandford. I hope my noble friend Lord Sandford will understand our position, which has been taken up in spite of his support for our previous amendment.
Perhaps I should say that I speak in my capacity of president of the Royal British Legion, Scotland, and with authority from that organisation. I do not speak on behalf of our sister organisation, the Royal British Legion, on this side of the Border. It
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might be that the proposals which the noble Earl, Lord Gainsborough, has explained would have some advantages to them. But for Scotland, the Legion has considered the two systems and has won support for the local authority alternative.
This alternative is contained in the Government amendment which will give to local authorities enabling powers which have existed in Scotland for the last seven years. That amendment gives to ex-service pensioners rent and rate rebates without deduction of their pension and follows the principle that war pensions are in compensation for lost amenities in return for services rendered, which has nothing to do with their being supplemental income.
Existing Scottish legislation gives to local authorities enabling powers and, as I understand it, the proposed Government amendment is similar to the amendment of my noble friend Lord Kinross and brings the new Bill into line with previous Scottish legislation. Looking at this problem from the Scottish ex-serviceman's point of view, it seems to us that the advantages of letting the local council watch over the interests of individual members of a community are great. It is important that it is written into the Bill that the local authorities are entitled to disregard, and we believe that it is at local level that the concern and caring should happen and where the waiving of income should be incurred.
We do not want to involve ourselves in theories about tiers of Government and the relationship of local authorities and central Government funding; and nor do we believe that the word "mandatory" is necessary in this context. We know that the enabling system works well in Scotland and can continue to work well so long as housing remains the prerogative of local government. We know that local councillors, who are part of our social fabric, are the best people to watch over the ex-servicemen's interests in matters of housing. We believe that they will follow the procedures laid down and there will be no variance of response between one local authority and another. I would prefer to wait for the Government amendment which we would support as being the amendment in the better interest of the ex-serviceman.
Lord Davies of Leek: My Lords, I followed this matter with interest and also looked at the noble Earl's amendment, which on the surface is saying in simple English that what Clause 28 does is to empower the Secretary of State with the Treasury's consent to make regulations requiring authorities to act on rent rebates, et cetera. The amendment by the noble Lord, Lord Sandford, and the noble Earl, Lord Gainsborough, is broader than the amendment of the noble Earl, Lord Avon. I can see no reason, if the Government are accepting the noble Earl's amendment (which I am delighted to see), why they cannot go to the length of accepting the war pension amendment put down by Lord Sandford and the noble Earl, Lord Gainsborough.
As one who had about two years' experience in the Ministry of Pensions, I had to deal at times exclusively with war pensions and in my own family I had a sister-in-law, now, I regret, deceased, whose husband as a young captain was killed in World War II. She and their two children struggled along on a war pension basis, and it took years before the rights of many of

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these people were investigated. I am sure that, particularly now, when we are talking about (and I must be careful of my phraseology) the Falkland incident—because we have not declared war; and I hope we never have other such incidents—the country would welcome a review of the position of the war pensioner.
Both sides of the House are well informed on this, and for years an effort has been made to clarify the position. All I ask is that the Government should consider accepting this amendment. When the noble Earl, Lord Avon, gets up to speak I am sure he will make some explanation of the differences. Nevertheless, I support the original Motion put down, and, whatever the voting may be, I hope the House will divide to indicate how we feel on both sides of the House in some cases. It is not a party political question but is about the problems of war widows and their dependants.
Lord Trefgarne: My Lords, at Report stage the House showed great sympathy for an amendment which drew attention to local authorities' discretionary powers to disregard war disablement and war widows' pensions under their local schemes. The Government have, as promised, put down a revised amendment to this end which my noble friend Lord Avon has it in mind to move shortly. The amendment which we are now discussing would provide for a total statutory disregard of such pensions—in other words, the disregard would be mandatory and not discretionary and local authorities would be able to claim a 90 per cent. subsidy from central Government towards the cost of the disregard.
I can, of course, understand the noble Earl's reasons for wanting to introduce a total statutory disregard of war pensions. We will accept the special nature of such pensions, and that they are deserving of some special recognition. The existing rebate and allowance schemes provide for a £4 statutory disregard of such pensions, and the Government propose to carry this forward into the housing benefit scheme. We should like to do more, but I am afraid that further central Government money is simply not available. I must remind the House that the housing benefit scheme is to be introduced on a nil cost basis, but the additional cost of central Government of a statutory disregard such as is proposed in this amendment would be in the order of £10 million. This extra money could only be found by reducing the help given to other claimants, and in the circumstances the Government's first priority must be to concentrate what resources we have at our disposal on giving help to those most in need. If the amendment were carried, the money would have to be found at their expense.
I must also draw noble Lords' attention to other, possible repercussive effects if the amendment is carried. There is a statutory disregard of £4 of war pensions under the supplementary benefit scheme. It would be extremely odd for there to be a statutory disregard of all war pension payments under housing benefit whereas the poorest pensioners received only a £4 disregard under supplementary benefit. It will come as no surprise that extension of full disregard of war pensions to supplementary benefit would also be very expensive. Nor would the effects stop there. Other groups of disabled people, for example the industrially
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injured, would naturally seek the same disregards of income.
This whole question of the amount and type of income which shall be statutorily disregarded in means-tested schemes is a complex one and one which is kept under constant review by Government in the context of available resources. It is not a matter which should be approached piecemeal, especially at the Third Reading of a Bill. Neither House has taken the opportunity before today to debate this particular point during the passage of this Bill. Your Lordships may feel that we have now left ourselves with insufficient time to consider with proper care the wider implications of this proposal.
In any case, I am sure the right solution, in the context of housing benefit, is for local authorities to continue to have powers to give total disregards to war pensions in their local schemes, if they wish. In that the House on Report warmly supported the amendment of my noble friend Lord Kinross which sought to encourage local authorities to do just that, I would ask the House to adopt the same approach tonight; that is, to leave this matter to local authorities. I hope that the noble Earl, Lord Gainsborough, will withdraw his amendment.
The Earl of Gainsborough: My Lords, I am grateful to the noble Lord, Lord Trefgarne, for what he has said. He spoke of a sum of' £10 million. That does not seem to me to be a very large sum if that is all it is going to cost. It seems to me a pity that the Government could not have conceded this point. It would not necessarily have to come out of some other fund; it could come out of central Government funds, and and it is not a large sum.
I realise that the British Legion in Scotland are well satisfied with what arrangements they have north of the Border. They often have better arrangements north of the Border than we do south of the Border. This would not necessarily be supported by the British Legion of England and Wales. I am very grateful for the support of noble Lords on the Labour Benches. In view of what the noble Lord said, I feel that we must wait for the amendment by the noble Earl, Lord Avon. I think I understand what he is going to say and perhaps in this case it would not be right to press this amendment to a Division. Although I am disappointed, as I know my noble friend Lord Sandford will be, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 30 [Local schemes]:
7.32 p.m.
The Earl of Avon The Earl of Avon moved Amendments Nos. 5 and 6:
Page 25, line 21, leave out from (" section ") to end of line 22.
Page 25, line 37, at end insert—
(" (1A) The power to modify a statutory scheme under this section shall be subject to any exceptions specified in the scheme; but nothing in such a scheme shall preclude the making of modifications which secure that, in determining the resources of any person (whether the occupier or any other person whose resources fall to be aggregated with his), any war disablement pension or war widow's pension payable to that person shall be disregarded.
In this subsection "war disablement pension "and" war widow's pension" have the same meanings as in the Pensioners' Payments and Social Security Act 1979.").
The noble Earl said: My Lords, on Report, we debated an amendment from my noble friends Lord Kinross and Lord Haig drawing attention to local authorities' discretionary powers to disregard war disablement and war widows' pensions under their local schemes. I explained then that for technical reasons the Government could not accept that amendment, although we fully supported the aim of my noble friend. In view of this, and in particular the the support which the amendment enjoyed in the House, I undertook to bring forward an amendment in similar terms today.
I hope the House will agree that this amendment meets that pledge. It draws attention to the provision of disregards for war pensions. It even has the added bonus, if I can use the term, of writing into the statute the fact that the Secretary of State cannot modify the housing benefit scheme by regulations so as to prevent authorities from disregarding war pensions in their local schemes, if they wish. This Government would certainly not wish to prevent local authorities from disregarding war pensions, but we did this, on the advice of parliamentary counsel, to give the provision a positive legal application. I hope though, that my noble friends will see it as an unexpected—but useful—safeguard for the future. I was able to consult my noble friend Lord Kinross briefly before the Government tabled these amendments. I believe that he found them acceptable. I would now ask the House to do the same. I beg to move.
Lord Kinross: My Lords, it only remains for me to express my gratitude to the noble Earl, Lord Avon, for having introduced this amendment which is not in exactly the same terms but expresses the same sentiment and principle as I did in my amendment. It is slightly differently worded by parliamentary draftsmen on his side. It is in a different place in the clause but it is of equally good effect. In particular, it carries forward the reference to the disablement pensioners and war widows which is the essential point that I wanted. It only remains for me therefore to thank him and other noble Lords on all sides of the House who supported me at Report stage and to assure the noble Earl, Lord Gainsborough, that I am sure the English Legion and other ex-service organisations will be able to take advantage of this benefit which Scotland has had for some time.
Baroness Jeger: My Lords, we accept gratefully and with appreciation the amendment that the noble Earl, Lord Avon, has moved. But I must put on record some anxiety. I am sure that all our thoughts tonight are with the soldiers, sailors and airmen in the Falklands. Some of them might lose their lives; some of them might be wounded. Why should it be that if one of them lives in Wiltshire and another in Gloucestershire there should be a difference in their housing benefits? I accept what the noble Lord has said about the importance of having local authority decisions; but it seems to me that when men are fighting together and working together on a common project it is absolutely wrong that the benefits which they will get in their housing should depend on where they live. This seems to me to be quite irrational and unfair. Although I am sure that we do not want to
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oppose the amendment which the noble Earl has put down, because it takes us some way towards our aim, I feel that we must put on record that we think it is totally irrelevant that the housing benefit of an ex-soldier or his widow should depend on the luck of where he lives. I very much hope that as a result of the debate in the House tonight local authorities up and down the country will decide that they must be generous and that they will all take on board the right that the House has given them tonight to make this generosity available for ex-servicemen and their dependents.
It is in that spirit that we are not opposing the amendment: but we want to make it absolutely clear that we are very much hoping that local authorities will use this power which has been given them so that there is not going to be this geographical distinction between one service family and another which seems to us totally illogical and wrong. We would have preferred the amendment of the noble Lord, Lord Kinross; but with the reality of politics I can say on behalf of my noble friends that we accept Amendment No. 6 and we hope that it will be widely used.
Lord Davies of Leek: My Lords, accepting that reality, I should like to thank the noble Earl, Lord Avon, for the explanation that he gave. While I should have liked to have seen the other amendment on the Marshalled List, nevertheless this is a step forward. The time may come when it is more appropriate for us to face this problem. Consequently, in thanking the noble Earl I say I am grateful at least for this being on the record.
On Question, amendments agreed to.
Schedule 1 [Circumstances in which periods of entitlement do not arise]:
Lord Trefgarne Lord Trefgarne moved Amendment No. 7:
Page 45, line 5, leave out (" the coming into effect of the current contract ") and insert (" that on which the current contract came into force").
The noble Lord said: My Lords, with your Lordships' permission, I speak to Amendments Nos. 7 and 8 together. These are both technical amendments. I beg to move.
On Question, amendment agreed to.
Schedule 4 [Amendments and transitional provisions]:
Lord Trefgarne Lord Trefgarne moved Amendment No. 4:
Page 54, line 10, leave out ("(a)").
On Question, amendment agreed to.
7.39 p.m.
Lord Wallace of Coslany Lord Wallace of Coslany moved Amendment No. 9:
Page 61, line 1, at end insert—
(" (4) In paragraph 3 for the words from "(b)" to "Northern Ireland;" there is substituted the following—

"(b) one after consultation with organisations representative of workers;

(e) one after consultation with the head of the Department of Health and Social Services for Northern Ireland;

(d) not less than three after consultation with organizations representative of local authorities.".").

The noble Lord said: This amendment is a modified version of the one that I moved on Report, but withdrew for further consideration and to take into account the Government's views as expressed by the noble Earl, Lord Avon. In general, the Government's opposition was on the grounds that they wanted generalists and not specialists on their new committee. I think that is a fair interpretation of the reply given by the noble Earl, Lord Avon. This new amendment provides for appointments after consultation with local authority associations, and not specifically with rating and housing authorities. The number of appointments in the amendment has been increased from two to three because it would now bring in the social service and education interests which I understand are already represented on the existing committee.
The main and vitally important point of the amendment is that the Government should consult with the local authority associations to ensure that appointees enjoy the confidence of local government, and I may add that is a very desirable objective. I beg to move.
Lord Trefgarne: My Lords, as was announced during the Committee stage in another place, the SSAC will be assuming responsibility for advising Ministers on housing benefit. I should not like noble Lords to think that SSAC will not have available the expertise to cope with the new responsibilities. As my noble friend Lord Avon explained on Report, DHSS Ministers and the chairman of SSAC, Sir Arthur Armitage, agreed that the membership of SSAC should be increased by two, specifically to allow the committee to be strengthened for its new responsibilities.
The noble Lord's amendment is slightly different from one he put down on Report. My noble friend Lord Avon explained why the Government could not accept that amendment. I am afraid we must also resist this amendment tonight, on the grounds that it is both unnecessary and inappropriate. The amendment is unnecessary, if the noble Lord is anxious to ensure that there is a local authority "voice" in advice given to Ministers on housing benefit, because the local authority associations will have direct access to Ministers to provide this advice themselves. Clause 36(1) provides that the Secretary of State must consult the associations before making housing benefit regulations, or amending regulations, except for uprating regulations. Ministers recognise that housing benefit is a complex matter, and that local authority expertise has much to contribute to its development.
I also said the amendment was inappropriate. In seeking to provide for consultations with local authority associations over the membership of SSAC, I fear the noble Lord may have misunderstood SSAC's role. The committee is there to give advice on a wide range of social security matters, and, where necessary, on competing claims and priorities. Apart from the Northern Ireland representative, whose inclusion on the committee is self-evident, all the members on SSAC, including those appointed after consultation with the CBI and TUC and the disabled person on the committee, are generalists. That is, they are all appointed on their abilities to consider the whole range of social security issues. They are not appointed to provide expertise in particular areas. While it is the case that local authorities have a major involvement in housing
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benefit, that is only one of SSAC's many interests. Indeed, apart from housing benefit, authorities have little direct involvement in other areas of SSAC's work. Other bodies or groups could make an equal claim, on the arguments advanced by the noble Lord, to be consulted about members of SSAC. If these claims were granted (and if this amendment were carried there would be no good reason why they should not) the process would quickly become unwieldy and would make the committee very much larger. As my noble friend explained on Report, Ministers and the chairman of SSAC are anxious to avoid that, as it would obviously weaken SSAC's ability to advise on specific issues in their wider context or to keep the whole spectrum of social security matters under review. I hope the noble Lord, Lord Wallace, will be persuaded by these considerations with withdraw his amendment.
Lord Wallace of Coslany: My Lords, the noble Lord, Lord Trefgarne, of course has caused no surprise by the fact that he will not accept my amendment, because after some many weeks and months on these Benches one gets used to that. But he has made the point—I want to be fair—that there is consultation with Ministers by local authorities. As to whether one more or two more people on the committee will make it too large, that is a matter for argument. There is a theory that small committees get business done and large committees never get anywhere. I can see the point, and I would frankly admit it. I do not think this is a very urgent matter to press before the House, bearing in mind the hour, the situation and those who are feeding themselves well and truly while we work on. In the circumstances, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
7.46 p.m.
Lord Trefgarne: My Lords, I beg to move that the Bill do now pass. May I, very briefly, express my gratitude to those Members of your Lordships' House who have taken an interest in this Bill. On a personal note, may I thank noble Lords for their tolerance of me as a "new boy" to social security. It is a major Bill. It recasts the arrangements for income maintenance during sickness and rationalises the provision of help to people on low incomes with their rent and rates. As with most social security legislation, there has been much technical material in the Bill but, despite this, there has been a loyal band of your Lordships taking part in the debates, and I particularly welcome the constructive approach of the noble Baroness, Lady Jeger, and her colleagues on the Opposition Front Bench.
Inevitably, much of our discussion has been on the effects of the Bill on individuals. I think that your Lordships have, as so often, done a valuable job in clarifying the intentions of the Bill's provisions as they affect ordinary people. We on the Government Benches have welcomed this approach and have done our best to clarify the provisions and explain their effect. I fear that some of that explanation and clarification was hardly necessary for the noble Lord, Lord Banks, who once again displayed his knowledge and expertise in this area.

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I will not detain your Lordships any longer, save to offer my special thanks to my noble friend Lord Cullen of Ashbourne for his help to me personally during the later stages of this Bill. Unhappily for us, my noble friend has now retired from the Front Bench. I hope he was not persuaded to do so by the rigours of this measure. My Lords, I beg to move that this Bill do now pass.
Moved, That the Bill do now pass.—(Lord Trefgarne.)
Baroness Jeger: My Lords, I should like to emphasise what the noble Lord, Lord Trefgarne, has said about the noble Lord, Lord Cullen of Ashbourne. We have often co-operated, consulted and worked together, and I very much hope that whoever succeeds him will find that there is co-operation on these Benches in the interests of the community of this country in this very important field. I can only say to him—I hope I am not embarrassing him—that I have much enjoyed working with him.
The Motion before your Lordships is that this Bill do now pass. I have to make it clear from these Benches that it passes without our commendation and without our blessing. In our view it is a wicked gallimaufry of a Bill, for it mixes up sick pay and housing subsidies in an unacceptable muddle, and as far as I can recollect, for the first time in history of modern social security it takes away any connection between contributions and benefits. It seems to me that for the first time it relates benefits to wages and not to contributions. This is a new and, I think, a very wrong situation. It means that men and women who have been paying national insurance contributions in good faith on the understanding that in sickness they would receive certain stated amounts, are now to find that with their contributions paid up their benefits are not to relate to their contributions, but to their wages.
This must mean—I am sorry the noble Lord is shaking his head at me, but I have in front of me the clause of the Bill which lays it down quite clearly—that the statutory sick pay for the first eight weeks is to be related to the wages which a person is receiving. This is quite different from the original set-up. As I understand from the figures that I have obtained from the department, national insurance sick pay is £22.50 for a single person, plus £13.90 for a dependent adult, plus 80p for each child and from that money national insurance contributions are not deducted, as they are to be deducted under this Bill. So it seems to me from my bad arithmetic that a couple with two children will receive less money under this scheme than they receive under the national insurance system, and that all those people who are earning between £34 and £44 a week are bound to be worse off. So that is a reason why we are fundamentally opposed to this Bill.
We understand that, as from April 1983, men and women at work will receive less than they understood they would get. This is set out clearly in Clause 7 and it seems quite wrong. The effect of this Bill is that the sick poor will be made poorer. There is no way of getting out of that. The poorest workers are to receive £25 a week, irrespective of how many children or adult dependents they have to take care of, and for the first eight weeks of an illness their poverty is bound to be increased.
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We also feel that industrial relations will be poisoned by the provision that workers on strike will not get sick pay, unless they prove that they had no interest in the strike. We feel that that is very damaging and divisive for industrial relations. So far as the housing provisions are concerned, the objective appears to be to save Government staff by increasing local government staff. We also note that sick pay is to be taxed and we see this Bill as making life more impoverished, more difficult and harder for the poorest people in this country. That is why, though we are not voting tonight we must register the fact that we do not welcome the passing of the Bill.
7.53 p.m.
Lord Banks: My Lords, the noble Lord, Lord Trefgarne, referred to himself as a new boy in this sphere of social security, but I think that the whole House has been greatly impressed by his versatility. He seems to pass from airports to foreign affairs and then to sick pay with the greatest of ease, and he certainly has not appeared during the discussions on this Bill to be a new boy. I am sorry to learn that the noble Lord, Lord Cullen of Ashbourne, will no longer be assisting him in this sphere, because it has always been a great pleasure to work with the noble Lord, who has always been so helpful and so courteous.
When this Bill first came before this House, I said that we on these Benches were opposed to the establishment of statutory sick pay, but we supported in principle, though with considerable reservations, the housing benefit. That remains our position after sitting through the debates which we have had in this House. I regret that the efforts made by the noble Lord, Lord Kilmarnock, and myself and by the Opposition Front Bench to improve statutory sick pay have not been successful. I regret, in particular, the fact that the 5 per cent. abatement was not removed and that we have not been able to deal—as I would think, satisfactorily—with the question of provision for children which we were discussing earlier. But I hope that these two reductions in benefit will eventually be made good.
Lord Kilmarnock: My Lords, I always feel on Third Readings of social security Bills that we are coming to the end of a ritualistic dance. We know exactly where we shall finish up at the end of the minuet. I too, should like to congratulate the noble Lord, Lord Trefgarne, on his speedy mastery of his new department, and I should like to add my personal appreciation of the great courtesy that has been shown to me by the noble Lord, Lord Cullen. I am sorry that he is not now in his place and hope that he will read the report tomorrow. I saw he was wearing slightly festive dress, so I hope that he has gone off to a celebration.
I cannot extend to the Government's policies the congratulations which I have conveyed to the noble Lord, Lord Trefgarne. It seems to me that every time we come to the end of a social security Bill in this House, we are left with the story of pinching and scraping 80p here, refusing to uprate there and so on. This has an effect not only on the rising number of poor in this country, who were referred to by the noble Baroness, Lady Jeger, but also on the level of economic

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activity. I find it hard to understand how the Government can expect businessmen to invest with confidence in the future when there is little or no prospect of growth in the aggregate demand from the population as a whole. So it seems to me that there are two elements, the humanitarian element and the economic element, which often seem to be forgotten when the Government approach social security matters.
With those few remarks, I think that I can simply associate myself with what the noble Lord, Lord Banks, has said, both on the statutory sick pay and on the housing sectors of the Bill. We are completely at one with the Liberal Party on these matters.
Lord Trefgarne: My Lords, with your Lordships' permission, I again thank all noble Lords for their participation in the debates on this Bill. I am sorry that I have not been able to persuade all of your Lordships to the views that I advanced. I fear that that was hardly to be expected. May I just make one point? The noble Baroness, Lady Jeger, complained that, unusually, this is a benefit which is related to wages. But it is not a benefit that we are introducing; it is an extension of occupational sick pay. I would not wish your Lordships to go away with any thought that that was the Government's view, although I understand that the noble Baroness may wish to disagree.
On Question, Bill passed, and returned to the Commons.
[The Sitting was suspended from 7.58 until 8 pin.]

Local Government Finance (No. 2) Bill
Further considered on Report.
Lord Beliwin Lord Beliwin moved Amendment No. 24:
After Clause 7, insert the following new clause:
(" Certification of information submitted by local authorities. 1980 c. 65.
. The Secretary of State shall have power to require any information submitted to him by a local authority under section 65(1) of the Local Government, Planning and Land Act 1980 (information for purposes of block grant) to be certified under arrangements made by the Audit Commission established under Part III of this Act.").
The noble Lord said: My Lords, in moving Amendment No. 24, I am also speaking to Amendment No. 54 which makes a consequential change in the Long Title of the Bill. This is a minor, and I hope uncontroversial, amendment, designed, quite simply, to allow the present arrangements for the certification of block grant claims to continue under the Audit Commission.
There is, I imagine, general agreement that the final calculation of grant entitlements must be based on audited figures. No Government could allow public money to be distributed without a formal independent check on the figures on which entitlements are based. In the past, arrangements have been made for the district auditor to certify rate support grant claims. This has not only provided the necessary audit check on the figures; it has also provided a means of ensuring that all claims are made on a consistent basis. These arrangements have proved wholly satisfactory, and it is in the interests of both authorities and the Govern
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ment for them to continue; there can be no argument about the importance of consistency of treatment in the distribution of grant. The provision is needed to give a specific statutory basis to what it has hitherto been possible to do by administrative arrangment. Consistency and continuity can be achieved in the future by arranging for the Audit Commission to certify claims in the same way as the district auditor does at present. This, quite simply, is what the amendment provides for, and in moving it I commend it to your Lordships.
Lord Bruce of Donington: My Lords, I willingly concede to the noble Lord the necessity of making new arrangements, following the appointment of the Audit Commisson, for the continuation of audit policies that have hitherto taken place under the audit directorate. As the noble Lord has said, this is undoubtedly a matter of some importance—so much so that one wonders why it was not in the Bill in the first place or why, if it is so important, it was not introduced at the Committee stage. But I suppose we cannot cavil at that. The noble Lord's department has been under considerable pressure—as have all departments. However, it lends some colour to the belief that we have expressed from time to time, and shall probably express again at Third Reading, that this Bill has been very hurriedly cobbled together. This matter is of such importance that of course it should have been incorporated in the original Bill. It does, however, raise certain questions.
When the noble Lord takes power for the certification to be made by the Audit Commission he is placing on the Audit Commission, which is no longer his creature, as was the district audit directorate, a new responsibility. What kind of discretion are they going to have? They will have to appoint auditors for this purpose. Will they have complete discretion to appoint one of their own staff, a former member of the Audit Inspectorate, to do the job? Or are they going to ask the auditor ultimately appointed to audit the authority's accounts to do the job? If the latter is the case, obviously it is convenient. It means that the auditor responsible for the audit of the authority's accounts under the provisions of Part I II of the Bill will also have the responsibility of certifying certain information provided to the Secretary of State. Obviously this would be convenient and would probably avoid duplication. It is highly desirable that any auditor appointed to audit the accounts of the authority should be able not only to audit its expenditure but also, as is customary in private industry and elsewhere, to audit its receipts.
Is the noble Lord therefore saying that in addition to the responsibilities under Clause 10 of the Bill which the auditor ordinarily has he is to have the additional responsibility of certifying the information necessary for the determination of block grant? If he is not to have that responsibility and it is to be a responsibility of the former district auditor—presumably recruited, under the provisions of Schedule 2, on to the staff of the Audit Commission—that is one thing. If it is to be the same auditor as audits the authority's accounts, that is another. We should be greatly obliged if the noble Lord could inform us about that, because there are other implications.

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The noble Lord will recall that at the Committee stage, and roughly paralleling the penalties that were to be imposed on auditors if they gave away confidential information, I sought to introduce an amendment which made it an offence for any local official of a local authority or one of his servants to give false information to the auditor. However, the noble Lord was quite explicit in his reply and I deeply sympathise with it. He said that cases of this kind simply do not arise; no official of a local authority would dream of giving false information to an auditor; consequently, the introduction of the penal clause, as proposed by me, to parallel the clause already operating in the event of a deficiency of auditors was unnecessary. So I am bound to ask the noble Lord, applying the same criteria, why he should not be able to rely upon the accuracy of the information provided to him by the officials of the local authority. Obviously, in his view, it requires an audit. That is all very well.
The information required under Section 65(1) of the Local Government, Planning and Land Act 1980 to which the amendment refers says this:
" each local authority shall submit to the Secretary of State or the Minister of Transport in respect of each year, by such date as he may specify, such information as he may from time to time require for the purposes of sections 53 to 64 above and to Schedule 11 to this Act in connection with the total expenditure to be incurred by them during the year".
As your Lordships are aware, the matters covered by Sections 53 to 64 are very wide indeed.
Could the noble Lord give the House in the case of an average local authority (if, indeed, such an animal there might be) or, shall we say, an average metropolitan borough, some idea of the number of hours per annum which are spent by that authority upon providing the Secretary of State with the information that he requires? It would be useful to obtain that information because then we should know approximately how many man hours are required in order to audit the information that is sent to him. I am sure he will be able to reply to that.
This brings me to a larger question, which I hope will not be dealt with before Second Reading by the introduction of a further amendment bringing the Bill up-to-date. Which reminds me—what is going to happen to the Audit Inspectorate anyway? Under Schedule 2 to the Bill the noble Lord has given the Audit Commission the power to recruit such members of the Audit Inspectorate as now exist. I have no doubt that in conformity with the Government's commitment, which some of us think is sometimes half-hearted, to full employment, presumably most of the members of the Audit Inspectorate, whether they are at Bristol or elsewhere, will be absorbed into the Audit Commission—in which case, what is going to happen to the entire organisational structure of the Audit Inspectorate? How are surpluses or deficits on the existing Vote at the time of transfer going to be dealt with? How is the establishment going to be dealt with? These are other questions which have not been dealt with so far in this Bill, but which obviously arise from the latter thoughts of the noble Lord.
That leads me to a further question. If there has been an afterthought in respect of the audit responsibilities in regard to the provision of information in Section
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64(1) of the Local Government, Planning and Land Act 1980, what about the responsibilities under other sections of the Local Government, Planning and Land Act which have not so far been mentioned in the current Bill? Are we going to have further afterthoughts? What about the audit information that has to be provided under Sections 10, 11, 12, 13, 14, 15, 16 and 17 of the Local Government, Planning and Land Act 1980? Are they going to be separate audit arrangements for them, or will they come under the ambit of the Audit Commission? We do not want anymore afterthoughts on this.
Finally, under Section 62(3) of the Local Government, Planning and Land Act 1980, which comes within the ambit of the amendment because Section 65 refers explicitly to the previous sections that I have mentioned, states:
" The Secretary of State may, for the purpose of the adjustment required by this section, make a fresh calculation of the entitlement of each local authority to block grant, substituting the total expenditure actually incurred by that authority during the year for the figure calculated as the authority's total expenditure under Section 56 above".
The question I wish to ask the noble Lord is, is the Audit Commission going to be invited to check the Secretary of State's calculations? It is not only the local authorities who want watching—it is also the Secretary of State. Secretaries of State have been known to behave somewhat capriciously. In fact, they have been known to behave benignly towards some of the shires. They are capricious people, evidently. If it is a good thing for the accounts of local authorities to be audited, and if it is a good thing for the information provided by local authorities to the Secretary of State for grant determination purposes also to be subject to audit then why, in order to protect the interests of local authorities (of which the noble Lord is such a devout if nostalgic supporter), should not the Audit Commission be required to check the Secretary of State's own calculations? These are important matters.
We on this side of the House do not resist the amendment which the noble Lord is putting forward. He is seeking to continue the same kind of arrangements which have been in force in the past. But he himself has brought a new situation and a new perspective into the picture. Instead of the Audit Inspectorate which was formerly responsible to him and which appears in his own departmental directory, he has created a new creature which is an independent Audit Commission—and which he assures us repeatedly is completely independent in order that the public may be safeguarded. But justice is a two-way traffic. The noble Lord has taken powers to ensure that justice is accorded to his department. He gets every conceivable kind of return under the Local Government, Planning and Land Act 1980 and under numerous other Acts, including this proposed one. He has all the information at his disposal—it is all checked and audited. What about the decisions that he makes? What about the calculations that he makes? Should they not be subject to audit also? In logic, there would appear to be no reason why they should not be. In order that we may not have to return, perhaps even more vigorously, on Third Reading to this very aspect of the matter which the noble Lord has unearthed—and for which we are in-

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deed grateful—I hope the noble Lord will be able to answer some of the questions which I have posed to him.
Lord Bellwin: My Lords, I do not know whether the noble Lord's suggestion that he may have to return to the charge is a threat or a promise. When he said that he may have to do more vigorously—well, he was not doing so badly this time, was he? I think he does himself less than justice when he talks about my having afterthoughts. There was he, the great advocate, asking, "Will you take this away to consider it? Will you look at it again?" And when we do so and come forward with something, he then complains that we are having afterthoughts. The noble Lord really cannot have it both ways and must make his mind up on what it is he really wants.
In fact, of course, the observations made by the noble Lord, Lord Bruce of Donington, were in the main very valid. Indeed, in a section of the Bill dealing with a technical subject on which the noble Lord clearly has expert knowledge, he is quite right to question and raise the points he has. The fact that 1 do not agree with most of them is perhaps secondary. Nevertheless, he is right to bring them up and I hope I will be right to knock them down if I think they are wrong.
I will try to answer at least some of the points he raised. I cannot cover all of them—how could I, because no one could write as fast as the noble Lord spoke and get it down. But if there is anything I do not cover which continues to trouble the noble Lord, he knows that all he has to do is get in touch or I will get in touch with him afterwards. The noble Lord asked what is going to happen to the Audit Inspectorate. The staff of the district audit will generally transfer to the commission. It will be for the commission to decide the staffing structure, but no doubt it will have regard to the present arrangements. Certainly, everyone has paid tribute to the quality and calibre of the people who come to work in the district audit service.
The noble Lord also made a point about the cost of auditing the block grants. Your Lordships may be interested to know that the cost of auditing rate support grant claims is something less than £100,000 for the whole country at present, and I do not anticipate that it will be significantly if at all greater in future. As the amendment does nothing more than make statutory provision for the present certification arrangements to continue under the Audit Commission, how naive I was (was I not?) when I said in introducing the amendment that this would prove wholly non-controversial. Non-controversial it may he, but the noble Lord, Lord Bruce of Donington, found plenty to talk about.
The noble Lord said the Secretary of State will want watching. Well, I hope that all Secretaries of State always want watching, need watching. That is what I understand the PAC is all about and the Comptroller and Auditor General. The noble Lord knows much more about it than I do; he was in another place, so he should not ask me who will overlook a Secretary of State. He knows the extent to which Secretaries of State are accountable and have to be the whole time.
The noble Lord made a point about false statements. All sorts of things require an audit for reasons of conventional propriety, but questions of false statements
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are a different point. The purpose of this certification is simply to assure the Secretary of State that central Government grants are properly disbursed. There surely is nothing surprising in that; I am sure your Lordships would expect it. I am not going to make a meal of it. We are in technical country now. if I have not covered any point the noble Lord thinks really ought to be brought out again, 1 will certainly do so. I am glad that in principle he accepts that this is an improvement on what we are proposing.
On Question, amendment agreed to.
Baroness Gardner of Parkes Baroness Gardner of Parkes moved Amendment No. 25:
After Clause 7, insert the following new clause:
(" Block grant for Receiver for the Metropolitan Police District.
.—(1) Schedule (Block grant: Receiver for the Metropolitan Police District) to this Act shall have effect for enabling block grant to be paid to the Receiver for the Metropolitan Police District.
(2) This section has effect for any year beginning on or after 1st April 1983.").
The noble Baroness said: My Lords, I beg to move the amendment standing in my name. I would like to point out that I would have put this amendment down at Committee stage, but, as your Lordships will remember, there was a change of date; we had a Falklands debate on the date that had been arranged. This is why I have brought it forward at this late stage.
This is very much a matter of common sense. It is the London Boroughs Association that have particularly asked me to move it, because this is a situation which affects all the London boroughs, and uniquely only the boroughs that are involved in the Metropolitan Police area; in no other part of the country is a similar situation in existence. This amendment, if accepted, would make it much more simple for the local authorities to estimate the rate that they need to raise in the year. At the present time the estimates of block grant are continually changed throughout the year, and it means that if they estimate that they might get less grant, they might need to raise a greater rate; if it works the other way, that they are expecting more in block grant and do not get it, then they find themselves short of finance and having to clip into reserves or raise funds in some other way. This is really a very simple amendment but it would make a very big difference to the authorities involved, and I would ask the House to support it.
To save speaking at a later stage, I would mention that there would be consequential amendments, Nos. 44, 50, 52 and 54. They are simply a matter of tidying up the procedures and they would come up at a later stage. But at the moment I beg to move Amendment No. 25.
Lord Bellwin: My Lords, may I start by thanking my noble friend, not only for what she has said and the clear way in which she said it, but for the brevity with which she said it, which is most appreciated at this hour. This is, as she said, a complex series of technical amendments moved on behalf of the London Boroughs Association. They follow a similar one moved during Report stage in another place. My honourable friend the Under-Secretary of State said on that occasion that, although he could not accept the new clause then proposed, he would look at it closely and consider the problem that had been raised.

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I am happy to say that the Government have honoured my honourable friend's undertaking and that we can accept these amendments in the form in which they are now moved by my noble friend. I have in front of me a long, detailed list of reasons why we are happy to accept these amendments, but I suspect I would not be too well received if I went into it. However, if anyone would wish for more information I will certainly give it. Otherwise, I happily confirm our acceptance of this amendment.
On Question, amendment agreed to.
Clause 8 [Establishment of Audit Commission]:
8.25 p.m.
Viscount Ridley Viscount Ridley moved Amendment No. 26:
Page 7, line 25, leave out from (" State ") to end of line 27 and insert (", of whom two shall be nominated by the Association of County Councils; two by the Association of District Councils; two by the Association of Metropolitan Authorities; and the rest shall be appointed after consultation with ").
The noble Viscount said: My Lords, we have just seen that brevity brings its own reward. Perhaps I might just simply move this amendment and hope that the Government will follow suit and take my hint. This point was discussed at some length at Committee stage. The object of this amendment is to ensure—and the Government's own words can be quoted—that the Audit Commission should be totally independent of Government influence. We wish to see that the commission, if we are to have one, should be as independent as possible. At the moment the Bill provides that the whole of the membership of the commission is in the gift of the Secretary of State. I do not think that we could, therefore, say that this is truly independent of the Government at the time. I believe that the commission's successful functioning requires the development of a real partnership between local government and the commission, and that will enable the commission to use the experience of local government people who will become members.
By this amendment we are providing that a proportion of the membership of the commission is appointed on the nomination of the local authority associations. That seeks to lay down the foundation of such a partnership, at the same time ensuring the independence of the commission. I realise it may he that my amendment may be defective in that the associations are mentioned by name.
The noble Lord, Lord Evans, who is a much better lawyer than I am—indeed, everybody is a much better lawyer than I am—has put down a manuscript amendment to this amendment, and it may well be that his suggested alteration, which is totally acceptable to me, would meet better favour with the Government. The point really is that the local authority associations should have as of right some membership that they appoint from their ranks. We do, however, realise the vital importance of the relationship between the Secretary of State, local government and the commission, and therefore there is on question but that the Secretary of State should appoint the majority of this commission. We are only seeking to have six people appointed by the local authority associations; the
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majority would be appointed by the Secretary of State.
I know my noble friend will say that the membership of the commission is appointed by the Secretary of State and that 'the Secretary of State is answerable to Parliament; therefore it is totally democratic. But I think we all have enough experience to realise that the Secretary of State is responsible to a Parliament to which the Whips are applied and he may not necessarily be as independent as he would like to be. I think this small amendment would go a long way to making the commission acceptable and workable. I beg to move.
Lord Bellwin: My Lords, I must admit that the amendment to Amendment No. 26 does go some way towards removing some of the objections which I voiced.
The Deputy Speaker (Lord Drumalbyn): My Lords, I think the amendment to the amendment should be moved before the noble Lord replies.
Lord Evans of Claughton Lord Evans of Claughton moved, as an amendment to Amendment No. 26, Amendment No. 26A.
Line 2, leave out from (" whom ") to (" and ") in line 4 and insert (" no fewer than six shall be nominated by such associations of local authorities as the Secretary of State shall from time to time determine; ").
The noble Lord said: My Lords, I totally agree with the amendment that the noble Viscount, Lord Ridley, has put down. The reason I move my amendment to that amendment is that I was warned by lawyers far better qualified than I that possibly the amendment put down by the noble Viscount might be defective because the local authority associations he mentions are not statutory bodies; they have a tendency to change, both in the people the authorities represent and in the size, shape and name. The amendment I suggest is to leave out from the word"whom" in line 2 to the word "and" in line 4, and insert the words:
" no fewer than six shall be nominated by such associations of local authorities as the Secretary of State shall from time to time determine ".
It would seem to me that if there is a technical fault in the noble Viscount's amendment it might remove that. I think the concept the noble Viscount puts forward is extremely important. I should not wish that it might be in any way tarnished by its being suggested that it was not in proper form. That is the only reason why I move my amendment—not in any way to obstruct the noble Viscount's amendment but possibly to assist it. It is on that basis that I move.
Baroness Platt of Writtle: My Lords, I should like to support the spirit of this amendment, though whether it is the amendment or the amendment to the amendment, I am not sure; but the most important thing is to foster the spirit of partnership between the Secretary of State and the local authorities. Therefore, whichever way is more convienient I would be in favour of, and I would very much support this.
Lord Bruce of Donington: My Lords, we on this side of the House would like to say ditto to what the noble Viscount, Lord Ridley, has said, and what was said by

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the noble Lord, Lord Evans of Claughton. In the interests of speed we say no more; we support it.
Lord Bellwin: My Lords, it does not work every time! May I begin again at the beginning with the original Amendment No. 26. The question of membership of the Audit Commission has been very thoroughly debated during the passage of this Bill, both in your Lordships' House and in another place. Perhaps there is now an element of repetitiveness about the discussion, but of course that only reflects the importance, quite properly, which everyone attaches to this issue.
I again listened carefully to what was said by my noble friend Lord Ridley in supporting this amendment, but I fear I am still not persuaded that it would be right to accept it. Let me say why. I recognise its particular features. I acknowledge that the number of local authority nominees would be less than one-half of the commission and that there is a simplicity of two nominees for each association and that the associations' members would he nominees with the actual appointment made by the Secretary of State but we are still left with the issue of principle; that is, that the appointment of members is a matter of great importance and it is constitutionally right that it should rest with the Secretary of State. He is—as my noble friend Lord Ridley quite rightly assumed that I would say, and I do—a Member of one or other House of Parliament, and therefore will be answerable to Parliament for the appointments, which I believe is as it should be.
The fact has to be faced that the local authority associations are themselves interested parties to the work of the commission. The associations are certainly responsible bodies and they are rightly well respected, but despite the careful arguments I cannot avoid the conclusion that if the associations were to make appointments to the commission, or nominations—and there is little difference in substance—no real degree of extra independence in any real sense would have been achieved. Moreover, the associations are not answerable to Parliament as is the Secretary of State. Might I remind your Lordships of the assurances I have already given at earlier stages of the Bill that local government will be well represented on the commission; and I would suggest that in practical terms flexibility over appointments is desirable.
Nobody doubts that there is a great deal of talent and ability in local government, but it would perhaps be unduly inflexible if appointments were to be tied by statutory formula to two people from each association. I respectfully submit that it would be better if the Secretary of State were left able to appoint the very best available persons although bearing in mind the need to balance broadly the various interests within local government. There is a whole mass of precedent in this field of appointing to bodies of this kind, and I believe in the main it would be fair to say that it works fairly well. Those who are charged with the responsibility of making appointments are themselves responsible people and understand that there has to be a sensible degree of representation and a sensible balance. That has always pertained to my knowledge. I see no reason why it should not continue to pertain in the future.
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Coming to the amendment to the amendment, I must admit that it goes some way towards removing some of the objections I have just mentioned, but by allowing the Secretary of State to decide how the six local authority nominations should be divided between the associations, the amendment would introduce an element of flexibility. Your Lordships will recall that I felt that this was lacking originally, in what I have just said about Amendment No. 26. I say again that to that extent the amendment becomes marginally more acceptable, but I come back yet again to the issue of principle and would want to say the Secretary of State's hands should not be tied in any way when he comes to what will be a difficult task in appointing a commission with the right balance of experience and ability.
There should be, and I say now that I am sure there will be, wide consultation. That is provided for in the Bill, but the Government strongly feel that there should not be a tying to a particular nomination, however flexibly the provisions may be drawn. This is an overriding reason. I conclude by saying again that in practice when we look at what happens in boards of this kind, it works because the people who make the appointments are themselves responsible. I have confidence that it will go on being that way. I know that that is not the same, as I have been told over the last three years, as having it on the face of the Bill, but the quid pro quo is the flexibility that it needs. I believe that it is worthy. I have the confidence. This is an extremely important commission that will be set up and I am sure it will be set up with people whose appointments will recognise that importance.
8.37 p.m.
On Question, Whether the said amendment to the amendment shall be agreed to?
Their Lordships divided: Contents, 23; Not-Contents, 50.

DIVISION NO. 5

CONTENTS

Airedale, L.

Lovell-Davis, L.

Birk, B.

Peart, L.

Bishopston, L.

Platt of Writtle, B.

Blease, L.

Ridley, V. [Teller.]

Bruce of Donington, L.

Stamp, L.

Collison, L.

Stewart of Alvenchurch, B.

Drumalbyn, L.

Stewart of Fulham Stone, L.

Elwyn-Jones, L.

Evans of Claughton, L.

Tordoff, L. [Teller.]

Gainsborough, E.

Underhill, L.

John-Mackie, L.

Winstanley, L.

Llewelyn-Davies of Hastoe, B.

NOT-CONTENTS

Abercorn, D.

Elles, B.

Ailesbury, M.

Elliot of Harwood, B.

Avon, E.

Elton, L.

Bellwin, L.

Ferrers, E.

Beloff, L.

Gainford, L.

Belstead, L.

Gardner of Parkes, B.

Boardman, L.

Boyd-Carpenter, L.

Brougham and Vaux, L.

Haig, E.

Campbell of Alloway, L.

Henley, L.

Cullen of Ashbourne, L.

Hornsby-Smith, B.

Davidson V.

Kemsley, V.

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Kinross, L.

Pender, L.

Long, V. [Teller.]

Rankeillour, L.

Lyell, L.

Rochdale, V.

McFadzean, L.

St. Aldwyn, E.

Mackay of Clashfern, L.

Sandys, L. [Teller.]

Macleod of Borve, B.

Skelmersdale, L.

Marshall of Leeds, L.

Stradbroke, E.

Massereene and Ferrard, V.

Suffield, L.

Mersey, V.

Thorneycroft, L.

Monk Bretton, L.

Trefgrane, L.

Mottistone, L.

Trenchard, L.

Mountevans, L.

Trumpington, B.

Onslow, E.

Young, B.

Resolved in the negative, and the amendment to the amendment disagreed to.
8.45 p.m.
The Deputy Speaker: My Lords, the Question now is, That Amendment No. 26 be agreed to? As many as are of that opinion will say, "Content"; to the contrary, "Not-Content? I think that the Not-Contents have it. The Not-Contents have it.
On Question, amendment negatived.
Lord Bellwin Lord Bellwin moved Amendment No. 27:
Page 7, line 31, after (" shall ") insert (", after the like consultation,").
The noble Lord said: My Lords, I beg to move Amendment No. 27. There is little for me to say about this amendment, which I trust will meet with wide support. Your Lordships will recall that I undertook to introduce an amendment along these lines during the Committee stage. These are vital appointments and we are happy to make them subject to the same consultation requirements as those governing the appointment of members in subsection (2). I beg to move.
Baroness Birk: My Lords, I moved a similar amendment in Committee, and the Minister undertook to look into the matter and to produce an amendment. I am very grateful to him because this amendment does meet the point entirely.
On Question, amendment agreed to.
Clause 9 [Accounts subject to audit]:
Lord Bruce of Donington Lord Bruce of Donington moved Amendment No. 28:
Page 7, line 40, leave out (" Commission ") and insert (" body whose accounts are to be audited from the list of auditors approved for the purpose by the Commission in accordance with the next following section ").
The noble Lord said: My Lords, I beg to move Amendment No. 28 standing in my name and that of my noble friend Lady Birk, the noble Viscount, Lord Ridley, and the noble Lord, Lord Evans of Claughton. With your Lordships' permission, I should like to speak also to Amendments Nos. 29, 32, 33, 34, and 43. Having said that, I am bound to say that most of the ground in support of these amendments—although the wording is slightly different—has already been covered in Committee. I do not propose to repeat to your Lordships tonight the same observations that I made on the same points in Committee. I would only wish to say that the whole object behind them is to give the local authorities or other bodies the opportunity
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of choosing their own auditors. That is the purport of the amendment to Clause 9, from which it follows that Amendment No. 29 amends appropriately Clause 10, in such a way that the Audit Commission has the power to compile a list of auditors from whom local authorities themselves may choose.
Of course, there are arguments on both sides as regards this matter. The noble Lord will aver that his right honourable friend the Secretary of State very much prefers that the Audit Commission, which he himself appoints will themselves appoint auditors to local authorities. Those that represent the local authority interests and those that believe in local government in the sense that I am quite sure the noble Lord himself believed in it when he was a prominent member of a local authority, prefer that the local authorities should retain that liberty.
All the arguments so far as I can see, one way or the other, have already been enumerated and have already been uttered in the House on Second Reading and in Committee. I do not propose to add to them. I do not think that anybody who has the ultimate interests of local authorities at heart and wishes them to retain their freedom, can in any way reject the notion that they should be entitled to select their own auditors.
This, indeed, is the principle that runs throughout these amendments. But I shall not repeat the arguments. Others may wish to add to the arguments which they made in Committee. For our part, we have nothing more to say on them than what we have already said, and I think that what we have already said has been fairly widely assimilated and needs no repetition. In that sense we commend the amendments to the House. I beg to move.
The Deputy Speaker: My Lords, is it the noble Lord's intention to consider all these amendments, up to and including No. 34, together?
Lord Bruce of Donington: My Lords, yes.
The Earl of Avon: My Lords, I think that there are two breaks in the middle, so we have to move one amendment at a time.
The Deputy Speaker: My Lords, in that case I shall put the Question, That Amendment No. 28 be agreed to?
Viscount Ridley: My Lords, I put my name to this amendment because I think that I spoke at some considerable length on this matter in Committee. Like the noble Lord, Lord Bruce, I believe that everything has been said and probably we are banging our heads against some sort of brick wall. Even so, I still think that it is an important issue. I feel strongly enough to hope that the Government at this very late hour may have a change of mind, because I think that this is important. However, as the arguments have all been made and it is late, I shall not repeat them but just support what the noble Lord, Lord Bruce, has said, and wish him well.
Lord Bellwin: My Lords, I do not feel like a brick wall and I am sure that my noble friend is not banging

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his head against me. But perhaps I can say straight away that I very much appreciate the practical way in which we are looking at this matter. Clearly, we have a difference of view. We have been round the track very extensively on a number of amendments in Committee, and there is just a difference in the way in which we see this.
I recognise that in fact the amendments ensure that the commission has to approve the auditors before they go on the list. I also accept that it is important to establish a harmonious relationship between the auditors and the audited body. But I submit that the Bill tackles this problem the right way round, by providing for the commission to make the appointment after consultation with the body concerned. This is the practice adopted widely elsewhere in the public sector and I am confident that it will work for local government.
Clearly, we have a difference of view here. A matter like this is a judgment; that is all it is. Like so many of these issues, it is a judgment of view. It is not political; it is simply how someone sees something working in practice. There is simply a difference of view here, and I am sorry that I cannot accept the noble Lord's point of view, not least because of the way in which both the noble Lord, Lord Bruce, and my noble friend have briefly spoken to it. I hope that at least they will understand the reasons. Certainly if they do not, they have only to refer to the earlier debates in Hansard—it will all be there, but they know this anyhow. Therefore, I cannot accept the amendment.
On Question, amendment negatived.
[Amendment No. 29 not moved.]
Clause 12 [General duties of auditors]:
8.54 p.m.
Lord Bruce of Donington Lord Bruce of Donington moved Amendment No. 30:
Page 10, line 33, leave out ("resources") and insert ("revenue and loans").
The noble Lord said: My Lords, I beg to move Amendment No. 30, which seeks to effect an amendment to Clause 12. It will be recalled that Clause 12 lays down the duties of auditors in statutory form. The House has already debated these issues at considerable length. Indeed, through the courtesy of the noble Lord opposite, I have had the opportunity of seeing both himself and his officers on some of the principles that are involved, which I am quite sure he realises are of considerable importance. Indeed, they are of very great importance to those of my professional colleagues as well as to the new district auditors who will take auditing responsibilities and prepare certificates under this clause.
If one passes to Clause 12(1)(c), it will be found that an auditor:
" shall by examination of the accounts and otherwise satisfy himself—
(c) that the body whose accounts are being audited has made proper arrangements for securing economy, efficiency and effectiveness in its use of resources ".
The amendment seeks to eliminate the word "resources" and to insert instead the words "revenue and loans". On the face of it, this may appear to be nit-
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picking, but in point of fact it raises very considerable questions of principle.
As I sought to explain to your Lordships at the Committee stage—and I believe that I did hint at it or possibly more than hint at it on Second Reading—a certification of this kind on the lines of Clause 12(1)(c) is not possible because the local authority itself does not have an accounting record of all its resources. It does not account for capital assets.
As t sought to explain to your Lordships in Committee, when I ventured to quote from the Layfield Report, which I shall not repeat to your Lordships tonight because it is all on the record, local authorities do not, in fact, adopt the system of accounting that is normally adopted in commercial or professional firms, of accounting for assets and liabilities as well as accounting for receipts and expenditure. They do not adopt that method of accounting at all, any more than the Government do; all capital expenditure is written off immediately as cash expenditure. It may well be that records are kept of the way in which loans are applied for the redemption. Such records as that are kept. But there is no record of assets as such. In fact, I think that only the Government of the Netherlands actually keep their accounts on a double entry basis, and that Government keep records of their assets, their liabilities as well as their receipts and expenditure. But we do not do so here, nor do local authorities.
Whether accountants are amateur or professional, qualified or unqualified, on one thing they are all agreed: that resources include assets. There can be no question about that. Here we have a situation where, as applicable to a local authority, it is not possible for any auditor to certify that a local authority has made the best use of its resources, or has arrangements to make the best use of its resources, when he does not know what those resources are.
Perhaps I may give an illustration. Some local authorities have tracts of land which remain unused, which they may have acquired many years ago. Those assets stand at no valuation whatever in the local authorities' accounts. A local authority may have land worth £20 million or £30 million, or very often more. That land does not stand in its books at a valued figure and, as the Layfield Commission points out, quite correctly, it would involve the local authority in some trouble to have its assets valued. I am not talking of its plant and machinery, for which there are separate provisions under the Local Government, Planning and Land Act 1980. I do not mean that; I mean its landed property, its assets in the larger sense of the term. For an auditor to certify that an authority has made satisfactory arrangements for the best use of its resources, he would have to know what those resources are.
If, for example, a local authority has £20 million-worth of land scattered in one part or other of the authority, an auditor required to satisfy himself under this particular clause in order to render a certificate might say to himself, after consultation with his colleagues and with the local authority, "Wouldn't it pay you to sell a plot of land at X price, and redeem some loans that you already have outstanding, because you are not going to put this land to use for many years, so far as one can understand? Would it not be far better to reduce your local rate burden that arises from the

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interest charged on loans by realising this land for the purpose of loan redemption and the reduction of the rates?" An auditor might think, on examining all those circumstances, that this was a prudent thing to do. But he has no knowledge of the resources.
In the course of the Committee stage—and I shall not repeat the arguments here—if the local authority themselves were required either in this Act or in another Act, and a beginning was made in connection with direct labour organisations to account for their assets, then it will be correct for the auditor to be able to satisfy himself as to the use of resources. In my respectful submission, an auditor at the moment cannot do that because the local authority does not know what it has in value terms, and we are progressively being steered, however wrongly or rightly, towards current costs accounting. We are already being steered for the purposes of determining profitability and efficiency to current cost accounting. If there are no assessments, there are no records of assets, how can he do it? If an auditor cannot do it, it is wrong that it should be in the Bill. For that reason this amendment has been put down to eliminate "resources".
It may well be that the noble Lord's legal department can think of better words than this. Indeed I myself have been a little doubtful as to the precise wording since I put it down. It might in fact have been good enough to have incorporated "income and loan" before "resources" so that it then would have been "in its use of income and loan resources" and that might have covered the point. All I wanted to do was to ventilate the principle, which is of some importance. I gave the noble Lord notice of the fact that I was going to raise this, and we had some discussions in his department on it, and I would hope that his legal department and his officials may find some form of words that does not impose on auditors a responsibility that, on the strict reading of the particular clause, they cannot possibly perform. I beg to move.
Lord Bellwin: My Lords, I certainly do not consider that the amendment is nit-picking or that what the noble Lord says is nit-picking. The point he raises is a fair one, and it is important. But I wonder whether it would be helpful if I briefly, at this hour, reminded your Lordships of the purpose of Clause 12(1)(c). It is concerned with the auditor's role in relation to the local authority's arrangements for ensuring economy, efficiency and effectiveness in its use of resources. The auditor does not have to make the arrangements. Nor does he have to ensure value for money. Rather he must direct his attention to whether the local authority has made arrangements for obtaining value for money in the use it has made of its resources.
The amendment would narrow down the auditor's interest to the use of revenue and loans. It would have the effect of removing from the auditor's purview the whole area of the arrangements made by local authorities and other bodies for the effective utilisation of their assets and of their manpower resources. The noble Lord, Lord Bruce, is quite right: local authorities have vast amounts invested in capital assets—houses, schools, land, plant and equipment and so on.
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They also have large labour forces carrying out administration and the provision of services. The effective use of these resources is a matter of great importance. It is right that the arrangements for ensuring that effective use are reviewed by the local government auditor.
I recognise that local government arrangements and conventions about capital accounting are different from those of companies. There are valid reasons for these differences. For example companies should, as part of their obligation to shareholders, make proper provision for replacement of profit-earning assets. Local authorities, on the other hand, have rather different objectives, and therefore need to approach capital provision in a different way. It is arguable that it is wrong to charge ratepayers now for replacement of assets which the electorate may, when the time comes for decision, decide should not be replaced anyway. Present ratepayers are already providing through payment of loan charges for assets now being used.
But this is a many-sided matter, and I readily acknowledge that there is room for more than one point of view. This is not perhaps the time to go into complex accounting issues. I would only suggest that this is not the occasion to consider changing the law which underlies the local authority arrangements. I say this especially because I understand that the Chartered Institute of Public Finance and Accountancy is currently considering the question of the possibilities and implications of using the companies type arrangements for capital accounting. I would prefer to see what comes out of that review and out of CIPFA's discussions with the other accountancy bodies before seeking to change the present basis of local authority capital accounts.
Again, as I have with other things, I could go on in some depth, but I suspect that again it would not be the right thing to do. Everything that the noble Lord, Lord Bruce, said about the position as it now pertains itself is right. I would perhaps differ from him on the approach to what an authority does or does not do, or what it should or should not do, with its assets. I am quite sure that if we were debating that together he and I would have different views about this, because then we would come into the whole area of taking a fixed asset, say, land that may have lain derelict for years. I would want to see it converted into a liquid asset by selling it so that it could then be developed or used in some way, and the money I would get I would want to apply to whatever purposes I wanted, either to reducing loan debt or to providing some provision for which I did not want to go to the ratepayers. In other words, capital receipts. But then we are really into a somewhat different area.
It is encouraging that this whole area of capital assets in local government is being looked at now for the first time ever. When I first went into local government my first question on looking at accounts was, "At what rate do you write off the capital assets?" It was explained to me that it did not work that way. It is a good thing that there is to be a look at the matter, and I hope that will take care of the fears expressed by the noble Lord, Lord Bruce. He will understand that I cannot take the point on board in this measure. However, that is by no means the end

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of the story; changes will, I think, be coming along and 1 look forward to seeing what they will be, but I hope he will understand why I cannot take it on in this Bill.
On Question, amendment negatived.
Clause 14 [Public inspection of accounts and right of challenge]:
9.9 p.m.
Lord Bruce of Donington Lord Bruce of Donington moved Amendment No. 31:
Page 11, line 31, at beginning insert (" Subject to the provisions of section 27 below.").
The noble Lord said: My Lords, the clause deals with the public inspection of accounts and the right of challenge by individual electors. Your Lordships will recall that we discussed this at some length in Committee when, supported by a number of noble Lords, I pointed out what an inconvenience the provision could be to the orderly conduct of an audit if individual electors had the right to inspect books, documents and so on, and indeed to question the auditor himself, on the accounts of the authority. I was assurred by the Minister that it was a right that was not abused, and I understand there are a number of local authorities where this right is exercised to a considerable extent.
Clause 27, on the other hand, binds the auditor to security. It says:
" No information relating to a particular body or other person and obtained by the Commission or an auditor, or by a person acting on behalf of the Commission or an auditor, pursuant to any provision of this Part of this Act or in the course of any audit or study thereunder shall be disclosed ".
There are then a number of conditions under which it can be disclosed, and then subsection (2) says:
" Any person who discloses any information in contravention of subsection (1) above shall be guilty of an offence ",
and be liable to certain penalties. The House will recall that when I dealt with Clause 27 on the previous occasion 1 suggested it should be removed because auditors could be trusted to be just as confidential as local authority officials could be trusted to be honest. The Minister had resisted the insertion of a similar provision regarding local officials which would have made it an offence for them to give false information to auditors.
The position remains unsatisfactory. If Clause 27 is to remain intact and it is to be an offence to reveal confidential information, it follows that at the beginning of Clause 14, where the provisions for a public inspection are laid down, we should insert the words:
" Subject to the provisions of section 27 below ".
That would ensure that an elector would not have the right to demand information from the auditor or obtain the sight of documents in the possession of the auditor which would bring the auditor into conflict with Clause 27. The House will be well seized of the point and I will not detain your Lordships. I hope the Minister will accept the amendment, which would in no way vitiate the purposes of the Bill or detract from its efficient operation, but would merely give protection where protection is due.
Lord Bellwin: My Lords, the amendment presupposes
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that there is a conflict between Clause 14(1) and Clause 27, but that is not so. Clause 14(1) enables any person interested, during the course of the audit, to inspect the accounts and other documents. I should point out that those documents are all documents in the possession of the local authority, or other bodies subject to audit, not in the possession of the auditor. The auditor himself has to be given access to them in the hands of the body, and that is done by Clause 13(1). But they do not leave that body's possession. Indeed, as between the public and the authority, in relation to Clause 14(1), the auditor has no role to play. If a person thinks that he is being improperly denied access, the auditor cannot help him; he must pursue his remedy through the courts. As the auditor has no function under Clause 14(1), he can make no disclosure under it, and there is no room for any potential conflict with Clause 27, which is concerned with guarding against improper disclosure of information gained during the audit.
I shall want to read what the noble Lord, Lord Bruce, has said this time, and in turn I hope that he will perhaps consider the point that I have just made about the fact that the amendment presupposes a conflict. If either he or I feel it necessary to move in a different direction, then his position would be much easier than mine. If he feels that what I am saying is correct and that therefore it assuages his concern, that would be the end of it. If I feel that there is here something more that we should be looking at, I assure him that we shall come back to him again. With that explanation of why I cannot accept the amendment as it is, I hope that the noble Lord will feel able to withdraw it.
Lord Bruce of Donington: My Lords, there is just one point that I should like the noble Lord to cover before he sits down. He seems to think that during an audit the auditor and the books and records are in separate rooms, that the books, accounts and documents are in the possession of the local authority, not in the possession of the auditor at the time that he audits them. As a matter of practice, that is not the case. When an auditor or his staff are engaged on the books, the audit staff have in front of them the books, documents and everything else. So during the time of the audit the auditor himself has the effective custody of the documents, because otherwise he cannot audit them.
It is the impingement of the elector on the auditor while the audit is still taking place, and while the documents are still in the auditor's possession, that I am concerned about, and of course I am also concerned about the information given by the auditor in response to any question arising from the elector. So I hope the noble Lord will realise that in practice it is not quite so compartmentalised as he would think; it is much more closely intermingled than that. That is why I wanted the words inserted at the beginning of Clause 14, and for no other reason. If the noble Lord can address himself to that point, then 11 should be very greatly obliged.
On Question, amendment negatived.
[Amendments Nos. 32 to 34 not moved.]
Clause 23 [Studies for improving economy etc. in local authority services]:
[Amendment No. 35 not moved.]
9.18 p.m.
Viscount Ridley Viscount Ridley moved Amendment No. 36:
Page 18, line 35, at end insert—
(" Provided that the Commission shall not in any such report refer to the affairs of any individual authority in a way which identifies that authority by name or otherwise").
The noble Viscount said: My Lords, we had considerable debate on the value for money clauses, which were introduced at Committee stage, and your Lordships will recall that there were two clauses, then Clauses 20 and 21, about neither of which was I particularly enthusiastic. So far as I read it, the debate which took place on what is now known as the "Joel Barnett clause"—which was Clause 21 and is now, I think, Clause 24—was very much on the side of the amendment which I then moved, to ensure that such reports as were made by the Audit Commission would be made in an anonymous way, and that no authority should be identified, as I say in the amendment, "by name or otherwise".
During the debate my noble friend Lord Bellwin said that I had been inconsistent in not applying such anonymity (if that is the right word) to the then Clause 20, and Amendment No. 36 seeks to do just that and to say that in either or both clauses there should not be the naming of any individual authority in a report which is published on the subject.
It is probably appropriate that, for the sake of speed, we discuss Amendments Nos. 36 and 40 together, because they are identical in wording, and they apply to both the two clauses, which, as I have just said, involve two attempts at seeking to achieve value for money in local government. There was previously a very full debate on both clauses, and I think it only fair to say that there was considerable, unanimous, support from all sides of the Chamber, even for once from behind me, for the amendment which sought anonymity. As I said at that time it was—and I still think that it is—the desire of another place that such reports should not name individual authorities.
At the end of the Committee stage I sought to withdraw the amendment, and therefore I have no guilt about putting it down for the second time. The real point is that what I say should apply to Amendment No. 40, as well as to Amendment No. 36. I commend Amendment No. 36 to the House because I believe that its objective is the desire of another place. It will seek to ensure that the commission does its job properly, and that it is able to act without trying to interfere in the affairs of individual local authorities, because if it is going to start naming individual local authorities, then I think we are in for considerable problems in the future. It could well be said, and may well be said, that the commission, possibly aided or otherwise by the Government, is taking away the freedom of local authorities in yet another respect. I know my noble friend will disagree with that, as he always does, but there is a danger here, and this is what I am trying to point out to your Lordships. This anonymity is something which I think is very important. Other noble Lords on all sides supported it, and I beg to move Amendment No. 36.
Lord Bellwin: Yes, my Lords, it is quite true, as my noble friend says, that here, too, we do not see it in quite the same way. I certainly understand the fears behind this amendment. In recent years local authorities themselves have begun to publish more information on their own performance in response to the codes of practice which have been produced under the 1980 Local Government Planning and Land Act. Publication of this information is an important step in our campaign to increase public awareness of local government activities.
Furthermore, CIPFA now produces a whole series of statistical publications, including one entitled Comparative Statistics. The whole purpose of this publication is to compare the performance of individual authorities, and it would clearly lose its point if the authorities were not identified.
I know it is slightly oblique to the subject, but I always felt that one reason why LAMSAC did not achieve what many of us hoped it would achieve was precisely because it did not disseminate its information. It has been so anxious, and is still so anxious, not to reveal the names of the authorities whose studies it carries out, and not to give this information to any one unless they specifically come and ask for it, that it becomes far less effective than it would otherwise be.
This amendment, as such, is sweeping. Not only does it prevent the commission from publishing information it collects in a way which identifies the authorities, but, as I hope my noble friend appreciates, it also prevents the commission from identifying authorities in reports under the clause in any way whatsoever. This means that the commission cannot quote information relating to an individual authority which the authority itself may publish. This restriction seems unnecessary.
The aim of comparative studies—and the name itself makes the point—is to provide information for use by local government on good practice in local authorities. I do not believe that maintaining the anonymity of the authorities concerned in such studies is consistent with the aim of encouraging a free exchange and dissemination of information. I have said it before, and I make no apology for repeating it: the efficient authorities not only have nothing to fear from such comparisons; they are proud to have comparisons made. The less efficient may well learn something. I, in a former capacity, wanted to know what others were doing, and if it was better than I was doing then I wanted to learn from them. Surely this can only be for the benefit of ratepayers and electors.
I am glad my noble friend moved on to Amendment No. 40. I will not speak at length on that because we went round that track at Committee stage at some length. We divided on it, and there was much feeling and much difference about it; and certainly there is no point in doing that again tonight.
Viscount Ridley: My Lords, may I interrupt my noble friend? We did not divide on Amendment No. 40 last time; that is why I put it down again.
Lord Bellwin: My Lords, I am grateful to my noble friend. I apologise for that; he is quite right. I am sure he will accept from me that we did divide on

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many occasions—almost as many, I think, as the number we have divided upon today—so if I get one wrong it is one out of many and I hope my noble friend will forgive me.
I understand the concern of the authority is to preserve their constitutional position vis-à-vis their electors. Can I say again, that the Comptroller and Auditor-General will not have privileged access to information about individual authorities, and this I think is an adequate safeguard. The commission will be a responsible body and will have a large number of local authority members. Surely, we can rely on the commission to decide, in doing a study under this clause (or under Clause 23) whether or not it is appropriate to identify individual authorities. It is not necessary in my view, or appropriate, to prevent them from doing it, if in their judgment it will be beneficial. The fear of the authorities that in some way this power will he used to clobber them, or pillory or put them in dock, I think is misplaced. If we are really as concerned as your Lordships tell me you are, and as I know you are, that the local authorities should be seen to be getting better value for money all the time and giving more services because of improved efficiency, there is nothing to fear in this.
Baroness Birk: My Lords, may I put a question on that? At the Committee stage, when we discussed this—and I cannot remember whether it was the old Clause 20 or the next one, which is now Clause 24—the Minister said that the new clause does not make the local authorities accountable to Parliament. Later, he said that the local authorities had nothing to lose from being identified in the commission's report. I raised this point myself and I pointed out that the Minister appeared to have made some contradictory statements. We were left unsure whether the local authorities would be identified or whether, if they were identified, there was any harm in it. I think there were two different points.
I do not think that we have had a clear answer. Listening to the Minister, I am still not sure what he means by this.
Lord Bellwin: My Lords, I am happy to give a more detailed explanation. Like most other noble Lords, 1 am trying not to go into depth but, if the point is raised, I must explain. I will set out briefly how Clause 24 will operate. After the necessary consultations, the commission will embark on its studies under this clause. They will be designed to enable it to prepare reports on the impact of statutory provisions on ministerial guidance on value for money in the provision of local government service. They will have to publish or otherwise make available a report on each study and send the report to the Comptroller and Auditor-General. It will be open to the commission, as the clause now stands to identify individual authorities in this report if it so wishes. This follows the form adopted in the original amendment which was put down for the report stage in another place.
Clause 24 then goes on to provide that when the Comptroller and Auditor-General gets his copy of reports produced under this clause, he may require information about the report from the commission, but he may not require information about individual
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authorities. I repeat that he may not require information about individual authorities. There is nothing in Clause 24 to prevent the Comptroller and Auditor-General from identifying individual authorities in his report to Parliament. He cannot have access to privileged information held by the commission, but he can quote published information. If the commission identifies individual authorities in its reports, the Comptroller and Auditor-General can quote that. He can quote information from any other source, such as CIPFA or the local authority itself. This must be right. It would be nonsense to prevent the Comptroller and Auditor-General using information already published. What the present amendment—and this is Amendment No. 40—seeks to do is to prevent the commission from identifying individual authorities in the reports. It does not prevent the Comptroller and Auditor-General from doing so by using CIPFA or local authority information. This is why we think the amendment is unnecessary.
I know that the authority associations are worried about the involvement of the Comptroller and Auditor-General and, hence, Parliament. I think that it is quite clear that the Comptroller and Auditor-General's role in all this is to secure better ministerial accountability to Parliament, and it seems unnecessary to prevent the commission identifying individual authorities in the studies under this clause. In our debates on the previous clause I explained why a similar amendment to that clause was unacceptable, and the same applies to this clause. I repeat, the efficient authorities have nothing to fear and the others should benefit.
I do not know whether that adequately covers the point that concerns the noble Baroness. We are into an area which is quite complex and where clearly there is some different thinking. I feel that the fears which have been expressed will prove to be groundless in practice. If I truly did not think that I could not argue the case as I hope I am doing.
Lord Mottistone: My Lords, there is another side to what my noble friend has been saying. I am sorry if I do not entirely agree with him, because I so often do. The way that Clause 23(3) is worded is that the commission shall publish or otherwise make available its recommendations. I will not say that I entirely agree with my noble friend Lord Ridley, but if the words "with discretion" were added I think that would help. The blunt statement says that it shall publish its reports.
I am not arguing at all about Clause 24(2) and reporting to the Comptroller and Auditor-General. I think that is reasonable. But one thinks of the local newspaper printing that their county is bottom of the league for something. This may be very bad locally but very good centrally. It is easy to see circumstances in which it is very bad to have a public league table of how everybody has come out on, say, the transport side or the social services side—" Your county is bottom in social services but top in transport ", that type of situation. That is bad.
If there was a qualification within the clause to say that the commission has to use its discretion, that would help. The commission will not include people from all the local authorities. It could be that some of them will be deeply hurt because of particular things going

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on in the county at the time, if they were badly shown up in a particular area at a particular time and they do not have a representative on the commission.
Therefore it will be bad news for this table to be produced. Perhaps it can be somehow qualified that the commission has to use its discretion and be sensible about it. I should like to see something in the Bill—I will not say that I go along with my noble friend Lord Ridley—which gave guidance to the commission to make sure that it uses its common sense which, in the nature of things, collectively it will not have.
Lord Bellwin: My Lords, with the leave of the House, may I say to the noble Lord, Lord Mottistone, that the commission has discretion as to what should be published. It does not have to identify individual authorities. Regarding the league tables, it depends on what is published. If you publish and decide that an authority is good or bad because it spends more or less—and this has so often been the case in the past—that in no way should he a measure of whether it is efficient or otherwise. When the previous Labour Government were in power, if a list was published that showed a local authority spent little—the lowest if you like—it was frowned upon as not doing its job. Today, in the same list if the same authority is spending least, then it is applauded as doing very well.
The real answer is that neither of those interpretations is correct. What really matters is: What are they achieving for what is being spent? It is not just the amount of money spent; it is a question of, what do you get? There are authorities who spend half what other authorities spend and achieve twice as much—and that statement is not a distortion. Therefore, what one would hope to see published eventually is: why does it cost Authority A so much to provide a service when it has for example, pupil-teacher ratios in education that are very much better in the sense there are fewer pupils per teacher, while at the same time the total cost of its education provision may be less than other authorities?
If information of that kind is published it is good that people should say: Tell me why? There may be very valid reasons why. I can think of all sorts of reasons. If you have many children who, for example, are under-privileged or who may come from immigrant homes and who need more basic teaching, it is bound to cost you more. That is a proper explanation. On the other hand, it may be that if you spend a lot of money you may be carrying too heavy back-up staffs. So what is wrong in publicising information?
If we believe—and I keep coming back to this point—that we want to see a better local government and one that everyone will respect, and not, as now, although many are respected there are others which are not—and if we want to see a raising up of standards—there should be no fear about publication. I have no fears about it. As it happens, the commission has the discretion, as I have said. There is not the power of the Comptroller and Auditor-General to indentify individual authorities in this way; so in fact there is not the total disclosure of comparatives that some people wish to see. That is why I think that my noble friend is over-concerned about this and that is why we cannot support him.
Viscount Ridley: My Lords, if I may speak again, with the leave of the House, I am sorry that my noble friend Lord Bellwin has not seen fit to meet me on this one. I do not somehow think that the arguments are hitting each other: they are flying round the room but not contacting the different points being made.
I quite agree with my noble friend that CIPFA and other bodies have published vast statistics which have been made available to the public. I have spent many hours studying these to see what benefit can be got from them. But it is quite another matter to have it written into an Act of Parliament that some outside body, which is already viewed with some suspicion, should come in and do this. I think we are laying ourselves open to great trouble in the future. I think there is a great danger, with all these clauses in this part of the Bill and failure to achieve anonymity, that we are taking away the job of the elected councillors to see that money is wisely spent. if we are not careful we are going too far down this road and we could end up in a situation where nobody of value or quality will stand for local government to be shot at by the Audit Commission, or by the newspapers as my noble friend Lord Mottistone says. You are going to get second-rate local government in the long run. I believe that we are in great danger of overdoing this "value for money" idea. However, I have no intention of pressing this amendment. I think the point has been made and I hope that one day the Government will see the value of what I am trying to say. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 37 not moved.]
Clause 24 [Reports on impact of statutory provisions etc.]:
9.39 p.m.
Baroness Birk Baroness Birk moved Amendment No. 38:
Page 19, line 2, leave out (" shall ") and insert ("may ").
The noble Baroness said: My Lords, this question came up in Committee but it all got rather confused with the clause following it, I seem to remember. It really is a very simple point: the commission should not be under this order. Perhaps it is the fashionable difference, between "totalitarian" and "authoritarian", but I think that this is both totalitarian and authoritarian.
I think that the noble Lord, Lord Mottistone, had a very real point which he put forward. It looks extraordinarily abrupt—I think he used the words "rather blunt". I would have thought that if you set up a commission of the calibre which the Minister has assured us of, you should leave it to them to undertake or promote comparative and other studies rather than legislate this very dictatorial "shall". It not only goes against any democratic aspects of local government but it is entirely against the British character as well. I find it rather abhorrent. It is not euphonious; it is rather unpleasant and it is totally unnecessary,
I hope that the Minister has given this matter more thought. I must have been able to get a little hope from what was said earlier. I know that we did not take the amendment to a Division. I think that there

385
was a certain amount of confusion about both clauses being taken together. But if the subsection is left with the word "shall", it means that a Minister of the Crown can come crashing down with statutory provisions. The commission will be completely boxed in and almost imprisoned in imperatives. If a commission of this calibre is worth its salt, it will most certainly undertake anything that it wants to do.
I always feel that, if you say to people that they shall do something, they feel that they are under instructions to undertake things which they should not have to undertake. The word "shall" here gives no choice or discretion to the commission and it is quite wrong, whether in the case of the Audit Commission or anything else. If you arc setting up a commission of this kind, you must give it an opportunity to take decisions. Whether it is something concerned with private business, public expenditure or whatever it is, the same rule applies.
You must give people a choice, if you give them a responsibility of this kind and they are worthy of that responsibility. If they are not worthy of that responsibility, then they should not be there. Therefore, they should not have to be told that they shall do something. If they have to be told, then they arc not the right people to do the job. If they are the right people, then they should he allowed to decide for themselves. I fear that I know what the Minister will say, but this is something that the Government really ought to think again about. My Lords, I beg to move.
Lord Mottistone: My Lords, may I intervene to tell the noble Baroness that I am sorry that I do not support her in this amendment, because there is nothing to tell the commission what it is to promote studies about. It can choose what it makes it studies about. What still gets in my gullet—though I do not want to go back to the other amendment, which was withdrawn—is that it must then publish all that it has found out. That is different. The use of the word "shall" is part of the normal practice. The parliamentary draftsman forces us into that corner, so that we get used to the "shall" and "may" argument. But, in this case, the subsection does not tell the commission what it has to do in detail. It just says that it must do it as a general principle. I think that that is perfectly acceptable and I hope that my noble friend will say something similar.
Lord Bellwin: My Lords, I am grateful to my noble friend Lord Mottistone, because that is precisely what I was going to say. Although Clause 24 states that the commission shall do the studies, it does not say how many or on what subjects. That is for the commission to decide, as it has a great deal of discretion and choice. I would only repeat to my noble friend, that the commission still has its discretion as to what shall be published. It does not have to publish. We discussed in some detail earlier the principles underlying the new clause, and I then sought to explain why I thought that local government's doubts about the clause will not be borne out in practice. I would only repeat that Members of another place attached great importance to these studies and for that reason, too, I cannot recommend your Lordships to weaken the clause by substituting
386
"may" for "shall". It would not be productive, even if desirable. For that reason alone, I would not be able to accept the amendment.
Baroness Birk: My Lords, I do not intend to press this amendment to a Division because it would be futile at this time of night. I hold different views about this. I am not against the commission undertaking studies, but I am still against the word "shall". With great respect, it is not true that they will have the opportunity to choose. Because of the way it is written it follows that whatever a Minister of the Crown deems to be a direction or guidance to those ends must be the object of such a study, whether or not that is the purpose of the particular direction or guidance. This is the way in which it can most certainly be interpreted.
Although I concede to the noble Lord, Lord Mottistone, that that is a different point, this is an absolute directive. Let us be absolutely clear about that. This is very unfortunate, because a political element is brought into something which we are all agreed ought to be non-political, whatever Government are in power, when the Commission decides what studies it will make. To make it imperative and then to link it up--which it is—with the directions or guidance given by a Minister of the Crown and the operation of any particular statutory provision brings it into the political arena, whether or not that is intended. It is the word "shall" which exacerbates the position.
The Minister is right. We have been down this road before. However, I thought it to be an important enough road to traverse again. I see that there is nothing I can say which will persuade the Government about it, but it is very unfortunate that it should be left as it is. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord Bellwin Lord Bellwin moved Amendment No. 39:
Page 19, line 14, leave out ("any report prepared by it") and insert ("its report of the results of any study").
The noble Lord said: My Lords, in moving Amendment No. 39, may I speak also to Amendment Nos. 41 and 42. In moving these amendments I shall refrain from going over the background to this clause. The amendments are intended to improve the clause and, as such, I commend them to the House. If any noble Lord would like me to go into detail, I shall be very happy to do so; otherwise I beg to move.
Lord Bruce of Donington: My Lords, we on this side of the House welcome Amendment No. 39. It is a distinct improvement. If one looks at Clause 24, line 13, it says that:
" The commission shall publish or otherwise make available any report prepared by it…".
I was a little apprehensive, knowing how voluminous reports are, that they would have to publish a colossal document. The amendment moved by the noble Lord is much more practicable and we are very grateful to him for having incorporated it. As the other amendments were also the subject of debate during the Committee stage, I propose to offer no comment upon them. We shall not resist the amendments.
On Question, amendment agreed to.
[Amendment No. 40 not moved.]
Lord Bellwin Lord Bellwin moved Amendment No. 41:
Page 19, line 24, at end insert—
(" ( ) The Comptroller and Auditor General shall from time to time lay before the House of Commons a report of any matters which, in his opinion, arise out of any studies of the Commission under this section and ought to be drawn to the attention of that House").
The noble Lord said: My Lords, I have spoken to this amendment and beg to move.
On Question, amendment agreed to.
Lord Bellwin Lord Bellwin moved Amendment No. 42:
Page 19, line 26, at end insert—
(" ( ) the Comptroller and Auditor General;").
The noble Lord said: My Lords, I have also spoken to this amendment and beg to move.
On Question, amendment agreed to.
[Amendment No. 43 not moved.]
Clause 35 [Repeals]:
The Earl of Avon The Earl of Avon moved Amendment No. 44:
Page 24, line 22, at end insert—
(" ( ) The repeals in Part IIA of that Schedule have effect for financial years beginning or on after 1st April 1983").
The noble Earl said: My Lords, my noble friend has spoken to this amendment. I beg to move.
On Question, amendment agreed to.
Schedule 1 [Rates and precepts—transitional provisions]:
[Amendment No. 45 not moved.]
Lord Gainford Lord Gainford moved Amendment No. 46:
Page 25, line 29, at end insert—
(". Where a person as tenant or licensee of any premises—

(a) is liable to make payments (whether as part of his rent or otherwise) which vary or may vary according to the rates chargeable in respect of those premises; or

(b) is entitled to make deductions from his rent in respect of those rates,

he shall, where a rating authority has made a supplementary rate falling within pargraph 1(a)(i) above which affects those premises, be entitled to recover or, as the case may be, liable to make good any payment or deduction which he would not have been liable or entitled to make if that rate had not been made; and any sum which he is entitled to recover as aforesaid may, without prejudice to any other method of recovery, be deducted by him from any rent payable by him to the person by whom that sum was received").
The noble Lord said: My Lords, I spoke to this amendment when I moved Amendment No. 2. I beg to move.
On Question, amendment agreed to.
Lord Bellwin Lord Bellwin moved Amendment No. 47:
Page 26, line 12, at end insert—
(" ( ) Where the precept by reference to which the original rate was made fell within paragraph 1(a)(ii) above and was issued under section 150(4) of the Local Government Act 1972 (expenses of parish and community councils) sub-paragraph (1) above shall not require the rating authority to make a substituted rate unless it considers that a substituted rate will be required for meeting the precept substituted pursuant to paragraph 5 above").
The noble Lord said: My Lords, these amendments deal with the transitional schedule, specifically with 1982–83. As with the other amendments, I shall not detain your Lordships unless more detail is requested. The amendments are generally sensible. I apologise for having to make such amendments at this stage to meet a problem which may not even exist, but given the difficulty of knowing exactly what is being done at the level of the thousands of parish and community councils, I hope that noble Lords will welcome what is in effect a small element of flexibility. I beg to move.
Baroness Birk: My Lords, unless I have got it wrong, this is not as simple as the Minister has made it sound. This is an addition to Schedule 1 and therefore it is connected with the whole Bedfordshire case. What it appears to be doing is relaxing the requirement to make a substituted rate where a precept has been made for less than a financial year. Parish councils do actually precept on rating authorities. I dare to presume that a parish council in Bedfordshire has actually done this. I would like to know from the Minister what the reason is for this particular amendment. Is it connected with a particular case of a parish council in Bedfordshire?
Lord Bellwin: Yes, my Lords; I will certainly answer the noble Baroness. I was trying to move on, but since the noble Baroness has asked me, [will answer that the Transitional Schedule deals with 1982-3 and sets out what should follow where a supplementary rate or precept, or a rate or precept made for less than a full year, made or issued at any time before the Bill is enacted, in relation to a period beginning on or after 1st April 1982, falls on Royal Assent.
Paragraph 6(1) puts an obligation on any rating authority whose main rate is partly to meet such a precept to make a new rate according to certain rules set out in paragraph 6(2) if the original rate referred to a supplementary precept and must be reduced, and paragraph 6(3) if the original rate referred to a precept made for less than a year and therefore must be increased. The purpose of these rules is to ensure that the ratepayers receive the full benefit of the reduced rate, in the first instance, and in the second to ensure that there is no leeway to increase the rate by more than is needed to cover the extension of the precept to the whole year.
As noble Lords know, we did discuss this schedule and the related Clause 3 dealing with substituted rates and precepts very fully with the local authority associations before they were incorporated in the Bill, to ensure that the provisions would be workable and would make sense to those who will have to use them. However, in what noble Lords will know is never idle time between Committee and Report, we have double and treble checked the way the clauses will work and have, for our labours, uncovered one point which might give rise to unnecessary problems, and that is the possibility—and it is only a possibility—that a few parish councils may still be precepting on a half-yearly basis. That in itself is not a problem. They will simply issue substituted precepts to cover the full year after Royal Assent, and their rating authorities will undoubtedly have sufficient reserves to cover their parish precepts for the full year. Unfortunately, as the Bill stands, subsection 6(1) would require the rating authority to rate again even though that might not be necessary. Clearly, this would be a waste of time and money. I can go still further into detail if the noble Baroness wishes me to do so and if your Lordships' House will give me leave so to do.
On Question, amendment agreed to.
The Earl of Gainsborough The Earl of Gainsborough moved Amendment No. 48:
Page 26, line 12, at end insert—
(" 6A.—(1) Where a rating authority has made a supplementary rate falling within paragraph 1(a)(i) above by reference to a supplementary precept falling within that provision it shall be entitled to recover from the precepting authority—

389

(a) its administrative expenses in making repayments or allowing credits under paragraph 3 above in respect of the supplementary rate; and

(b) its rate collection expenses in respect of that rate.

(2) Where a rating authority has made a rate falling within sub-paragraph (a)(ii) or (b) of paragraph 1 above by reference to a supplementary precept or precept falling within sub-paragraph (1)(a) of that paragraph it shall be entitled to recover from the precepting authority—

(a) its administrative expenses in making repayments or allowing credits under section 3(5) and (6) of this Act in respect of that rate; and

(b) any increase attributable to paragraph 5 or 6(1) above in its rate collection expenses for the financial year.").

The noble Earl said: My Lords, this matter was discussed when we debated Amendment No. 1. I beg to move.
On Question, amendment agreed to.
[Amendment No. 49 not moved.]
9.55 p.m.
Baroness Gardner of Parkes Baroness Gardner of Parkes moved Amendment No. 50:
After Schedule 1 insert the following new schedule—

SCHEDULE
  BLOCK GRANT: RECEIVER FOR THE

    METROPOLITAN POLICE DISTRICT
    Interpretation
    1.—(1) In this Schedule—

    " gross rateable value ", in relation to the Metropolitan Police District, means the aggregate of the rateable values of the hereditaments in that District;

    "the principal Act" means the Local Government, Planning and Land Act 1980;

    "rateable values ", in relation to hereditaments in that District, means, subject to sub-paragraphs (2) and (3) below, rateable values ascribed to them in the valuation lists on a date to be specified in each year in the Rate Support Grant Report;

    "the Receiver" means the Receiver for the Metropolitan Police District;

    "Receiver's grant-related poundage" means a poundage determined by the Secretary of State and related

    (a) to a given ratio between the Receiver's total expenditure and the Receiver's grant-related expenditure; or

    (b) to a given difference between his total expenditure divided by the population of the Metropolitan Police District and his grant-related expenditure so divided;

    "Receiver's total expenditure" means that part of the Receiver's expenditure for a year which falls to be defrayed out of the Metropolitan Police Fund and which is not met by any such grant as is mentioned in section 54(7)(a) or (b) of the principal Act but reduced by the amount of any payments of such descriptions as the Secretary of State may specify which fall to be paid for that year into the Metropolitan Police Fund;

    "Receiver's grant-related expenditure means a sum determined by the Secretary of State as being the aggregate for for the year of the Receiver's notional expenditure having regard to his functions.

    (2) The reference to hereditaments in the definition of "rateable values" in sub-paragraph (1) above includes a reference to a notional hereditament which a body is treated as occupying by virtue of any enactment.
    (3) A Rate Support Grant Report may provide that for the year to which it relates the rateable values of hereditaments in the Metropolitan Police District falling within any class of hereditaments shall be ascertained for the purposes of this Schedule otherwise than by reference to the values ascribed to them in the valuation lists.
    Payment of block grant
    2. In section 53(1) and (8) of the principal Act, so far as relating to block grant, references to local authorities or a local authority shall include references to the Receiver.
    Aggregate amount of rate support grants
    3. In subsection (1) of section 54 of the principal Act the reference to local authorities shall include a reference to the Receiver, "relevant expenditure" as defined in subsection (5) of that section shall include the Receiver's total expenditure and the reference in subsection (6)(a) of that section to sums falling to be paid to another local authority shall include a reference to sums falling to be paid to the Receiver.
    Calculation of block grant
    4.—(i) The amount of block grant payable to the Receiver is to be calculated by deducting from the Receiver's total expenditure for the year the product arrived at by multiplying the Receiver's grant-related poundage by the gross rateable value of the Metropolitan Police District.
    (2) Sub-paragraph (1) above has effect subject to subsection (7) of section 56 of the principal Act in which the reference to a local authority shall include a reference to the Receiver.
    Adjustment of distribution of block grant
    5.—(1) Subject to the following provisions of this paragraph, the Secretary of State may provide in a Rate Support Grant Report that the amount of block grant payable to the Receiver for a year shall be calculated by deducting from his total expenditure, instead of the product of his grant-related poundage and the gross rateable value of the Metropolitan Police District, the product of those sums multiplied by a multiplier determined by the Secretary of State.
    (2) In paragraphs (a) and (b) of subsection (6) of section 59 of the principal Act references to a local authority shall include references to the Receiver and the power conferred by this paragraph may only be exercised

    (a) for the purposes specified in either of those paragraphs or in paragraph (c) or (d)of that subsection; or

    (b) for the purpose of preventing or limiting any change in the amount of block grant payable to the Receiver that would otherwise result from any fresh determination of his grant-related poundage in a supplementary report made under section 61 of the principal Act.

    (3) In section 7(3) and (7) of this Act references to section 59 of the principal Act and to a local authority shall include references to this paragraph and to the Receiver.
    (4) If the Secretary of State exercises the power conferred by this paragraph the principles on which he exercises it shall, subject to section 7(9) of this Act, be specified in the Rate Support Grant Report.
    Rate Support Grant Reports
    6. In subsection (6)(a) of section 60 of the principal Act the reference to Part VI of that Act shall include a reference to this Schedule and in subsection (9) of that section the reference to a local authority shall include a reference to the Receiver.
    Supplementary Reports
    7. In the application of section 61 of the principal Act to the Receiver's grant-related poundage and the Receiver's grant-related expenditure subsection (5) shall be omitted.
    Adjustment of block grant total
    8.—(1) In subsections (1) and (2) of section 62 of the principal Act references to a local authority or local authorities shall include references to the Receiver.
    (2) The Secretary of State may, for the purpose of the adjustment required by that section, make a fresh calculation of the entitlement of the Receiver to block grant, substituting the total of the Receiver's expenditure actually defrayed out of the Metropolitan Police Fund for the figure calculated as his total expenditure under paragraph 4(1) above.
    Information
    9. In section 65(1) of the principal Act for the words "sections 53 to 64 above and to Schedule 11 to this Act" there shall he substituted the words" sections 53 to 63 above".
    Estimates and calculations
    10. In section 66 of the principal Act, so far as relating to block grant, references to a local authority shall include references to the Receiver.").
    The noble Baroness said: My Lords, I beg to move Amendment No. 50. This is consequential on the amendment I moved earlier.
    On Question, amendment agreed to.
    Schedule 2 [The Audit Commission]:
    Viscount Ridley Viscount Ridley moved Amendment No. 51:
    Page 26, line 22, leave out paragraph 3.
    The noble Viscount said: My Lords, the noble Baroness, Lady Birk, moved a similar amendment at Committee stage and withdrew it. I am sorry I have not apparently got her support on paper, but I can generally count on it in the air. I think the purpose of this amendment is what we all want. It has been discussed at some length, both at this stage and previously. It is to see that this commission has real independence of central Government. I think this paragraph 3 reserves to the Secretary of State excessive powers of direction over the Commission, powers which must seriously reflect on the integrity of the commission and call into question its true independence. The integrity of the commission should be demonstrated by the removal of these powers of direction. I think it is in the interests of the smooth working of this part of the Act that the Government are not quite so sitting on the back of the commission all the time. I hope the Government will now be willing to accept Amendment No. 51. I beg to move.
    Lord Bruce of Donington: My Lords, I sincerely hope the noble Lord will sec fit to accept this amendment. I spoke about this at some length in Committee, and I do not propose to repeat it now. All I propose to do, in the interests of time, is to agree entirely with everything that has fallen from the lips of the noble Viscount, Lord Ridley. I sincerely hope the Government will accept the amendment.
    Lord Bellwin: My Lords, we have, of course, debated this amendment before, and it has also been discussed in another place. I could hardly fail to be aware that the proposed power of direction to the Secretary of State and his power to require information is a matter of concern to a number of your Lordships. For my part, I must repeat that I consider the power to be a proper one, and it is also, I submit, not quite so drastic a provision as is suggested. Perhaps I might begin with this last point and stress how carefully the power is hedged about with safeguards against improper use.
    First and foremost, the Secretary of State is prohibited from giving a direction or requiring information in respect of any particular local authority; so there is no question of the Secretary of State being able to cut across the judgment of the Audit Commission about, say, which auditor should be appointed to which authority. Nor is there any question of the Secretary of State being able to use his power to intervene in any other way with the affairs of any particular authority. That restriction has been in the Bill from the very start, and I personally attach great importance to it.
    Moreover, before giving a direction, the Secretary of State must consult the local authority associations and the accountancy profession, and any direction once again must be published. These provision were included after opposition pressure in another place; I readily acknowledge that fact. They mean that there is absolutely no question—not that there ever really was—of the Secretary of State being able to creep up the back stairs to deliver a stealthy direction; everything must be out in the open. I know enough about the
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    local authority associations to be sure that if they think the Secretary of State is acting wrongly, he will be guaranteed a first class public row.
    Secondly, I would emphasise that this provision is very well precedented. This is another point I made in Committee and I hesitate to bore your Lordships with examples; I am not going to do so tonight. I would only repeat that Governments of all parties over a long period of time have thought it right to take powers to give directions to bodies of this nature. One body over which such a power has been taken is the Commission for Local Authority Accounts in Scotland, a body which is similar in many ways to the Audit Commission which this Bill proposes for England and Wales.
    Your Lordships may ask: why, if the power is rarely used, is it necessary at all? The answer, of course, lies in the principle of ministerial answerability to Parliament, but the Audit Commission is a quango and as such it seems perfectly right and firmly desirable that Ministers should be able to answer questions in Parliament about it and should be able to respond to public pressure. A power of direction is of very great importance for this purpose. Without it Members of both Houses of Parliament could argue in the future, if not now, that the Bill was deficient and that they had been asked by Ministers to establish a body for which Ministers could not be properly answerable. I even venture to think that after deeper reflection local government might come to welcome this extra avenue through which Ministers and the commission can respond to local government's own views about how the commission should act.
    I hope I have explained this, and even at this hour I have tried to do so carefully, because I understand the concern that my noble friend expresses. I hope I have explained how carefully limited is this provision, why it is there and why it is found so commonly in other legislation of this kind. I fear I cannot concede on this point because it would be wrong to do so. The issue has been presented as one of principle. That is how I view it, too, and that is why I am convinced that the concern need not be there. That is why I ask your Lordships not to press this.
    Baroness Birk: My Lords, before the noble Viscount replies saying what he is going to do on this amendment, I would say that most certainly we support him. As my noble friend Lord Bruce of Donington has explained, although our names were not down to the amendment, that was probably an oversight with so much to do. The Minister's reasons again are quite ordinary and usual as they run through the Bill in the same way. The implication that we might forget that the Secretary of State has all these powers if they were not on almost every page and almost every paragraph is really almost laughable if it were not sad.
    I entirely agree with the noble Viscount. Unfortunately, he did not get very far in Committee, but it is an extremely important paragraph and it is one which again provides for the issuing of the most robust instructions to this co-called independent commission. This is the laugh of the thing, and they may find it rather difficult to get really independently minded people to serve on the commission because nobody would believe they are independent when they know

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    what they are tied in by. I leave it entirely to the noble Viscount whose name appears on this amendment, but whatever he does we will folow him.
    Lord Mottistone: My Lords, my noble friend the Minister is absolutely right in his argument. The wording says:
    " The Secretary of State may give".
    Supposing that was not there, surely the commission, particularly being a quango, as my noble friend has said, cannot be responsible and in no way controlled by the Secretary of State. It must be controlled in a degree. It does not say that he shall. It says that he may, and there must be opportunity for the Secretary of State to do this. I really feel that my noble friend, whom I normally support up to the hilt, as we both come from counties, is pressing the point far too far on this one; and of course I am very surprised at the Opposition because normally they like to control things from the centre.
    Viscount Ridley: My Lords, I am not pressing the point too far, and have no intention of pressing it, but I believe that with this clause in the Bill the Audit Commission will be seen as a creature of Government. That was the point I was making. I beg leave to withdraw the amendment.
    Amendment, by leave, withdrawn.
    Schedule 5 [Repeals]:
    Baroness Gardner of Parkes Baroness Gardner of Parkes moved Amendment No. 52:
    Page 38, line 7, at end insert—

    (" PART IIA

    Chapter

    Short title

    Extent of repeal

    1980 c. 65.

    The Local Government, Planning and Land Act 1980.

    In section 56(8), in the definition of "grant-related poundage" the words "subject to paragraph 6 of Schedule 11 below."section64.scgedule11.

    1982 c.

    The Local Government Finance Act 1982.

    In section 7, in subsection (3) the words from "and by paragraph 8" to "District)", in subsection (5) the words "and sub-paragraphs (3) and (4) of the said paragraph 8" and the words following the semi-colon, in subsection (6) the words "and paragraph 8" and "and sub-paragraphs (9) to (11) of that paragraph", in subsection (7) the words "or paragraph 8" and subsection (11).".)

    The noble Baroness said: My Lords, I beg to move this amendment, which again is consequential on Amendment No. 25.
    On Question, amendment agreed to.
    In the Title:
    Lord Bellwin Lord Bellwin moved Amendment No. 53:
    Line 8, after (" authorities ") insert (" and with respect to relief from rates in enterprise zones ").
    The noble Lord said: My Lords, I have already spoken to this amendment. I beg to move.
    On Question, amendment agreed to.
    Lord Bellwin Lord Bellwin moved Amendment No. 54:
    Line 9, leave out (" adjustments of the distribution of ").
    The noble Lord: My Lords, I have already spoken to this amendment. I beg to move.
    On Question, amendment agreed to.

  ASBESTOSIS AND MESOTHELIOMA: INDUSTRIAL DEATH BENEFIT AWARDS
  ASBESTOSIS AND MESOTHELIOMA: INDUSTRIAL DEATH BENEFIT AWARDS
  ASBESTOS: CASES NEWLY DIAGNOSED
  ASBESTOS: CASES NEWLY DIAGNOSED
  FALKLAND ISLANDS DISPUTE: NUCLEAR WEAPONS
  FALKLAND ISLANDS DISPUTE: NUCLEAR WEAPONS
  TREATY OF TLATELOLCO AND THE ARGENTINE
  TREATY OF TLATELOLCO AND THE ARGENTINE
  SOUTH ASIA: NUCLEAR WEAPON FREE ZONES
  SOUTH ASIA: NUCLEAR WEAPON FREE ZONES
  EUROPE: NUCLEAR WEAPON FREE ZONES
  EUROPE: NUCLEAR WEAPON FREE ZONES
  AFRICAN CONTINENT: NUCLEAR WEAPON FREE ZONE
  AFRICAN CONTINENT: NUCLEAR WEAPON FREE ZONE
  THE MIDDLE EAST: NUCLEAR WEAPON FREE ZONE
  THE MIDDLE EAST: NUCLEAR WEAPON FREE ZONE
  COMMUNITY INSTITUTIONS
  COMMUNITY INSTITUTIONS
  OVERSEAS STUDENT TRUST STUDY
  OVERSEAS STUDENT TRUST STUDY
  EL SALVADOR ELECTIONS: OBSERVERS' REPORT
  EL SALVADOR ELECTIONS: OBSERVERS' REPORT
  WEST AFRICA: THE "LEOPARD MURDERS"
  WEST AFRICA: THE "LEOPARD MURDERS"
  DRIVING LICENCES: RENEWAL PROCEDURE
  DRIVING LICENCES: RENEWAL PROCEDURE