Sitting of 25 May 1982

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

  PRIVATE BUSINESS
  PORT OF LONDON BILL
  Lords amendments agreed to.
  TEES AND HARTLEPOOL PORT AUTHORITY BILL (By Order)
  Read a Second time, and committed.

Oral Answers to Questions
  DEFENCE

    Falkland Islands
    Mr. Buckasked the Secretary of State for Defence if he will make a statement on the current situation with respect to the task force in the South Atlantic.
    Mr. David Atkinsonasked the Secretary of State for Defence whether he has had any discussions with his North Atlantic Treaty Organisation counterparts on the strategic value of the Falkland Islands.
    Sir William van Straubenzeeasked the Secretary of State for Defence whether he will make a statement on the current military position in the Falkland Islands.
    Mr. Canavanasked the Secretary of State for Defence whether he will make a statement about the Falkland Islands operations.
    The Secretary of State for Defence (Mr. John Nott): I met my NATO colleagues at the beginning of May. Only last Saturday all members of the North Atlantic Council expressed solidarity with the action that we are taking in the Falkland Islands.
    In my statement in the House yesterday I outlined recent action that had taken place in the South Atlantic leading up to the successful landing on East Falkland on 20 May by Her Majesty's forces and the establishment there of a secure base.
    Since then our Harriers have carried out a further successful attack on Port Stanley airfield.
    Separately, yesterday our task force came under attack from Argentine aircraft. Argentine losses as a result of that action are assessed at eight combat aircraft. Two of our support ships were damaged but they are being made good. I deeply regret the loss of HMS "Antelope", which sank yesterday.
    Finally, I should like to deny the latest wild report from Argentina that the "Canberra" has come under attack.
    Several Hon. Members rose——
    Mr. Speaker: Order. I shall call first those hon. Members whose questions are being answered.
    Mr. Buck: I thank my right hon. Friend for that answer. Is he satisfied that there is now an appropriate and balanced flow of information coming in from the task force with, hopefully, some of it getting through to Argentina?
    Will my right hon. Friend say something further about the possible establishment of a fund for the benefit of the members of the task force and their dependants, which he mentioned yesterday?
    Mr. Nott: We are getting information from the task force, sometimes not as rapidly as we would wish, but we must understand the serious problems that face our forces.
    We feel strongly that there should be one fund, not many, for people who wish to give for dependants. The terms of the fund should be widely drawn so that too much money is not directed at only a few people. The trustees of the fund should have the flexibility to direct donations across the whole spectrum of those in need. The best way to ensure that is to use existing charities. However, we cannot allocate money between charities at this stage as we do not know the relative need. We propose to set up a South Atlantic fund, which will not in itself be a charity but will hold money on behalf of existing charities until we have a clearer idea of how best it can be used.
    We should appreciate it if members of the general public, who understandably want to make donations, will direct them to this central fund. That will save a lot of confusion and difficulty.
    Mr. Atkinson: Is not one of the main lessons to be learnt from the past eight weeks the sheer neglect of the vital strategic importance of the Falkland Islands within a global context, apart from the oil, gas and seabed resources that might exist in that area?
    Will my right hon. Friend assure the House that Britain has nothing to concede by way of sovereignty in any future negotiations on the territory? Will he now discuss with our Western allies what part they will play in the future defence of those islands?
    Mr. Nott: As I said yesterday, and as my right hon. Friend the Prime Minister has repeatedly pointed out, British sovereignty is a fact and it cannot be removed by aggression. Of course we accept the very great importance of Antarctica and the Falkland Islands and the great promise that that part of the world holds out.
    Sir William van Straubenzee: Does my right hon. Friend understand the not jingoistic but quiet pride felt by the vast majority of British people in the remarkable achievements of the Armed Forces so far? Does he accept that he will have widespread support for any tactical decisions made for strictly military, not political, reasons, whether those reasons are nationally or internationally motivated?
    Mr. Nott: I am grateful to my hon. Friend for his assertion of the pride that we all feel in our Armed Forces. The whole House and country share that feeling of pride with him. I assure my hon. Friend that tactical decisions will be a matter wholly for the task force commander. Of course, he will work within the broad political directions and the strategic aims laid down for him by Her Majesty's Government.
    Mr. Canavan: Now that there is even more demand for a ceasefire, with British casualties amounting to 73 dead and about 100 wounded, and a total of 500 people already having lost their lives in the conflict, why does the chairman of the Tory Party say that diplomacy must now take a back seat? Has the Tory Party become so bloodthirsty that it is now hell-bent on using the crisis for the same reason as Galtieri created it—to distract attention from the problems of mass unemployment and the social and economic crisis here?
    Mr. Nott: If Argentina had taken notice and acted upon Security Countil resolution 502, a ceasefire would have taken place.
    Mr. Viggers: As one who represents a major naval centre, may I point out that we can be as proud of the families of the men of the task force as of the men themselves? On their behalf, may I ask whether it is necessary, for defence reasons, for news to come so slowly from the task force and to be so vague? The families of the men in the task force are left listening to Argentine broadcasts without knowing whether the information has any basis of truth.
    Mr. Nott: There is a great problem about the dissemination of information from the task force. I recognise my hon. Friend's concern. We have to respond quickly to factual information as it is received from the task force to counteract the propaganda that so frequently comes out of Buenos Aires, which is both inaccurate and damaging. Therefore, even if the information that we have is sparse, as soon as we receive it we put it out in order to deal with propaganda from the other side. However, we have always informed the next of kin before making a full announcement to the public. There is a difficult balance to be struck between avoiding propaganda from the other side and informing the next of kin before anyone else.
    Mr. John Silkin: The Opposition welcome the setting up of a South Atlantic fund. Does the right hon. Gentleman recall that yesterday he was asked about the pension rights of Service men who might be killed or injured? Is he now in a position to make a statement to the House?
    Mr. Nott: The dependants of Service men will receive a full pension and a lump sum from the Ministry of Defence. In addition, there is, of course, a war widows' pension from the DHSS. The hon. Member for Inverness (Mr. Johnston) asked me about the Merchant Marine. Under an agreement with the National Marine Board, provision has been made for compensation for death and injury to be paid to merchant seamen engaged in war-like operations. The levels were enhanced in early April and apply to those merchant seamen sailing with the task force.
    Mr. Robert Atkins: Will my right hon. Friend confirm that the Sea King helicopters being used in the extremely difficult conditions of the South Atlantic are performing as well as everyone expected? Will he also confirm that the manufacturers have been extremely forthcoming and helpful in supplying spares and technical advice during such a difficult time?
    Mr. Nott: I confirm what my hon. Friend said about spares from the manufacturers. We have lost some Sea King helicopters by accident. It has been a tragic loss. However, the losses of helicopters in relation to the amount of flying time undertaken have not been great.
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    Indeed, there have been fewer losses than we might have expected, given that the helicopters have been extremely busy.
    Mr. Douglas: Does the Secretary of State accept that the South Atlantic fund should also embrace merchant seamen? Will he make that perfectly clear to all concerned? What will be the future loading on the naval dockyards? Given the strain on them now, some of those on shore are extremely concerned about future employment possibilities.
    Mr. Nott: Through the fund, we shall look to the charities for the Merchant Marine as well as to the Service Charities. As a result of the action—and when it is over—there will be additional work in the dockyards. In due course we shall consider that but it would be wrong to make a premature decision about the amount of extra work required.

    Sea Wolf
    Mr. Trotterasked the Secretary of State for Defence whether he will take steps to accelerate the introduction of Sea Wolf or other means of point defence of Royal Navy vessels against sea skimming missiles and substantially increase the number of vessels to which such systems will be fitted.
    The Under-Secretary of State for Defence Procurement (Mr. Geoffrey Pattie): As I have already indicated, we plan to fit Sea Wolf to all type 22 frigates on construction and to five Leanders at refit. The fitting of point defence systems to other classes of ship is a matter for further consideration.
    Mr. Trotter: Can my hon. Friend give an assurance that the Soviet Union—our principal potential enemy in the North Atlantic—does not possess a sea skimming missile and that adequate defences against such missiles will be available before the Soviet Union can develop them? Is it not necessary to consider the whole question of air defence? Many of the casualties have resulted from attacks by high performance aircraft dropping very old-fashioned dumb bombs. Does my hon. Friend agree that we should consider the whole question of air defence for the Navy?
    Mr. Pattie: There will be a need to consider all aspects of the operations after they have been satisfactorily concluded. I agree that when the Falkland episode is over the Soviet Union will still remain the main threat. I confirm that the Soviet Union lacks that type of sea skimming missile.
    Mr. Jay: Have the Government yet placed orders with British industry for replacing the ships and aircraft that have been lost?
    Mr. Pattie: No.

    Trident
    Mr. Cryerasked the Secretary of State for Defence if he will now make a further statement on the implementation of the Trident programme.
    Mr. Trippierasked the Secretary of State for Defence what recent representations he has received on the Trident system.
    The Minister of State for the Armed Forces (Mr. Peter Blaker): Work is continuing satisfactorily on the design of the new class of submarines and on the remainder of the programme necessary to bring the Trident system into operation with the Royal Navy.
    Since the announcement made by my right hon. Friend the Secretary of State on 11 March on the Government's decision to adopt the Trident II D5 system, we have received about 50 letters from members of the public on the subject.
    Mr. Cryer: Does the Minister accept that the so-called nuclear deterrent has not kept the peace? Does he also accept that, as a result of the losses in the South Atlantic, hundreds of millions of pounds will have to be spent on replacing frigates, destroyers, helicopters and aeroplanes? Given the lunatic cost of the Trident project and the fact that it represents a significant and serious escalation of nuclear weaponry, will the Government now make a belated effort to support peace instead of war and announce the cancellation of the Trident project?
    Mr. Baker: The hon. Gentleman is wrong about not keeping the peace. The nuclear deterrent has kept the peace in Europe since 1945. There is no cash ceiling on the cost of the operation in the South Atlantic. When the costs are more accurately known and the prospects for defence expenditure as a whole in 1982–83 are clearer, we shall decide to what extent supplementary provision is needed. The main objective of our defence policy must be to meet the main threat, which comes from the Soviet Union. That is why we need a nuclear deterrent.
    Mr. Trippier: I thank my hon. Friend for reaffirming the Government's commitment to the Trident D5 missile system. Will he assure the House that recent events in the South Atlantic do not alter the fact that it is essential for us to have a nuclear deterrent? Will my hon. Friend also confirm that the success of a flexible response depends on the coexistence of strategic nuclear, theatre nuclear and conventional forces?
    Mr. Blaker: My hon. Friend is absolutely right. The main threat continues to be the Soviet Union, which has a wide range of nuclear weapons of different kinds, as well as vast and growing conventional forces. I think it is therefore right to pursue the policies of deterrence and of flexible response which have been pursued by successive Governments, including that of which the hon. Member for Keighley (Mr. Cryer) was at one time a member.
    Mr. Wellbeloved: Does the Minister agree that peace in Europe has been maintained since 1945 by a combination of nuclear and conventional arms acting as a deterrent? Does he further agree that the tragedy is that the Government failed to provide an adequate deterrent in the South Atlantic and that that led to the present disaster?
    Mr. Blaker: That is an entirely different question. I do not agree with the hon. Gentleman's analysis of the causes of the Argentine aggression. Those causes may have had much to do with internal affairs in Argentina.
    Mr. John Silkin: Is it not a fact that, during the peak years of the programme, the Trident cost will be 20 per cent. of new equipment? How can that be reconciled with a really credible conventional defence policy?
    Mr. Blaker: I do not recognise the figure quoted by the right hon. Gentleman. It is not one that I have seen. The
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    right hon. Gentleman will have read the open Government document, which was published at the time of my right hon. Friend's announcement, which showed that, at its peak, the cost of bringing in Trident will be about 11 per cent. of the defence equipment budget for a couple of years.
    Mr. Silkin: Of the equipment, but not of new equipment. Will the hon. Gentleman direct his mind to my question?
    Mr. Blaker: I think that the right way to approach the problem is to look at the percentage of the total defence budget that is involved. That, as has often been said, is 3 per cent. of the total defence budget over the period of 15 years during which Trident is being brought in.
    Mr. Amery: Does my hon. Friend agree that we could not possibly have sent the task force to the South Atlantic unless we already had an independent nuclear deterrent of our own? Does he further agree that without it we would have been open to nuclear blackmail from the Soviet Union and our entire strategy and diplomacy would have been dependent on our allies? Is not the first lesson to be drawn from the Falkland Islands crisis that we must have a nuclear deterrent of our own now and in the future, and that Trident is the best instrument for that?
    Mr. Blaker: I entirely agree with my right hon. Friend. It is reassuring to know that, while large parts of our Navy, Army and Air Force are now in the South Atlantic, peace is kept in Europe by our nuclear deterrent.

    P110 Aircraft
    Mr. Robert Atkinsasked the Secretary of State for Defence what representations he has had on the British Aerospace P110 project.
    Lord James Douglas-Hamiltonasked the Secretary of State for Defence whether Her Majesty's Government will consider giving a commitment in principle to developing P110 aircraft, in conjunction with other European countries.
    Mr. Pattie: My right hon. Friend has received a number of representations from hon. Members stressing the importance of this project for the aerospace industry and urging Government commitment to it.
    As I told my hon. Friend the Member for Edinburgh, West (Lord James Douglas-Hamilton) in the Adjournment debate on 1 March, our studies of our future combat aircraft requirements and options are continuing.
    Mr. Atkins: I thank my hon. Friend for that reply. Is he aware of the vital strategic importance of this new aeroplane for the Royal Air Force, particularly if it means that we do not have to buy from abroad? Is my hon. Friend also aware of the vital importance of this project to British Aerospace, Preston division, in terms of jobs in the design team and keeping the technical operation available? What steps is my hon. Friend taking to find some measure of support, financial or otherwise, from some of our partners in Europe and the rest of the world?
    Mr. Pattie: The Government are continuing to give all the support that they can to British industry—British Aerospace, in particular—for the development of this project. My hon. Friend will be interested to know that, in pursuance of this aim, I shall later this afternoon be

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    visiting the Federal Republic of Germany for discussions with German industry, and subsequently the Federal Government in Bonn.
    Lord James Douglas-Hamilton: Is my hon. Friend aware that the long-term capability of the British aerospace industry to design and produce military combat aircraft depends to a large extent on this project?
    Mr. Pattie: I agree with my hon. Friend, but he will no doubt accept that this project, in order to get started, will have to rely on a new way of procuring aircraft—that is, a new way of getting development money—and it is to that end that the discussions and consultations are continuing.
    Mr. McNamara: Is the Minister aware of the impressive lobby that took place on this issue by British Aerospace workers in the House a few weeks ago and of the concern shown at all levels about the need to develop this project? Are the Government prepared to put in extra finance to help British Aerospace to get the project off the ground?
    Mr. Pattie: There is no basic change in the Government's position as set out in the White Paper, Cmnd. 8288. As I said in answer to my hon. Friend the Member for Edinburgh, West (Lord James Douglas-Hamilton), we have to see whether we can find different ways of obtaining the money required to fund the development part of the programme.
    Mr. Edward Gardner: Is my hon. Friend aware of the deep anxiety that is felt about the future of this project by my constituents, and others, who work at Warton and Samlesbury in South Fylde? Does he agree that the development of this quite brilliant warplane is of the utmost importance, nationally as well as locally, and that it deserves, and must get, the fullest and firmest support from the Government?
    Mr. Pattie: I agree with my hon. and learned Friend about the importance of the project to British industry and to the excellent work force that he has the honour to represent. I have nothing to add to what I have already said on the precise nature of the Government's commitment.
    Mr. Geoffrey Robinson: Is the Minister aware that the project is vital to Rolls-Royce? I note that discussions are taking place with prospective partners. Will the Minister assure the House that an interim funding arrangement could be made by the Government to ensure that the vital design and development work can proceed and that the prototype development work on the engine and the aeroplane can go on and not be held back?
    Mr. Pattie: The Government are fully aware of the relevant time scale on the project. As the hon. Gentleman knows, this is a Tornado-related development. The engine is the 67R, and that is already included in future programmes. Among the companies that I shall be seeing later this week will be Motor Turbinen Union.

    Armed Services (Strength)
    Mr. Chapmanasked the Secretary of State for Defence what is the current strength of the Armed Services; and how this figure compares with that for three years before.
    The Under-Secretary of State for the Armed Forces (Mr. Jerry Wiggin): The strength of the Armed Services
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    on 31 March 1982 was 327,647, excluding locally entered personnel and reserves. This is 12,656 more than at 31 March 1979.
    Mr. Chapman: I have noted that increase. Will my hon. Friend confirm that, in the continuing review of defence plans, not only is defence procurement and equipment being reassessed, but the numbers required in each of the Armed Services?
    Mr. Wiggin: Government policy remains as outlined in Cmnd. 8288, "The United Kingdom Defence Programme: The Way Forward". We shall, of course, seek to learn from the lessons of the current operation as we review it in the future.
    Mr. Radice: At a time of increasing numbers in the Armed Services, what is the logic of cutting manpower in the Royal ordnance factories, including Birtley in my constituency?
    Mr. Wiggin: That is not an area within my direct responsibility, but I understand that the reductions in manpower are entirely related to the business done by the factories.
    Mr. Cyril D. Townsend: Will my hon. Friend confirm not only that the numbers are up, but that the wastage rate of experienced personnel is down and that we are using this opportunity to increase further the standard of recruits coming into the Forces?
    Mr. Wiggin: I can confirm what my hon. Friend said. Recruiting has improved since the Government took a proper approach to Service pay.
    Mr. McNamara: In view of the operations in the South Atlantic, what further review will the Government undertake of the strength of the Navy in future years as against the proposed cuts?
    Mr. Wiggin: I do not think that I have anything to add to what I have just said. We shall, of course, take a sensible view of all the lessons that we shall learn as a result of this operation. The numbers of men, equipment and so on will be looked at in the same light.

    French Government (Missile Supplies)
    Mr. Adleyasked the Secretary of State for Defence if he will make a statement on his latest discussions with the French Government about the availability of their missiles to the Argentine junta.
    Mr. Nott: Following the Argentine invasion of the Falkland Islands, the French Government immediately took action to suspend all arms sales to Argentina. We share with France and much of the rest of the world a common resolve to stand firm against military aggression. The Government are grateful for the help and staunch support from the French Government for the position we have taken.
    Mr. Adley: Is my right hon. Friend aware that there will be widespread support in the House and the country for what he has just said? Will he take an early opportunity to ensure that the French Government know how widely they are appreciated and how their position is welcomed in this country? In view of the persistent reports of countries such as South Africa and Israel, perhaps, assisting Argentina with the supply of missiles, and in

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    pursuance of the question asked by the right hon. Member for Deptford (Mr. Silkin) yesterday, will my right hon. Friend carry out as detailed an investigation as possible, so that in future we can know who our friends are?
    Mr. Nott: The main question relates to France, and I should like to emphasise the tremendous support that we have from President Mitterrand and the French Government as well as the particular support that I have had from my opposite number, M. Hernu, since the outset of the Falkland Islands problem. As to other countries, as I said yesterday, we continually monitor the movement of arms and look in particular at the dangers for us of the movement of, for example, Exocet missiles to Argentina. That review will continue.
    Mr. Marks: As most of Argentina's military equipment was sold to it by NATO countries, is it not time that NATO Defence and Foreign Ministers examined the whole question of arms sales to countries that may well use the weapons against individual members of NATO?
    Mr. Nott: I think that this is a matter for individual countries. As the hon. Gentleman knows, we review all our arms sales. We look at each country individually and make a judgment on each case. That has always been the manner in which these policies have been conducted by successive Governments.

    Arms Sales
    Mr. Newensasked the Secretary of State for Defence if he will adopt more restrictive criteria in reaching decisions upon individual applications for the sale of arms, following the Falkland Islands dispute.
    Mr. Skinnerasked the Secretary of State for Defence whether there are to be any changes in the sale of arms policy arising out of the Falkland crisis.
    Mr. Winnickasked the Secretary of State for Defence whether, in his review of arms sales to individual countries, especially with regard to the nature of the regime concerned, he will bear particularly in mind circumstances in which such a régime is involved in a territorial dispute with another country.
    Mr. Pattie: We shall continue to subject all proposals for the sale of military equipment overseas to close individual scrutiny, taking into account all the factors relevant to each particular case.
    Mr. Newens: Will the Minister confirm that the £120 million worth of arms from Britain and the expertise acquired by Argentine troops trained in Britain are now being used to kill British Service men such as those who were on the Gazelle helicopters that were reported to have been shot down by British-made Blowpipe missiles? Will he now listen to those of us who have consistently argued—even when the right hon. Member for Plymouth, Devonport (Dr. Owen) invited the Argentine air force chief to Britain with a view to arms sales—that it is time that we called an end to this situation, cancelled the British arms exhibition scheduled for June and worked for international agreement to end this trade in the weapons of death?
    Mr. Pattie: All defence sales are considered individually on their merits, and have been ever since the Labour Government established the defence sales organisation in 1966.
    Mr. Newens: Not with my support.
    Mr. Pattie: The hon. Gentleman may or may not have supported that development. None the less, it is true. It is also true that Labour Governments have supplied large amounts of military equipment to Argentina.
    Mr. Speaker: Mr. Dennis Skinner.
    Mr. Skinner rose——
    Hon. Members: Oh.
    Mr. Speaker: Order. I remind the House that I am calling first those hon. Members whose questions are being answered.
    Mr. Skinner: When the battle in the Falkland Islands is over, when the dead on both sides have been finally counted and the generals and their opposite numbers have wined and dined, would it not make sense for this Government, unlike all previous Governments, whether Tory, Labour or Lib-Lab, to make an unequivocal declaration that there will be no more arms sales to Fascist-style regimes? Would that not make sense?
    Mr. Pattie: The question whether we sell military equipment to anyone turns on fundamental questions about whether we wish to supply our own Armed Forces with cur own equipment, and the industrial consequences of that. In addition, we must have regard to the 200,000 plus jobs in this country that depend on the manufacture of military equipment.
    Mr. Winnick: Is it not a fact that without the junta's threats and the invasion of the Falkland Islands, arms sales to Argentina would have been continued as previously, without murmur of protest from Conservative Members? Do arms continue to be sold to the Right-wing dictatorship in Chile and other such regimes where murder and torture are the order of the day?
    Mr. Pattie: I repeat that all arms transfers are decided on the particular circumstances prevailing at the time. Obviously, no Government will make arms transfers to someone whom they have reason to believe will use them against them. That was no doubt exactly the case when the Labour Government decided to sell two type 42 destroyers to Argentina in 1970.
    Mr. Nicholas Winterton: Will my hon. Friend expand on his last answer and indicate the amount, in cash terms, of arms sold to Argentina by Labour Administrations and perhaps also indicate the type of arms that Labour Administrations have been prepared to sell to Argentina in recent years?
    Mr. Pattie: I have already mentioned the type 42 destroyers. I think the House will be aware that the first consignment of Sea Dart missiles, Lynx helicopters and Blowpipe surface-to-air missiles were all supplied under Labour Governments.
    Mr. Robert C. Brown: Much as the House will support the Government in refusing to sell arms to Warsaw Pact countries. Surely the overriding lesson that we should now learn is that Right-wing dictatorships are just as evil as Left-wing dictatorships.
    Mr. Pattie: The same answer must apply—that all the situations prevailing at any particular time must be taken into account, irrespective of whether we are talking about different political situations in various parts of the world. All of that must be considered.
    Mr. Michael Marshall: Does my hon. Friend not agree that hindsight wisdom seems to be flying about on the Labour Benches and that the reality and importance of arms sales is demonstrated by the Harrier and its great success on the AV8B?
    Mr. Pattie: I agree with my hon. Friend, but what he has said relates to an earlier answer that I gave. That was the fundamental question whether we believe that we should be properly defended. We need equipment to carry out that requirement, and must decide from which country we shall get it. If we want to get it from Britain, it helps if we can have decent, long production runs, so that we can enjoy all the industrial benefits arising therefrom.
    Mr. Cryer: Does the Minister recall that in August 1980 my hon. Friend the Member for Harlow (Mr. Newens) urged the chairman of the Conservative Party, who is a member of the War Cabinet, not to sell weapons of war to military juntas such as Argentina? Will the Minister comment on who was right—the chairman of the Conservative Party, or my hon. Friend the Member for Harlow?
    Mr. Pattie: As my right hon. Friend had no influence whatever over Argentina's decision, either to acquire Exocet missiles from France or type 42 destroyers from the Labour Government in 1970, I do not think that that question arises.
    Mr. Newens: On a point of order, Mr. Speaker. In view of the unsatisfactory nature of that reply, I beg to give notice that I shall seek to raise the matter on the Adjournment at the earliest opportunity.

    Type 42 Destroyer
    Mr. Michael McNair-Wilsonasked the Secretary of State for Defence if he is satisfied that the type 42 destroyer is properly constructed to resist the effect of all known air-to-ship and ship-to-ship missiles.
    Mr. Dalyellasked the Secretary of State for Defence what assessment he has made of the implications of the destruction of HMS "Sheffield" by an air-launched surface-skimming missile.
    Mr. Pattie: No ship can be constructed to resist the effect of all known anti-ship missiles. The circumstances and implications of the attack on HMS "Sheffield" are, however, being studied. As my right hon. Friend the Secretary of State for Defence has made clear, we shall take full account of the lessons to be learnt from current operations in determining whether any changes are needed within the general framework of the policy announced last year.
    Mr. McNair-Wilson: I thank my hon. Friend for that reply. In view of the sinking of HMS "Sheffield" and, in particular, the damage to the ship caused by fire, is my hon. Friend satisfied that the amount of aluminium used in the superstructure does not give it an unreasonable proneness to damage by fire? By the same token, does he believe that conventional wiring should now be used in warships?
    Mr. Pattie: Those are precisely the kinds of detailed points that will be examined once we are in a position to know the full operational details, after the operation is satisfactorily concluded.
    Mr. Dalyell: Is not the brutal lesson of "Sheffield" either that one goes in and destroys the bases from which these weapons are launched or that one withdraws the task force? Whereas some of us might want to withdraw the task force, is it a fact that the SAS or other operational troops did their best to go on to the South American mainland and destroy the bases?
    Mr. Pattie: The hon. Gentleman is following press speculation, as he is entitled to do. On his question about the so-called brutal lesson of "Sheffield", I would say that nothing is quite as black or as white as he suggests.
    Mr. Crawshaw: Is not one of the assessments that should be drawn from this instance the fact that it does not matter how sophisticated are one's weapons if one's adversary has weapons that are more sophisticated? Does this not show the illogicality of the argument of those who say that we have atomic missiles that can destroy the world 10 times over, since it means nothing if one is not capable of getting one of those missiles to the target?
    Mr. Pattie: There is a good deal of military force in what the hon. Gentleman says. There is no point in having any weapon unless the delivery system also exists.
    Mr. Speaker: Sir Patrick Wall.
    Mr. Dalyell: On a point of order, Mr. Speaker. In view of the unsatisfactory nature of that reply, I beg to give notice that I shall seek to raise the matter on the Adjournment at the earliest opportunity.
    Mr. Speaker: I cannot now call the hon. Member for Haltemprice (Sir P. Wall).

    Gibraltar Dockyard
    Mr. McQuarrieasked the Secretary of State for Defence if it is his intention to retain the existing labour force in the Gibraltar dockyard during the period of the Falklands crisis.
    Mr. Blaker: The closure of the Royal naval dockyard is not expected to begin until 1983. The number of jobs in the yard is therefore unlikely to be significantly affected this year. The possibility of the commercial operation of the dockyard from 1983 onwards is being examined by the Gibraltar Government with assistance from ourselves.
    Mr. McQuarrie: My hon. Friend will be aware of the considerable importance that was attached to Gibraltar during the time of the conversion of various vessels for the Falkland Islands crisis? Will he accept the fact that Gibraltar is the nearest port to the Falklands for the repair of any damaged naval vessels? In those circumstances, will he accept that it is essential that the labour force in Gibraltar is retained for so long as the crisis in the Falklands exists?
    Mr. Blaker: I join my hon. Friend in extending congratulations to the work force in the Gibraltar naval base and dockyard for what they did in preparing the task force for the South Atlantic. The naval base is to remain open. So far as the dockyard is concerned, we have said that when the appropriate time comes we shall consider whether any adjustments are needed to our policy within our general strategy.
    Mr. John Silkin: Is it not time that the hon. Gentleman and his colleagues told the House and the people of

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    Gibraltar that the Gibraltar dockyard played a prominent part in the setting forth of the task force? Should that not be taken into account? Without it, the task force would not have been able properly to assemble.
    Mr. Blaker: I am not sure that the conclusion of the right hon. Gentleman follows. But certainly, when the spray settles, if I may so express it, we shall look at the situation to see whether any adjustments are needed within our broad strategy.

    Cyprus (Sovereign Base Area)
    Mr. Christopher Priceasked the Secretary of State for Defence if he has any plans to improve the arrangements for the defence of the sovereign bases areas of Cyprus from outside aggression and interference.
    Mr. Blaker: We believe that the existing arrangements for the defence of the sovereign base areas are satisfactory. Plans are, of course, always kept under review.
    Mr. Price: If the Turkish army were to invade the sovereign territory of the Republic of Cyprus and threaten the sovereign territory of Britain in the bases, would the Government use force to prevent it doing so? Do the Government consider that the north part of Cyprus still remains the sovereign territory of the republic, as the Falklands, in spite of invasion, remain the sovereign territory of Britain?
    Mr. Blaker: The first part of the hon. Gentleman's question is entirely hypothetical. I recall that when there was an invasion some years ago at the time of a Labour Government, the Government did not do very much about it. Sovereignty is a matter for my right hon. Friend the Secretary of State for Foreign and Commonwealth Affairs.

  PRIME MINISTER

    Engagements
    Mr. Proctorasked the Prime Minister if she will list her official engagements for Tuesday 25 May.
    The Prime Minister (Mrs. Margaret Thatcher): This morning I presided at a meeting of the Cabinet and had meetings with ministerial colleagues and others. In addition to my duties in the House, I shall be having further meetings later today, including one with the Australian Foreign Minister.
    Mr. Proctor: During the course of a busy and exacting day, will my right hon. Friend take time to pay tribute, with the support of the whole House, to the bravery and sacrifice of our Armed Forces and merchant seamen in defence of British interests in the Falkland Islands? In the light of this, will my right hon. Friend give an assurance that there will be no negotiations on sovereignty with the Argentine or anyone else, because this would be unforgivable and unforgettable?
    The Prime Minister: I respond gladly to my hon. Friend's invitation to pay tribute to the courage and skill of our Armed Forces and of the merchant marine in the splendid work that they are doing. Our object is to retake the Falkland Islands. They are British sovereign territory. We wish to restore British administration. There will be a good deal of reconstruction to be done and then the future
    790
    will have to be discussed with the Falkland Islanders. I shall be amazed if the Falkland Islanders are not now more hostile to the Argentinians than they were before.
    Mr. Foot: I certainly join the right hon. Lady in paying tribute to the courage and skill of the British troops. May I turn to the second part of the matter to which she has referred? Can she clarify the attitude of the Government on the state of the possibilities of negotiation now? Does she agree that it is essential, in the interests of saving lives—British lives along with other lives—that the possibilities of negotiation should be kept open, along with the military action?
    The Prime Minister: Security Council resolution 502 has yet to be implemented. If it were implemented and the Argentine troops withdrew from the islands, peace would follow.
    Mr. Foot: That is not the question that I put to the right hon. Lady. The reason why I put it—we have every right to put it and the country has the right to put it to her—is that the Secretary of State for Defence appears to us to speak in these matters in somewhat different terms from those used by the Foreign Secretary at the end of the debate on Thursday. I wish therefore to give the right hon. Lady a full opportunity to reply to this question. Does she agree fully with what was stated by the Foreign Secretary at the end of the debate on Thursday, when he said that we remained ready to negotiate and expanded upon what he meant. Does the right hon. Lady confirm that the Government absolutely adhere to what was stated by the Foreign Secretary on that occasion?
    The Prime Minister: Yes, but I do not think that the right hon. Gentleman has quite got the import of what I said. The end of the conflict would occur if there were a withdrawal of Argentine forces in accordance with resolution 502. Unless that occurs, I do not think that any negotiation would get very far.
    Mr. Foot: The right hon. Lady cannot leave these matters here. There are the questions that may be raised by the Secretary-General of the United Nations, as he is entitled to do. I ask the right hon. Lady clearly: does she or does she not agree with what was said by the Foreign Secretary at the end of the debate on Thursday, when the decision to send in British troops had already been made?
    The Prime Minister: I do not think that the Foreign Secretary would disagree for one moment with what I have said, or with what I am saying now. I make it perfectly, fully and abundantly clear that there can be no progress without Argentine withdrawal.
    Sir Timothy Kitson: Will my right hon. Friend give an assurance to the House that, however difficult it may be, she will encourage those Falkland Islanders who can to leave Port Stanley before a major military confrontation takes place?
    The Prime Minister: A number of Falkland Islanders have already left Port Stanley. I do not think that I can do more to encourage them to leave. Many of them have already gone to the camps, and I am sure that they will be the best judges of their interests.
    Mr. James Lamond: When the righ hon. Lady is repeatedly asked if she adheres to what her Foreign Secretary says in a debate in this House, why does she not simply answer "Yes"?
    The Prime Minister: Because, like me, my right hon. Friend has made about five different speeches. I wish to know precisely—[Interruption.]—He has made five different speeches, as the circumstances have changed. It would be amazing if circumstances had not changed. I agree with the Foreign Secretary's speeches, and the Foreign Secretary agrees with mine, which is totally unlike the Labour Party.
    Sir John Biggs-Davison: When the Prime Minister is received by the Queen, will she consult Her Majesty about the early return of her representative to liberated British territory?
    The Prime Minister: I understand that my hon. Friend is saying that with the restoration of British administration there should be an early return of the governor. That is under consideration.
    Mr. Cunliffeasked the Prime Minister if she will list her official engagements for 25 May.
    The Prime Minister: I refer the hon. Gentleman to the reply that I gave some moments ago.
    Mr. Cunliffe: Does the right hon. Lady agree with another view of her Foreign Secretary, that once British rule is back in force on the islands and a period of resettlement follows—between six and 12 months was the period quoted—Britain will then seek, the Foreign Secretary has hinted, the aid of other Governments within the area, a means of guaranteeing the long-term security of the islands? Can the right hon. Lady assure the House that these Governments will not be of a Fascist or military character, and especially that the despicable policy of South Africa will not be involved in any participation arrangements?
    The Prime Minister: I hardly think that Fascist or military Governments would be the appropriate guarantors for any democracy.
    Mr. Eggar: Although the good economic news that has come out recently has naturally been eclipsed by events in the Falklands, would my right hon. Friend care to comment on the tremendous improvement both in the retail price index and factory output prices? Is this not good news for competitiveness and, thus, for jobs?
    The Prime Minister: The excellent news of a continually falling retail price index, a falling wholesale price index and input index is good news for British industry, for British sales overseas and good news for jobs.
    Mr. David Steel: I wish to ask the Prime Minister a question on the distressing but necessary subject of compensation for the dependants of those who have been killed—[Interruption.]
    Mr. Speaker: Order. The right hon. Gentleman is entitled to ask his question.
    Mr. Steel: Can the right hon. Lady, with her authority as Prime Minister, advise those members of the public who naturally wish to contribute something—[Interruption.]—whether——
    Mr. Speaker: Order. This behaviour is not fair on the right hon. Gentleman. He must be allowed to complete his question.
    Mr. Steel: Will the Government publish a list of existing organisations that already cater very well for those problems?
    Mr. Arthur Lewis: Give them some of your radio and television earnings.
    The Prime Minister: My right hon. Friend the Secretary of State for Defence announced earlier the setting up of a South Atlantic fund, which will have full charitable status, under the Ministry of Defence.
    Mr. John Townend: Does my right hon. Friend agree that the reported proposal of the Irish Government to table a resolution calling for a ceasefire at this stage is most unhelpful? Will she reassure the House that we shall not agree to a ceasefire until the Argentines agree to withdraw their troops or when the occupation of the islands is complete? Will my right hon. Friend use the veto if necessary?
    The Prime Minister: Yes. There can be no ceasefire without full withdrawal of Argentine troops. That is in resolution 502 and if necessary, if there were an attempt to have a ceasefire without that, we would have to use the veto.
    Mr. Flanneryasked the Prime Minister if she will list her official engagements for 25 May.
    The Prime Minister: I refer the hon. Gentleman to the reply that I gave some moments ago.
    Mr. Flannery: In view of the confident assertion yesterday—some people might think over-confident—that the days of the Argentine garrison are numbered——
    Mr. Nicholas Winterton: They are.
    Mr. Flannery:—may we now have a cessation of hostilities? [Interruption.] I know that the bloodthirsty hooligans on the Tory Benches do not want that, but could we not discuss future sovereignty of the Falklands under the aegis of the United Nations, especially in view of the fact that the Tory British Nationality Act has deprived at least a third of the islanders of British nationality? What shall we do with those islands once we have them? Are we to have a permanent fleet on a vast scale there indefinitely, and are we to have an army down there indefinitely to protect them?
    The Prime Minister: That is about seven questions. I wonder which to start on. The hon. Gentleman referred to the phrase in my right hon. Friend's speech that the days of the Argentine garrison are numbered. Does the hon. Gentleman not want those days to be numbered? We wish them to be numbered. He then called for a ceasefire while the invader was kept in occupation. We totally reject that. It would leave the whole paraphernalia of tyranny in place. Perhaps two answers will be enough for the hon. Gentleman.
    Miss Fookes: Is my right hon. Friend satisfied with the flow of mail to and from the Falkland force, because I have received one or two complaints from my constituents about delays, and mail is important for morale?
    The Prime Minister: I am sure that everything possible under the circumstances is being done to get mail both to the Armed Forces and from them. I recognise the importance of mail, and I am confident that everything is being done.
    Mr. Bidwellasked the Prime Minister if she will list her official engagements for 25 May.
    The Prime Minister: I refer the hon. Gentleman to the reply that I gave some moments ago.
    Mr. Bidwell: While in no way condoning or wishing to condone the Fascist junta's military aggression against the Falkland Islands, may I ask whether the Government are studying the situation being conveyed to us about the state of the junta in Argentina and the possibility of being able to make overtures to saner voices there? In that context, would it be better if the right hon. Lady dropped the idea of not allowing some Argentine families eventually to settle on the islands?
    The Prime Minister: The islanders have enjoyed democratic Government for quite a long time. What the hon. Gentleman has spoken of is a matter for the executive and legislative councils under British administration. The present law must continue until it is changed through the proper authority of those councils.
    Mr. Fairbairn: Will my right hon. Friend ensure that no order is given restricting military action of the task force in any way that could possibly jeopardise one life of our forces, whatever the cost to the enemy?
    The Prime Minister: We are concerned for the safety of our task force. We are also concerned not to have one more life than is necessary lost. We rightly rely totally on the professional views of those who are in charge. We have every confidence in their judgment and in their care for human life.
    Mr. Race: As Argentina is likely to become a nuclear weapon State in the near future, is it not essential to recognise that that would raise the stakes considerably in the South Atlantic? Does not that point to the need for a rational negotiated settlement on a permanent basis for the Falkland Islands?
    The Prime Minister: I should not have thought that the second question followed from the first. Argentina has nuclear power stations. I understand that those who have supplied the requisite uranium have done so under the authority of the International Atomic Energy Agency, which supervises its use extremely carefully. Naturally, one hopes that countries such as Argentina that have nuclear power stations will join the nuclear nonproliferation agreement.

British Rail
3.31 pm
Mr. Leslie Spriggs: I beg to ask leave to move the Adjournment of the House, under Standing Order No. 9, for the purpose of discussing a specific matter of public and parliamentary importance that should have urgent consideration, namely,
"the railway crisis, which may lead to a national railway strike and which may cause industrial strife throughout the country".
The McCarthy report has vindicated the National Union of Railwaymen national executive committee's policy. Flexible rostering proposed by the British Railways Board has been accepted by 90 per cent. of NUR members. The British Railways Board plans to close a number of British Rail workshops with the loss of 5,000 jobs. The British Rail engineering works at Shildon will be closed and there will be rundowns at Horwich, Swindon and Derby locomotive works, while thousands of passenger coaches stand in sidings awaiting repairs and many of the main line express trains are running under strength from North to South and from South to North because, as one member of the board explained to me, "We cannot get them repaired." That is happening when the British Railways Board proposes to close the most essential part of British Rail Engineering Ltd's workshops.
I wish to draw the attention of the House to the fact that with the present problems facing the railwaymen, the situation could escalate into a national strike. It would affect the coal mining industry and the electricity generating industry and there would be consequent damage to the British economy.
For those reasons I submit that this is an urgent, important and appropriate matter for debate, which should not be left until it is too late for parliamentary action.
Mr. Speaker: The hon. Member for St. Helens (Mr. Spriggs) gave me notice before 12 noon today that he would seek leave to move the Adjournment of the House to discuss a specific and important matter that he thinks should have urgent consideration, namely,
"the railway crisis, which may lead to a national railway strike and which may cause industrial strife throughout the country".
Such an application was made yesterday by the right hon. Member for Barrow-in-Furness (Mr. Booth). I fear that there are no different considerations today from yesterday, when I gave my ruling. Therefore, I am unable to submit the hon. Gentleman's application to the House.

South American Mainland (SAS Operations)
3.35 pm
Mr. Tam Dalyell: 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 operations by the SAS on the South American mainland".
I gave you notice before 12 noon today, Mr. Speaker, of the subject that I have mentioned, which I hoped to be able to withdraw because I thought that it would be cleared up in defence questions or Prime Minister's questions. In applying for an Adjournment debate under Standing Order No. 9, I believe that it would not be right to argue the case one way or the other for those operations. Many of us understand that in view of Exocet and other subjects discussed at Question Time.
Whatever one's view, surely the matter must be cleared up one way or the other as a matter of importance and urgency. It is an important matter for this country because the impression is put abroad in the face of lack of contradiction—witness the front page of today's Daily Mail—that those operations have taken place. Some of us would argue, whatever our views on the general issue hitherto, that any operation on the mainland of the South American continent raises the matter to an entirely different order of importance and urgency. I do not want to abuse the Standing Order No. 9 procedure, but through you, Mr. Speaker, I must state that this is an important subject. Perhaps the Leader of the House will volunteer a short statement. The matter was not cleared up by the Minister of State when he answered question No. 17.
Mr. Speaker: The hon. Member for West Lothian (Mr. Dalyell) gave me notice before 12 noon today 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 operations by the SAS on the South American mainland".
I am grateful to the hon. Gentleman for confining himself to the question of urgency and importance rather than seeking to make the speech that he would have made had his application been granted. I listened with anxiety to the hon. Gentleman, but I must rule that his submission does not fall within the provisions of the Standing Order and, therefore, I cannot submit his application to the House.

Orders of the Day
  Transport Bill
  As amended (in the Standing Committee), further considered.
  Transport Bill
    Clause 8

      PRIVATE-SECTOR VEHICLE TESTING
      3.38 pm
      The Under-Secretary of State for Transport (Mr. Reginald Eyre): I beg to move amendment No. 17, in page 6, line 19, at end insert—
      '(1A) The Secretary of State may not under subsection (1) above authorise any person who is for the time being either—

      (a) the holder of a goods vehicle operator's licence granted under Part V of the Transport Act 1968; or

      (b) the holder of a PSV operator's licence granted under Part II of the 1981 Act;

      to carry on a vehicle testing business; and any authorisation granted to any person under that subsection shall cease if that person subsequently becomes the holder of any such licence.'
      This amendment makes it impossible for vehicle operators to be appointed as approved testing authorities. It fulfils an undertaking given in Committee, where concern was expressed about the possibility of undue commercial pressure if vehicle operators were able to pass their vehicles and fail those of other operators. It became clear during the discussions in Committee that many hon. Members shared the view that no vehicle operators should be able to carry out tests on their own and their competitors' vehicles, with the evident risk of commercial influence that that entails.
      It has always been the Government's view that vehicle operators should not be appointed as testing authorities. We have given assurances to that effect. We agreed, however, to consider whether it would be desirable to make that intention plain in the Bill. That is what the amendment does. The amendment makes it impossible for the Secretary of State to authorise as an improved testing authority any person—that includes a company—who holds an operator's licence either for PSVs or HGVs. The provision will reassure hon. Members and those in the industry who have been concerned that we should never enable a vehicle operator to pass his own vehicle and fail those of his competitors. That possibility is clearly ruled out.
      Mr. Robert Hughes: I am grateful to the Secretary of State and the Under-Secretary for tabling the amendment. In Committee we were concerned that the hiving off of vehicle testing centres from the Department of Transport to private enterprise would lead to undue commercial pressures that could damage road safety and public confidence in the testing system. We are glad that the amendment has been tabled as we want all doubt removed. The Opposition welcome amendment No. 17
      Amendment agreed to.

    Clause 9

      THE TESTING AND SURVEILLANCE FUNCTIONS
      The Solicitor-General for Scotland (Mr. Peter Fraser): I beg to move amendment No. 18, in page 8, line 37, after 'The', insert 'cancellation'.
      The amendment follows one that was made in Committee to provide for the cancellation of certificates of conformity and Minister's approval certificates. The relevant provisions can be found in schedule 5(8)(b).
      The earlier amendment gave power to cancel a certificate of conformity or Minister's approval certificate. It is a minor change to procedure which will improve the handling of paperwork, which follows when a goods vehicle subject to type approval is altered in some way which affects its type-approved characteristics. The vehicle has a certificate that shows its conformity to the approved type. If the vehicle undergoes major alterations, that certificate may no longer apply. Regulations under the Road Traffic Act 1972 require that certain alterations to type-approved vehicles must be notified to the Secretary of State, who may require an examination.
      Once a vehicle has been inspected and the alterations have been found satisfactory, the paperwork needs to be brought into line with the new position. At the moment we can suspend or amend the certificate of conformity or MAC. We cannot cancel it altogether and issue a new one. In many cases that would be a great deal simpler and give a much clearer result. Schedule 5(8)(b) provides that small extra power. Clause 9 provides that authorised inspectors may be given a number of related powers in the same area. They should also be authorised to carry out examinations of type-approved vehicles which have been altered and to exercise existing powers to amend or suspend the certificate. If they are to operate in that area they should also have the new power to cancel the certificate, and that is what this small amendment does.
      Amendment agreed to.
      Mr. Eyre: I beg to move amendment No. 19, in page 9, line 8, at end insert
      `under regulations made under subsection (IA) of that section'.
      Mr. Deputy Speaker (Mr. Ernest Armstrong): With this, it will be convenient to take also Government amendments Nos. 20 to 23.
      3.45 pm
      Mr. Eyre: The first amendment of substance is No. 20, which strengthens the provisions under which the Secretary of State can determine which examinations of public service vehicles are carried out by the private sector. The new subsection which the amendment adds to clause 10 introduces a power to make regulations about examinations under section 6 of the Public Passenger Vehicles Act 1981. That concerns the requirement of certificates of initial fitness for PSVs. The other substantive amendment is No. 23, which similarly introduces a new regulation-making power relating to one of the activities that authorised inspectors may be authorised to undertake in the private sector. It adds to the existing amendment in clause 10 which concerns section 20 of the 1981 Act regarding inspections of public service vehicles following notifiable alterations or damage to a vehicle. The other amendments are consequential and add nothing of substance.

      799
      The introduction of the provisions means that less weight needs to be placed on the conditions that can be attached to the authorisations under clause 8 which, I believe, some hon. Members felt were in danger of being overworked. I do not accept that as a general proposition, but I agree that certain key provisions about the way examinations are to be carried out in the private sector might usefully be embodied in regulations where they have the force of law. These amendments make that possible. They also repair an omission. Clause 9 allows authorised inspectors to be empowered to carry out or supervise examinations under section 6 or section 20 of the 1981 Act. At present those sections contain no reference to the supervision or direction of examinations. Section 6 and section 20 of the 1981 Act need to contain some reference to supervision or direction if authorised examiners are to be empowered under clause 8 and clause 9 to carry them out.
      The supervision to which we are referring is the in-house supervision or direction of examinations as part of an approved testing authority's own systems for quality and standards control. There is a subsequent Government amendment on the Amendment Paper on outside supervision.
      The amendments make no changes of substance to the range of functions to be transferred to the private sector, or the powers and duties of authorised inspectors. They make explicit a number of matters which have been managed by administrative arrangement while the work has been done in the Civil Service. The amendments strengthen the structure of the Bill and make it more effective. I hope that the House will accept the amendments as a helpful improvement.
      Mr. Robert Hughes: I am not sure that I wholly accept the phrase used by the Minister that amendment No. 20 strengthens the workings of the new testing centres. It may be that reference back to the 1981 Act and different sections of that Act complicates the matter even further. Amendment No. 20 transfers to private enterprise the provision of the certificate of initial fitness and type approval under the 1981 Act. It was not my impression that that was the intention of the Bill. I have noticed the amendment relating to out-house inspection, which we will welcome when we come to it.
      There seems to be some contradiction between what is embodied in amendment No. 20, the subsequent amendments, and that later amendment. Either the initial certificate of fitness has to be provided for individual vehicles or, if the vehicle is of a type that has a type certificate under section 10 of the Act, the certifying officer can, if he thinks fit, give the vehicle its licence or operator's certificate without actually examining the vehicle. We believe that that is what happens and that to pass initial testing and type approval to private enterprise stretches the frontiers of the examination system too far.
      The hon. Gentleman knows that we object to the transfer of the testing stations. He referred earlier to the need to build into the Bill clear safeguards against commercial pressures. If type approval is to be done by the private sector instead of the Department of Transport, clear commercial pressures could be brought into play. I believe that, instead of strengthening the Bill, the amendments actually weaken it.
      800
      When the Under-Secretary replies, I ask him to tell us how many certifying officers will be replaced by section 20 of the 1981 Act concerning type approval and initial certificate fitness work. We understood that the Secretary of State is embarking on this hiving-off operation to divest himself of a number of civil servants. However, his enthusiasm for so doing should be tempered by the necessity to ensure that when vehicles first take to the roads they are in proper order. Surely that is consistent with the supervisory functions that he is now writing into the Bill and consistent also with retaining the certifying officers' functions within the Department of Transport. I hope that the Under-Secretary of State will think again about pressing the amendment if what I have said is right.
      Mr. Eyre: The hon. Member for Aberdeen, North (Mr. Hughes) revealed a misunderstanding when he asked his first question. Power for the private sector to carry out examinations of public service vehicles for certificates of initial fitness is already in clause 9, and has been from the start. I hope that on consideration of this issue the hon. Gentleman will appreciate that the amendment will improve the means by which the standards of such examination can be kept high on an in-house basis.
      The other powers about which the hon. Gentleman is worried will be handed over only if testing goes to one authoritative body, such as Lloyd's Register. Clause 9 lists the powers that may be handed over, not which must be handed over. I know that the hon. Gentleman will appreciate the importance of that wording.
      Type approval of PSVs cannot be handed over. There is not provision for that. Only individual initial fitness examinations can go to the private sector. I hope that that will satisfy the hon. Gentleman. I am sorry that it is not possible immediatedly to answer his inquiry about the number of certifying officers. However, I shall obtain that information and let the hon. Gentleman have it as soon as possible.
      Mr. Albert Booth: The Minister says that the functions that can be transferred are those that are listed in clause 9. Lines 29–33 on page 9 in clause 9 state:
      "Such further functions (whether conferred by or under any existing enactment or not) as may be prescribed, being functions which appear to the Secretary of State to be connected with any of the functions described above."
      I am not raising this issue on Report merely as a nitpicking point. I raised it as a matter of substance in Committee. Short of seeing what the Minister proposes, it is almost impossible to tell whether the functions might be described as being connected with the other functions listed in clause 9. Therefore, it is not possible to state with authority, unless the Minister has received legal advice on the meaning of this part of the clause which I have not been able to obtain, that the function to which my hon. Friend the Member for Aberdeen, North (Mr. Hughes) referred could not be transferred.
      If the only functions that can be transferred are those that are listed, the Government must have had a clear idea of the functions that would be transferred when they decided how many civil servants' jobs were to be chopped. If they had not had that knowledge, they would have been unable to make an estimate. If the Government have changed their mind about the savings within the Civil Service that they will achieve with the Bill, if fewer civil servants' jobs are to be lost than previously indicated by

      801
      not transferring all the functions listed in clause 9, and if they are not to transfer any of the functions set out in lines 29–33 of the clause, that should be stated now.
      Is that what the Minister is saying, or is he merely giving an assurance that further functions will not cover the area that we are discussing? Will he tell us what areas are not covered and the areas that cannot be covered and, against that background, explain the purpose of having these provisions in the Bill?
      Mr. Eyre: I am not able entirely to follow the legal interpretation of the right hon. Member for Barrow-in-Furness (Mr. Booth) of clause 9. If he considers the matter more fully, he will find that I have made the position clear. The functions that are referred to have to be connected with others and cannot include type approval. That was the anxiety expressed by the hon. Member for Aberdeen, North (Mr. Hughes) and I have been able, I hope, to reassure the right hon. Gentleman. However, the right hon. Gentleman went much further in his thoughts, for which there is little foundation.
      I emphasise that the amendments will make no changes of substance to the range of functions that are to go to the private sector or the powers and duties of authorised inspectors. The intention is to make explicit a number of matters that have hitherto been managed by administrative arrangements. The amendments strengthen the Bill's structure and make it more effective for inside or in-house examinations.
      Mr. Booth: Surely the hon. Gentleman must accept that the words to which I have referred do not give any absolute limitations to what may be covered by clause 9. The words are:
      "Such further functions … as may be prescribed, being functions which appear to the Secretary of State to be connected"
      and so on. If the Secretary of State thinks that there is some connection between type approval and any of the examinations that are listed as functions in clause 9, he is entitled to take that view. It would be difficult to argue with him. One could argue that anything involved in testing public service vehicles must be connected with something that is specified as a function in clause 9. That could not be challenged effectively in the courts.
      If the Secretary of State of the day said "This is my view and I say with my hand on my heart that there is some connection between that type of testing and that function", how could that be denied? The courts would say "Parliament passed the Bill and saw fit to allow the Secretary of State to add further functions to those that were specified." The Under-Secretary of State has said that the current Secretary of State thinks that there is no connection. However, we cannot have an assurance, while the Bill is in this form, that further functions connected with examinations, the issuing of certificates, the refusal to issue certificates, plating, periodical tests and all the functions in clause 9 will not ultimately be added to the functions that are to be transferred from the Civil Service to the private sector.
      I am asking a simple and straightforward question: was the Government's estimate of the saving in civil servants made on the presumption that only the functions listed in clause 9 and not covered by the further functions paragraph would be transferred? That is a simple and straightforward question. If that is the basis of the estimate, the answer is "Yes". If that is not the case and further functions are to be transferred, and if the last part of clause 9 has to be used
      802
      to make that Civil Service saving, the Minister can say so. If he is not prepared to reveal what those further functions are, that will be a matter of argument between us. Surely, it is not impossible for him to give a straight answer to that question.
      4 pm
      Mr. Eyre: The right hon. Gentleman has sought to bring forward his own interpretation of the meaning of part of clause 9. His interpretation is wrong. No absolute limitation is appropriate. The Secretary of State must exercise his powers in context. A type approval function would not be in context. The right hon. Gentleman is mistaken in his interpretation. There are settled rules for determining the limits of powers.
      The basis for the savings in civil servants quoted to the right hon. Gentleman in Committee was correct. For the purpose of this amendment we are discussing the in-house position of examination. The right hon. Gentleman has used the occasion to examine clause 9 and to bring forward his own interpretation of it. I have sought to explain to the right hon. Gentleman that his interpretation is not correct.
      Mr. Booth rose——
      Mr. Eyre: The right hon. Gentleman was so absorbed in setting out his understanding of this part of the Bill that he missed my explanation. I am able to confirm that the estimate of Civil Service savings was made on the presumption that only the functions listed would go.
      Mr. Booth rose——
      Mr. Deputy Speaker: Order. I remind the House that we are on Report and not in Committee. Only the mover of the amendment and the Minister in charge of the Bill have a right of reply. There was genuine anxiety, which needed clarification, so I allowed a dialogue to take place.
      Amendment agreed to.

    Clause 10

      PROVISIONS SUPPLEMENTARY TO SECTION 8.
      Amendments made: No. 20, in page 11, line 27, at end insert—
      (7A) In section 6 of the 1981 Act (certificates of initial fitness required for use as public service vehicles), the following subsection shall be inserted after subsection (1)—
      "(1A) Without prejudice to the powers of the Secretary of State under section 7 of this Act in relation to the exercise by certifying officers of their function,, regulations may make provision with respect to the examination of vehicles for the purposes of subsection (1) (a) above by or under the direction of authorised inspector s and the issue or refusal of certificates of initial fitness by such inspectors on any such examinations.".'.
      No. 21, in page 11, line 28, leave out 'the 1981' and insert `that'.
      No. 22, in page 11, line 45, leave out 'and'.
      No. 23, in page 12, line 6, at end insert
      `and
      (c) for the examinations to be carried out under the regulations and, in particular, for authorising any such examination to be carried out by or under the direction of a public service vehicle examiner or an authorised inspector ".'.—[Mr. Eyre.]
      Mr. Eyre: I beg to move amendment No. 24, in page 12, line 14, leave out subsection (10) and insert—
      '(10) Subject to the qualification mentioned below, regulations made under

      (a) section 43, section 45 or section 50 of the 1972 Act; or

      (b) section 6(1A) or 20(2A) of the 1981 Act;

      803
      may include provision for the purpose of securing that private-sector examinations are properly carried out in accordance with the regulations, including (but without prejudice to the generality of the preceding, provision) provision for the supervision or review of private-sector examinations by persons authorised for the purpose by or under the regulations.

      No person other than an officer of the Secretary of State may be authorised by or under regulations so made to supervise or review an examination carried out in the course of a vehicle testing business carried on by a person other than his own employer.
      In this subsection "private-sector examination" means, in relation to an examination under regulations so made, an examination carried out by or under the direction of an authorised inspector.'.
      The amendment replaces the present clause 10(10) with a new subsection. Like the present one, the new subsection is about arrangements for ensuring that private sector testing is properly carried out. It differs from the present provision in two main ways.
      First, it is more comprehensive. It refers not only to sections 43 and 45 of the Road Traffic 1972 Act but to several other sections. Therefore, it effectively covers all the main areas of work where authorised inspectors may be authorised to carry out examinations.
      Secondly, and most important, the new subsection contains completely different provisions about the supervision and review of examinations. We have revised it to make it clear that the supervision of the work of approved testing authorities will and must be carried out by officers of the Secretary of State. We shall not be using independent private sector contractors on this work, which, at one time, was being considered. There remains some provision for supervision of examinations by people who are not civil servants. That relates to in-house supervision to which I have already referred, which an approved testing authority will carry out, using its own staff, to ensure that proper standards are maintained within its own organisation.
      In-house supervision by the authority's own management will be important. The amendment does nothing to frustrate it. In ruling out private sector supervision, we refer to outside supervision by people who are not employed by the approved testing authority but who act on behalf of the Secretary of State. According to the amendment, these people must be civil servants.
      The question of who should carry out the supervision caused some concern in Committee. We undertook to reconsider our previous view that private sector staff might be used. I am glad that we have been able to meet the wishes of the Opposition on this point. I hope that the amendment will be generally welcomed.
      Mr. Robert Hughes: I rise briefly to welcome the amendment. Two points exercised us in Committee. The first was that the general supervision of the approved inspectors of the business should be retained in the Department of Transport under the direction of the Secretary of State in the interests of public safety. Secondly, we were concerned that, if the chain were to be broken up into two or three chains, one part of the chain could not supervise the functions of the others. I take it that that could not happen.
      Mr. Eyre indicated assent.
      Mr. Hughes: I see that the Minister is agreeing. I welcome the amendment.
      Amendment agreed to.
      Mr. Booth: I beg to move amendment No. 25, in page 12, line 35, at end insert—
      '(12) The Secretary of State may make orders with respect to the provisions of pensions by any person authorised to conduct a business which consists of or includes any of the functions specified in section 9 of this Act; for or in respect of persons who are transferred from the Civil Service to private employment under the provisions of section 8 of this Act'.
      The purpose of the amendment is to provide the Secretary of State with the power to make orders for the provision of pensions for those who are transferred from the Civil Service into private employment as a result of the Government selling or leasing heavy goods vehicle testing stations.
      Part II of the Bill contains no provision for pensions. There are inconsistencies in the construction of the Bill. The Government have introduced a series of privatisation measures. Not only the Department of Transport but a number of other Government Departments have introduced, during the past two legislative years, a number of Bills which turn over functions either from nationalised industries or from the Civil Service to the private sector. In all those Bills provisions have been made to take care—if I may put it that way—of any possible difficulty which might arise in the transfer of pensions.
      To demonstrate an inconsistency, I turn first to the measures introduced by the Department of Transport. In the Transport Act 1980, in the Transport (Finance) Act 1981 and in part I of the Bill, provision is made for the Secretary of State to make an order, if he judges that to be the right thing to do, for the transfer of pensions from a nationalised industry to the private sector. The Bill provides for the transfer of pensions from the National Bus Company to the private sector. We debated the matter last night and expressed our reservations about such provisions, but there is no argument that the Government judged it right to have such a provision.
      However, in this part of the Bill there is no such provision and I oppose the inconsistency. I cannot see that there is any consistent line of policy which until now in the Department's legislation for privatisation has given the Secretary of State power to make orders for the transfer of pensions, yet there is no such provision in the case of heavy goods vehicle testing stations.
      Another inconsistency is that, when people have been transferred from Government service, as opposed to a nationalised industry—from local government or even the Civil Service—the legislation of other Departments has provided for the transfer of pensions. One example, under the Local Government (Miscellaneous Provisions) Bill, is people moving from the Audit Commission to another form of service. In the case of the Department of the Environment, the Wildlife and Countryside Act 1981 created the Countryside Commission and those who had to leave Government employment ceased to be members of Government pension schemes. In the one case I am talking about a local government pension scheme and in the other of the Civil Service pension scheme.
      The consistent thread has been a recognition by the Government that when they move people out of public service into private employment it may be necessary or desirable for a Minister to have a direct power or obligation, or at least the right, if he judges it necessary, to make an order to cover the transfer of pensions.

      805
      The Secretary of State's predecessor judged it correct to use, as a pattern for the transfer, a method that was developed for transferring pensions not from the public to the private sector but between public sector industries. In earlier Transport Acts, when people were required to move between British Rail, British Road Services and the National Freight Corporation, there was a method of transferring pensions. One sees it in schedule 1 to the Bill, which deals with the sale of British Rail subsidaries, and it is repeated in clause 5 of the Bill. The terms are almost exactly the same. It has been accepted in part II of this Bill that a similar power is necessary. That is not surprising. Preservation of pension rights on transfer is a problem that has exercised management and unions in the public sector for many years and, because of the attention that has been given to the problem, we have reached the position in legislation whereby staff can in most cases move freely between schemes in the public sector without jeopardising their pension rights. It is possible to move from British Rail to the National Bus Company or to the National Freight Corporation.
      I hope that the Minister will accept that that protection has been possible mainly because the benefits and schemes that have existed in the public sector have been broadly comparable. One cannot say that all the schemes in the private sector have been comparable with those in the public sector. There have been many significant differences, which I hope I need not detail for the purpose of this argument.
      4.15 pm
      The preservation of pension rights on change of employment has been given much publicity in recent years. The Occupational Pensions Board was requested to examine the problem in depth and to make recommendations, but the Government have decided to proceed with their privatisation legislation before they have the benefit of that examination in depth and the recommendation of the Occupational Pensions Board. Therefore, it is understandable that the Government should have consistently used a mechanism in legislation for the transfer of pensions from the public to the private sector similar to that used for transfers in the public sector.
      In transfers from the public to the private sector, many problems can arise. In my researches, I have found only one precedent when the Department of Transport attempted to transfer employees from the public to the private sector without a provision being made for pensions to be transferred. That is the case of those who were transferred from the road construction units to employment as private consultants. Many problems arose. The Government were unwilling to permit the extension of indexing public service pensions into the private sector. The consultants were unwilling to enter into agreements that would have involved what they regarded as the acceptance of an open-ended liability for index-linking. The Association of County Councils was unwilling to advise its constituent members to negotiate such agreements because, as it claimed, in the event of a consultant's default the superannuation administering bodies would have to pay the bill for the cost of index-linking.
      That is the only example that I can find. If the Minister knows of other examples of people being forced by Government legislation to transfer from the public to the private sector without any legislative cover or without the
      806
      Minister retaining any rights, I shall be interested to hear what they are and whether it was possible to accomplish the change without any difficulty. All the evidence shows that it has been a matter of considerable difficulty. Therefore, we have supported the Government in such provision as they have made until now and all our criticisms have been addressed in the other direction of having more safeguards in the legislation. Here we must protest that there are no safeguards.
      Those who will be affected by part II of the Bill—I assume that we shall have the misfortune of seeing it carried through this Session—will be covered by the principal Civil Service pension scheme. They are in a scheme that provides benefits indexed to increase in line with Civil Service earnings. Those who have joined the Government test service have been encouraged not only to join the pension scheme but to transfer any pensions that they have in the private sector to the Civil Service scheme.
      If the Minister wishes, I shall quote chapter and verse from the leaflet that was issued within the Civil Service. In effect, it says that a person going into Civil Service employment and the Civil Service pension scheme has the responsibility of deciding whether to transfer his benefits into the principal Civil Service pension scheme, even if his benefits under his present scheme are better, as it might be worth while to transfer to the Civil Service one which gives lower benefits, as it is unlikely that his present scheme will have as good an indexation arrangement as the Civil Service one.
      I have paraphrased the leaflet but I believe that I have fairly represented the basis upon which many people have joined the Government testing service and have transferred their pensions to the Civil Service scheme. As a result of the present legislation, they will find themselves being treated exactly the same, in legal terms, as if they had voluntarily left the Civil Service. They will not be one whit better off than the person who decided of his own free will to leave.
      I challenge the Minister to show me any shred of legal protection or benefit that would have accrued to a person who had voluntarily left the Civil Service. We are now dealing with people who will be forced out by the present legislation. That is the way in which the Government propose to treat them. Not only is the Secretary of State being inconsistent in his treatment of his civil servants as compared with civil servants of other Departments; he is also legislating between those who will be forced to leave his employ in the HGV testing stations and those who will be forced to leave the employ of the National Bus Company under the same Bill. Such inconsistencies are, to say the least, highly unjust.
      I should like to put some direct questions to the Minister. I have addressed them to him before without receiving an answer, but that makes them no less relevant. I hope that the Minister will accept their relevance now. What will happen to civil servants who are currently employed in HGV testing stations which the Government will sell or lease to private employers who may not have a contracted-out scheme? Nothing in the Bill will limit those to whom the Secretary of State might decide to sell HGV testing stations.
      There is nothing to limit the right hon. Gentleman's selling stations to those who have contracted-out schemes. What will happen to the people employed there? Will the Treasury be prepared to make a payment into a scheme of an employer which is not contracted out to secure benefits

      807
      for the civil servants whom the Bill transfers? If the Treasury will not be prepared to make such a payment, how are the pension rights of the affected civil servants, on ceasing to be civil servants, to be protected? What will happen to those who have transferred into the Civil Service scheme on joining the HGV testing stations service when they have not acquired five years' service? Presumably, they do not even have a right to a frozen pension arrangement. The right to a frozen pension at the current acquired benefit level is dependent upon five years' service.
      I admit that I have had to re-study the legislation to prepare myself for the debate. As I understand the present provisions for transfer guarantee, civil servants with more than five years' service in the Civil Service scheme who go to a contracted-out scheme, provided that it is approved by the Inland Revenue and provided that the trustees of the scheme are prepared to accept the transfer, can have their accrued payments into the Civil Service scheme transferred. They may turn out to be the fortunate few. There is no guarantee that the only people who will be transferred will have five years' or more service in the Civil Service pension scheme, or that the employers to whom they are transferred have contracted-out schemes approved by the Inland Revenue and the trustees of which will accept a transfer from the Civil Service pension scheme.
      Unless all those conditions are met—there is nothing in the Bill to suggest that they will be—civil servants are entirely justified in expressing the fear that has been represented to us through their union that the Bill is utterly inadequate with regard to pensions. It does nothing to protect them. It leaves them substantially worse off than others who have been affected by Government privatisation proposals.
      The Secretary of State may take the same view of that as he took when the Opposition proposed that there should be some statutory liability to make orders of transfer. We were then arguing about a different proposition. It is not pertinent here. When we discussed National Bus Company pensions, we accepted that the Secretary of State had taken an order-making power but that he would retain discretion about when to use it for the transfer of pensions. That is not the argument here. We are discussing why the Secretary of State has not taken an order-making power. Without the amendment, no such power will exist.
      The Opposition cannot and will not accept at this juncture simply the Secretary of State's hope or wish that anyone to whom he transfers civil servants, as a result of the sale or lease of testing stations, will be so honourable, decent, civilised and progressive with regard to pensions that he will run a pension scheme that is capable of taking transferred Civil Service pensions. We may hope for that but we cannot leave the matter to the hopes of the Secretary of State. He cannot say that, because he hopes that that will happen, there is no need to have a provision for transfer when he said previously that order-making powers were necessary, as he did in this Bill and his predecessor did in the two previous ones.
      At the very least, the Government can accept the amendment so that there is a safeguard. The Minister cannot deny, on the basis of the record, that such are the problems of transferring pensions from the public to the private sector that it has been found desirable to have a
      808
      power to make an order for transfer. That has been done in all the other cases. The amendment deals with one exception that covers a serious range of problems confronting those who have lost their public servant status. For that, if for no other reason, the amendment should be accepted. If it turns out not to be necessary and it is possible to transfer and safeguard pension provisions, no one will be happier than my right hon. and hon. Friends and I. We cannot be happy with the creation of a precedent whereby people who, by legislation, are thrown out of the Civil Service are in exactly the same legal position as those who voluntarily leave or break a contract into which they have voluntarily entered.
      4.30 pm
      The Secretary of State for Transport (Mr. David Howell): We are dealing here with issues of great importance for the employees concerned in the changes proposed by the Government, which we debated yesterday. There is no difference or division whatever between the extremely strong, well-informed and concerned feelings of the right hon. Member for Barrow-in-Furness (Mr. Booth) and those of the Government about the importance of pension provision for those working in the testing stations who will in future be working in the new organisation.
      We must start from the recognition of a great deal of what the right hon. Gentleman says about the need to ensure a fair deal for the staff under the new arrangement and to ensure either that a pension scheme is available in the type of organisation to which the testing stations will be transferred to which, if the employees so wish, pensions can be transferred or that existing and accrued pension rights are properly preserved. All these matters are very much the concern and intention of the Government and are very much in our mind in preparing plans for the negotiation of the transfer of the HGV testing stations to a new organisation of the kind outlined in the debate yesterday. I should not like there to be any difference of view on that.
      The difference arises when the right hon. Gentleman asks why there is not a more explicit power in the Bill relating to the bringing about of this change of affairs and of a situation in which pensions would be guaranteed under the new arrangements.
      The answer given in Committee, which I shall be concerned not just to repeat but to justify very closely again today, is that the amendment is not necessary. The order-making power that it proposes is not necessary to achieve the aims and objectives that both I and the right hon. Gentleman have outlined for the preservation or transfer of accumulated pension rights when an individual ceases to be a civil servant.
      The right hon. Gentleman suggested that the proposition that I have put, and which I shall elaborate—that there is no need for an order-making power of the kind that he seeks because the matter is covered by existing powers and special powers are unnecessary—is in some way unique, that it had never been done this way before and that it must therefore be inconsistent and arouse fears. I know the right hon. Gentleman's feelings in these matters and I know that he would be the last to wish to raise fears and worries for which there is no basis.
      The charge of inconsistency is perfectly fair and I must seek to meet it.
      Mr. Booth: Just to make sure that the record is completely straight, I did not say that there was no precedent. Indeed, I cited the case of those who were transferred from the road construction units to the private consultants and I instanced the difficulties that it raised.
      Mr. Howell: I certainly do not wish to mislead or misquote the right hon. Gentleman. As he has said, he cited one instance in which special powers were not involved. There are others. I am advised, for example, that no such provision appeared in legislation relating to the sale of British Rail hotels or Seaspeed. I shall examine whether special powers of the kind that the right hon. Gentleman seeks were found necessary in other areas.
      In this situation, however, the need for such powers does not exist. As we have said before, there seems to be no real difference between us on the question of the pension need. We want to see fair and reasonable pensions for the testing staff after they leave the Civil Service. The only difference between us is about the necessity for legislation to achieve that.
      I mentioned the charge of inconsistency, as I do not wish it to be suggested—I understand from the right hon. Gentleman's intervention that he is not suggesting this—that the arrangement is unique and special and therefore to be feared, because it is not. I place on record again what I said in Committee. Ample powers already exist to make suitable pension arrangements for former civil servants. The principal Civil Service scheme, which was often cited in Committee, contains full and detailed provisions for the preservation or transfer of accumulated pension rights when a person leaves the Civil Service. Provision for future pensions with a new employer will be covered by the rules of whatever scheme the staff joins, so even if it is necessary to set up a new scheme no special provision is required to cover that. The normal and right way to make provision for pensions of staff who leave the Civil Service, as is proposed in this case, is by negotiation and agreement.
      As the right hon. Gentleman fairly pointed out, this follows from Government action. It follows from the policy that was described, debated and approved by the House yesterday. As I have said, there is no need for special legislative provision to deal with this. The right hon. Gentleman says that the Government's word on this is not enough. In other words, in a matter of this kind he is not prepared to accept the assurance that the Government want a fair deal for those involved. He wants it to be written into the Bill. I must tell him that there is no need for legislation because the powers exist already. It is therefore the assurance of the Government in good faith that the powers are available and will be used to ensure adequate pension provision. That is the assurance that the right hon. Gentleman can throw back in the face of the Government, but it is also the assurance upon which I believe that those concerned should rest without fear and with comfort, in the full realisation that a fair deal will be sought and secured for them in the negotiation with the successor organisation. The nature of that organisation was clearly set out in the amendments yesterday.
      I believe that that undertaking is not only adequate but fully sufficient to secure the aspirations and concerns and the immediate, long-term and lasting needs of those involved in the change of ownership.
      Of course, no pension transfer is possible if there is not a contracted-out scheme in the new organisation. Accrued
      810
      pension rights would then be preserved within the principal Civil Service pension scheme and index-linked, and future earnings-related pensions would come from the State scheme. But in the case of transfer to Lloyd's Register Vehicle Testing Association, which is precisely what we are proposing, this should not arise.
      I indicated in an earlier debate that that was what we were proposing and that plans were well advanced. I spoke of this matter in a way that satisfied the House. If the House will accept that that is the course that we are set en, I do not see why the right hon. Gentleman should feel it vital that we should write in an order-making power on the lines proposed in the amendment. There is no necessity for it. Either a new contracted-out scheme will be established or we shall arrange for staff to join an established scheme.
      That is what we have said again and again. I have been able to give to the House a much clearer indication of the nature of the body that will take over the stations than I was in Committee. In negotiating with the new body, we have said that we are determined that the staff shall have a fair deal, which means that they will be able to enter a pension scheme when they leave the Civil Service pension scheme, and that the question of transfer, as with preservation, will be governed by the principal Civil Service pension scheme.
      I give those assurances most strongly to the House because I wish to counteract firmly any impression that there might be grounds for fear that the staff would not get a fair deal. The Government are determined that they will get a fair deal. I have indicated to the House the sort of organisation to which we propose to transfer the heavy goods vehicle stations. The staff would become employees of the new organisation.
      Against that background it is right for the Government to put forward through me their intentions. It is not necessary to press for the additional order-making power proposed by the right hon. Gentleman to achieve the objectives that we all want and that will clearly be achieved in the context of the plans outlined in an earlier amendment for heavy goods vehicle testing stations. For those reasons, I ask the right hon. Gentleman to withdraw the amendment.
      Mr. Booth: With the leave of the House, may I first clear up the misunderstanding by the Secretary of State? As I understood the right hon. Gentleman, he said that he was advised that there was not a statutory provision covering British Rail hotels or Sealink services. That is not the case. Section 4 of the Transport Act 1981 says:
      "Schedule 1 to this Act has effect for the purpose of making certain provisions supplementing sections 1 to 3 of this Act. '
      The first paragraph of schedule 1 gives the Secretary of State powers to make
      "orders under section 74 of the Transport Act 1962 … in relation to related companies as he could make if those companies were subsidiaries of the Railways Board."
      I submit that that provision is applicable to both British Rail hotels and to Sealink. Therefore, those who negotiated on the transfer of pensions of the staff at the three British Rail hotels, which included Gleneagles and the Edinburgh hotel, knew that if they could not secure a satisfactory agreement they could ask the Secretary of State to use his power under schedule 1 to the 1981 Act to make a transfer order.
      4.45 pm
      That is on all fours with what my hon. Friends and I are seeking in the amendment. This is not a question of cur

      811
      not trusting the Secretary of State. We are asking him to accept an amendment under which we are placing trust in him. That is the interesting point. We are saying that we are happy that he should have the power and the discretion. If he accepts the amendment, it will not place an obligation upon him. It does not say that he must make an order if the transfer can be negotiated. If the amendment were accepted, the Secretary of State could make an order if he deemed it to be necessary or justified.
      If the Secretary of State had the order-making power, it could in certain circumstances influence the nature of the negotiations. It is one thing to negotiate with somebody when it is recognised by both sides that if the negotiated outcome is not satisfactory the Minister can be called upon to make a statutory provision: it is another thing to conduct negotiations if the person with whom the employees are negotiating knows that they have to rely entirely on their own strength and cannot call upon a Minister. That is particularly the case for these civil servants who are without any of the rights that would accrue if there were order-making powers. They are in the same legal position as those who have retired.
      If the right hon. Gentleman thinks this matter through, I do not think that he can say that it is consistent to argue that there is no necessity in this case but that it was right to make such a provision in another case. I am happy to stay with the examples that the right hon. Gentleman cited of British Rail hotels and Sealink. One could cite many other examples. For example, under clause 5 the Secretary of State might have said that it was the Government's intention that the pensions should be negotiated and transferred on a satisfactory basis and that he did not want to have the back-up power. But he did not say that. Very wisely, he defended having exactly the degree of back-up power that we are asking him to take in this case, not one whit more or one whit less. Although we pressed him to take greater powers and greater obligations, he resisted, but he did not resist having this degree of power.
      I put it to the Secretary of State that the precedent has been established for good reasons. I do not want to go over the ground again. The Government have acknowledged the problems of the transfer of pensions from the public to the private sector. In their wisdom, or otherwise, they decided to proceed with the privatisation in advance of getting the benefits of the commission. Having done that, they have said that in all these cases they will call upon the House of Commons to give the Secretary of State this back-up power, which will enable him, if he is not satisfied that negotiations will produce a satisfactory transfer of pension, to make an order. That is what we are asking. It is a modest request. We are reflecting fears which have been expressed to us. Whether we share them is not important for the purpose of this debate.
      We did not bring forward the amendment without having talked to those who have negotiated pensions, to pension experts in transport unions, to pension experts in the TUC and to Civil Service officers who are concerned about pension levels. The Secretary of State cannot wipe away their fears. He cannot say that their fears are ill-founded, in view of all the evidence, and that of course the Government set up a commission to consider the problems of the transfer of pensions. If the Archangel Gabriel came to the Dispatch Box, he could not wave away those fears.
      812
      I am not saying that I do not believe in little miracles, because I believe that big miracles can happen. I am pleading for a very small miracle, and that is for the Secretary of State to accept here what is regarded as consistent and proper in part I of the Bill and in legislation introduced by his predecessor in the Acts of 1980 and 1981. We should rejoice with him if he did not have to use the powers and if the transfer were accomplished smoothly, but we would still say then, as we say now, that the fact that the power to make the order was in the background was valuable and could contribute to achieving a satisfactory arrangement.
      Mr. Stanley Cohen: Will my right hon. Friend ask the Minister for an assurance that the fears of the unions which have been negotiating on this matter are unfounded? That would be a great help to them.
      Mr. Booth: I shall be delighted if the Secretary of State can tell us that he has reached a clear understanding since we last talked with the unions that the transfer will not take place unless every civil servant who is transferred under part II will take with him his accrued rights and the equivalent benefits of his pension scheme. I could then accept that our amendment was unnecessary. I can only reiterate my hon. Friend's appeal. However, that would be surprising, and, with great respect to the Secretary of State, it would be easier for him to accept our amendment than to give that assurance.
      Mr. David Howell: With permission, Mr. Deputy Speaker, I shall try to answer some of the right hon. Gentleman's points.
      First, I cannot accept that the special powers that the right hon. Gentleman now presses on the Government would be either consistent or necessary. On the contrary, the pattern proposed and the words that I have used to describe the procedures and the line that the Government will adopt in pursuing their plans for this transfer give the best assurance that there will be a fair deal for the staff. Moreover, the Bill provides that that will take place with the powers "in the background"—if I may use the right hon. Gentleman's phrase—which lie in the principal Civil Service pension scheme. That underlying security provides the background against which the new pension provision, or the transfer or the preservation of accrued rights, will be secured for all employees.
      The right hon. Gentleman returned to the matter of the British Rail hotels. He mentioned Sealink, but in fact Seaspeed was the example that I used. I am still advised that what I said about the right hon. Gentleman's interpretation of the legislation involved in those transfers and negotiations was correct. The right hon. Gentleman quoted textual evidence in an attempt to refute that, but I am advised that the words that I used were correct.
      If there is a misunderstanding and we are arguing about different things, as often happens, or if there are two separate views, or if it will help the right hon. Gentleman, I shall endeavour to support what I said on the matter in correspondence with him. However, that is the clear advice that I have received in support of the words that I used. All the same, I am sure that the right hon. Gentleman will be the first to agree that it will not help our common objective to get a fair deal for the staff if we get involved in a wrangle about precedents. After all, our aim is to get a fair deal for the staff.

      813
      I wish to take up a further point, because I am anxious that the right hon. Gentleman should feel satisfied about all the matters that he raised. He asked about civil servants in the heavy goods vehicle testing network who had less than five years' service. I understand that, under the principal Civil Service pension scheme, transfer payments may be made even where the individual has less than five years' service and that people with less than five years' service may not opt for a preserved pension. If they do not take a transfer value, they receive a short-service payment instead. If they opt for a transfer, they should be in the same position as civil servants with longer service. I believe that I am giving an accurate representation of the position. I shall, of course, check further on the details of the matter. If any amplification is needed, I shall write to the right hon. Gentleman.
      I listened closely to the right hon. Gentleman, whose views I respect in this connection. Having carefully examined whether special powers of the kind that he seeks are justified, I am clear that there is no need for special legislative provision to make that possible. There is no ground for fearing that the Government intend anything other than a fair deal for the staff who are involved. That is the Government's determination and intention. I have described the kind of body to which heavy goods vehicle testing stations are to be transferred under the privatisation proposal.
      On that basis, I believe that employees can be assured that their pension needs and problems will be well looked after and that there is no need in the Bill for a further legislative order-making power of the kind that the right hon. Gentleman wants. On that basis, I hope that he will withdraw the amendment.
      Mr. Booth: With the leave of the House, Mr. Deputy Speaker. It is clear that the Secretary of State is not prepared to make similar legislative provision for these civil servants as has been made for a number of other people forced out of public service. I am not prepared to withdraw the amendment, because it involves the important issue of employment protection rights. My right hon. and hon. Friends and I can only vote on it.
      Question put, That the amendment be made:—
      The House divided: Ayes 221, Noes 281.

      Division No. 170]

      [5 pm

      AYES

      Abse, Leo

      Campbell, Ian

      Adams, Allen

      Campbell-Savours, Dale

      Allaun, Frank

      Canavan, Dennis

      Alton, David

      Cant, R. B.

      Anderson, Donald

      Carmichael, Neil

      Archer, Rt Hon Peter

      Carter-Jones, Lewis

      Ashley, Rt Hon Jack

      Cartwright, John

      Ashton, Joe

      Clark, Dr David (S Shields)

      Atkinson, N.(H'gey,)

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

      Bagier, Gordon A.T.

      Cohen, Stanley

      Barnett, Guy(Greenwich)

      Coleman, Donald

      Barnett, Rt Hon Joel (H'wd)

      Concannon, Rt Hon J. D.

      Beith, A.J.

      Conlan, Bernard

      Benn, Rt Hon Tony

      Cook, Robin F.

      Bennett, Andrew (St'kp'tN)

      Cowans, Harry

      Bidwell, Sydney

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

      Booth, Rt Hon Albert

      Crowther, Stan

      Bradley, Tom

      Cryer, Bob

      Bray, Dr Jeremy

      Cunliffe, Lawrence

      Brown, Hugh D. (Provan)

      Cunningham, G.(IslingtonS)

      Brown, Ron (E'burgh, Leith)

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

      Buchan, Norman

      Dalyell, Tam

      Callaghan, Rt Hon J.

      Davies, Ifor (Gower)

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

      Davis, Clinton (Hackney C)

      814

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

      McWilliam, John

      Dean, Joseph (Leeds West)

      Marks, Kenneth

      Dewar, Donald

      Marshall, D(G'gowS'ton)

      Dixon, Donald

      Marshall, Jim (Leicester S)

      Dobson, Frank

      Martin, M(G'gowS'burn)

      Dormand, Jack

      Mason, Rt Hon Roy

      Douglas, Dick

      Maxton, John

      Dubs, Alfred

      Meacher, Michael

      Duffy, A. E. P.

      Mellish, Rt Hon Robert

      Dunnett, Jack

      Mikardo, Ian

      Dunwoody, Hon Mrs G.

      Millan, RtHonBruce

      Eadie, Alex

      Miller, Dr M.S. (E Kilbride)

      Eastham, Ken

      Mitchell, Austin(Grimsby)

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

      Mitchell, R. C. (Soton Itchen)

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

      Morris, Rt Hon A. (W'shawe)

      English, Michael

      Morris, Rt Hon J. (Aberavon)

      Ennals, Rt Hon David

      Moyle, Rt Hon Roland

      Evans, Ioan (Aberdare)

      Newens, Stanley

      Evans, John (Newton)

      Oakes, Rt Hon Gordon

      Field, Frank

      Ogden, Eric

      Fitch, Alan

      O'Halloran, Michael

      Flannery, Martin

      O'Neill, Martin

      Fletcher, Ted (Darlington)

      Orme, Rt Hon Stanley

      Foot, Rt Hon Michael

      Owen, Rt Hon Dr David

      Ford, Ben

      Palmer, Arthur

      Forrester, John

      Park, George

      Foster, Derek

      Parker, John

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

      Parry, Robert

      Freeson, Rt Hon Reginald

      Powell, Raymond (Ogmore)

      Garrett, John (Norwich S)

      Prescott, John

      Garrett, W. E. (Wallsend)

      Price, C. (Lewisham W)

      George, Bruce

      Race, Reg

      Gilbert, Rt Hon Dr John

      Radice, Giles

      Graham, Ted

      Rees, Rt Hon M (Leeds S)

      Grimond, Rt Hon J.

      Richardson, Jo

      Hamilton, James (Bothwell)

      Roberts, Albert (Normanton)

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

      Roberts, Ernest (Hackney N)

      Hardy, Peter

      Hoberts, Gmilym (Cannock)

      Harrison, Rt Hon Walter

      Robinson, G. (Coventry NW)

      Haynes, Frank

      Rodgers, Rt Hon William

      Healey, Rt Hon Denis

      Rooker, J. W.

      Heffer, Eric S.

      Ross, Ernest (Dundee West)

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

      Sandelson, Neville

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

      Sever, John

      HomeRobertson, John

      Sheerman, Barry

      Horam, John

      Sheldon, Rt Hon R.

      Howells, Geraint

      Shore, Rt Hon Peter

      Hoyle, Douglas

      Short, Mrs Renée

      Hughes, Mark (Durham)

      Silkin, Rt Hon J. (Deptford)

      Hughes, Robert (AberdeenN)

      Silkin, Rt Hon S. C. (Dulwich)

      Hughes, Roy (Newport)

      Silverman, Julius

      Jay, Rt Hon Douglas

      Skinner, Dennis

      Jenkins, Rt Hon Roy (Hillhead)

      Smith, Rt Hon J. (N Lanark)

      John, Brynmor

      Snape, Peter

      Johnson, Walter (Derby S)

      Soley, Clive

      Johnston, Russell (Inverness)

      Spearing, Nigel

      Jones, Rt Hon Alec (Rh'dda)

      Spriggs, Leslie

      Jones, Barry (East Flint)

      Stallard, A. W.

      Kaufman, Rt Hon Gerald

      Steel, Rt Hon David

      Kilroy-Silk, Robert

      Stoddart, David

      Kinnock, Neil

      Stott, Roger

      Lambie, David

      Strang, Gavin

      Lamborn, Harry

      Straw, Jack

      Lamond, James

      Summerskill, Hon Dr Shirley

      Leadbitter, Ted

      Thomas, Dafydd (Merioneth)

      Leighton, Ronald

      Thomas, Dr R. (Carmarthen)

      Lestor, MissJoan

      Tilley, John

      Lewis, Ron (Carlisle)

      Tinn, James

      Litherland, Robert

      Torney, Tom

      Lofthouse, Geoffrey

      Urwin, Rt Hon Tom

      Lyon, Alexander(York)

      Varley, Rt Hon Eric G.

      McCartney, Hugh

      Wainwright, E.(DearneV)

      McDonald, Dr Oonagh

      Wainwright, R. (ColneV)

      McElhone, Frank

      Walker, Rt Hon H. (D'caster)

      McKay, Allen (Penistone)

      Watkins, David

      McKelvey, William

      Weetch, Ken

      McMahon, Andrew

      Wellbeloved, James

      McNally, Thomas

      Welsh, Michael

      McNamara, Kevin

      White, Frank R.

      McTaggart, Robert

      White, J. (G'gow Pollok)

      815

      Whitehead, Phillip

      Woodall, Alec

      Whitlock, William

      Woolmer, Kenneth

      Wigley, Dafydd

      Wright, Sheila

      Willey, Rt Hon Frederick

      Young, David (Bolton E)

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

      Williams, Rt Hon Mrs (Crosby)

      Tellers for the Ayes:

      Wilson, Gordon (Dundee E)

      Dr, Edmund Marshall and Mr. George Morton

      Wilson, Rt Hon SirH.(H'ton)

      Winnick, David

      NOES

      Adley, Robert

      Eden, Rt Hon Sir John

      Alexander, Richard

      Edwards, Rt Hon N. (P'broke)

      Alison, Rt Hon Michael

      Eggar, Tim

      Ancram, Michael

      Emery, Sir Peter

      Arnold, Tom

      Eyre, Reginald

      Aspinwall, Jack

      Fairbairn, Nicholas

      Atkins, Rt Hon H. (S'thorne)

      Fairgrieve, SirRussell

      Atkins, Robert (PrestonN)

      Faith, MrsSheila

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

      Farr, John

      Baker, Kenneth (St.M'bone)

      Fenner, Mrs Peggy

      Baker, Nicholas (N Dorset)

      Finsberg, Geoffrey

      Banks, Robert

      Fletcher-Cooke, SirCharles

      Beaumont-Dark, Anthony

      Fookes, Miss Janet

      Bendall, Vivian

      Forman, Nigel

      Bennett, Sir Frederic (T'bay)

      Fowler, Rt Hon Norman

      Benyon, Thomas (A'don)

      Fox, Marcus

      Benyon.W. (Buckingham)

      Fraser, Rt Hon Sir Hugh

      Best, Keith

      Fraser, Peter (South Angus)

      Bevan, David Gilroy

      Fry, Peter

      Biffen, Rt Hon John

      Gardiner, George(Reigate)

      Biggs-Davison, SirJohn

      Gardner, Edward (S Fylde)

      Blackburn, John

      Garel-Jones, Tristan

      Blaker, Peter

      Gilmour, Rt Hon Sir Ian

      Body, Richard

      Glyn, Dr Alan

      Bonsor, SirNicholas

      Goodhew, SirVictor

      Bottomley, Peter (W'wichW)

      Goodlad, Alastair

      Bowden, Andrew

      Gorst, John

      Boyson, Dr Rhodes

      Gow, Ian

      Braine, SirBernard

      Gower, Sir Raymond

      Bright, Graham

      Gray, Hamish

      Brinton, Tim

      Greenway, Harry

      Brittan, Rt. Hon. Leon

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

      Brooke, Hon Peter

      Griffiths, Peter (Portsm 'thN)

      Brotherton, Michael

      Grist, Ian

      Brown, Michael(Brigg&Sc'n)

      Grylls, Michael

      Bruce-Gardyne, John

      Gummer, JohnSelwyn

      Buchanan-Smith, Rt. Hon. A.

      Hamilton, Hon A.

      Buck, Antony

      Hamilton, Michael(Salisbury)

      Budgen, Nick

      Hampson, Dr Keith

      Bulmer, Esmond

      Hannam, John

      Burden, SirFrederick

      Haselhurst, Alan

      Butcher, John

      Havers, Rt Hon Sir Michael

      Cadbury, Jocelyn

      Hawkins, Paul

      Carlisle, John (Luton West)

      Hawksley, Warren

      Carlisle, Kenneth (Lincoln)

      Hayhoe, Barney

      Chapman, Sydney

      Heddle, John

      Churchill, W.S.

      Henderson, Barry

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

      Heseltine, Rt Hon Michael

      Clark, Sir W. (Croydon S)

      Hicks, Robert

      Clarke, Kenneth (Rushcliffe)

      Higgins, Rt Hon Terence L.

      Clegg, SirWalter

      Hill, James

      Cockeram, Eric

      Hogg, Hon Douglas(Gr'th'm)

      Colvin, Michael

      Holland, Philip(Carlton)

      Cope, John

      Hooson, Tom

      Cormack, Patrick

      Hordern, Peter

      Corrie, John

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

      Costain, SirAlbert

      Howell, Ralph (NNorfolk)

      Cranborne, Viscount

      Hunt, David (Wirral)

      Critchley, Julian

      Irving, Charles (Cheltenham)

      Crouch, David

      Jenkin, Rt Hon Patrick

      Dean, Paul (NorthSomerset)

      JohnsonSmith, Geoffrey

      Dickens, Geoffrey

      Jopling, Rt Hon Michael

      Dorrell, Stephen

      Joseph, Rt Hon Sir Keith

      Douglas-Hamilton, LordJ.

      Kershaw, SirAnthony

      Dover, Denshore

      Kilfedder, James A.

      du Cann, Rt Hon Edward

      Kimball, SirMarcus

      Dunn, Robert (Dartford)

      Kitson, SirTimothy

      Durant, Tony

      Knight, Mrs Jill

      Dykes, Hugh

      Knox, David

      816

      Lamont, Norman

      Ridsdale, SirJulian

      Lang, Ian

      Rifkind, Malcolm

      Latham, Michael

      Rippon, Rt Hon Geoffrey

      Lawrence, Ivan

      Roberts, M. (Cardiff NW)

      Lawson, Rt Hon Nigel

      Roberts, Wyn (Conway)

      Lee, John

      Rossi, Hugh

      Lennox-Boyd, HonMark

      Rost, Peter

      Lester, Jim (Beeston)

      Royle, Sir Anthony

      Lewis, Kenneth (Rutland)

      Sainsbury, Hon Timothy

      Lloyd, Ian (Havant & W'loo)

      St. John-Stevas, Rt Hon N.

      Loveridge, John

      Shaw, Giles (Pudsey)

      Luce, Richard

      Shaw, Michael (Scarborough)

      McCrindle, Robert

      Shelton, William (Streatham)

      Macfarlane, Neil

      Shepherd, Richard

      MacGregor, John

      Silvester, Fred

      MacKay, John (Argyll)

      Sims, Roger

      Macmillan, Rt Hon M.

      Skeet, T. H. H.

      McNair-Wilson, M. (N'bury)

      Smith, Dudley

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

      Speed, Keith

      McQuarrie, Albert

      Speller, Tony

      Madel, David

      Spence, John

      Major, John

      Spicer, Jim (WestDorset)

      Marland, Paul

      Spicer, Michael (SWorcs)

      Marlow, Antony

      Sproat, Iain

      Marshall, Michael (Arundel)

      Squire, Robin

      Marten, Rt Hon Neil

      Stainton, Keith

      Mather, Carol

      Stanbrook, Ivor

      Maude, Rt Hon Sir Angus

      Stanley, John

      Mawby, Ray

      Steen, Anthony

      Mawhinney, Dr Brian

      Stevens, Martin

      Maxwell-Hyslop, Robin

      Stewart, A (E Renfrewshire)

      Mellor, David

      Stewart, Ian (Hitchin)

      Meyer, SirAnthony

      Stokes, John

      Miller, Hal (B'grove)

      StradlingThomas, J.

      Mills, Iain (Meriden)

      Tapsell, Peter

      Mills, Peter (West Devon)

      Temple-Morris, Peter

      Miscampbell, Norman

      Thatcher, Rt Hon Mrs M.

      Mitchell, David (Basingstoke)

      Thomas, Rt Hon Peter

      Moate, Roger

      Thompson, Donald

      Monro, SirHector

      Thorne, Nei1 (IlfordSouth)

      Montgomery, Fergus

      Thornton, Malcolm

      Moore, John

      Townend, John (Bridlington)

      Morris, M. (N'hampton S)

      Townsend, Cyril D, (B'heath)

      Morrison, HonC. (Devizes)

      Trippier, David

      Morrison, Hon P. (Chester)

      Trotter, Neville

      Mudd, David

      van Straubenzee, Sir W.

      Murphy, Christopher

      Vaughan, Dr Gerard

      Myles, David

      Viggers, Peter

      Neale, Gerrard

      Waddington, David

      Needham, Richard

      Wakeham, John

      Nelson, Anthony

      Waldegrave, Hon William

      Neubert, Michael

      Walker, Rt Hon P. (W'cester)

      Newton, Tony

      Wall, SirPatrick

      Normanton, Tom

      Waller, Gary

      Nott, Rt Hon John

      Walters, Dennis

      Onslow, Cranley

      Ward, John

      Oppenheim, Rt Hon Mrs S.

      Warren, Kenneth

      Page, John (Harrow, West)

      Watson, John

      Page, Richard (SW Herts)

      Wheeler, John

      Parris, Matthew

      Whitelaw, Rt Hon William

      Pawsey, James

      Whitney, Raymond

      Percival, Sir Ian

      Wickenden, Keith

      Peyton, Rt Hon John

      Wiggin, Jerry

      Pink, R.Bonner

      Wilkinson, John

      Pollock, Alexander

      Williams, D. (Montgomery)

      Porter, Barry

      Winterton, Nicholas

      Prentice, Rt Hon Reg

      Wolfson, Mark

      Proctor, K. Harvey

      Young, SirGeorge (Acton)

      Pym, Rt Hon Francis

      Younger, Rt Hon George

      Rees, Peter (Dover and Deal)

      Rees-Davies, W. R.

      Tellers for the Noes:

      Rhodes James, Robert

      Mr. Robert Boscawen and Mr. Anthony Berry.

      Rhys Williams, SirBrandon

      Ridley, HonNicholas

      Question accordingly negatived.

    Clause 14

      CONSULTATION WITH REPRESENTATIVE BODIES
      The Solicitor-General for Scotland: I beg to move amendment No. 26, in page 15, line 38, leave out '10 or 11' and insert '10(11) or 11(2)'.
      The sole purpose of this small and simple amendment is to make the Bill a little clearer. Clause 14 lists the subjects on which the Secretary of State must consult representative bodies, and one of those subjects is the designation of premises as testing stations. To make clear what is meant by designation, clause 14(4) refers to the clauses in which the powers to designate premises are to be found. In Committee, it was suggested that it would be helpful if the reader were referred not only to the appropriate clause, but to the right subsection. The Government are happy to oblige. I hope that this small amendment will be generally welcomed.
      Mr. Roger Stott: I shall not detain the House. The Solicitor-General for Scotland has acknowledged the concern expressed in Committee. I am grateful to him for introducing an amendment that clarifies the position.
      Amendment agreed to.

    Clause 18

      PROHIBITIONS UNDER SECTION 57 OF THE 1972 ACT
      The Solicitor-General for Scotland: I beg to move amendment No. 27, in page 19, leave out lines 34 and 35 and insert 'any person".'.
      Mr. Deputy Speaker: With this it will be convenient to take Government amendments Nos. 76 and 78.
      The Solicitor-General for Scotland: The amendments improve the drafting of the provisions in the existing legislation on the imposition of prohibitions on dangerously defective vehicles. Clause 18(1), as drafted, amends section 57 of the Road Traffic Act 1972, which is about prohibitions on goods vehicles found to be unfit for service. Clause 18(1) alters the specification of the circumstances in which a goods vehicle shall be prohibited with immediate effect, so as to make that section consistent with the corresponding provision for public service vehicles, which is to be found in section 9 of the Public Passenger Vehicles Act 1981. The formula that clause 18(1) introduces—copied from the 1981 Act—provides that a prohibition shall take effect immediately if using the vehicle
      "would involve danger to the driver, to other persons carried on the vehicle or to other members of the public."
      In Committee, Opposition Members pointed out that the formula was unnecessarily long and complex. A reference to "danger to any person" would do just as well. Accordingly, we propose these amendments, which will amend both clause 18(1) and the model on which it was based—section 9 of the 1981 Act. The amendments have the rare virtue of shortening two pieces of legislation. I hope that that in itself will be enough to commend them to the House.
      Amendment agreed to.
      5.15 pm
      The Solicitor-General for Scotland: I beg to move amendment No. 28, in page 20, line 6, at beginning insert
      818
      `subject to subsection (9A) below'.
      Mr. Deputy Speaker: With this it will be convenient to take Government amendment No. 29.
      The Solicitor-General for Scotland: The amendments extend the provisions in clause 18 to introduce what is known as a due diligence defence for a goods vehicle operator who is charged with causing or permitting a vehicle to be used in contravention of a prohibition. The amendments will provide him with a defence if he can prove that he took all reasonable precautions and exercised all due diligence to prevent an offence from being committed.
      Clause 18 already contains provisions that give some protection to a driver who is charged with driving a goods vehicle in contravention of a prohibition, but who had no knowledge that the vehicle was prohibited. The amendment extends a corresponding protection to the vehicle operator. In both cases, we are bringing the law on goods vehicles into line with existing provisions for public service vehicles. The provisions in clause 18 are modelled on those in the 1981 Act about public service vehicles.
      It is right and reasonable that such protection should be given to vehicle operators. If an operator can prove that he took all reasonable precautions, he should have a defence against conviction. I emphasise that that will in no way weaken the sanctions that are available against the careless or irresponsible operator. The burden of proof remains on the defendant. He will have to convince the court that he exercised all due diligence. The amendment involves protecting people who are in practice innocent of wrongdoing. It is a modest improvement to the law. I hope that it, too, will be welcomed by the House.
      Amendment agreed to.
      Amendment made: No. 29, in page 20, line 7, at end insert—
      `and the following subsection shall be inserted after that subsection—
      "(9A) It shall be a defence for a person charged with an offence under subsection (9)(aa) above to prove that he took all reasonable precautions and exercised all due diligence to avoid the commission of any offence under that provision.".'.—[The Solicitor-General for Scotland.]

    Clause 22

      FORGERY AND MISUSE OF DOCUMENTS ETC
      The Solicitor-General for Scotland: I beg to move amendment No. 30, in page 23, line 23, leave out from `section' to '(at' in line 24 and insert
      `32 of the Magistrates' Courts Act 1980'.
      This is a technical amendment which does not affect the substance of clause 22. It amends subsection (2)(a), which defines what is meant by the "statutory maximum" fine with respect to England and Wales. The clause, as drafted, refers to the provisions of the Criminal Law Act 1977. However, that Act has been repealed, and the relevant provisions now appear in the Magistrates' Courts Act 1980. The amendment accordingly deletes the outdated reference and substitutes the new one.
      Amendment agreed to.

    Clause 26

      FIXED PENALTY OFFENCES AND FIXED PENALTY NOTICES
      Amendments made: No. 31, in page 26, line 1, leave out from `a' to end of line 5 and insert
      'fixed penalty notice in respect of the offence'.
      No. 32, in page 26, line 10, after 'notice', insert
      'in respect of the offence'.
      No. 33, in page 26, line 29, leave out subsection (5).—[The Solicitor-General for Scotland.]
      Mr. Stott: I beg to move amendment No. 34, in page 26, line 35, after '(6)', insert
      'subject to section 27(1) and '.
      Mr. Deputy Speaker: With this it will be convenient to take the following amendments: No 38, in clause 27, page 27, line 27 at end insert
      `but no such order may provide for any offence involving obligatory endorsement to be a fixed penalty offence'
      No. 50, in clause 39, page 43, line 20, leave out from 'Act' to the end of line 23 and insert
      'but not any offence involving obligatory endorsement'.
      No. 67, in page 60, leave out schedule 1.
      No. 71, in page 65, leave out schedule 2.
      Mr. Stott: In Committee, we raised serious doubts about whether we should embark on framing legislation that would bring offences that are currently and properly defined as endorsable into the fixed penalty net. Our concern has been expressed and shared by many hon. Members, particularly by the hon. Member for Wellingborough (Mr. Fry), who indicated some dissent in our debates yesterday.
      Over the years, the laws applying to motorists have become more and more complicated. The situation has not been helped by the lack of uniform application. The Bill represents an ideal opportunity for simplifying the process of dealing with motoring offences by enlarging the number of offences to be dealt with under the fixed penalty procedure. I believe that the vast majority of hon. Members welcome such a move, because regulations that are well founded and simple to apply will be readily accepted by the driving public.
      Regrettably, if the Bill's provisions are enacted in their present form, they will have the reverse effect. Drivers will find them complex, confusing and in some ways objectionable. The Bill will probably not achieve its primary objective of simplification, ease of understanding and the removal of the thousands of minor cases from our courts. There are degrees of culpability in all motoring offences and that fact is generally recognised by the current procedure.
      A specific motoring offence may be ignored, or it may result in a verbal on-the-spot warning, a written warning or a prosecution. We believe that the offer of a fixed penalty should be a further option, but that it should not attract an endorsement, penalty points or in any way be given the status of a conviction. That must continue to be a matter for the courts to determine.
      The provisions of the clause and its associated schedules describe the offences which may be dealt with by the offer of a fixed penalty. Many endorsable offences are included. The Bill thereby perpetuates the complication of the penalty points system by failing to accept the basic and essential need to simplify these procedures.
      I contend that fixed penalties should be no more than a further option available to the police for dealing with
      820
      motoring offences. As I said earlier, any offence dealt with by fixed penalty should not involve the expensive administrative procedure of endorsements, the levying of penalty points and the associated record-keeping that is envisaged in the Bill. Once the fixed penalty has been paid, that should be the end of the matter. However, if the offender comes before a court for non-payment of a fixed penalty, the penalty points procedure should apply as if the matter had been dealt with summarily in the first place.
      We made these points on many occasions in Committee. We have tried to probe the Government on the reasons why they have seen fit to include in the fixed penalty net offences that rightly attract penalty points and other offences that attract endorsements. We have not yet had a satisfactory reply.
      The Opposition contend that some of the offences listed in schedules 1 and 2 for fixed penalty treatment should not rank as such. We welcome the Government's intention to remove from the schedule of fixed penalties the pedestrian crossing offence and the offence of disregarding a school crossing patrol, but most of us believe that other offences should be removed because they demonstrate anti-social driving behaviour and should always result in the culprit appearing before a court. The offences to which I refer are offences committed on motorways; contravention of one-way requirements on a trunk road; failure to comply with traffic directions and signs; dangerous parking; failure to stop when required to do so by a constable; and using a vehicle in a dangerous condition.
      None of those offences should be available for treatment by a fixed penalty notice. I cannot understand why the Government have sought to muddy the waters in that respect. I venture to suggest to the Solicitor-General for Scotland that most of us are in favour of extending fixed penalties into the areas I have mentioned. However, we are not in favour of doing so into areas where there are serious anxieties that the Bill, in seeking to deal with the problem, will actually allow motorists to get away with a more serious offence.
      We are worried that the Government have sought to include offences that are rightly and properly endorsable. We believe that they should continue to be dealt with properly in court. We do not believe that they should be included in the fixed penalty net, although we give a general welcome to the Government's view that fixed penalties should be extended to take minor offences out of the courts. However, I must tell the Solicitor-General for Scotland that I was not convinced by the arguments in Committee. I am still not convinced that we are legislating in the right way. I hope that the hon. Gentleman will take my remarks on board.
      Mr. Peter Fry: Not for the first time, I find myself in agreement with the hon. Member for Westhoughton (Mr. Stott) who speaks for the Opposition on transport matters.
      It is a pity that the House is hardly fuller than it was earlier this afternoon to deal with this important aspect of the Bill, which goes to the root of the observance of, and respect for, the law on the part of the average motorist. Those who have served on a jury dealing with motoring offences will know that there is a marked reluctance by jurors to find someone guilty of a serious offence when a heavy penalty is involved, merely because it is a motoring

      821
      offence. The reason is that there are a host of minor offences which most of us, alas, probably commit at one time or another, such as exceeding the speed limit.
      The average motorist, although knowing that he has done wrong, does not accept that he has broken the law in the same way as he would if committing burglary, fraud or inflicting grievous bodily harm. In most people's minds there is a distinction between, say, driving at 12 miles an hour above the speed limit and driving dangerously. It is not too hard to distinguish between the two. Because there are so many minor offences—some are technical—that are still subject to endorsement, there is a blurring in people's minds. There is not the clear distinction that one would have thought was necessary between a serious offence and a minor one. It is an important aspect, because it relates to the attitude of the motorist to the law.
      I should have thought that the Government would use the opportunity presented by the fixed penalty system to encourage a clear distinction between committing a serious offence and committing a technical, or minor, offence. Unfortunately, the Government do not appear to have made the saving or reduced the complication.
      It is noticeable that both of the major motoring organisations, the Royal Automobile Club and the Automobile Association, are against the Government's proposals in this respect. To illustrate the attitude of the motoring organisations and my own point of view, there is no more typical offence than that of speeding. If a person drives along the motorway at 120 miles an hour, he is clearly a major danger to other road users and to himself. On the other hand, it is also commonly known that one can drive at 79 miles an hour along the motorway and probably escape prosecution simply because there is a margin offered to the offender who just exceeds the limit. But there is no doubt that the driver doing 79 miles an hour is speeding. However, the odds are that he is not causing any danger either to himself or other road users. Therefore, speeding is fairly obvious whether the offence is serious or a minor infraction of the law.
      Mr. Dudley Smith: I have been listening to my hon. Friend with a great deal of interest and I agree with him to a large extent. Clearly serious offences should be punished with severity. Although all of us from time to time unwittingly or through negligence have committed motoring offences, does my hon. Friend agree that there are many people who persistently break the law by committing what he calls small and technical offences and, as a result, are bad drivers and a menace to other people?
      Mr. Fry: I take that point. However, a number of offences that are considered to be endorsable do not, to my mind, fall into that category. I accept what my hon. Friend says about the person who habitually speeds. None the less, in other countries—the United States is an example—it is normal to get a ticket for exceeding the speed limit up to a certain level above the norm.
      5.30 pm
      Having said that, I go on to say that a person who perpetually breaks the law in a dangerous way is hardly likely to exceed the speed limit by just a few miles an hour. He will probably be the sort of driver who will exceed it by 20 or 30 miles an hour. In such cases he should be prosecuted, and I believe that the offence should be endorsable.
      822
      I want the Government to get the advantage of introducing a fixed penalty system, but I believe that they have unnecessarily complicated the issue. Secondly, I want to encourage motorists to keep and respect the law. I therefore believe that we must look at speeding as a two-tier conviction. Thirdly, the motoring organisations that speak for many millions of British motorists have given useful advice, and it is a great pity that the Government have not accepted their point of view.
      As the hon. Member for Westhoughton said, a policeman now has an alternative. He can either caution, as he does on certain occasions, or he can issue a fixed penalty. In addition, if there is any doubt, he can insist on a prosecution against the offending motorist. The fact that those three alternatives exist take care of the case where there is some doubt about whether the motorist has committed a less serious or more serious offence. If the policeman is in any doubt he can issue a notice of intended prosecution, in which case the courts can decide.
      I am in agreement with the Opposition amendments. The Government should explain why they have not accepted this common sense advice. If we have fixed penalties that insist on endorsement, there is the problem of levying the penalty points. There is the record-keeping associated with that and all the administration that is involved. Surely the practice in other countries should have given us some guidance.
      We should not forget one thing. British motorists are about the most law-abiding in the world. The accident rate on our roads is excellent compared with that in nearly every other major industrialised country. The British motorist is not a habitual law-breaker, yet the one area where there is friction between the police and the public is that covering traffic offences.
      The Government appear to have missed an opportunity to reduce at one fell swoop the time taken by the courts to deal with minor offences, by convincing the motorist that he will be heavily penalised if he commits a serious offence. On the other hand, using the fixed penalty system without an endorsement will ensure that police-public relations are not worsened. Frankly, many of the offences that are now listed as endorsable are not accepted as serious offences by the vast majority of motorists. I therefore ask my hon. Friend to be realistic about the real world and to think again about this part of the Bill.
      Mr. Barry Sheerman: I shall be brief in my support of the amendments. In doing so I agree not only with what was said by my hon. Friend the Member for Westhoughton (Mr. Stott) but with what was said by the hon. Member for Wellingborough (Mr. Fry).
      I believe that the Government have missed an opportunity. Transport legislation should aim to achieve quick and fair justice. If that is the case, many parts of the Bill do much to expedite matters and to establish a quick relationship between the punishment and the crime. Most people involved with safety and driving behaviour believe that that is of the essence. If the paying of the fine or penalty takes place as soon as possible after the committing of the misdemeanour, all the research that has been carried out in many countries shows that that is the best possible solution, because people than respond.
      Only yesterday, in our debate on wheel clamps, we heard how some sections of the law on driving and parking have fallen into disuse because there is no clear relationship between the misdemeanour or crime and the

      823
      penalty that is paid. If that attitude creeps into the behaviour that has been described by my hon. Friend, we shall be in danger of the law falling further into disrepute. I therefore believe that we must have a system that is fast and fair.
      We shall create a dangerous precedent if at the same time as introducing a fixed penalty system on a much broader scale we introduce a system which the motoring public regard as unfair. The provisions of the Bill are not bad when viewed in the long term. However, I should have liked a phasing in of the legislation so that in the first year or two, when motorists are learning about the fixed penalty system, the penalties do not result in a loss of licence.
      This is a major change. Many of us have underestimated the size of the change and the qualitative step that we are taking by introducing a much broader fixed penalty system. If we allow the motoring public two years to learn about the fixed penalty system, we can then assess in a fair and pragmatic way how the system has worked. We shall then be able to see more clearly whether there is a need to introduce fixed penalties into the system, from which penalty points and loss of licence flow.
      I cannot understand why the Government cannot adopt a much more tentative approach at this stage. After all, we must be realistic. It is unlikely that a transport Bill will be introduced each and every year.
      Mr. Booth: Not until we have a change of Government.
      Mr. Sheerman: My right hon. Friend is right. Even though many of us would like to see improvements in the law each year, we realise that a transport Bill will not be introduced each Session.
      Surely the drafting of this Bill can be amended so that the penalty points system can be phased in over, say, a two-year period. That would be similar to some of the provisions of the 1981 Act. I do not know why that is impossible. I hope that the Government will examine this again, bearing in mind what has been said about police-public relations, and will more seriously consider the views of the major motoring organisations.
      As someone who has served on two Standing Committees on transport Bills, I pay tribute to the motoring organisations. In a sense, Oppositions are more grateful to motoring organisations than Governments, because they do not have large armies of bureaucrats helping them with drafting and so on. The reputation of the two major motoring organisations in Britain is second to none. Although we may disagree with some of their actions, by and large they reflect the wishes and desires of the motorist. In the short time between the Bill going to another place and returning to this House, I hope that the Government will talk to the motoring organisations and have second thoughts on this aspect of the Bill.
      Mr. Alexander W. Lyon: I apologise for coming late to this debate, but I am concerned about the issue involved in the amendment. I subscribe to the general thesis behind the proposal in the Bill that, in so far as it is possible to extend the fixed penalty system, it could be done for a number of comparatively minor traffic offences. It seems to me that a fixed penalty would be appropriate for offences of the kind set out in the schedule.
      824
      However, what I find unacceptable is that, under the points system, those penalties can be the accumulator for disqualifying people from driving.
      Disqualification is the severest punishment that magistrates' courts can impose. It can create far more difficulties for an offender than a prison sentence. A prison sentence of, say, a month may disrupt his life and cause him to be socially ostracised, but disqualification can end his job and lead to a collapse of his living standards. In the present economic climate, perhaps he would not work again for a considerable time. I do not believe that totting up the number of endorsements imposed simply as traffic precaution measures, which fixed penalties would be, should be a prerequisite for cutting a man's standard of living.
      Therefore, I am opposed to the suggestion that fixed penalty endorsements should be used as part of the system of points regulation for disqualification. If the Government wish to continue to use these fixed penalty offences as part of the system of points regulation for disqualification, they should provide that after, say, three fixed penalty endorsements, there should not be any further fixed penalty endorsement and that any subsequent endorsements would be for other offences. The fixed endorsement principle would apply, say, only three times.
      If one looks at the offences that will be part of the fixed penalty endorsement system, it is not too much to say that none of them, even cumulatively, should count for disqualification. The offences that are suggested are a nuisance, but represent the kind of thing that any driver of any vehicle can do from time to time. They are not offences like dangerous driving, driving without insurance or driving under the influence of drink, which can be said to be criminal offences. They are the inevitable pattern for anyone who is on the road for a long period. Those who can say that they have not committed any of these offences are probably people who do not often drive.
      5.45 pm
      In those circumstances, it is right to say that it should not be possible for a fixed penalty endorsement for this kind of offence to be dealt with by disqualification. I am opposed to the Government's proposition. I favour the amendment.
      The Solicitor-General for Scotland: As the hon. Member for Westhoughton (Mr. Stott) said, there was considerable debate on this matter in Committee. I recognise that the division of opinion on what should be done has not necessarily followed party lines. My hon. Friend the Member for Wellingborough (Mr. Fry) has made clear in this debate and previously how he feels. It was suggested in Committee that endorsable offences should not attract penalty points if they were dealt with by the fixed penalty system. That proposal was not acceptable, but at least it maintained one of the principal objectives of the Bill that I had understood both sides of the House considered desirable—to reduce the considerable burden that road traffic offences impose on the police and the courts.
      We are now discussing a proposal that no endorsable offences should be included within the fixed penalty system. If that were to be followed, we would effectively demolish the objective of this part of the Bill. The estimate is that up to 600,000 cases a year could be taken out of the courts by the extension of the fixed penalty system. That

      825
      number would be so significantly reduced by this proposal as to make it hardly worth while, because about 500,000 cases would have to be dealt with by the courts.
      Mr. Fry: How many of the cases that come before the courts are for comparatively minor speeding offences? According to my information, the majority of cases are for speeding. If, therefore, only offences where the speed limit was exceeded by more than 15 miles an hour had to come to court, there would be a considerable saving.
      The Solicitor-General for Scotland: Two points are involved. The first concerns offences which are ordinarily dealt with following a plea of guilty and where there is no necessity for a court appearance. I shall come to that point. It is important to establish that the introduction of the fixed penalty system is not intended to devalue the seriousness of endorsable offences or their consequences. We are providing a simpler and more efficient method of dealing with many traffic offences that are currently processed through the courts.
      Of the endorsable offences, only the less serious ones are being included in the extended fixed penalty system. We are not proposing to include careless driving or any of the more serious offences. Except for the more serious breaches, with which only the courts will be able to deal appropriately, the net effect of committing an endorsable offence will be little different if it is dealt with by fixed penalty. The licence will still be endorsed with penalty points, although the fine may be slightly less and there will be no record of conviction. The endorsement will, of course, be a record of the offence itself.
      My hon. Friend the Member for Warwick and Leamington (Mr. Smith) made an important point. Although the degree by which the speed limit is exceeded—many hon. Members may on occasion have done just that—may be small, what is more important and what is, I believe, in the interests of public safety is that, if a motorist repetitively commits that offence, it would seem appropriate that the courts should have that in mind. If we know that a motorist has been driving in this way on a number of occasions, eventually he will have to pay a greater penalty.
      I have heard the worry that dealing with endorsable offences in this way, and not through the normal process, will lead to a diminution of respect for the law. If that were to be so, I should be concerned. However, I do not believe that that will be the case, particularly as in a substantial number of cases there is no personal appearance in court. For straightforward speeding and other endorsable offences—the type ideally suited to the fixed penalty treatment—a substantial proportion of offenders plead guilty by post. This does a great deal to save court time, but a large amount of court work is still necessary in such cases, which would be removed if the fixed penalty procedure were used.
      It must be remembered that the fixed penalty system is not being introduced exclusively, or as the only option. It will be one of three options. A constable will still have the discretion to caution or prosecute when there are serious breaches of the law. I know that much of the concern about the introduction of endorsable offences into a fixed penalty system originally centred around the need for the licence at the roadside. We have already dealt with that matter, which is not a particularly relevant problem over the
      826
      border. If that problem disappears, some of the anxieties about including endorsable offences in the fixed penalty system will also disappear.
      In all the circumstances, it seems to me that what is being provided is an additional option that gives the police greater flexibility. Concern was expressed that people m ho have had fixed penalties imposed on them may rind that the accumulator works against them, and that it might be undesirable to do all this within the fixed penalty system. It must be emphasised that the motorist is not obliged to accept the fixed penalty notice. If it is a matter that concerns him, and he wishes to go to court, there is nothing to stop him doing that, even with the fixed penalty system. It would be alarming if motorists believed that we were introducing this system to deprive them of the fundamental right, in the last resort, to go to court.
      There are two threads which, although they may not conflict, none the less are evidence of an unease, for different reasons, about what has been introduced. On one side, there is the argument that this will diminish the respect for the law, and reduce the seriousness of the offences involved. Another thread, which the RAC has been suggesting, is that we ought to be reducing the importance of such things as lesser speeding offences by taking them out of the penalty points system.
      I understand that that is what the RAC is suggesting in the latest briefing that it has sent to hon. Members. It appears that it is suggesting that, in the more serious speeding offence, it would be incumbent on the prosecution not only to establish the speed at which the motorist was going and the prevailing speed limit, but to point to some additional evidence of potential accident risks. In such circumstances, we should not be making a true distinction among the different effects of speeding at a particular degree above the limit but, in that category of dangerous or reckless driving, introducing yet a further category of offence in which speeding, of itself, is not necessarily a major part.
      Mr. Alexander W. Lyon: I agree that the proposal by the motoring organisation is misconceived, but does the Minister agree that speeding can be either a potentially dangerous activity or not, depending on the circumstances? It may not be simply a question of degree. The speed of 30 miles an hour could be dangerous in a particular place, yet 100 miles an hour on a motorway might not be dangerous in any circumstances.
      In that respect, would it not be better for us to reconsider the whole realm of speeding and whether we should make it, as it has been in this case, simply subject to a fixed penalty? If the driving is thought to be dangerous or reckless, charges should follow, which would deal with the serious danger that is occasionally caused by speeding.
      The Solicitor-General for Scotland: I follow the hon. Gentleman's point, but as I understand the position—this is the case north of the border on which I can speak—if someone was doing 120 miles an hour in a 30 miles per hour limit close to a school, he would not expect to be prosecuted only for breaking a speed limit. He would be charged with the more aggravated offence of careless driving. I understand the argument and realise that it is appropriate to look to the circumstances of the driving, such as the condition of the road, not just the speed.
      With regard simply to speeding offences, we are allowing in the Bill a simple and necessary flexibility, with

      827
      three options. First, if the offence is minor, all that the constable needs to do is give a caution or warning. Secondly, if the offence is more excessive, the fixed penalty would be more appropriate. Thirdly, if it is significant and serious but does not involve one of the other driving offences it is still open to the police to take the case to the courts. That flexibility is desirable.
      By deleting all of schedules 1 and 2, these amendments would have an odd effect. I doubt whether the hon. Member for Westhoughton intended that. It would mean that when we introduce the new system we should have to seek parliamentary approval, by the affirmative resolution procedure, for the use of fixed penalties for offences, such as parking offences, that have already been in the fixed penalty system for many years. I think that the hon. Member for Westhoughton accepts that that is an appropriate system to deal with such offences. Rather than adding to the list of fixed penalties, we should have to seek further approval for those that we already have. We should be moving backwards rather than forwards.
      I appreciate the concern expressed by my hon. Friend the Member for Wellingborough on this matter. However, as this system allows for flexibility, if we were to exclude all the offences that were endorsable, all that we have sought to do in this part of the Bill would effectively be worthless, because so many offences would be left before the courts. For those reasons, I am not inclined to recommend that these amendments should be accepted.
      Mr. Stott: I join my hon. Friend the Member for Huddersfield, East (Mr. Sheerman) in his tribute to the motoring organisations. Throughout the proceedings on the Bill, on Second Reading, on Report and in Committee, we have been greatly assisted by the Royal Automobile Club and the Automobile Association in formulating our amendments and our view of the Bill. I pay tribute to them because they co-operate fully with all hon. Members.
      6 pm
      We have had an interesting short debate. Good contributions have been made by the hon. Member for Wellingborough (Mr. Fry) and by my hon. Friends the Members for Huddersfield, East (Mr. Sheerman) and York (Mr. Lyon), all of whom, like me, feel that endorsable offences on principle ought not to be included in the fixed penalty net. It is clear from what the Solicitor-General for Scotland said that the Government have no intention of withdrawing that provision because they believe that it will assist in taking out of the courts many of the offences that are taken to court at present.
      I still remain opposed to the principle. I speak only for myself from the Dispatch Box, not for my party, because this is not a party issue, but an issue that concerns the House generally. Therefore, I must say that I still oppose the principle because I do not wish to see those offences given the status of a conviction, which I fear may happen.
      The Solicitor-General seemed to try to mollify me by saying that the problems envisaged in Committee in respect of the licence had been removed, so the major plank of our objections was removed. That is a useful step. I am pleased that the Government have taken our advice, but our fundamental objection to the principle enunciated in the Bill has not been removed. While I recognise that many Conservative and Opposition Members may support
      828
      the hon. Gentleman, a number of us, including hon. Members who have spoken this afternoon, still oppose that principle.
      I am keenly aware that I might attract the wrath of the House if I were to force a Division, but I shall restrain my natural inclination only because I believe that their Lordships will have taken note of what we have said in Committee and in the Chamber. I am sure that when the Bill goes to another place, their Lordships may be able to persuade the Government to remove endorsable offences from the provisions of the Bill because many hon. Members do not believe that they should have been included.
      Mr. Deputy Speaker: The Question is, That the amendment be made. As many as are of that opinion say "Aye". Those of the contrary opinion say "No".
      Hon. Members: No.
      Mr. Deputy Speaker: The "Noes" have it.
      Amendment negatived.
      Mr. Alexander W. Lyon: On a point of order, Mr. Deputy Speaker. When you put the Question a moment ago, I said "Aye". I may not have said it loudly enough, but I said it. In those circumstances, is it right that the Division should not have taken place?
      Mr. Deputy Speaker: I put the Question clearly. I did not hear any "Ayes". I said: "The 'Noes' have it". There were still no "Ayes" in my hearing. When I moved on, the complaint was made. I was sure in my own mind that the "Noes" had it.
      Mr. Fry: On a point of order, Mr. Deputy Speaker. I was sitting next to the hon. Member for York (Mr. Lyon) and I distinctly heard him say "Aye". I imagined that the Division would take place.
      Mr. Deputy Speaker: I did not hear that. I waited and still did not hear any "Ayes". I heard the "Noes", so the amendment was defeated.
      Amendment made: No. 35, in page 27, line 12, at end insert—
      '(8A) In this Part of this Act, "fixed penalty notice" means a notice offering the opportunity of the discharge of any liability to conviction of the offence to which the relates by payment of a fixed penalty in accordance with this Part of this Act. '—[The Solicitor-General for Scotland.]

    Clause 27

      FURTHER PROVISIONS WITH RESPECT TO FIXED PENALTY OFFENCES AND NOTICES
      Amendment made: No. 36, in page 27, line 22, at beginning insert
      `Proceedings shall not be brought against any person for the offence to which a fixed penalty notice relates until the end of the period of twenty-one days following the date of the notice or such longer period (if any) as may be specified in the notice (referred to below in this Part of this Act as the suspended enforcement period in respect of the offence).
      (1A).'.—[The Solicitor-General for Scotland.]
      The Solicitor-General for Scotland: I beg to move amendment No. 37, in page 27, line 26, leave out ' (including Schedules 1 and 2)'.
      Mr. Deputy Speaker: With this it will be convenient to take amendment No. 57.
      The Solicitor-General for Scotland: This amendment has been coupled with amendment No. 57. Hon. Members may observe that my remarks will also be relevant to amendment No. 58.
      These minor amendments do no more than seek to make the Bill easier to understand. Schedule 2 is not introduced until clause 39 and it therefore seems inappropriate to refer to it in clause 27, before the reader knows that it has anything to say about fixed penalties. However, in order to retain the meaning of the existing reference to schedules 1 and 2 in clause 27, we need to say that references to this part of the Act include the schedules introduced by it.
      Amendment agreed to.
      Mr. Stott: I beg to move amendment No. 39, in page 28, line 17, at end insert
      `( ) Chief officers of police shall operate the provisions of this Part of this Act on the same basis and in respect of the same fixed penalty offences in accordance with written advice from the Secretary of State for the Home Office and the Secretary of State for Scotland.'.
      We debated this issue in Committee. We did not get much satisfaction from the Under-Secretary of State.
      The Solicitor-General for Scotland: The hon. Gentleman will get less from me.
      Mr. Stott: Perhaps, if the Solicitor-General listens to my remarks, he will moderate his view.
      We debated the uniform application of the fixed penalty system. Under the Bill a constable or the procurator fiscal in Scotland may issue a fixed penalty notice. It seems that the availability of the fixed penalty system as an alternative to prosecution will remain a policy decision for individual police forces rather than be nationally implemented on a uniform basis.
      That will perpetuate the present unsatisfactory and confusing situation whereby in different areas of the country the fixed penalty is used to a differing extent for different offences. Under the terms of the Bill over 30 more offences will qualify for fixed penalty treatment in Scotland compared with the rest of the United Kingdom. It is inequitable that a decision whether to prosecute or issue a fixed penalty should depend upon where the offence took place rather than on the nature of the offence.
      A first step in simplifying motoring offence procedure would be that the fixed penalty system should be available on the same basis throughout Great Britain for the same offence. The Solicitor-General may recall that in Committee I gave some examples of the wide discrepancy among the police forces of Essex, Suffolk and Kent in respect of certain fixed penalty provisions. Chief constables do not apply the fixed penalty procedure uniformly. The amendment provides that some uniformity would be a good thing in new legislation.
      It appeared that the Government were sympathetic when the Under-Secretary of State for Transport wound up the debate in Committee. I prayed in aid in defence of the amendments the recommendations of the report of the inter-departmental working party on road traffic law. Paragraph 50 says:
      "We have acknowledged the reasons put forward by Chief Officers of police for the unevenness of the application of the existing fixed-penalty system. The resource argument in that connection would have little if no relevance to offences under the extended system since it is designed to reduce the work of the police in preparing and undertaking prosecutions and we therefore consider that there should be uniformity in practice."
      830
      The acceptance of the amendment would make the extension of the fixed penalty provisions uniform throughout the United Kingdom, as they should be.
      The Solicitor-General for Scotland: We had a considerable debate on this matter in Committee. I do not quite know what the words "on the same basis" mean. I understand the amendment to mean that there should be uniformity of practice in the conduct of the fixed penalty system both in terms of procedure and offences dealt with. It is hoped to achieve that uniformity by circulars to the police.
      The Government's reservations are essentially the same as they were about the amendment that was debated in Committee. I thought that it was accepted that it would not be right to seek to impose complete uniformity of procedure on the police and unrealistic to suppose that all forces could deal in the same way with all possible offences. The Committee was aware that the interdepartmental working party on road traffic law had recommended that the system should be operated uniformly. The Association of Chief Police Officers has accepted that recommendation in principle. It is accepted that uniformity should be our goal but it may have to be achieved gradually rather than instantly. The hon. Member for Westhoughton (Mr. Stott) withdrew his amendment in Committee on the basis that he accepted the assurance of my hon. Friend the Under-Secretary of State for Transport that the fixed penalty system would be operated as uniformly as possible. It is with some surprise that we find a further amendment on the Notice Paper.
      The hon. Gentleman may feel that there is a distinction between imposing uniformity by statute and advising it by circular. The drafting of the amendment does not make such a distinction. It provides for circulars to be issued giving advice and the police would be under a statutory obligation to comply. That is quite contrary to normal practice, where advice to chief constables has no statutory force although it is issued in the expectation that it will be fo—llowed. It would be unusual for a statute to provide that Ministers should not only offer guidance but also stipulate the contents of the advice. The amendment is similar to a provision for regulation-making powers. Ministers frequently give undertakings as to the advice they will offer but not on the face of the Bill.
      Technically, it is not conventional to refer to the particular Secretary of State. I cannot accept the amendment and commend it to the House. The most that it would be appropriate for me to do would be to undertake to explore with my right hon. Friend the Home Secretary and my right hon. Friend the Secretary of State for Scotland the possibility of guidance being issued to the police to the effect that consistency of practice is desirable if possible. Since the Association of Chief Police Officers has already agreed to that approach, it might be thought that such advice would be superfluous. The Government do not object to the principle of uniformity.
      6.15 pm
      Mr. Peter Griffiths: I have a sense of deja vu since the same people have said much the same thing in Committee. To be consistent, I should like to say that we should not regard uniformity as something to be universally sought. There may be circumstances in which the application of the provisions within a particular

      831
      police area may be considered by the chief constable to be necessarily operated in a way that is not entirely consistent with that operated in other police areas.
      Certain areas of the country are affected by motoring offences at particular times of the year—Christmas or the New Year—when chief constables may wish to carry out particular schemes designed to discourage motorists from committing road offences by telling them in advance that there will be a blitz on that type of offence. Anything which inhibited a chief constable from carrying out such a scheme because it did not conform with the way the fixed penalty system was being operated elsewhere would be most undesirable. This amendment is an interference in chief constables' operational decisions. It was wrong when it was suggested in Committee and it is even worse that it should be included in the Bill.
      Mr. Stott: The hon. Member for Portsmouth, North (Mr. Griffiths) made exactly the same points in Committee. My response, now as then, is that, although I understand the resource argument, I believe that the amendments we tabled then and now are valid to try to make the Government ensure that the fixed penalty scheme is applied on a uniform basis. It may be that we did not table it correctly but we intended to ensure that the Government were apprised of our feelings.
      The Solicitor-General for Scotland asked me why I withdrew the amendment in Committee. As the hon. Gentleman well knows, I am famous for being able to facilitate progress in debate. That is one reason why I withdrew the amendment.
      I was pleased to hear the Solicitor-General for Scotland say that the Government will issue guidance to chief constables on the new provisions within the Bill. If uniformity cannot be written into the statute, guidance to chief constables will be most welcome. The motoring public will feel that it is unfair if one area of the United Kingdom issues more fixed penalty notices than another merely because the chief constable considers them to be especially important in the first area. That will cause confusion in the minds of the motoring public.
      The Solicitor-General for Scotland: I did not say that the Government undertook to issue guidance to chief constables. I said that my right hon. Friends the Secretaries of State for Transport and for Scotland will consider the possibility of issuing that guidance and that that will now be explored.
      Mr. Stott: I am grateful to the hon. Gentleman. I hope that when the Secretary of State for Scotland and other Ministers have considered that possibility they will see fit to give guidance. It is important that it is given. With that in mind, I beg to ask leave to withdraw the amendment.
      Amendment, by leave, withdrawn.

    Clause 28

      EFFECT WHERE FIXED PENALTY NOTICE IS GIVEN TO THE ALLEGED OFFENDER
      Amendment made: No. 40, in page 28, line 20, after '26(1)', insert
      'or [Fixed penalty notices given at a police station] (2)'.—[Mr. David Howell.]

    Clause 32

      ENDORSEMENT OF LICENCES WITHOUT HEARINGS
      Amendments made: No. 42, in page 33, line 13, after '26(1)' insert
      'or [Fixed penalty notices given at a police station] (2)'.
      No. 41, in page 33, line 24, after '26' insert
      'or [Fixed penalty notices given at a police station]'—[Mr. David Howell.]

    Clause 33

      LICENCE RECEIPTS
      Amendment made: No. 43, in page 35, line 3, after '26(1)' insert
      'or [Fixed penalty notices given at a police station] (2)'.—[Mr. David Howell.]

    Clause 35

      REGISTRATION AND ENDORSEMENT INVALID IN CERTAIN CIRCUMSTANCES
      Mr. Eyre: I beg to move amendment No. 44, in page 38, leave out lines 6 to 9.
      Mr. Deputy Speaker (Mr. Bernard Weatherill): With this it will be convenient to take Government amendments Nos. 45 to 47.
      Mr. Eyre: The amendments remove an anomaly in clause 35, which deals with the statutory declaration. As the clause stands, if a person makes a statutory declaration under subsection (2)(b) to the effect that a hearing had been requested in respect of the fixed penalty offence in question, the registration of the fine and any proceedings to enforce it are void. However, that person's licence may already have been endorsed. The clause, as drafted, has no provision for cancelling that endorsement. The amendments put right that anomaly.
      Amendment agreed to.
      Amendments made: No. 45, in page 38, line 11, leave out 'and'.
      No. 46, in page 38, line 13, after 'registered', insert
      'and any endorsement, in respect of the offence in respect of which the relevant fixed penalty notice was given, made under section 32 of this Act before the declaration was served'.
      No. 47, in page 38, line 17, at end insert—
      '(6A) It shall be the duty of the clerk of the relevant court to cancel an endorsement of a licence under section 32 of this Act that is void by virtue of subsection (5) or (6)(a) above on production of the licence to him for that purpose, and to send notice of the cancellation to the Secretary of State.'—[Mr. David Howell.]

    Clause 36

      NOTIFICATION OF COURT AND DATE OF TRIAL
      Amendment made: No. 48, in page 40, line 21, after '26(1)'
      'or [Fixed penalty notices given at a police station] (2)'—[Mr. David Howell.]

    Clause 38

      PROVISION FOR EXCLUSION OF FIXED PENALTY PROCEDURES WHERE FIXED PENALTY NOTICE MISTAKENLY GIVEN
      Amendment made: No. 49, in page 41, line 37, after '26(1)' insert
      'or [Fixed penalty notices given at a police station] (2)'.—[Mr.David Howell.]

    Clause 44

      EVIDENCE IN FIXED PENALTY NOTICE CASES
      Amendments made: No. 51, in page 48 line 34, after 'notice' insert
      'or a notice under section [Fixed penalty notices given at a police station] (1) of this Act'.
      No. 52, in page 48, line 37, leave out 'fixed penalty'.
      No. 53, in page 49, line 30, leave out from 'the' to end of line 33 and insert
      'relevant date.
      In paragraph (b) of this subsection, "relevant date" means—

      (i) where the accused gives notice requesting a hearing in respect of the offence in accordance with any provision of this Part of this Act, the date on which he gives that notice; and

      (ii) where a notice in respect of the offence was given to the accused under section [Fixed penalty notices given at a police station] (1) of this Act but no fixed penalty notice is given in respect of it, the last day for production of the first-mentioned notice at a police station in accordance with that section.'.—[Mr. David Howell.]

    Clause 47

      SUPPLEMENTARY PROVISIONS
      Amendments made: No. 54, in page 50, line 40, after '26' insert
      '[Fixed penalty notices given at a police station]'
      No. 55, in page 52, line 34, at end insert
      'or in respect of which a notice has been given under section [Fixed penalty notices given at a police station] (1) of this Act'—[Mr. David Howell.]

    Clause 48

      INTERPRETATION OF PART III
      Mr. Eyre: I beg to move amendment No. 56, in page 53, line 27, after 'constable', insert
      'or, as the case may be, to a constable in uniform'.
      In Committee it was accepted that the Bill should make clear that a constable must be in uniform when he issues a fixed penalty notice. This technical amendment is consequential to that. It maintains consistency by ensuring that references to a constable in uniform, as well as to a constable, are to include a traffic warden for the purposes authorised.
      Amendment agreed to.
      Amendment made: No. 57, in page 53, line 31, at end insert—
      '(4A) Subject to any express exception, references in this Part of this Act to this Part of this Act include Schedules 1 to 3. '.—[Mr. Eyre.]
      The Solicitor-General for Scotland: I beg to move amendment No. 58, in page 53, line 34, after 'this' insert 'Part of this'.
      834
      When I was speaking to amendments Nos. 37 and 57 I said that this amendment naturally fell with them. It is a technical amendment that relates to amendments Nos.37 and 57.
      Amendment agreed to.
      Amendments made: No. 59, in page 53, line 39, leave out '(1)' and insert '(8A)'.
      No. 60, in page 54, line 10, leave out ' 26(5)' and insert '27(1)'.—[Mr. David Howell.]

    Clause 49
      CONTROL OF OPERATION OF GOODS VEHICLES ON ENVIRONMENTAL GROUNDS
      Amendment made: No. 61, in page 54, line 16, leave out clause 49.—[Mr. David Howell.]
    Clause 54

      REGULATIONS AND ORDERS
      Mr. Robert Hughes: I beg to move amendment No. 62, in page 57, line 35, after '(2)', insert
      'subject to subsection (2A) below'.
      Mr. Deputy Speaker: With this, it will be convenient to discuss amendment No. 63, in page 57, line 38, at end insert—
      (2A) The Secretary of State shall not make any orders under section 27(1) of this Act unless a draft thereof has been approved by both Houses of Parliament.'.
      Mr. Hughes: This is a reference back to clause 27(1), which gives the Secretary of State power to create new fixed penalty offences or to remove certain fixed penalty offences from that category. We had a considerable debate in Committee on a wider issue about whether the orders should be by affirmative or negative procedure. I do not want to repeat that argument in full.
      It is interesting to note that if the Secretary of State wishes to extend the functions of traffic wardens under the 1967 Act, he has to proceed by affirmative order. We believe that moving offences into or out of the fixed penalty system should be done with some consistency and that consistency should be taken into account.
      There are difficulties with the negative procedure, the most obvious one being lack of time. The House NA ill recall that during 1971–72 a Joint Committee of both Houses considered delegated legislation. I shall not go through the report, but there was considerable criticism about a number of prayers that were not taken. There have been changes since then and it is now possible to consider statutory instruments in Committee. But that is no guarantee that a matter will be debated in time.
      The Department is open to criticism on this score. My attention has been drawn to the occasion when the hon. Member for Flint, West (Sir A. Meyer) prayed against an order dealing with right-hand sidecars on motor cycles. In Committee, the Government were defeated, but the then Under-Secretary of State, the hon. and learned Member for Rushcliffe (Mr. Clarke), who is now the Minister for Health, refused to accept the decision of the Committee on the ground that the debate had taken place one day out of time. When a Department cannot arrange to take matters in time, it does not inspire us with confidence in the negative procedure. It is even worse than that, because the then Secretary of State declined to take the matter on

      835
      the Floor of the House so that the view of the House might be taken. That does not inspire confidence in the negative procedure.
      In Committee, we debated penalties as well as offences. It was a two-pronged debate. The Under-Secretary of State, the hon. Member for Wallasey (Mrs. Chalker), said that she was open to further enticement. The hon. Lady is not on the Government Front Bench to be enticed. We understand why she is not present and we make no complaint about her absence. I hoped that, following the end of our deliberations in Committee, the hon. Lady had been able to persuade the Secretary of State to accept the amendment. I await the Under-Secretary of State's reply with confidence.
      Mr. Eyre: I regret that the hon. Member for Aberdeen, North (Mr. Hughes) will be disappointed with my reply. He was right to say that this issue was discussed at some length in Committee. The question whether such orders should be subject to the affirmative resolution procedure was considered fully. I do not share the hon. Gentleman's concern about the negative resolution procedure that we are proposing for the order to remove from or to add to the list of fixed penalty offences. Hon. Members need not be worried that we shall want to start including serious offences, such as drinking and driving, in the fixed penalty offences. Any offence which involves the possibility of disqualification could not be included because of the need for a court hearing. However, experience of the system may show that some offences should be taken out or that others should be included.
      6.30 pm
      Things do change. New offences may be created which may subsequently be thought suitable for fixed penalty treatment. In some circumstances the procedure advocated is appropriate, but it is time-consuming and by no means simple. It is not warranted for the type of order that we envisage. This is a matter of judgment.
      There are other considerations. There is no advantage in including an offence if the fixed penalty procedure is not suitable for it. The motorist would probably object and not accept a fixed penalty notice, and the police, too, would not take advantage of the benefits offered by the system.
      My right hon. Friend the Secretary of State has given the matter much thought since it was discussed in Committee. He remains of the view that what we propose is adequate and proper. Therefore, I ask the House to join me, if necessary, in resisting the amendment. However, I hope that, in the light of my explanation, the hon. Gentleman will withdraw the amendment.
      Mr. Robert Hughes: I regret that the Minister regrets that he cannot accept the amendment. I would have been happier if he had come to the Dispatch Box and explained that, although the matter arose before he went to the Department of Transport, he could give an absolute assurance that the Government, in the form of the Secretary of State for Transport, would ensure that prayers were not delayed beyond the time that they were due to be debated. That would have been a great reassurance, but the Minister has not said that.
      The Minister put forward a fallacious argument about convenience. What is convenient for the Government is
      836
      not important, but what is convenient for the House is. It is true that the negative procedure is more convenient for the Government because, once the orders are laid, they lie there unless someone takes action against them. I did not suggest that the Government would act irresponsibly by taking things out or putting them in, but it would be perfectly proper for the Government to use the affirmative procedure. That would mean that they must find time for debate and that the changes could not be effected until the debate had taken place.
      This is a House of Commons matter. I do not wish to delay the House any longer. I am prepared to give way if the Government will give an assurance that they will play the game on the negative procedure. I shall be delighted if the Minister springs to his feet—it rather worries me that he does not—and says that the events which I have described will not happen again.
      Mr. Eyre: Any procedural mishap would be regretted. I have listened to what the hon. Gentleman has said. I do not know enough about the facts of the matter, but I assure him that the Government would want to avoid the repetition of such a procedural mishap.
      Mr. Hughes: Since we appear to be in a friendly mood today, I will go so far as to accept that there was a mishap on the previous occasion, but I have some suspicion that it was not. In view of the assurances that I have finally managed to wring out of the Minister, I beg to ask leave to withdraw the amendment.
      Amendment, by leave, withdrawn.

    Clause 55

      MINOR AND CONSEQUENTIAL AMENDMENTS AND REPEALS
      Amendment made: No. 64, in page 58, line 7, at end insert—
      `but the repeal in the Heavy Commercial Vehicles (Controls and Regulations) Act 1973 is subject to the saving in section (Definition of heavy commercial vehicle) (3) of this Act.'.—[Mr. Eyre.]

    Clause 57

      CITATION, COMMENCEMENT AND EXTENT
      Amendment made: No. 66, in page 58, line 22, at beginning insert—
      `Sections (Immobilisation of vehicles illegally parked, etc.) and (Definition of heavy commercial vehicle) of this Act and'.—[Mr. Eyre.]

    Schedule 1

      FIXED PENALTY OFFENCES
      Mr. Eyre: I beg to move amendment No. 68, in page 61, line 7, column 2, at end insert
      `except an offence in respect of a moving motor vehicle'.
      Mr. Deputy Speaker: With this, it will be convenient to take amendment No. 69.
      Mr. Eyre: These amendments are in response to the Opposition's concern that these two offences were not suitable for fixed penalty treatment. Their proposal would have removed all pedestrian crossing offences from the

      837
      fixed penalty system. We do not feel that is justified.—Schedule 5 Therefore, the amendment is confined to excluding offences
      "in respect of a moving motor vehicle."
      There are many instances where fixed penalty treatment would be appropriate for minor breaches of the pedestrian crossing regulations, especially those involving stationary vehicles. It would be absurd if each of those had to be dealt with in court when one of the main objectives of the new system is to relieve the courts of road traffic cases. However, I am prepared to accept that offences in respect of moving vehicles may be more serious. It must be remembered that the fixed penalty procedure is only an option for a constable who retains the discretion to prosecute for serious breaches of a regulation.
      There is no intention to devalue the seriousness of any offence by making it eligible for fixed penalty treatment. Nevertheless, in view of the concern expressed, we have decided that breaches of pedestrian crossing regulations in respect of a moving motor vehicle should not be included in the extended fixed penalty system.
      We have also decided that the offence of disregarding a school crossing patrol may not be ideally suited to the fixed penalty treatment in all cases. In view of the fact that the number of cases that would stay within the court process is relatively small—about 650 convictions in 1980—and in view of the concern expressed, which to an extent I share, we have decided that these offences, too, should not be part of the fixed penalty system.
      Mr. Stott: On behalf of my right hon. and hon. Friends, I thank the Minister for bringing forward the two amendments.
      Amendment No. 68 is a sensible amendment with regard to pedestrian crossings. I understand the Minister's point about the moving traffic offence. That is important.
      The Committee was appalled that a provision should be included in the Bill whereby a fixed penalty notice could be given to a motorist who clearly ignored a school crossing patrol. That could not be right. I am grateful that he has taken notice of the view expressed on both sides in Committee.
      Mr. Sheerman: This is a useful concession. It is an example of some light being shed rather than just heat being generated in Committee. Once the Committee recognised the division between those offences and the number of prosecutions for moving and stationary vehicles, the need for the amendment became clear. I thank the Government for making that change.
      Amendment agreed to.
      Amendment made: No. 69, in page 61, leave out lines 9 and 10.—[Mr. Eyre.]

    Schedule 4
      AMENDMENTS OF TRANSPORT ACT 1968 RELATING TO OPERATOR'S LICENCES
      Amendment made: No. 72, in page 70, leave out from beginning of line 1 to end of line 9 on page 76.—[Mr. Eyre.]
    Schedule 5

      MINOR AND CONSEQUENTIAL AMENDMENTS
      Mr. Eyre: I beg to move amendment No. 73, in page 77, line 35, after 'in', insert 'any provision of.
      This is a minor technical amendment which makes no difference to the substance of schedule 5. It simply improves the drafting. It amends the definition of "authorised inspector" which paragraph 9(4) of that schedule inserts into the Road Traffic Act 1972.
      Amendment agreed to.
      Mr. Eyre: I beg to move amendment No. 74, in page 78, line 27, leave out from—driver"' to "`alleged"' in line 28 and insert
      `for the word "was" there shall be substituted the word "is",.
      This is a technical amendment that alters the amended definition of "driver" in section 5 of the Road Traffic Act 1974. The use of "is" rather than "was" is more appropriate to convey the feeling that the allegation can be a continuing one and consistency with the wording of clause 29(3) is maintained.
      Amendment agreed to.
      Mr. Eyre: I beg to move amendment No.75, in page 79, line 21, leave out first 'and' and insert `to'.
      This amendment merely corrects an error of drafting.
      Amendment agreed to.
      Amendment made: No. 76, in page 79, line 40, leave out from beginning to end of line 42 and insert—
      'In section 9 of the Public Passenger Vehicles Act 1981 (power to prohibit driving of unfit public service vehicles)—(a) in subsection (5), for the words from "the driver" to "public" there shall be substituted the words "any person"; and (b) the following subsection shall be added at the end—'—[Mr. Eyre.]
      Mr. Eyre: I beg to move amendment No.77, in page 79, line 44, at end insert—
      `16A. In section 52(1)(a) of that Act (fees for grant of licence), for sub-paragraph (ii) there shall be substituted the following subparagraph—"(ii) applications for certificates of initial fitness under section 6 of this Act which are required by regulations to be made to the commissioners and the issue of certificates on such applications;"'.
      The purpose of this minor amendment is to ensure that if the initial certification of public service vehicles is undertaken by an authorised body in the private sector, applications and fees for the certification work will go to the authority that does it and not, as at present, to the traffic commissioners. The amendment does not contain any specific reference to the payment of fees to a private sector testing authority, but it makes it clear that the destination of applications and fees can be determines in regulations under the Public Passenger Vehicles Act 1931. That leaves it open for regulations to specify that fees shall be paid to the prescribed authority.
      Amendment agreed to.
      Amendment made:
      No. 78, in page 80, line 1, leave out 'the 1981' and insert `that'.—[Mr. Eyre.]

    Schedule 6

      REPEALS
      Amendments made:
      No. 79, in page 80, line 21, column 3, leave out `Section 68(4)(a)' and insert—
      'In section 63, in subsection (1) the words "Subject to subsection (2) of this section" and subsection (2).

      839
      In section 64(2), in paragraph (d) the words from "and that the place" to the end of the paragraph and in paragraph (e) the words "and of a suitable operating centre".
      Section 68(4)(a).'.
      No. 80, in page 80, line 37, at end insert—
      `1973 c. 44
      Heavy Commercial Vehicles (Controls and Regulations) Act 1973.
      Section 1(7). '.
      No. 81, in page 81, line 34, column 3, at end insert—'In Schedule 4, paragraph 2(b) and (c).'.—[Mr. Eyre.]
      Mr. Eyre: I beg to move amendment No. 82, in page 81, line 44, column 3, leave out 'paragraph 3' and insert `paragraphs 3 and 5'.
      This is a minor consequential amendment completing the repeals that must be made of parts of schedule 3 to the Transport Act 1978.
      Amendment agreed to.
      Amendment made:
      No. 83, in page 81, line 50, after '7', insert 'paragraph 13 and'.—[Mr. Eyre.]
      No. 84:

    New Schedule
      `AMENDMENTS OF TRANSPORT ACT 1968 RELATING TO OPERATORS' LICENCES

        PROVISIONS INSERTED AFTER SECTION 69 OF TRANSPORT ACT 1968
        Control of operating centres for goods vehicles on environmental grounds
        Operating centres for authorised vehicles to be specified in operators' licences
        69A.—(1) A person may not use a place in the area of any licensing authority as an operating centre for authorised vehicles under any operator's licence granted to him by that authority unless it is specified in that licence.
        (2) A person applying for an operator's licence shall give to the licensing authority a statement giving such particulars as the authority may require of each place in the area of the authority which will be an operating centre of the applicant if the licence is granted.
        (3) Without prejudice to section 62(4) of this Act, a person applying for an operator's licence shall also, if he is required by the licensing authority so to do, give to him such particulars as he may require with respect to the use which the applicant proposes to make, for authorised vehicles under the licence, of any place referred to in the statement under subsection (2) of this section.
        (4) Any person who contravenes subsection (1) of this section shall be liable on summary conviction to a fine not exceeding £500.
        Objection to, and refusal or modification of, applications for operators' licences on environmental grounds
        69B.—(1) Any person entitled by virtue of section 63(3) of this Act to object to the grant of any application for an operator's licence on the ground there mentioned may also object to the grant of any such application on the ground that any place which, if the licence is granted, will be an operating centre of the holder of the licence is unsuitable on environmental grounds for use as such.
        (2) In the case of any such application, any person who is the owner or occupier of land in the vicinity of any place which, if the licence is granted, will be an operating centre of the holder of the licence may make representations against the grant of the application on the ground that that place in unsuitable on
        840
        environmental grounds for use as such, provided that any adverse effects on environmental conditions arising from that use would be capable of prejudicially affecting the use or enjoyment of the land.
        (3) Where any objection or representations are duly made under this section in respect of any application for an operator's licence, the licensing authority may in any case refuse the application on the ground that the parking of authorised vehicles under the licence at or in the vicinity of any place which, if the licence were granted, would be an operating centre of the holder of the licence would cause adverse effects on environmental conditions in the vicinity of that place.
        (4) Where any objection or representations are duly so made in respect of any such application, the licensing authority may refuse the application, subject to subsection (5) of this section, on the ground that any place which, if the licence were granted, would be an operating centre of the holder of the licence is unsuitable for use as such on environmental grounds other than the ground mentioned in subsection (3) of this section.
        (5) A licensing authority may not refuse an application for an operator's licence under subsection (4) of this section if the applicant satisfies the authority that the grant of the application will not result in any material change as regards—

        (a) the places in the area of the authority used or to be used as operating centres for authorised vehicles under any operator's licence previously granted by the authority or under the licence applied for; or

        (b) the use of any such place already in use as an operating centre under an existing licence so granted.

        (6) Without prejudice to the power of a licensing authority to issue an operator's licence subject to either or both of the modifications or limitations mentioned in section 64(4) of this Act, in any case where—

        (a) the authority has power to refuse an application for any such licence under subsection (3) or (4) of this section; and

        (b) any place other than a place unsuitable for use as an operating centre is referred to in the statement under section 69A(2) of this Act as a proposed operating centre of the applicant;
        the authority may, instead of refusing the application, issue the licence specifying in it only such place or places referred to in that statement as are not unsuitable for use as an operating centre.

        For the purposes of this subsection, a place referred to in any such statement given to a licensing authority by an applicant for an operator's licence is unsuitable for use as an operating centre if the licensing authority has power to refuse the application under subsection (3) or (4) of this section in consequence of the proposed use of that place as an operating centre.
        (7) A request for the grant of a licence under section 67(5) of this Act pending the determination of a current application shall not be treated as an application for an operator's licence for the purposes of this section, but in granting a licence under section 67(5) a licensing authority may specify in the licence such place or places referred to in the statement given to the authority by the applicant under section 69A(2) of this Act as the authority thinks fit.
        Conditions as to the use of operating centres
        69C.—(1) Subject to the following provisions of this section, a licensing authority may attach such conditions to an operator's licence as appear to him to be appropriate for the purpose of preventing or minimising any adverse effects on environmental conditions arising from the use for authorised vehicle under the licence of any operating centre of the holder of the licence in the area of the authority.
        (2) The conditions which may be attached to a licence under this section shall be of such description as may be prescribed; and, without prejudice to the generality of the preceding provision, the descriptions which may be prescribed include conditions regulating—

        (a) the number, type and size of motor vehicles or trailers which may at any one time be at any operating centre of the holder of the licence in the area of the authority for any prescribed purpose;

        (b) the parking arrangements to be provided at or in the vicinity of any such centre; and

        (c) the hours at which operations of any prescribed description may be carried on at any such centre.

        (3) Subject to subsection (4) of this section, the licensing authority by whom an operator's licence was granted may at any time vary or remove any condition attached to the licence under this section.
        (4) The power to attach a condition to an operator's licence under this section shall be exercisable by a licensing authority on granting the licence; and that power, and the power to vary or remove any condition so attached, shall also be exercisable in accordance with section 69D of this Act on an application by the holder for variation of the licence.
        (5) Any person who contravenes any condition attached under this section to a licence of which he is the holder shall be liable on summary conviction to a fine not exceeding £500.
        Variation of operators' licences with respect to operating centres and conditions affecting their use, etc.
        69D.—(1) Subject to section 69E of this Act, on the application of the holder of an operator's licence, the licensing authority by whom the licence was granted may at any time while it is in force vary the licence by directing—

        (a) that a new place shall be specified in the licence as an operating centre of the holder of the licence, or that any place so specified shall cease to be so specified; or

        (b) that any condition to the licence under section 69C of this Act shall be varied or removed.

        (2) A person applying for the variation of an operator's licence under this section shall give to the licensing authority such information as he may reasonably require for the discharge of his duties in relation to the application.
        (3) The licensing authority shall publish in the prescribed manner notice of any application for a variation under this section, unless the licensing authority is satisfied that the application is of so trivial a nature that it is not necessary that an opportunity should be given for objecting to it or making representations against it.
        (4) Any person entitled to object to the grant of any application for a variation of which notice has been published under section 68(4) of this Act may object to the grant of any application for a variation of which notice has been published under section 68(4) or under subsection (3) of this section on either of the following grounds, that is to say—

        (a) that any place which, if the application for variation is granted, will be an operating centre of the holder of the licence is unsuitable on environmental grounds for use as such; or

        (b) that the use in any manner which will be permitted if the application for variation is granted of any operating centre of the holder of the licence will have adverse effects on environmental conditions in the vicinity of that centre.

        (5) Subject to subsection (6) of this section, any person who is the owner or occupier of land in the vicinity of—

        (a) any place which, if the application for variation is granted, will be an operating centre of the holder of the licence; or

        (b) any existing operating centre of the holder of the licence to which the application relates;
        may make representations against the grant of any application for a variation of which notice has been published under section 68(4) of this Act or under subsection (3) of this section on either of the grounds mentioned in subsection (4) of this section, but so far only as relates to that place or operating centre.

        (6) A person may not by virtue of subsection (5) of this section make representations against the grant of an application for variation of an operator's licence unless any adverse effects arising from the use of the place or operating centre in question would be capable of prejudicially affecting the use or enjoyment of land there mentioned.
        (7) On any application for a variation of an operator's licence under this section the licensing authority may refuse the application in any case where it appears to him that the application ought to be refused on either of the grounds mentioned in subsection (4) of this section.
        (8) In any case in which the licensing authority grants an application for a variation of an operator's licence of which notice has been published under section 68(4) of this Act or under subsection (3) of this section, the licensing authority may direct that any condition attached to the licence under section 69C of this Act shall be varied or removed or that a condition shall be attached to the licence under that section.
        (9) If an applicant under this section so requests, the licensing authority may, pending the determination of the application, give
        842
        an interim direction under subsection (1) or (8) of this section, that is to say, a direction expressed to continue in force only until the application, and any appeal arising out of it, have been disposed of; and a request for such a direction shall not for the purposes of subsections (3) to (7) of this section be treated as an application for a variation under this section.

        Publication of notice of applications for licences and variations in localities affected
        69E.—(1) The licensing authority for any area shall refuse—

        (a) any application to the authority for an operator's licence; and

        (b) any application to the authority for the variation of an operator's licence of which notice has been published under section 68(4) or 69D(3) of this Act;
        without considering the merits of the application unless he is satisfied that notice of the application in such form and containing such information as may be prescribed has been published within the period mentioned in subsection (2) of this section in a local newspaper or newspapers circulating in each locality affected by the application.

        (2) The period referred to in subsection (1) of this section is the period beginning twenty-one days before the date on which the application is made and ending twenty-one days after that date.
        (3) For the purposes of this section a locality shall be taken to be affected by an application to a licensing authority for, or for the variation of, an operators's licence if it contains any place in the area of the authority which will be an operating centre of the holder of the licence if the application is granted, or (in the case of an application for variation) any existing operating centre of the holder of the licence to which the application relates.

        Revocation, etc. of operators' licences for breach of provisions controling use of operating centres
        69F.—(1) Subject to subsection (2) of this section, the licensing authority by whom an operator's licence was granted may direct that it be revoked, suspended, terminated on a (late earlier than that on which it would otherwise expire under section 67 of this Act, or curtailed on the ground that the holder of the licence has contravened section 69A of this Act or any condition attached to his licence under section 69C of this Act; and during any time of suspension the licence shall be of no effect.
        (2) Section 69 of this Act shall apply as if the power to give a direction under subsection (1) of this section and the ground there mentioned were respectively conferred by and mentioned in subsection (1) of that section.
        Provisions supplementary to sections 69A to 69F
        69G.—(1) Any objection or representations under section 69B or 69D of this Act shall contain particulars of any matters alleged by the person making the objection or representations to be relevant to the determination of the licensing authority to which the objections or representations relate; and the onus of proof of any matters so alleged shall lie on the person making the objection or representations.
        (2) any objection or representations under either of those sections with respect to any application for, or for the variation of, an operator's licence shall be made within the prescribed time and in the prescribed manner, which—

        (a) may differ for representations from that prescribed for objections; and

        (b) shall in either case be stated in the notice of the application published under section 63(1) of this Act or (as the case may be) under section 69D of this Act.

        (3) In making any of the following determinations, that is to say—

        (a) any determination with respect to the suitability of any place on environmental grounds for use as an operating centre for authorised vehicles under an operator's licence;

        (b) any determination with respect to attaching any condition under section 69C of this Act to an operator's licence or varying or removing any condition so attached;

        (c) any determination with respect to the effect on environmental conditions in any locality of the use in any particular manner of any operating centre of the holder of an operator's licence;
        the licensing authority shall have regard to such considerations as may be prescribed as relevant to determinations of that description.

        (4) In making any such determination for the purposes of exercising any of his powers under sections 69B to 69D of this

        843
        Act in relation to an application for, or for the variation of, an operator's licence, the licensing authority shall also have regard to—

        (a) any information supplied by the applicant in accordance with section 69A or 69D of this Act; and

        (b) any objections or representations duly made under section 69B or 69D.

        (5) Notice of an application for a variation of an operator's licence published under section 69D of this Act shall contain

        (a) an indication in the prescribed form to the effect that the grant of the application may only be opposed on either of the grounds mentioned in subsection (4) of that section;

        (b) a description of the persons entitled in accordance with that section to make an objection or representations against the grant of the application on either of those grounds; and

        (c) such other information as may be prescribed.

        (6) Any statement or information to be given to a licensing authority under section 69A or 69D of this Act shall be given in such form as the authority may require.
        (7) For the purposes of sections 69D(5)(b) and 69E(3) of this Act an application for a variation of an operator's licence shall be taken to relate to an operating centre of the holder of the licence if any condition attached to the licence which the application seeks to have varied or removed relates to that centre.

        PART II
        OTHER AMENDMENTS OF TRANSPORT ACT 1968
        '1. In section 63 of the Transport Act 1968 (objections to grant of operators' licences)—

        (a) in subsection (1) the words "Subject to subsection (2) of this section" shall be omitted;

        (b) subsection (2) shall be omitted; and

        (c) in subsection (3), for the words from "of which" to "this section" there shall be substituted the words "for an operator's licence".

        2. In section 64 of that Act (grounds for objection to application for a licence under section 63 and decision of licensing authority on applications)—

        (a) at the beginning of subsection (1) there shall be inserted the words "Subject to section 69E of this Act";

        (b) the words in paragraph (d) of subsection (2) from "and that the place" to the end of the paragraph, and the words "and of a suitable operating centre" in paragraph (e) of that subsection (which were in each case inserted by the Road Traffic Act 1974 and are superseded by the provisions set out in Part I of this Schedule) shall be omitted; and

        (c) in subsection (3), after the words "subsection (4) of this section" there shall be inserted the words "and section 69B of this Act".

        3. In section 68(4) of that Act (publication of notice of applications for variation of operators' licences)—

        (a) paragraph (a) shall be omitted; and

        (b) for the words "the said section 63" (where first occurring) there shall be substituted the words "section 63 of this Act".

        4. In section 70(1)(b) of that Act (right of appeal for persons aggrieved by certain directions or orders), after the words "69(1) to (7A)" there shall be inserted the words "or 69F(1)".
        5. At the end of section 92(3) of that Act (construction of references to directing that an operator's licence be curtailed), there shall be added the following paragraph—
        "(d) that any one or more of the places specified in the licence as operating centres be removed therefrom". '.—[Mr. Eyre.]
        Brought up, read the First and Second time, and added to the Bill.
        No. 85, in title, line 15, leave out 'the operation of' and insert 'operating centres for'.—[Mr. Eyre.]
        6.43 pm
        Motion made, and Question proposed, That the Bill be now read the Third time.—[Mr. David Howell.]
        Mr. Booth: I take it that the Secretary of State is simply formally moving the Third Reading.
        Mr. Deputy Speaker: That is what the Secretary of State did.
        Mr. Booth: It is understandable that the Secretary of State does not wish to deploy a case for the Third Reading of such a repugnant measure as this. I realise the reluctance of those who have laboured hard and long on any measure to see it killed or disappear. No matter what the results of one's handiwork, if that handiwork is embodied in the Bill one is reluctant to see it dispatched to the scrap heap, the dustbin or the wastepaper basket of legislative history. Nevertheless, it is my task tonight to commend the House to do precisely that with this measure.
        I commend the House to do so, first, because of the main provisions of clause 1, which are that a power shall be granted to the Secretary of State to instruct the National Bus Company to sell any of its subsidiaries or to so reorganise its assets as to form a subsidiary for the purpose of selling it.
        It is clear to anyone who examines the transport industry that few assets can be sold. There are many that one could not give away, to put it bluntly. However, there are a few profitable areas of operation, jewels that shine from the murky background of the operation—murky in the financial sense, not necessarily in the public service sense. Many operators strive hard to maintain a tradition of good public transport.
        Within the National Bus Company there are a few profitable organisations that were made profitable by much enterprise and effort by those who worked in the company and responded when the Government de-licensed express coaching. It is clear that in part I the Government wished to say "You have used our legislation to create a profitable area in transport. You cannot do that. You will be giving a good name to a public industry and to public transport. Anything that is public must be damned or made unprofitable and, therefore, we shall instruct you to sell it." That is our first objection to what the Government are doing. They have found another profitable area in the holiday agency operation.
        Apart from our difference of philosophy with the Government, we have a mechanical difference with them which we commend to the House. The ability of the NBC to succeed in this area where others have failed does not arise solely from the management expertise, the ability of the staff or the fact that it is a good operator. It arises because it is such a large organisation that it can integrate the provision of other services within its general duty to run the stage carriage services of Britain. As it has garages and booking offices all over the country, it is possible to slot into the framework of that massive organisation express coaching and holiday agencies and to derive a profit, which is currently used to support the non-profitable services such as the rural bus services and the off-peak urban services.
        Last night the Secretary of State urged the House to get the matter into perspective. I took that point carefully. He said that the company made a profit of only £5 million, although it has a large turnover. Which other organisation made £5 million last year running buses anywhere in Britain? That would be a desirable organisation, but I know of none. To make £5 million last year when the competition was cut-throat and when other firms went to the wall in trying to compete is no small achievement.
        That situation will not continue for long. There will be a swing of the pendulum in the other direction and the coach operators that survived the period of cut-throat competition will examine ways in which to put up their fares again so that they can have a larger income. That is

        845
        all the more reason why we should not attempt to break up that closely integrated operation. I question whether it can be done. It might be done by accountancy, but to remove from the NBC the drivers, buses, garages and offices and to say that those parts must be devoted only to express coach operations or holiday agencies is to make practical nonsense of the operation.
        If only £5 million is to be taken out, will the Secretary of State give us a guarantee that the £5 million will be handed to those authorities whose agreements with the NBC will lapse as a result of the NBC no longer being able to feed in that money by way of transport supplementary grant? If that is not the case, the public will once again be the loser.
        Before raising the Opposition's principal objections about HGV testing stations, I urge the Secretary of State to consider their possible size. I do so incase, despite our superb case against the Bill, the Government's argument may yet be carried.
        The right hon. Gentleman should carefully examine public service vehicle testing. When I talked to operators, I found that the development of testing facilities for public service vehicles on the operator's premises had almost been brought to a halt by Government action. There had been considerable expansion of the installation of such facilities in larger bus garages. The operators tell me that they are uncertain about being able to have coaches tested and about the charges that will be made as a result of the proposed changes.
        If the Secretary of State is to operate the Act, he must take steps to ensure that operators who have good test facilities are assured that they will be provided with authorised testers. There is no guarantee of that at the moment. They fear, with some justification, that some of the authorised testers will be the employees of their competitors for test facilities.
        The Secretary of State appears to disagree. I take the example of a bus operator who has spent a considerable sum of money installing equipment to carry out tests to the Ministry of Transport's requirements. He may have been able until now to rely on the Ministry to supply someone to test buses on his facilities at a fixed fee. The operator fears that he may in future be forced to go to a private HGV testing station to ask for someone to test his vehicles on his premises.
        The private tester will decide when he will make a man available and how much to charge, unless there is a uniform system of charges, without any account being taken of the fact that operators provide their own test facilities. That will be a major disincentive to the expansion of test facilities.
        I plead with the Secretary of State to bear in mind that the provision of such facilities has contributed greatly to the maintenace of bus standards. An operator with his own test facilities does not use them only when the tester arrives. He tests his vehicles first. He will not waste the time of the tester, who might find that the vehicle is not up to standard and the owner will then have to carry out the work. He will test his vehicles first and find the faults. He will carry out the work to prevent the faults from developing. This is done to maintain braking standards, for example. It is in the interests of road safety to encourage that development.
        The Opposition remain alarmed about the down-licensing rather than the down-plating approach of the Government. I hope that the Secretary of State will ensure that vehicle operators who claim the advantage of paying a lower licensing fee under the Finance Bill because they will run below their plated weights will be required to display a plate prominently. That will allow much more effective enforcement.
        846
        In spite of varying cross-party opinions on part HI, the Opposition find parts I and II repugnant. They are narrowly doctrinaire and are conceived to sacrifice the interests of public transport and road safety to Tory monetarist prejudice. They will result in cuts in the Civil Service and the destruction of the public sector because of the aims of a crusade, the achievement of which seems to justify any end.
        For those reasons, we recommend that the Bill be rejected.
        6.54 pm
        Mr. David Howell: I was anxious to hear whether the right hon. Member for Barrow-in-Furness (Mr. Booth) had some worthwhile reasons for opposing what most people recognise as a thoroughly constructive transport Bill. Admittedly it covers a wide range of transport interests, but it is utterly in tune with the needs of those who use public transport, the transport industry and the interests of the community. That is why I thought it right that the right hon. Gentleman should have the opportunity to oppose the Bill and to advance some good reasons for doing so. The House will be confirmed in its suspicion that he has none.
        The right hon. Gentleman dealt with the question of more private money being brought into the bus industry. He mentioned his worry that the profitable operations of the National Express subsidiary of the National Bus Company should be privatised. That is a little strange as, thinking back, he and his right hon. and hon. Friends vigorously opposed—possibly with more vigour than the Opposition have pursued what they think is wrong in the Bill—the measures that enabled National Express to develop healthily into a highly profitable enterprise. What is wrong with that? The right hon. Gentleman opposed it. Now that it occurs he wrings his hands and regrets that private money should be sought to reinforce the success of National Express.
        What is more, the money will be used to reinforce the NBC, which is a minority shareholder in the National Express subsidiary—as I believe it will be—and to provide some resources to back up its other operations. That is a desirable and helpful development. It is not in the mode of party doctrine or dogma. It is a sensible and practical development. I cannot understand why the right hon. Gentleman could not advise his right hon. and hon. Friends to welcome it strongly.
        The Bill also deals with other opportunities for the development and expansion of the passenger transport business. It will bring higher quality services and better facilities for both the travelling public and the staff. The company has advanced preliminary proposals for separate commercial accounts for National Express and the holiday side of the business. Those ideas are being developed in discussions between the Department and the company with a view to their being in place by the end of 1982.
        With regard to property, the chairman of the National Bus Company has presented me with an interesting package of proposals that involve the private sector in the development and improvement of NBC sites. I shall discuss them shortly with the chairman to try to agree the best way forward for the NBC, the people who use buses and sit in stations and all those, both customers and those in the industry, who wish to see it prosper. I cannot understand why the Opposition find that so objectionable in practice or why they find it impossible to suppress a deep primeval instinct to attack everything to do with the

        847
        private sector and private money being introduced to further operations. It is a pity that they were not able to override their prejudices.
        Part II proposes a goods vehicle scheme which will be more efficient and better geared to the needs of industry. The way in which I have suggested that that should be done—through discussions with Lloyd's Register—is wholly in line with the requirements and suggestions that were advanced both by the Select Committee on Transport and with the needs and concerns that were expressed in Committee. Again, I should have expected a warmer welcome than we have received from the Opposition.
        I shall, of course, take account of the needs of bus operators in the way that the right hon. Gentleman describes. Of course we want an efficient service in safe hands. I believe that under the scheme being discussed with Lloyd's Register it will be possible to develop the system in a way that meets the needs as well as or even better than at present.
        The Bill also proposes a fairer and much more efficient system of penalties for traffic offences and more effective safeguards for the public from the unpleasant side of lorry operations. Much of the debate on traffic offences inevitably concentrated on the extension of the system to a wider range of offences. Nevertheless, we must not lose sight of the important measures provided by the Bill to improve enforcement of the present system, which have, I think, also been universally welcomed. As the House knows, at present the system is being defeated by a large number of motorists who do not pay because they believe that the penalties will not be enforced. The changes being introduced will help to ensure that that does not happen.
        I have listened carefully to the right hon. Gentleman, but I have heard no good reason why the Third Reading of the Bill should be opposed. We do not feel defensive about it in terms of party dogma. We put it forward with confidence as a series of sound, practical measures which deserve the full support of everyone with a genuine interest in the transport industries of this country and in meeting the transport needs of the community and the customers of the transport services. I hope, therefore, that right hon. and hon. Members will give it full support.
        Question put, That the Bill be now read the Third time:—
        The House divided: Ayes 282, Noes 217.

        Division No. 171]

        [7 pm

        AYES

        Adley, Robert

        Biffen, Rt Hon John

        Alexander, Richard

        Biggs-Davison, SirJohn

        Alison, Rt Hon Michael

        Blackburn, John

        Amery, Rt Hon Julian

        Blaker, Peter

        Ancram, Michael

        Body, Richard

        Arnold, Tom

        Bonsor, SirNicholas

        Aspinwall, Jack

        Boscawen, Hon Robert

        Atkins, Rt Hon H. (S'thorne)

        Bottomley, Peter (W'wich W)

        Atkins, Robert('PrestonN)

        Bowden, Andrew

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

        Boyson, Dr Rhodes

        Baker, Kenneth (St.M'bone)

        Braine, SirBernard

        Baker, Nicholas (N Dorset)

        Bright, Graham

        Banks, Robert

        Brinton, Tim

        Beaumont-Dark, Anthony

        Brittan, Rt. Hon. Leon

        Bendall, Vivian

        Brooke, Hon Peter

        Bennett, SirFrederic (T'bay)

        Brotherton, Michael

        Benyon, Thomas (A'don)

        Brown, Michael (Brigg&Sc'n)

        Benyon, W. (Buckingham)

        Bruce-Gardyne, John

        Best, Keith

        Buchanan-Smith, Rt. Hon. A.

        Bevan, DavidGilroy

        Buck, Antony

        848

        Budgen, Nick

        Hicks, Robert

        Bulmer, Esmond

        Higgins, Rt Hon Terence L.

        Burden, SirFrederick

        Hill, James

        Butcher, John

        Hogg, Hon Douglas (Gr'th'm)

        Cadbury, Jocelyn

        Holland, Philip(Carlton)

        Carlisle, John (Luton West)

        Hooson, Tom

        Carlisle, Kenneth (Lincoln)

        Hordern, Peter

        Chapman, Sydney

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

        Churchill, W.S.

        Hunt, David (Wirral)

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

        Irving, Charles (Cheltenham)

        Clark, Sir W. (Croydon S)

        Jenkin, Rt Hon Patrick

        Clarke, Kenneth (Rushcliffe)

        JohnsonSmith, Geoffrey

        Clegg, SirWalter

        Jopling, Rt Hon Michael

        Cockeram, Eric

        Kaberry, SirDonald

        Colvin, Michael

        Kershaw, SirAnthony

        Cope, John

        Kilfedder, JamesA.

        Cormack, Patrick

        Kimball, SirMarcus

        Corrie, John

        Kitson, SirTimothy

        Costain, SirAlbert

        Knight, MrsJill

        Cranborne, Viscount

        Knox, David

        Critchley, Julian

        Lamont, Norman

        Crouch, David

        Lang, Ian

        Dean, Paul (North Somerset)

        Langford-Holt, SirJohn

        Dickens, Geoffrey

        Latham, Michael

        Dorrell, Stephen

        Lawrence, Ivan

        Douglas-Hamilton, LordJ.

        Lee, John

        Dover, Denshore

        Lennox-Boyd, HonMark

        du Cann, Rt Hon Edward

        Lester, Jim (Beeston)

        Dunn, Robert (Dartford)

        Lewis, Kenneth (Rutland)

        Durant, Tony

        Lloyd, Ian (Havant&W'loo)

        Dykes, Hugh

        Lloyd, Peter (Fareham)

        Eden, Rt Hon Sir John

        Loveridge, John

        Edwards, Rt Hon N. (P'broke)

        Luce, Richard

        Eggar, Tim

        McCrindle, Robert

        Emery, Sir Peter

        Macfarlane, Neil

        Eyre, Reginald

        MacGregor, John

        Fairbairn, Nicholas

        MacKay, John (Argyll)

        Fairgrieve, SirRussell

        Macmillan, Rt Hon M.

        Faith, MrsSheila

        McNair-Wilson, M. (N'bury)

        Farr, John

        McNair-Wilson, P. (NewF'st)

        Finsberg, Geoffrey

        McQuarrie, Albert

        Fisher, SirNigel

        Madel, David

        Fletcher-Cooke, SirCharles

        Major, John

        Fookes, MissJanet

        Marland, Paul

        Forman, Nigel

        Marlow, Antony

        Fowler, Rt Hon Norman

        Marshall, Michael (Arundel)

        Fox, Marcus

        Marten, Rt Hon Neil

        Fraser, Rt Hon Sir Hugh

        Maude, Rt Hon Sir Angus

        Fraser, Peter (South Angus)

        Mawby, Ray

        Fry, Peter

        Mawhinney, Dr Brian

        Gardiner, George (Reigate)

        Maxwell-Hyslop, Robin

        Gardner, Edward (S Fylde)

        Mellor, David

        Garel-Jones, Tristan

        Meyer, Sir Anthony

        Gilmour, Rt Hon Sir Ian

        Miller, Hal (B'grove)

        Glyn, Dr Alan

        Mills Iain (Meriden)

        Goodhart, SirPhilip

        Mills, Peter (West Devon)

        Goodhew, SirVictor

        Miscampbell, Norman

        Goodlad, Alastair

        Mitchell, David (Basingstoke)

        Gorst, John

        Moate, Roger

        Gow, Ian

        Monro, SirHector

        Gower, SirRaymond

        Montgomery, Fergus

        Gray, Hamish

        Moore, John

        Greenway, Harry

        Morris, M. (N'hampton S)

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

        Morrison, Hon C. (Devizes)

        Griffiths, Peter Portsm'th N)

        Mudd, David

        Grist, Ian

        Murphy, Christopher

        Grylls, Michael

        Myles, David

        Gummer, JohnSelwyn

        Neale, Gerrard

        Hamilton, Hon A.

        Needham, Richard

        Hamilton, Michael (Salisbury)

        Nelson, Anthony

        Hampson, Dr Keith

        Neubert, Michael

        Hannam, John

        Newton, Tony

        Haselhurst, Alan

        Normanton, Tom

        Havers, Rt Hon Sir Michael

        Nott, Rt Hon John

        Hawkins, Paul

        Onslow, Cranley

        Hawksley, Warren

        Oppenheim, Rt Hon Mrs S.

        Hayhoe, Barney

        Page, John (Harrow, West)

        Heddle, John

        Page, Richard (SW Herts)

        Henderson, Barry

        Parris, Matthew

        Heseltine, Rt Hon Michael

        Pawsey, James

        849

        Percival, Sir Ian

        Stevens, Martin

        Peyton, Rt Hon John

        Stewart, A. (E Renfrewshire)

        Pink, R, Bonner

        Stewart, Ian (Hitchin)

        Pollock, Alexander

        Stokes, John

        Porter, Barry

        StradlingThomas, J.

        Prentice, Rt Hon Reg

        Tapsell, Peter

        Proctor, K. Harvey

        Temple-Morris, Peter

        Pym, Rt Hon Francis

        Thatcher, Rt Hon Mrs M.

        Rees, Peter (Dover and Deal)

        Thomas, Rt Hon Peter

        Rees-Davies, W. R.

        Thompson, Donald

        Renton, Tim

        Thorne, Neil(IlfordSouth)

        Rhodes James, Robert

        Thornton, Malcolm

        Rhys Williams, SirBrandon

        Townend, John (Bridlington,)

        Ridley, HonNicholas

        Townsend, Cyril D, (B'heath)

        Ridsdale, SirJulian

        Trippier, David

        Rifkind, Malcolm

        Trotter, Neville

        Roberts, M. (Cardiff NW)

        van Straubenzee, SirW.

        Roberts, Wyn (Conway)

        Vaughan, Dr Gerard

        Rossi, Hugh

        Viggers, Peter

        Rost, Peter

        Waddington, David

        Royle, SirAnthony

        Wakeham, John

        Sainsbury, HonTimothy

        Waldegrave, HonWilliam

        St. John-Stevas, Rt Hon N.

        Wall, SirPatrick

        Shaw, Giles (Pudsey)

        Waller, Gary

        Shaw, Michael (Scarborough)

        Walters, Dennis

        Shelton, William (Streatham)

        Ward, John

        Shepherd, Colin (Hereford)

        Warren, Kenneth

        Shepherd, Richard

        Watson, John

        Silvester, Fred

        Wheeler, John

        Sims, Roger

        Whitelaw, Rt Hon William

        Skeet, T. H. H.

        Whitney, Raymond

        Smith, Dudley

        Wickenden, Keith

        Speed, Keith

        Wiggin, Jerry

        Speller, Tony

        Wilkinson, John

        Spence, John

        Williams, D.(Montgomery)

        Spicer, Jim (WestDorset)

        Winterton, Nicholas

        Spicer, Michael (S Worcs)

        Wolfson, Mark

        Sproat, Iain

        Young, SirGeorge (Acton)

        Squire, Robin

        Younger, Rt Hon George

        Stainton, Keith

        Stanbrook, Ivor

        Tellers for the Ayes:

        Stanley, John

        Mr. Anthony Beny and Mr. Carol Mather.

        Steen, Anthony

        NOES

        Abse, Leo

        Conlan, Bernard

        Adams, Allen

        Cook, Robin F.

        Alton, David

        Cowans, Harry

        Anderson. Donald

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

        Archer, Rt Hon Peter

        Crowther, Stan

        Ashley, Rt Hon Jack

        Cryer, Bob

        Ashton, Joe

        Cunliffe, Lawrence

        Atkinson, N.(H'gey,)

        Cunningham, G. (IslingtonS)

        Bagier, Gordon A.T.

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

        Barnett, Guy (Greenwich)

        Davidson, Arthur

        Barnett, Rt Hon Joel (H'wd)

        Davies, Ifor (Gower)

        Beith, A.J.

        Davis, Clinton (HackneyC)

        Benn, Rt Hon Tony

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

        Bennett, Andrew(St'kp'tN)

        Dean, Joseph (Leeds West)

        Bidwell, Sydney

        Dewar, Donald

        Booth, Rt Hon Albert

        Dixon, Donald

        Bray, Dr Jeremy

        Dobson, Frank

        Brocklebank-Fowler, C.

        Dormand, Jack

        Brown, Hugh D. (Provan)

        Douglas, Dick

        Brown, Ron(E'burgh, Leith)

        Dubs, Alfred

        Buchan, Norman

        Duffy, A. E. P.

        Callaghan, Rt Hon J.

        Dunn, James A.

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

        Dunnett, Jack

        Campbell, Ian

        Dunwoody, Hon MrsG.

        Campbell-Savours, Dale

        Eadie, Alex

        Canavan, Dennis

        Eastham, Ken

        Cant, R. B.

        Edwards, R. (W'hampt'n SE)

        Carmichael, Neil

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

        Carter-Jones, Lewis

        English, Michael

        Cartwright, John

        Ennals, Rt Hon David

        Clark, Dr David (S Shields)

        Evans, Ioan (Aberdare)

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

        Field, Frank

        Cohen, Stanley

        Fitch, Alan

        Coleman, Donald

        Flannery, Martin

        Concannon, Rt Hon J. D.

        Fletcher, Ted (Darlington)

        850

        Ford, Ben

        O'Neill, Martin

        Forrester, John

        Owen, Rt Hon Dr David

        Foster, Derek

        Palmer, Arthur

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

        Park, George

        Garrett, John (Norwich S)

        Parker, John

        Garrett, W. E. (Wallsend)

        Parry, Robert

        George, Bruce

        Penhaligon, David

        Gilbert, Rt Hon Dr John

        Powell, Raymond (Ogmore)

        Graham, Ted

        Prescott, John

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

        Price, C. (Lewisham W)

        Hardy, Peter

        Race, Reg

        Harrison, Rt Hon Walter

        Radice, Giles

        Heffer, Eric S.

        Rees, Rt Hon M (Leeds S)

        Hogg, N. (EDunb't'nshire)

        Richardson, Jo

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

        Roberts, Albert (Normanton)

        HomeRobertson, John

        Roberts, Ernest (Hackney N)

        Howells, Geraint

        Roberts, Gwilym (Cannock)

        Hoyle, Douglas

        Robinson, G. (Coventry NW)

        Hughes, Mark (Durham)

        Rodgers, Rt Hon William

        Hughes, Robert (Aberdeen N)

        Rooker, J. W.

        Hughes, Roy (Newport)

        Ross, Ernest (Dundee West)

        Janner, HonGreville

        Ryman, John

        Jay, Rt Hon Douglas

        Sandelson, Neville

        John, Brynmor

        Sever, John

        Johnson, Walter (Derby S)

        Sheerman, Barry

        Johnston, Russell (Inverness)

        Sheldon, Rt Hon R.

        Jones, Rt Hon Alec (Rh'dda)

        Shore, Rt Hon Peter

        Jones, Barry (East Flint)

        Short, Mrs Renée

        Kaufman, Rt Hon Gerald

        Silkin, Rt HonJ. (Deptford)

        Kerr, Russell

        Silkin, Rt Hon S. C. (Dulwich)

        Kilroy-Silk, Robert

        Silverman, Julius

        Kinnock, Neil

        Skinner, Dennis

        Lambie, David

        Smith, Rt Hon J. (N Lanark)

        Lamborn,Harry

        Snape, Peter

        Lamond, James

        Soley, Clive

        Leadbitter, Ted

        Spearing, Nigel

        Leighton, Ronald

        Spriggs, Leslie

        Lestor, Miss Joan

        Stallard, A. W.

        Lewis, Ron (Carlisle)

        Steel, Rt Hon David

        Litherland, Robert

        Stoddart, David

        Lofthouse, Geoffrey

        Stott, Roger

        Lyon, Alexander (York)

        Strang, Gavin

        McCartney,Hugh

        Straw, Jack

        McDonald, Dr Oonagh

        Summerskill, Hon Dr Shirley

        McElhone, Frank

        Thomas, Dafydd (Merioneth)

        McKay, Allen (Penistone)

        Thomas, Mike (Newcastle E)

        McKelvey, William

        Thomas, Dr R. (Carmarthen)

        Maclennan, Robert

        Thorne, Stan (PrestonSouth)

        McMahon, Andrew

        Tilley, John

        McNally, Thomas

        Tinn, James

        McNamara, Kevin

        Tomey, Tom

        McTaggart, Robert

        Urwin, Rt Hon Tom

        McWilliam, John

        Varley, Rt Hon Eric G.

        Marks, Kenneth

        Walker, Rt Hon H. (D'caster)

        Marshall, D (G'gowS'ton)

        Watkins, David

        Marshall, Dr Edmund (Goole)

        Wellbeloved, James

        Marshall, Jim (Leicester S)

        Welsh, Michael

        Martin, M (G'gow S'burn)

        White, Frank R.

        Mason, Rt Hon Roy

        White, J. (G'gow Pollok)

        Maxton, John

        Whitehead, Phillip

        Maynard, Miss Joan

        Whitlock, William

        Meacher, Michael

        Willey, Rt Hon Frederick

        Mellish, Rt Hon Robert

        Williams, Rt HonA. (S'seaW)

        Mikardo, Ian

        Williams, Rt Hon Mrs (Crosby)

        Millan, Rt Hon Bruce

        Wilson, Gordon (Dundee E)

        Miller, Dr M.S. (E Kilbride)

        Wilson, Rt Hon SirH.(H'ton)

        Mitchell,Austin(Grimsby)

        Winnick, David

        Mitchell, R.C. (Soton Itchen)

        Woodall, Alec

        Morris, Rt Hon A. (W'shawe)

        Woolmer, Kenneth

        Morris, Rt HonJ. (Aberavon)

        Wright, Sheila

        Morton, George

        Young, David (Bolton E)

        Moyle, Rt Hon Roland

        Newens, Stanley

        Tellers for the Noes:

        Oakes, Rt Hon Gordon

        Mr. James Hamilton and Mr. Frank Haynes.

        Ogden, Eric

        O'Halloran, Michael

        Question accordingly agreed to.
        Bill read the Third time and passed.

  Adjournment (Spring)
  Motion made, and Question proposed,
  That this House at its rising on Friday do adjourn until Tuesday 8 June.—[Mr. Garel-Jones.]
  Mr. Deputy Speaker (Mr. Bernard Weatherill): I should tell the House that Mr. Speaker has selected the amendment in the name of the Leader of the Opposition.
  7.12 pm
  Mr. John Silkin: I beg to move, as an amendment to the motion, at end add
  'but that, pursuant to Standing Order No. 122 (Earlier meeting of House in certain circumstances) should the public interest so require, Her Majesty's Ministers of their own volition or following representations from Her Majesty's Opposition shall represent to Mr. Speaker that the House should meet at a time earlier than that to which the House stands adjourned'.'
  The purpose of the amendment is to make it clear to the House and to the country that the House of Commons stands ready to come back at any time during the Whitsun Recess and attend to its business, should that become necessary.
  In the normal course of events one could leave this matter to be considered through the usual channels without an amendment of this sort being tabled. But in the present circumstances it seemed to the Opposition that it was right that we should have a formal amendment on the Order Paper to make the position clear. My feeling is that it is likely that the House will be recalled. I find it almost inconceivable that nothing that can interest the House will happen during the next week. Whether that be so or not, at least the country will be aware that this is what we intend and what we have provided for.
  I hope, therefore, to get the support of the House for the amendment.
  7.14 pm
  The Lord President of the Council and Leader of the House of Commons (Mr. John Biffen): It is customary in debates of this character for the Leader of the House to reply at the conclusion and deal with the many points which I know hon. Members will wish to raise. With the permission of the House, I should like to do that, but it may be helpful if I refer at this stage to the amendment standing on the Order Paper in the name of the Leader of the Opposition.
  The Government fully appreciate the concerns that underlie the amendment. Since the Falkland Islands crisis began, the Government have welcomed the positive contribution that Parliament has made in its debates and have recognised the importance of keeping the House informed.
  The Government, therefore, accept the amendment. They will give proper and serious consideration to any approach made to them on this matter by the Opposition and will, if they judge that the public interest so requires, take the appropriate steps under the Standing Order for recalling the House, as was done during the Easter Recess.
  7.16 pm
  Mr. Roland Moyle: I support the amendment in the name of my right hon. and hon. Friends because, although the Leader of the House has referred to the Falkland Islands, there is another much longer lasting and more serious crisis which will almost certainly require the recall or at least the attention of the House at some
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  stage. That is the deteriorating situation in the National Health Service, where a number of the unions with membership in that service are taking industrial action.
  The National Health Service would not be in this situation were it not that the Government had of their own volition abolished the Clegg commission in their early days of office.
  Mr. Lawrence Cunliffe: Disgraceful.
  Mr. Moyle: As my hon. Friend says, it was disgraceful. If the Clegg commission had still existed as we left it, employees in the National Health Service would be at least £19 a week better off, and, even if they were not satisfied, machinery would exist for a painless adjustment of their grievances.
  In 1980 inflation at times touched 20 per cent. and National Health Service pay rises were only 14 per cent. In 1981 the inflation rate was 16 per cent. and the National Health Service pay rises were only 6 per cent. This year price inflation is still around the 10 per cent. mark and the offer that the Government have made to National Health Service employees is only 4 per cent., with 61/2 per cent. for nurses. So the Government have failed over some years to meet the legitimate ambitions of National Health Service workers.
  What sort of wages are we talking about? We are not talking about the wealthy of this world. Obviously, in an organisation such as the National Health Service, there is a wide range of pay rates, but, for example, catering and domestic assistants and cleaners receive a basic £59 for their working week. Even if they were given the full 12 per cent. increase that the trade unions are asking for, they would have an increase of only £2·36. Caretakers, storekeepers and assistant cooks enjoy, if that is the right word, a basic take-home pay of £64·22. Again, 12 per cent. on that would yield them only £2·57 per week.
  The Confederation of Health Service Employees has estimated that half the employees in the National Health Service have a take-home pay which qualifies them for consideration under the family income supplement scheme. The grades I have mentioned may not be the grandest employees in the National Health Service but they need to live and they are needed to make the Health Service tick over. Yet the Government have offered them only a 4 per cent. increase, which in some cases is an improvement in pay of only pence per week.
  The sole argument for that approach by the Government is the need to fight inflation—not an attempt to apply justice, but a need to fight inflation. The same argument applied when the police claim was considered and settled this year, but they got an increase of 13 per cent. The firemen got 10 per cent. Water service workers got 9 per cent. Even local authority manual workers got 7½ per cent. Doctors and dentists got 6 per cent. Members of the Armed Forces—soldiers, sailors and airmen—got 6 per cent. Civil servants generally got 6 per cent., and top civil servants, judges and defence chiefs, as we all know, have recently been granted an 18½ per cent. increase. In fact, Lord Chief Justice Lane's annual increase under this settlement of about £8,000 a year compares favourably with the average ancillary worker's annual income in the Health Service of £3,070 before the present pay claim is settled.
  It would not be right to attack the good fortune of the groups that I have mentioned, any more than it was right

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  to attack their good fortune before their increase was granted. However, I want to ask the Government why some modest part of the good fortune which has been granted to those groups should not be extended to people on very low pay. Why should the full burden of fighting inflation fall on the shoulders of a humble cleaner in the NHS, when apparently it is far too heavy a burden for the Lord Chief Justice to bear?
  In the past three weeks in the South Atlantic we have lost three frigates. The cost of those losses, with other additions, amounts to £375 million. That price will not bring this country to its knees, but it would be enough to settle in full the union claim. That too would not bring the country to its knees.
  We now have mounting industrial action in the National Health Service. The official aim of that action is to reduce the NHS to an emergency service. When I attempted to obtain the Adjournment of the House under Standing Order No. 9 a week ago yesterday, I said that unless this House paid attention to what was going on in the Health Service it would be an incitement to perhaps irresponsible elements to take matters into their own hands and take them much further than they should be taken. Evidence of that is now emerging and it is one of the reasons why the Government should be prepared to recall the House to consider the situation in the NHS.
  There is news of patients doing without meals, and of operating theatres being deprived of the services of sterile units. During the past 24 hours, news has been coming through of miners in Yorkshire and South Wales who are prepared to take action to support the NHS workers. That action is being taken because of the morality of industrial action in the National Health Service. The most fervent supporters of the morality that it is difficult to take industrial action in the NHS are NHS employees themselves. If the great mass of them did not have an overwhelming dedication to the welfare of the patients, the NHS would have ceased to exist as a viable organisation a week or two ago, and the Government would have been in serious trouble. They are saved by the sense of duty and dedication of NHS workers and union members.
  Where is the morality of the Secretary of State when he complains that patients' lives are being put at risk by industrial action, while he seeks to exploit the NHS workers' reluctance to strike by paying poverty line wages? When I was a law student I was told that people were supposed to "intend the natural consequences" of their action. It is a good principle for life, as well as for law. The Secretary of State should come to the House in the not-too-distant future so that we may ask him why the Government have adopted the policy of putting patients' lives at risk because, as a consequence of the Secretary of State paying poverty wages, the NHS workers are forced to take some form of industrial action.
  There should be a return to a machinery of fair comparison between NHS wages and those of equivalent jobs outside, as was provided by the Clegg commission, which was set up by the Government of which I was a member. If the NHS staff are not to strike, we should provide a machinery for fair wages that relates to the economy in general. We should dearly like to know the Secretary of State's plans in this connection. If the motion proposed by my right hon. Friend the Member for Deptford (Mr. Silkin) is accepted, it will be possible for the House to consider at an early date the problems in the Health Service to which I have drawn attention.
  7.25 pm
  Sir Walter Clegg: I believe that my right hon. Friend the Leader of the House was wise to accept the Opposition amendment.
  I shall not follow the right hon. Member for Lewisham, East (Mr. Moyle) in what he said about the National Health Service, except to say that my namesake was responsible for a great deal of inflation, and that the last time he was in action I was identified with him, which I found somewhat embarrassing at times.
  A matter which affects my constituency and in which time is a great element is the fishing industry. By the end of this year, we have to reach some conclusion about a common fisheries policy. At present, there is great confusion in the industry, as well as great uncertainty about what is to happen during the next six months. I have spoken to inshore fishermen and fishermen who are still operating in our medium-water trawlers, and they do not know where they are going. By this time last year, substantial help had been given to the fishing industry, and I know that my right hon. Friends are discussing the matter at the moment.
  If we are recalled next week, we should have an early statement in the House on this matter. The structure Of the industry is affected, in that uncertainty does not help vessel owners to plan replacements or to see their way ahead. The news from Europe is that other countries are subsidising the building of fishing vessels. Here we seem to be waiting for Godot as we wait for the common fisheries policy. Soon after we come back, the House should be given a statement about what is happening in this area so that the uncertainty can be removed.
  7.28 pm
  Mr. Derek Foster: I support the amendment, because it is important that we should have an opportunity to discuss the proposed closures of the British Rail engineering works at Shildon, Horwich and Swindon. Each represents a community which will be destroyed if the closures are allowed to take place.
  Today, 700 of my constituents came to London. They took letters to Sir Peter Parker from children in Shildon pleading with Sir Peter that their fathers should nol be made redundant. That is the position in Shildon. If Shildon dies, there is no other work there. The children have written to the chairman of British Rail saying "Don't sack our fathers. Give them jobs and let us have some prospect of jobs ourselves when we come of age."
  As they walked through the streets of London from Kings Cross to Westminster, those 700 people noticed that people were asking "Where is Shildon?" A brave little town in County Durham can die and the majority of people in Britain do not even know where it is. Just as people did not know where the Falkland Islands were a few weeks ago, they do not know where Shildon is and they care little whether it lives or dies.
  I am proud to say that after today's activities many more people in the south of England will know where the town of Shildon is. Shildon was the birthplace of the railway and has 150 years proud history of railways. The majority of people in the south who do not know where Shildon is have no idea either of the suffering of the unemployed and what it means to have the prospect of long-term unemployment for the foreseeable future. Those people now know where Shildon is and they know the

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  anger and the bitterness of those people who have given every co-operation to try to ensure that their works was competitive both in Britain and abroad.
  British Rail says that it does not need to buy any wagons. There were 130,000 wagons in 1979. There are 75,000 wagons now and there will be only 34,000 in 1986. That is partly because of the greater utilisation of wagons. I welcome all increases in productivity, whether they be in nationalised industries or in private sector industries. That is good and we welcome it.
  However, in 1986, marginally less freight will be carried by a quarter of the fleet. That is a substantial reduction. In addition, that greater utilisation must mean that those wagons will have a shorter life and must have more maintenance and repair. Yet when we ask British Rail what it foresees will be the optimum rate of replacement of the 34,000 wagons in 1986, it cannot tell us. It says that it does not need to buy any until 1985 and that a few will come through in 1986. How many wagons is it commercially prudent to buy to replace that fleet of 34,000 year by year? British Rail has no answer to that.
  If one assumes, for the sake of argument, that a wagon has a 30-year life, British Rail—surprise, surprise—will need to buy about 1,000 wagons a year in the medium and long-term to replace its stock of 34,000 wagons. A thousand wagons a year is just the new production that Shildon needs to ensure its long-term future and its continued profitability.
  British Rail Engineering Ltd. made £1·2 million profit last year, of which £800,000 came from the little works at Shildon which has always been efficient and profitable. If it has a market for its goods, that profitability and efficiency will continue. I argue that there is a market for those wagons. While there has been a severe reduction in the number of British Rail's wagons—from 130,000 in 1979 to 34,000 in 1986—the number of wagons that are owned or leased by clients of British Rail has increased to 17,000, and British Rail expects that there will be an increase of about 8,000 by 1986. Therefore, in 1986, British Rail will own 34,000 wagons and British Rail clients will own 25,000 wagons. Therefore, another 8,000 wagons will be needed and will be produced between now and 1986.
  Those wagons should be built at Shildon, but I can almost guarantee that they will be built by private manufacturers. There is not a lack of demand for wagons; the demand for wagons is being diverted from British Rail Engineering Ltd. to private manufacturers to suit the convenience of British Rail because it eliminates its need to operate within tight financial limits.
  The fact that wagons will be built not in Shildon but in the private sector is privatisation by the back door. That is a new and imaginative method of privatisation. The works are not bought out but are starved of work, the workers are sacked and the equipment is sold at knockdown figures to private manufacturers which—surprise, surprise—are growing and will need new equipment. I wish that the Labour Party had thought of such a thing when it was in power.
  There is a great deal of anger in my constituency and in those of my hon. Friends, who I know would like to catch your eye Mr. Deputy Speaker later this evening on the subject of British Rail engineering closures. We are determined to pin the blame where it belongs—on the
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  Government's policies that are starving British Rail of investment and imposing far too tight financial limits upon British Railways and which have resulted in Sir Peter Parker not knowing whether he is coming or going. He sold out his own work force to obtain the electrification of British Rail from the previous Secretary of State for Transport—who failed to deliver the goods. Sir Peter Parker now has a confrontation with his own loyal work force, which he is beginning to abuse.
  Those matters cannot go undebated and I am glad to have had the opportunity to draw attention to them.
  Several Hon. Members rose——
  Mr. Deputy Speaker: Order. For the good order of our debates, may I remind hon. Members that they should link their arguments to reasons why the House should not adjourn? This is not a general Adjournment debate.
  7.37 pm
  Mr. David Madel: I agree with the right hon. Member for Deptford (Mr. Silkin) about the need for the House to be recalled instantly should the Falkland Islands situation worsen. However, I should briefly like to raise a couple of other potentially dangerous matters on the home front.
  I should like to follow the hon. Member for Bishop Auckland (Mr. Foster) on the difficulties of British Rail from a slightly different angle. We are faced with further serious industrial trouble from British Rail before many days into June.
  This year has been a bad year for the railway industry. Its relations with its customers have sunk to an all-time low. Management and unions have been at loggerheads. In The Guardian this week Mr. Sidney Weighell was quoted as saying:
  "Railworkers have reached the end of their tether and must now stand and fight for their industry. We do not advocate going to the barricades every Monday."
  I appreciate that he speaks for the overwhelming majority of the people he represents. That newspaper report went on to say:
  "Sir Peter Parker, BR's chairman, is at loggerheads with not just one but all three rail unions, making the situation even more serious than when it was a straight fight with ASLEF."
  There is a threat of further industrial action on 7 June, which is why I think that it is relevant to raise the matter now.
  I am glad to see that, on the problem of allowing the Bedford-St. Pancras electrified line to work with the new rail rolling stock, Mr. Weighell has disclosed that he has put compromise proposals to the management for the operation of the new rolling stock on this line. Mr. Weighell's proposal from the NUR is that guards on the new train should also double up as ticket inspectors and collectors, which would in turn reduce the number of people required to man the platform barriers.
  I cannot stress too strongly the fact that many of my constituents who are regular commuters on that line look forward to travelling on the new electrified stock, instead of the old worn-out diesel stock. They would view another industrial clash on British Rail with absolute horror. In some parts of the country the idea has grown up that we can somehow manage without the railways. That is wishful thinking for the South-East. This capital city teeters on the brink of road chaos day after day. It is on a knife edge. If there is a rail strike or any trouble, the chaos instantly becomes much worse.

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  I should like to know British Rail's response to Mr. Weighell's compromise proposal to get the electrified line working properly. I hope that there will be a quick agreement so that the commuters know what the position is. If an agreement can be reached on operating that line with new rolling stock, we may be able to build on that and seek further agreements in the industry.
  In general, the railways cannot go on like this. I am convinced that, with the experience of the Advisory, Conciliation and Arbitration Service, British Rail should talk to those industries that have overcome the problems of productivity, manning and the new technologies. There is a bank of other industrial experience from which British Rail can draw. Under its terms of reference, ACAS can set up an inquiry. The members should consist of representatives of both management and unions in an industry that has overcome the problems that British Rail is now grappling with.
  Other industries have succeeded in overcoming similar difficulties and it is not impossible to reach an agreement in the railway industry, and thus avoid putting commuters from the South-East and elsewhere into constant difficulty.
  Another industrial difficulty is looming. On 18 May, The Times carried the following headline:
  "Power workers decide on action over pay."
  The article stated:
  "The first stage of the campaign will begin May 3 l"—
  slap in the middle of the recess—
  "with an overtime ban. That will be followed by a programme of selective strikes from June 14 in large power stations and among staff collecting cash from domestic meters."
  It is difficult to predict the effect of an overtime ban in the power industry. Some of us remember what happened in December 1970, when an overtime ban ran rapidly out of control. Within hours of the start of the ban there was the most exceptional difficulty. If there is no agreement in the power industry and there is an overtime ban followed by further action, a very careful response will be required from the Electricity Council, and particularly from the local management of power stations, if we are to avoid the terrible difficulties of December 1970.
  Everybody knows that power cuts have a swift and devastating effect that often goes far further than intended. Therefore, if that difficulty cannot be avoided, I hope that management will make a very careful response. Again, such a problem raises the question of the pay of those in vital public sector industries. I am well aware that the electricity supply workers are in difficulties with their management, because they can see the settlements made in the mining, gas and water industries. The offer made to them is not quite at the same level as that made to the workers in those industries.
  That too raises the problem of obtaining agreements in our key public sector industries without running the risk of strikes and overtime bans. Once an overtime ban has begun, all sorts of reactions may follow and the industry and the domestic consumer can be seriously affected.
  The Government have a great deal of talking to do with the TUC on, to name but one matter, the new training initiative. I hope that the Government will widen their discussions to see what can be agreed on pay and conditions in our key public sector industries. The Electricity Council and the unions can probably reach a compromise settlement, but even if we settle this year we have not got rid of next year's problem. Therefore, in
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  those industries we must try to create a more settled atmosphere so that we can avoid the problems that I hope will not be experienced by the end of the month.
  7.44 pm
  Mr. William Hamilton: You have asked, Mr. Deputy Speaker, that hon. Members should relate their remarks to the motion or the amendment. I shall do precisely that. I shall give the House several reasons why it should not adjourn for a week. All hon. Members can enumerate half a dozen or a dozen subjects that demand the urgent attention of the House. My right hon. Friend the Member for Lewisham, East (Mr. Moyle) has declared his priority, which is also mine.
  However, during the eight days in which we are absent from the House heaven knows how many hundreds of young British and Argentine men will be killed. Hundreds of millions of taxpayers' money will go down the drain somewhere in the South Atlantic. While that is going on, hon. Members will be in recess. It is interesting to compare the Government's attitude—particularly that of the Prime Minister—towards expenditure on that great tragedy in the South Atlantic with the money spent on keeping people alive through the medium of the National Health Service. The Prime Minister is on record as saying that, whatever the cost, she and the Government will go through with the South Atlantic adventure. She will do that come what may and whether or not the operation costs £1,000 million of taxpayers' money. Indeed, it will probably cost more than that when the ships that have been lost have been replaced. In addition, it is impossible to measure the cost of the lives that have been lost; that is particularly true for the wives and families that are left behind.
  When it comes to saving lives and paying nurses, ambulance men and all the ancillary workers in the NHS, the Prime Minister does not say that, no matter what the cost, they will get a fair deal. She does not say that at all. The Government have brutally told the nurses that those dedicated men and women will get an increase of about 6 per cent. this year although the rate of inflation is about double that. In other words, they are saying that those dedicated people must have their standards of living slashed, no matter what the value of their work to the community.
  The Government claim that in a way the nurses are receiving favourable treatment. They are to receive an increase of a little more then 6 per cent. However, by the time that the increase in their lodging allowances has been deducted, hardly anything of this year's increase will be left. Meanwhile, we pour thousands of millions of pounds down the drain in the South Atlantic. Yet the Prime Minister dares to say that the House and the country are behind her in that obscenity of priorities. She had better think again. She has not got the House or the country behind her. Her priorities are not civilised.
  My right hon. Friend the Member for Lewisham, East referred not only to nurses and ancillary workers in the NHS, but to the Plowden report on top salaries. I refer to those people who are struggling along on the poverty line, knocking along on £40,000, £50,000 or £60,000 a year, plus inflation—proofed pensions and all the perks that;go with their jobs. My right hon. Friend will not believe what that Top Salaries Review Body said, so I shall put the words on record. In considering those poverty-stricken

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  folks, the judges, the top civil servants, the admirals, generals and air commodores, the review said that they must have much higher salary levels
  "that are consistent with the effective motivation of those occupying such posts."
  The review added that the salaries
  "will ensure that they"—
  the judges, the top civil servants, and the top brass in the Army and elsewhere—
  "are not affected by lack of incentive or deep-seated feelings of unfairness."
  I swear that those are the words used by the Top Salaries Review Body. But there is no incentive for the nurses struggling along below the poverty line. Half the nurses in our Health Service are struggling along on a wage that, by the Government's own definition, is below the poverty line. What kind of priority is that?
  The position is even worse. In the three Budgets of this Government it is the people at the top who have had the tax concessions. The people at the other end of the scale have been clobbered by tax. Again, that is seen from the Government's figures. Everyone on lower than averge earnings is paying more in tax than three years ago. The people earning more than £20,000 a year are paying less tax than three years ago. It is that gross unfairness, that gross division of the country between the poor, or the less well-off—the more worthy citizens, I should add—and those at the top that incenses our people.
  It is rather sinister that the Government have given the highest salary increases to the Armed Forces, the police and the judges. I wonder why. Is it because the Government think that there will be increased social tension as a direct result of their policies? There could be something in that.
  We have sought a debate on the National Health Service and on the Government's pay policy, if only to get the Secretary of State for Social Services to the Dispatch Box to defend what he is doing. He even has the genteel Royal College of Nursing against him. They are the people who will not strike. They are too respectable to strike. I can understand that. No one in the Health Service wants to strike and hurt patients, but the genteel folk in the Royal College of Nursing are now having a ballot to see whether they want to alter their constitution, which at present forbids them to take strike action. The Government know that these workers in the Health Service are so responsible, so moderate, and so unmilitant that they will not strike because that would hurt the patients. The Government have said "OK, we can belt them in the groin because they will not strike." That is exactly what the Government are doing, have done and will do in future unless the nurses stand firm.
  The nurses want 12 per cent. when inflation is just about the same. They had a massive reduction in their standard of living last year so they are only saying "We want, please, if we may, to stand still." They are asking not to advance their standard of living, but merely to stand where they are.
  The Secretary of State for Social Services claims that the 4 per cent. and 6 per cent. offers are generous. He now says that he is waiting for the result of the ballot in the Royal College of Nursing. I warn the nurses that if they say that they will not strike or take any industrial action,
  860
  but will accept the Government's offer, they will have lost. The Government will have won and they will repeat the process next year.
  The truth is that the National Health Service is bleeding to death at the same time as the Prime Minister and the Government are pouring hundreds of millions of pounds of taxpayers' money into that silly adventure in the South Atlantic and jeopardising the lives of our young men. For those reasons even the few hon. Members here tonight could spend the whole of next week and the whole of the next six months arguing and debating the obscenity of the Government's policies and priorities.
  7.58 pm
  Mr. David Stoddart: I too suggest that we should not go into recess at a time when there are so many problems facing the nation. I listened carefully to my hon. Friend the Member for Fife, Central (Mr. Hamilton) but I shall not follow him because I want to deal with the great problem facing British Rail that was raised by my hon. Friend the Member for Bishop Auckland (Mr. Foster).
  The hon. Member for Bedfordshire, South (Mr. Madel) pointed out that by 7 June there will be a crisis in the railway industry because the National Union of Railwaymen, supported by other unions, has made it clear that it is not prepared to see the railways destroyed by the Government and the British Railways Board.
  I refer specifically to the problems that have arisen in my constituency of Swindon. We heard a week or two ago, with the utmost shock, as did Shildon and Horwich, that Swindon is to lose 1,500 jobs, leading to partial closure, and that Shildon and Horwich are to be completely closed down. That is being done when there are 3 million unemployed. In Shildon and Horwich the unemployment rate is between 25 and 30 per cent. In Swindon we have a high rate of unemployment and insufficient jobs are being brought to the town: Like Shildon, Horwich, and other areas, Swindon cannot afford to lose 1,500 jobs. What is more, it is quite wicked to propose that those jobs in Swindon, and jobs on the railways in other parts of the country, should be lost at a time when the railways, far from being deliberately run down, need refurbishing for the benefit of the people of this country.
  We went through this trauma in Swindon in 1973–74 when the British Railways Board decided that the railway workshop at Swindon should be closed. A new manager was sent to Swindon with the express instruction to close down the workshops. When he arrived he realised the potential of the railway workshops and, in co-operation with the workers at Swindon, he rebuilt them. They are now a viable and profitable enterprise. That has been achieved by a real partnership between management and men.
  No locomotives had been built in Swindon since 1962, but through the co-operation of the work force it was possible to build 20 from scratch for Kenya. That was a massive operation. Without anything on the ground, the workers built 20 locomotives from scratch. It showed their potential, skill and dedication. They co-operated. A real partnershhip was recognised by management and by British Rail which led to the end of demarcation disputes. For 10 years there was virtually no industrial trouble—a model of good industrial relations.
  The Government are always talking about partnership in industry. That was the sort of partnership they were seeking. That was the sort of partnership that Swindon

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  gave them, but the reward has been the sack for 1,500 people. People in Swindon, Horwich and Shildon and those in the railway industry throughout the country simply will not stand for that sort of treatment. That is why the NUR and other trade unions, including the ETU, of which I am a member, will put up such a fight as the Government have never had from the railway industry before.
  I have with me a copy of a petition that was sent to Sir Peter Parker, the chairman of British Rail. It is signed by 160 people who were tricked into rejoining the railways because they were assured of a long and secure future. They sent that petition to Sir Peter Parker, who has not yet had the courtesy to reply to them. I shall now have to take the matter up with him and ask why he has had the discourtesy not to reply to those 160 people who were tricked into joining his railway on the assurance that they had secure jobs for a long time ahead.
  Mr. Dennis Skinner: I am sure that my hon. Friend's constituents will now be getting a reply, because I am sure that the message will have got home to Mr. Flexible Rostering.
  Mr. Stoddart: I sincerely hope that my hon. Friend is right and that this place still has some influence at least to get a reply from the chairman of a great nationalised industry.
  There is a suspicion in my constituency that the British Railways Board is not now quite so committed as it was to running railways. The suspicion is that, instead of providing engineering jobs and enabling highly skilled and dedicated people to continue working in Swindon, the British Railways Board, at the behest of the Government, is more interested in making money. Property in Swindon is valuable. There is a suspicion that the 1,500 people—it will eventually be 3,500 people—are being sacrificed on the altar of property speculation. Believe me, if the British Railways Board thinks that it will get away with that, it will have a fight on its hands.
  The Government seem to have written off the railways by their disgraceful treatment of the industry as revealed in its financial operations. At this very moment, because of Government policy on external financing limits, money which should be used for capital spending, building new carriages and new wagons and refurbishing the fleet is being used on current operations. It is being used to pay wages, salaries and so on on a day-to-day basis. We believe that the Government have treated the railways disgracefully, and ought to be giving a greater commitment to that industry.
  The British Railways Board has a lot to answer for. It also seems to have too little commitment to railways. Every time I meet the board, all I get is the argument that is given by the British Road Federation—that 90 per cent. of goods must travel by road. Apparently, the British Railways Board sees no hope of attracting that traffic back to the railways.
  The people of Britain do not want heavy lorries on our roads. They suffer the environmental damage caused by heavy loads, and those vehicles will get heavier if the Government have their way. They want the railways to be used to carry freight and to improve the environment. I sincerely hope that the British Railways Board alters its attitude very soon.
  The travelling public deserves a better deal than it is getting at present. It deserves to travel in decent,
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  comfortable railway carriages—not the wrecks, some of them 40 years old, that are disgracing our railway; at present. Those carriages can be provided if the money is provided. They can be provided by the workers in British Rail workshops and other railway workers who will run them for the benefit of the country and the people.
  If the British Railways Board stopped fighting its workers and instead fought the Government for the money with which to bring the railways up to a decent, modern standard, it would be doing a service not only to itself and railway men but to the country as well.
  8.7 pm
  Mr. Peter Snape: Like my hon. Friends the Members for Swindon (Mr. Stoddart), who spoke so eloquently, and for Bishop Auckland (Mr. Foster), I support the amendment in the name of my right hon. Friend the Leader of the Opposition. I do so for much the same reason as my two hon. Friends, the crisis—I believe that term is justified—in the railway industry.
  During the past 25 years, the railway industry has tottered from crisis to crisis and from problem to problem. In the 1950s—indeed, almost in the first week that I began working on the railways—it was said that the industry was Victorian and grossly overmanned and that, unless and until the railway unions and management got together and sank their differences, the future would be bleak.
  In the 1950s, there were the modernisation plans with their consequent redundancies, and dieselasation with its effect on the locomotive grades in particular. The 1960s heralded the Beeching era, when the good doctor, who w as then paid a salary of about £24,000 a year, told the workers "Ah, but this time, if you accept your medicine, those of you who are left will have well-paid and secure jobs." The workers in the industry are still waiting.
  At present, the industry is being told that it is again the fault of the wicked trade unions and that if only it will accept the board's productivity proposals there will be jobs for all and the Government will play their part in the modernisation of the railway system. I met some of the constituents of my hon. Friend the Member for Bishop Auckland this afternoon. No one within the railway industry believes this any longer. All the years of cooperation have brought not the benefits that railway men were promised, but rather the reverse.
  Any pleasure, if that is the right term, that I might have derived from addressing railway men this afternoon is tempered by the fact that the fight for the railway industry will not be waged in this Chamber. The fight for its future will not even be waged at Rail House—that palatial building outside Euston to which the British Railways Board has managed to move itself lock, stock and cocktail cabinet in the last few weeks, despite financial problems within the industry. The fight for the future of the industry will be waged by the men and women involved within it. Success will be achieved only, I regret to say, by a fight, the reasons for which I shall try to outline.
  No one who has any connection with the industry likes advocating strike action. I have participated in one official and one unofficial strike during my time in the industry. Strike action is a course upon which railway men—a disciplined and ordered body of men—are reluctant to embark. Yet hon. Members saw within the precincts of the House of Commons today a group of men driven by desperation and concern about their future prospects and the future of the railway industry to come to London to

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  march from Euston station to the Embankment. Some were saying that they had never before taken part in a march. However, so great is their concern that they felt they must express it.
  The Government, who have promised through successive Secretaries of State to take action over investment and modernisation of the railway system, are far from blameless. The previous Secretary of State made various promises about electrification—some in the Chamber and others through press releases—that have not been kept. One cannot accuse the present Secretary of State of breaking any promises, because he never says anything. The right hon. Gentleman seems reluctant to comment at the Dispatch Box on the future of the railway industry and its modernisation. That is perhaps not surprising. By all accounts, the right hon. Gentleman did not particularly want the job, which was widely regarded by experts in the newspapers as a demotion for him. However, it is sad that, given the state of the industry and its problems, we seem to have a Secretary of State who shows a deplorable lack of concern for its future.
  On electrification, the British Railways Board has made all the necessary submissions to the Government. It has set out the prospectuses for inter-city and freight business, established as preconditions by the Government, who stated that, once they were received, a sympathetic approach would be adopted towards authorising further electrification projects. The board has belatedly submitted proposals for electrification of the East Coast main line between Kings Cross and Edinburgh. The railway unions, despite the adverse publicity that many receive, have cooperated on a wide range of productivity items—another precondition for electrification laid down by the Government.
  Nevertheless, the Government have taken no action to keep their promises. It is surprising that a Government who supposedly believe in business, profitability and efficiency should treat the board's application to go ahead with further electrification in a cavalier manner. It is surely in the interests of the Government, as paymaster, as well as in the interests of the management and the rail unions, to proceed as speedily as possible with electrification. The benefits of such a programme are well known: increased speed, increased reliability of rolling stock and equipment, reduced fuel requirements, lower maintenance costs, lower marginal costs, lower capital costs and greater productivity from the railwaymen. All that could be achieved by a programme of electrification.
  The Department of Transport and the British Railways Board produced a review of main line electrification as long ago as February 1981. It was stated at the time that the largest and the most expensive scheme, in terms of investment, would bring great tangible and measurable benefits to the railway industry. But the only Government announcement has been the agreement to go ahead with electrification of part of the line from Liverpool Street to Norwich. No new money has been provided for this purpose. The Government know that preliminary work before electrification, such as re-signalling and track alterations, will take about two years, which should see them safely, they hope, into the next election. Nothing at all has been offered towards paying for further electrification.
  864
  There have recently been leaks in the newspapers about prospects for the Channel tunnel. It would appear from newspaper reports that the Prime Minister turned down the Channel tunnel project at a meeting with President Mitterrand on 18 May. But hon. Members are still awaiting a Government statement confirming this.
  There has been even greater pressure on the British Rail Property Board in recent months to sell off its assets. Sir Robert Lawrence, the property board chairman—he is no Left-winger—said recently that he believed that only three years remained before the property division was virtually stripped of its prime assets. In an article in The Guardian on 19 May he conceded that the property board, because of pressure from the Government to make sales, was not getting the best price for the land and property that it was selling.
  The true decline in the railway industry is amply outlined in a recent report of the Central Transport Consultative Committee pointing to service reductions and the fact that passengers were not receiving proper treatment because of the pressure for savings imposed on the board by the Government. The report expressed concern about the effects of the application of rigid financial targets on the quality of services. Those who continually complain about standards of service in London and the South-East would be better employed, instead of writing angry letters to Mr. Sid Weighell and Mr. Ray Buckton, pressing Conservative Members to apply pressure on their Government to bring about more investment and so produce better services in their areas.
  There have been other numerous consequences of service reductions. The frequency of London to Birmingham stopping services which normally use the slow line through Northampton has been reduced and the journey time increased due to the state of the track. The effect is felt not only by passengers and commuters using the stopping services. Because of the state of the track, many services booked to use the fast, more direct route via Rugby find that they are moved to the slow line due to the backlog of maintenance on the fast line. Customers who depend on a service at 30-minute intervals and a journey time of one and a half hours between London and Birmingham are deserting the service because of the chronic unreliability of the trains.
  The line was electrified in the mid-1960s. It carries traffic far in excess of that for which it was designed. There are not only two trains to Birmingham from Euston every hour, but one to Manchester, one to Liverpool, one normally to Scotland and an intermediate semi-fast train to Preston and either to Blackpool or Barrow. The same lines are used by freightliner trains from Willesden and by freight trains from other regions.
  There is a chronic need for greater investment and modernisation of a line on which a great amount of money was last spent 17 years ago. In that time, the equivalent of 30 rail years have been used due to the amount of additional traffic. Again, that is a commentary on the productivity of the railway men, which is rarely, if ever, acknowledged by the Government.
  As my hon. Friend the Member for Swindon said, it looks as though industrial action will be precipitated in the railway industry in the next few weeks. I blame not only the Government for this. The management must take some blame. All too often, it appears to want to do the Government's job for them. Recently I had the pleasure of visiting my hon. Friend's constituency, when the

  865
  employees at the Swindon works staged a demonstration in protest against the threatened partial closure of the works and in defence of their jobs. The following day, in a newspaper which circulates in my hon. Friend's constituency, under the heading
  "BR want to cut rural lines",
  a Mr. D. J. Cobbett, who is described as the director for strategic studies, talked about the need to get out of suburban services and some of the more lightly used commuter services. He said:
  "Our dearest wish is to get out of having to do it."
  That is, having to run passenger trains. He continued:
  "We are not allowed to in many ways. Our own unions are not as clear-sighted on this as we are, which is a great shame as there is much opportunity in employment if you concentrate on strengths rather than including your weaknesses and allowing everything to fritter away to everyone's detriment."
  I do not know Mr. D. J. Cobbett particularly well. In my railway career we managed to do without a director for strategic studies. I should hazard a guess that he has no problem about flexible rostering for his work. However, when senior managers in the railway industry are doing the Government's job for them, it is a sad commentary.
  Mr. Stoddart: Undermining the railways.
  Mr. Snape: Further, as my hon. Friend the Member for Swindon said, it undermines the position of the railways, and of the unions in defence not of jobs for the sake of jobs, but of the industry, because they want to see a reasonable and viable future for the railways.
  Ultimatums have been issued by both sides. The Railway Staffs National Council meets on Friday this week when it is expected that the negotiations will collapse. Many in the industry, and those of us who are members of the railway unions, believe that the management of British Rail has decided that now is the right time to take on the railway unions to try forcibly to implement many of the so-called productivity schemes that it desires.
  One scheme that it is trying to force on the National Union of Railwaymen is that of one-man train operations between St. Pancras and Bedford. The management has put up a valid case for a driver only, with no other crew member on a train. As an ex-railway guard, I know that there are times when it is not possible to deploy railway guards to "maximum efficiency", to use one of the board's phrases.
  It will be a far worse railway system for many of the passengers and commuters if the only member of the staff is the driver, isolated as he is, in the front cab.
  Mr. Stoddart: Dangerous, too.
  Mr. Snape: Yes, it is also dangerous.
  For the travelling public, one-man operation of buses has proved to be a disaster. I remember the arguments in the early 1970s about productivity, when I was a member of a passenger transport authority. The result of the forcible implementation of the one-man buses is a mass desertion of passengers from buses. The buses are too slow and cumbersome and passengers cannot get assistance with luggage. There is no service provided. Public transport should provide a service. It should be concerned with helping people on and off trains and moving parcels and mail.
  The proposals of the British Railways Board for one-man operation of trains are, in my view and that of my union, a disaster. We were prepared to talk, but we are
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  now being told by the board "Drive them, operate them, or else". If we do not operate them, the board says that it will close down the system. So be it. The railways board is ready for what it would term a long siege. It is prepared for a two-months' shutdown, or one that is even longer.
  None of us with any regard for the industry looks on that with any pleasure. I have little patience for those who continually spend their time carrying banners demanding "Fight, smash, and crush", or this, that, or the other. However, railway men have been driven into a corner from which the only escape will be strike action. That will be a disaster for the industry, but the responsibility will lie primarily with the Government.
  8.25 pm
  Mr. A. E. P. Duffy: I shall vote for the amendment moved by my right hon. Friend the Member for Deptford, (Mr. Silkin) for the reason that he enunciated. However, like my other hon. Friends I have a further reason for doing so, and one that is also urgent. It relates to regional policy and to those changes that were announced in the early life of the Government, of which my right hon. and hon. Friends representing the Yorkshire region were apprehensive a year ago. We were responsible for promoting a full day's debate, the purpose of which was largely to bring to the attention of the Government and the House the effect of the Government's impending changes in regional policy on our region.
  The timetable for those changes is almost up, and time is fast running out. Already, it is too late to lodge applications for aid under certain headings of regions! policy. Already parts of Yorkshire and Humberside are viewing the changes that are to become final during the next few weeks with much more dismay than they thought possible a year ago, because of the change in their economic conditions.
  Some parts of Yorkshire and Humberside, soon to be deprived of assisted area status, believe that the impact of those changes on them could be nothing short of catastrophic. I wish to look at the region as a whole before focusing on my corner of it, South Yorkshire and the city of Sheffield. In doing so I wish to take stock of the fortunes of our region over the past year. I remind the House that our region remains substantially dependent for manufacturing employment on three sectors—textiles, mining and steel—and prospects for all of them have deteriorated since we held our debate a year ago.
  The bulk of Britain's wool textile industry is concentrated in our region, in Bradford and Huddersfield. Although the industry has moved up market and now exports 40 per cent. of its output, it remains prey to foreign competition. Consequently wool textile manufacturers find themselves once again wondering what kind of future: lies ahead for the industry, as they have to face up to regional difficulties.
  Trade union leaders too are questioning yet again whether the job sacrifices that they have made have been worth it. In the short space of a decade and a half the Yorkshire coalfield has been transformed from a top-heavy, under-productive organisation to a highly efficient one, using the latest technology to achieve productivity levels that are the admiration and envy of nearly every other British coalfield. Yet the future of our mining industry is, like that of textiles, difficult to assess.
  Although coal's importance seems likely to increase further as a result of oil supply and price uncertainties, the

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  future of the region's pits will be affected by the development of the great new Selby coalfield in neighbouring North Yorkshire.
  Sheffield has also been seriously hit by the problems of two of its principal sectors—steel and cutlery. Private sector steel has suffered long and hard from market raids by European producers, especially the Germans, who appear to have established an efficient and streamlined marketing system for all grades of specialised steel.
  In the public sector, the British Steel Corporation, having shed more than 1,000 jobs a year for the past 13 years, is down to 3 million tonnes of manned capacity. In cutlery about 90 per cent. of the market for stainless steel knives, forks and spoons has been captured by importers, which has forced the local industry to concentrate almost entirely on higher priced items.
  The engineering sector as a whole remains depressed, with a generally low level of business and cuts in employment continuing at firms such as Johnson and Firth Brown and involving for the first time firms such as Davy Loewy. Those are engineering giants. There are no parts of the private sector on which the whole of our economy must depend more than those firms. If they get into trouble, the whole of British industry is in trouble. Moreover, the majority of small firms in great engineering centres such as Sheffield depend precisely on the giant engineering firms such as Firth Brown and Davy Loewy as well as the British Steel Corporation and Hadfields to keep them going.
  The deep-sea fishing fleet on Humberside has declined from nearly 500 80 ft trawlers at the beginning of 1975 to about 120 registered trawlers, of which no more than half are active at present. For Hull that has meant that only about 5 per cent. of the labour force is now employed in fishing and its associated processing industry.
  British Aerospace workers at Brough are worried about their future employment. Today's announcements about cuts elsewhere in the economy by British Aerospace will do nothing to ease their anxieties. People in both Rotherham and Doncaster hope that the completion of the South Yorkshire navigation improvements will symbolise the renewal of the region and the ultimate revival of their industries. However, Doncaster, with its unique geographical setting, its long-established and advantageous rail links, its industrial diversity, which includes glass, fabrics, vehicle manufacture and everything from railways to steel rope-making and a high standard of industrial relations and responsible trade union leadership, might be expected to survive the recession better than most. Instead, it continues to be afflicted with severely increasing unemployment.
  As my right hon. Friend the Member for Barnsley (Mr. Mason) brought to the attention of the House today in his early-day motion entitled "Unemployment in South Yorkshire", the level of unemployment in the south of the region continues to rise. The underlying trend continues to rise more steeply than in almost any other part of the country.
  Despite today's news of the sag in the national level of unemployment, the level in South Yorkshire is still at 14·5 per cent., which is higher than the national level of 12·4 per cent. and significantly higher than the level of 11·3 per cent. that Yorkshire Members deplored just a year ago in our debate on Yorkshire.
  868
  Furthermore, that unusually high level of unemployment in South Yorkshire hides the severity of the problem in the main industrial centres. In our region unemployment is now higher than it was traditionally and is rising more steeply than elsewhere in the economy, yet in the part of the region that includes North Yorkshire, a rural county, the number of unemployed is substantially lower, which brings down that level. Therefore, the level is higher in the industrial centres.
  When we scrutinise the level of employment more closely we see that the regional rate, even in the old industrial centres of West and South Yorkshire and Humberside, also hides the higher level of unemployment among men. In all the great cities such as Bradford, Leeds, Sheffield and Hull, the male-only figure of unemployment is now approaching 20 per cent.
  Because of the overall state of the United Kingdom economy, the rate of inward investment into our area has been low. The gap between jobs lost and jobs created has been growing. In trying to persuade new industry to settle, from now on most of the region will be able to offer only a narrower range of investment incentives, following the Government's redrawing of development area boundaries and their intention to deprive local authorities such as Sheffield of assisted area status in a few weeks' time and given their general retreat from regional policy. That is where my concern lies.
  A comparison of average gross weekly earnings, spending on social security benefits, regionally relevant public spending per head and regional development spending per head with figures for Scotland, Wales, the Northern and North-West regions shows that our region fares badly. There is less public investment within our region than in neighbouring regions. The onus for securing economic regeneration has been placed as a result upon the local authorities. Each of the four county councils, together with their constituent districts, has been investigating possible new initiatives aimed at influencing the pattern of economic development.
  South Yorkshire has been active in the development of industrial estates. In Humberside a large quantity of land on the Humber estuary is being offered as an inducement for major petrochemical plant development. Sheffield city council is setting up its own employment department, thus launching a unique initiative in local government. A special working party recently set up by the Sheffield trades council criticised the youth opportunities programme for its failure to create new jobs for young people. A group of Sheffield business men have devised a plan called "future enterprises" to revitalise the city's industrial base.
  In West Yorkshire the county council has supported an action committee formed to link the various bodies concerned with the problems of the wool and clothing industries. It hopes to attract EEC funds for a scheme for textile area regeneration, known as STAR, through which aid to improve the environment and stimulate employment opportunities can be channelled.
  In the Yorkshire and Humberside region there is a surprising and heartening amount of self-help among local authorities, trade unions, trade councils and private business men. It is precisely the response for which the Government have asked. Every responsible body in the region is playing its part except the Government. The Yorkshire and Humberside region is a good area in which to test Britain's industrial prospects. In economic terms the

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  region shares many of the structural problems affecting many major United Kingdom centres. It has a number of important assets which suggest that it is one of the areas where economic improvement would manifest itself with the right encouragement and the required Government policies.
  The Government have well-defined financial policies. They can point to some results, but they have no strategy to help British industry sustain itself against the shattering effects of those same financial policies. The Yorkshire and Humberside region is in trouble, its industrial base of textiles, mining, steel and heavy engineering has been badly eroded. Yet this is the time when the Government have chosen to deny parts of the region investment incentives.
  I appeal to the Leader of the House and the Secretaries of State for Industry and Employment to reconsider their policy decisions. There might have been some justification for those policies when notice of them was given nearly three years ago. Given the deterioration within our national economy and the faster deterioration in the Yorkshire and Humberside region, there is less justification than there was. In parts of the Yorkshire and Humberside region, such as Sheffield, the imminent deprivation of assisted area status is viewed as perhaps a near-disaster. I hope that the Leader of the House will bring to the attention of his right hon. Friends my appeal to them at this late hour to reconsider their regional policies.
  8.40 pm
  Mr. Roy Hughes: I support my hon. Friend the Member for Fife, Central (Mr. Hamilton) in his contention that there are a hundred and one reasons why the House should not adjourn for the Whitsun Recess. Yesterday during Welsh questions I referred to the scandal of Welsh water charges. I was incensed by the indifferent nature of the reply that I received and I resolved to raise the issue again at the earliest opportunity.
  It seems that Ministers at the Welsh Office have an insufficient realisation of the gravity of the situation that is developing in Wales over water charges. I gave them due warning during the Welsh debate on 25 February, especially of the feeling that was building up in my constituency. An urgent statement is now necessary from the Secretary of State for Wales on financial relief for hard-pressed ratepayers in Newport and throughout Wales. Bearing in mind the right hon. Gentleman's performance, I am not optimistic about the outcome.
  One can point to the scandalous nature of the administration of the Welsh water authority. The authority was created nearly 10 years ago by a Conservative Government. Throughout its area there has been no representation on its management board from Newport, which is the third largest town in Wales. On the new board that has been created by the Secretary of State—one might say that it is his brain child—Gwent does not have a representative, yet Gwent has about 20 per cent. of the population of Wales and perhaps the largest sector of industry throughout the Principality.
  The public have become cynical about the political nepotism that is so frequently demonstrated by the Secretary of State in the appointments for which he is responsible. This tendency has been most marked over appointments to the new Welsh water authority. We have, for instance, the ridiculous appointment of Sir John
  870
  Cotterell of Hereford, a well-known Conservative. As I have said, Gwent, which is one of the largest counties in Wales, has no representative.
  There is no need to take my word for the strength of feeling over appointments to the authority. A few days ago the Gwent county council had a full-scale debate on the issue, during which it was said that retired Army officers seem to have the best chance of being chosen for the board. Among other scathing criticisms reported in the Welsh press was a reference to the "clowns" at the Welsh Office. A senior member of the county council said that the new board was an "affront" to Gwent and was a case of "jobs for the boys."
  There has been some speculation that the board will meet in private. Bearing in mind its composition, one can understand why. Newport and Gwent seem defenceless in this situation. Exorbitant charges are levied without representation. All local access to and local links with representatives will vanish. Such developments are dangerous for democracy, particularly when one considers the strength of feeling that is building up over these charges. I have received several large petitions from people who say that they will refuse to pay. I do not encourage them to do that, but I can understand why they feel as they do.
  Newport, as a progressive local authority, provided for the water supplies of its consumers many years ago. Then, over the years, we experienced various centralisation measures. The Newport authority was followed by the South Monmouthshire authority and the Gwent authority. Now we have the Welsh water authority. Throughout this time the ratepayers of Newport have paid through the nose.
  Since 1960 water rates in Newport have increased by no less than 2,700 per cent. That is why I say that the charges are a scandal. They have risen from £1·93 in 1959–60 to £53·00 in 1982–83. There has been a similar exorbitant pattern of increases in sewerage charges.
  For the average domestic ratepayer, water and sewerage charges will amount to £96 compared with a total borough rate of £46. That figure is finalised by the 18 per cent. imposed by the Welsh water authority about three months ago. The charges for water and sewerage are more than double the charges for all the other services provided by the local authority.
  A great proportion of the rates in Newport is eaten up by these charges, when so many other valuable services need that money. A great deal more money could he spent on housing. Public health, swimming pools, parks, public works, the municipal bus service and a subsidy for the National Welsh Bus Company must be provided for out of the rates. What is left must be spent to try to attract new industry to the area.
  Industrial sites must be developed to provide new jobs not only for Newport but for the valleys of the hinterland. Newport has done its best to persuade the Welsh water authority to provide drainage and water supplies for the new industrial areas. We already pay enough to the Welsh water authority to have that type of service. Work is particularly necessary on a number of low level sites on the coastal belt. Such sites could accommodate the massive new industries, such as Datsun, which we hope to attract to the area. Many firms realise the potential of the area, with its motorway links to the Midlands and South-East England, yet the Welsh water authority just

  871
  does not wish to know about this vital work and says "We shall leave it to the Welsh Development Agency or you can do it yourself at the ratepayers' expense".
  There is no rebate scheme for water charges for the really needy sections of the community. Pensioners, some of them with limited means, cannot understand why they receive such hefty bills when the quantity of water that they consume is so small.
  Mr. Haydn Rees, the chairman of the Welsh water authority, will retire this week after six years in the hot seat. I do not blame him for the situation that has developed. He inherited the problem, and he seems to know the difficulties, but the Government have not given him the wherewithal to rectify the position.
  In his valedictory statement a few days ago, Mr. Rees said that within 10 years there would be a common water charge for England and Wales. Such a system has already been created for gas and electricity charges. Perhaps that is the way ahead, but people in Newport are not prepared to wait for 10 years. Mr. Rees has at least attempted to get a realistic price for Welsh water where it is sold to other water authorities, but the Secretary of State for Wales is dithering over this proposal. Indeed, he has been dithering for seven months. It is absurd that people who live in the shadow of the Elan valley reservoirs are paying more for their water than those who live in industrial Birmingham and the West Midlands.
  The Labour Government introduced a rudimentary equalisation scheme and the Welsh water authority benefited by £3 million annually. Admittedly that was not much, but the idea was that the system should be built up to obtain an element of justice for Welsh ratepayers. However, when this Government came to power they soon set aside that scheme.
  Ministers in the Welsh Office should remember that if they do not take some action on the exorbitant charges they will reap the whirlwind. Those who live in Newport and in the whole of Wales are law abiding, but now they seem to be saying "Enough is enough".
  8.54 pm
  Mr. Phillip Whitehead: I shall return to the matter of the railways, a subject which has already been raised by four of my hon. Friends. The Leader of the House will be aware that many Opposition Members are distressed because, due to the need to debate the European Community tomorrow, we have been deprived of the opportunity to discuss the grave state of affairs of British Rail, which is likely to lead to the worst industrial confrontation—and perhaps a decimation of services thereafter—that I can recall. It will certainly be the worst during the present generation. Those are serious words. I hope that they will be taken seriously.
  We are now on a collision course, about which the Government must make a statement before the House rises for the recess. The deadlines involved will have been passed before the House resumes. It appears that on Friday, at a meeting of the Railway Staffs National Council, the British Railways Board will advance proposals that will lead to the complete shutdown of the railways. It may have decided on that course of action in the knowledge that a collision with all the major rail unions, at a time of national crisis and hypertension as a
  872
  result of events overseas, may intimidate railway workers out of taking industrial action, which will be inevitable if the board puts forward its package.
  The board is being egged on by the Government. The Government have brought about the impasse. That impasse will continue as long as the complete freeze on investment and a failure of confidence in the railways remain. Decisions about the future of the industry have been pre-empted because of the inquiry—which may be an inquest on the whitening bones of the industry if the Government force the industry to commit suicide by egging the board on to a collision course to disaster. I shall not go into detail as others have done. I shall deal with the problem as it affects my constituency and the industry as a whole.
  It is not right to say, as I believe the Secretary of State for Employment—that well-known hammer of the unions—will say in Beaconsfield this evening, that the railways have not delivered, that the unions must be told that if there is a showdown they will be to blame and that they must be whipped back into line. The unions and those who work on British Rail have always acknowledged that there is a need for a more efficient and productive railway. Most of them have delivered.
  The National Union of Railwaymen, to which I belong, has delivered on the productivity deals that the British Railways Board has suggested. The railwaymen have delivered on freight marshalling yards, rationalisation, cuts in passenger train mileage and the acceleration of administrative changes, and they have co-operated in all of the good housekeeping schemes that have been put up by British Rail.
  Every month 1,000 people leave the industry. From April 1980 to April 1981 there was a reduction of 5,886 posts, with a saving of £28,896,000 in staff costs. In the following April to December of 1981 another 8,293 posts were lost, yielding a saving of £33,741,000. The unions have delivered time after time. They have delivered the jobs of their own members. What have they received in return? Nothing. All the schemes for electrification have been put on the back burner. They have had no tangible benefits recently to show for the years of co-operation.
  The matter has been brought to a head by the proposal artificially to bring forward the decision to close two-and-a-half railway workshops and make major redundancies elsewhere. We have heard what has happened to the Shildon and Swindon works. In my constituency and that of my hon. Friend the Member for Derby, South (Mr. Johnson) the Derby locomotive works must face 400 redundancies. The work force there has co-operated with the management in every scheme. Now the workers are told that they will have some work as a result of closures elsewhere, so why not co-operate? "Let the crocodile eat other people and he will eat you later." That is not working people's view of closures elsewhere when they know that their turn may come next or the time after that.
  Two of the three apprentice schools in Derby have been closed as a result of a rationalisation. In those circumstances, how can British Rail say that it will be going out for expansion and that if productivity were better it could obtain more overseas orders? A large order for Nigeria is being discussed. Where will the rolling stock be built? Where will the trained personnel be found if lay-offs in the workshops continue in this way and skilled apprentices do not come through into the work force? The answer is that it will be impossible to find them.

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  Many of us suspect that not merely is British Rail embarking on a collision course with all the unions, having deliberately put together a package which includes elements of conflict with the staff unions, the NUR and TSSA, but that the Government are encouraging British Rail to act as their willing client in selling off most of the assets of the railways.
  My hon. Friend the Member for West Bromwich, East (Mr. Snape) referred to the sayings of Sir Robert Lawrence about asset-stripping. In Derby our workshops have been the pride of the railway system. There is the technical centre and there are the carriage and loco works. We now hear that those workshops may be candidates for privatisation. They will not be closed, because too much investment went into them in the good days of the railways, but if they are slimmed down and the work force bled away they may well become candidates for privatisation. Indeed, we are told that GEC may be coming to look around. It would be outrageous if the engineering workshops in Derby were sold off.
  I believe that in the last Session of Parliament there was a draft Bill, which never saw the light of day or the scrutiny of Members of Parliament, to permit the selling off of all the workshops. Our suspicion and fear is that, after two months of total shutdown on the railways and a crisis from which everyone should now back away because it will lead to the most destructive confrontation, the result will be the devastation of the railway system as we have known it.
  As has been emphasised several times this week, there have been persistent calls for statements from the Government on a number of issues. Where is the statement about the Channel tunnel? Where is the statement about the delays in electrification? Where is the statement about railway workshop closures? Finally, before the key decision that must be made on Friday, just before the House rises for the recess, I say in all seriousness to the Leader of the House that an explanation is required from the Government. There must be some understanding by the Government that if the essentially moderate people who work on the railways are driven too far, not only will they be driven to the point at which they have no alternative but to take industrial action, as I believe will be the case if the proposals to be put on Friday are carried through, but the result will be the destruction of the British railway system, for which the British public will not forgive the Government.
  9.3 pm
  Mr. David Winnick: I endorse all the remarks made by my hon. Friends the Members for Derby, North (Mr. Whitehead), Swindon (Mr. Stoddart), West Bromwich, East (Mr. Snape) and Bishop Auckland (Mr. Foster) about the onslaught on the railway industry. My hon. Friends spoke eloquently of the need to defend their constituencies and the industry and they have the full support of the entire Parliamentary Labour Party.
  It is many years since the House went into recess in a situation such as today's, in which we are at war with another country. There was unanimous agreement in the House in totally condemning the Argentine junta's invasion of the Falkland Islands. Before the House goes into recess, however, the need for a negotiated settlement must be understood. I understand the political pressures that led the junta to take its action. The week before the
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  invasion, there was a massive demonstration in the Argentine capital, and it was to relieve itself from that pressure that the junta acted as it did.
  The need to seek a negotiated settlement is very important and should be given great priority by the House and by the Government. I was concerned at what I considered to be the negative attitude shown by the Prime Minister at Question Time today. When pressed by my right hon. Friend the Leader of the Opposition about negotiations, the United Nations and so on, the right hon. Lady fell back on the need for military victory. As my right hon. Friend mentioned, the speech which the Foreign Secretary made on Thursday was somewhat different from the remarks we heard from the Prime Minister today.
  I hope that the Leader of the House will listen to this quote from what the Foreign Secretary said only last Thursday:
  "I was coming on to the future of negotiations, which was one of the important points taken up by the right hon. Member for Cardiff South-East as well. There is no question of the Government having turned their back on the idea of a negotiated settlement. The diplomatic option and effort continues as vigorously as before."
  In the same speech the Foreign Secretary also said:
  "I agree entirely with what the right hon. Member for Leeds, East (Mr. Healey) said about military and diplomatic pressures going together. Both are required. Neither would be effective without the other. They are part of a comprehensive whole."—[Official Report, 20 May 1982; Vol. 24, c. 552.]
  We know about the military pressures and the escalation which has occurred since the debate last Thursday. What we do not know about are the diplomatic efforts and what efforts have been made by the British Government to find a negotiated settlement to the crisis.
  No one, certainly not myself, denies that the issue is complex. I have said previously in a debate on the Falkland Islands that I do not consider this to be another Suez because at the time of Suez it was clear who the aggressor was. If I believed it was another Suez, I would be virtually condoning what the junta did. That does not alter the fact that a military solution will not be a proper lasting solution—for reasons which must be obvious to everyone in the House. Therefore, I hope that the Government will not close the door on negotiations or on trying to find an interim arrangement.
  There has been much talk in the House and in the media generally about the possibility of United Nations administration or trusteeship. That type of solution may be more acceptable in the long run than Britain simply repossessing the Falkland Islands. If we repossess the islands, what will we do afterwards? Will we keep a huge force there, 8,000 miles away from the United Kingdom? Will we have to keep such a force there in case the ruling authorities in Argentina decide to have another go? There must be recognition of all the complex problems involved, which must mean a need to get around the negotiating table. Of course it goes without saying that that applies to the junta as well as to the British Government.
  I am glad that the Leader of the House accepted at the outset the amendment moved by my right hon. Friend the Member for Deptford (Mr. Silkin). It would be impossible to believe that if there was a further major escalation of the conflict with major casualties the House would not be called back. I hope that pressures from Members of Parliament and the public generally will ensure that we will be brought back.
  I have contempt for those who believe that what is happening in the South Atlantic can be a springboard for

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  some electoral success. It would be a disgrace if the British and Argentines who have lost their lives and those who have been injured were used as an excuse for a snap election in which the Tory Party could do well on the basis of what has happened over the Falkland crisis.
  I hope that, like me, most Conservative Members will view with contempt those people who are willing to use people's lives, let alone British lives, lost in military action purely and simply to advance their party's narrow interests. Might I add here that the inquiry has yet to take place about the events which led to the invasion in the first place, and presumably the then Foreign Secretary did not resign for the fun of it.
  I turn now to some local matters. Although there has been some decrease in unemployment according to the figures which came out today, the underlying number of unemployed adults is still increasing. What is particularly worrying for hon. Members like me who represent West Midlands constituencies is the continued substantial increase in unemployment in the region during the past three years.
  On 22 April I asked a question about
  "the percentage increase in unemployment between May 1979 and the current time in each of the travel-to-work areas of the West Midlands."—[Official Report, 22 April 1982; Vol.22, c. 130.]
  In my own travel-to-work area of Walsall, the increase in unemployment over the past three years was 240 per cent. In Dudley and Sandwell, and, also of course, in the black country, the figure was 271 per cent. In Birmingham, it was 182 per cent. Clearly, the increase in unemployment in the West Midlands has been far greater than in most other parts of the country, and certainly nationally.
  I have here an answer to another question that I asked on 8 April. These answers will be of particular interest to the Leader of the House, for obvious reasons. I asked for the percentage increases for the West Midlands and the Walsall travel-to-work area. I have already mentioned the increase of 241 per cent. in three years in the Walsall travel-to-work area. For the West Midlands as a whole the figure was 193 per cent. There are also continuing large-scale redundancies, closures, and the rest. We therefore believe that measures are urgently needed to reverse the tide of mass unemployment so that people may get back to work, and to stop adults rotting their lives away in the dole queues, as well as young people leaving school.
  So far, there has been no announcement from the Government that they intend to pursue policies which will reverse the tide of mass unemployment. At the moment, the dominant issue is the Falklands. That is natural, because lives are involved and we do not know how many more casualties there will be. However, when the Falkland crisis is over, we shall still be faced with the crisis of mass unemployment and the fact that millions of people in this country are denied the opportunity to earn their living.
  I am also worried because those who have been made unemployed are to be penalised in a particularly vindictive manner. We had a debate about the fact that unemployed people are to be taxed. We know, too, that although taxation will begin in the current year, the 5 per cent. which was taken from them in 1980 in lieu of taxation will not be restored. I have a reply here from a Treasury Minister to a question in which I asked how many
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  unemployed will not pay income tax because their income is too low. The reply was 1¼ million. So out of those who will not be liable to income tax—the registered unemployed—1¼ million will not pay any income tax at all because their total income is too low.
  Forty per cent. of the unemployed are affected in that way, yet those people who will not pay income tax are denied the 5 per cent. in benefit. The 60 per cent. of unemployed people who will be liable to tax will be subject to double taxation. They will pay income tax as well as the 5 per cent. deduction that was introduced in lieu of taxation about 2 years ago.
  I mention that matter because it seems to me that the House should have special concern for those people most at risk in our community. It is all very well for the Government to say that unemployment is unfortunate but inevitable because of economic trends and what is happening abroad. That is certainly not an argument that my right hon. and hon. Friends and I would accept.
  What possible justification can there be, however, for the measures that I have been describing being taken against the unemployed? People who, through no fault of their own, find themselves without work and on the dole queue are penalised by having less money than they would otherwise have. When we talk about going into recess, everyone should bear in mind how difficult things are for those of our constituents who are out of work and to whom every single penny counts. It is not just the unemployed who suffer: it is their wives and children. Yet the Government have taken action which is amongst the most vindictive that they have taken in the past three years.
  My hon. Friend the Member for Fife, Central (Mr. Hamilton) was right in what he said about the nurses. He also referred to the wealthier sections of the community which have done so well. It is about time the Government took some action for the poorer sections of the community and certainly for the unemployed. The plight of those people who have been the victims of Government policy should be brought to the notice of the House. I hope that even at this late hour the 5 per cent. that was stolen from the unemployed will be restored to their benefit.
  9.15 pm
  Mr. Tam Dalyell: Many of my hon. Friends have raised the issue of the railway workshops. Like some of my hon. Friends, I have the good fortune to be an NUR-sponsored Member. There is nothing that I can usefully add to the authoritative speech of my hon. Friend the Member for West Bromwich, East (Mr. Snape) and others who have spoken on this issue, as the Shadow Secretary of State for Transport my right hon. Friend the Member for Barrow-in-Furness (Mr. Booth) knows well.
  In all the meetings that I have attended with the NUR I have been struck by the extent to which the union has cooperated in the various proposals that have been put forward over the years by British Rail. If anybody thinks that in the cuts and in the changes in passenger services and freight there has not been formidable union cooperation, they are living in another world. It may be that they have been too helpful for their own good. It would be a great pity if at this stage, on the crux issue of railway workshops, unfair advantage was seen to be taken of all the co-operation that has been given over the past few years.
  Last year, with several colleagues, I visited the railway workshops in the constituency of my hon. Friend the

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  Member for Swindon (Mr. Stoddart). It is an extremely impressive place. The training is exceptional. As one whose job it was to go round a number of training institutions in Britain, I can say that the training given at Swindon is second to none. I hope that the Leader of the House and his colleagues will heed what Labour Members have said.
  It would be an abuse of the procedure of the House to go in detail into the many aspects of the Falklands issue at this stage in the business. However, I thank the Leader of the House for the undertaking that he gave at the beginning of the debate on the recall of Parliament. I shall concentrate on one issue. If those who share the view that some of us have put forward are to be persuasive in trying to achieve a ceasefire and an immediate end to bloodshed we must point out to the Government that they should be very careful about inviting the Russians into the South Atlantic. As the right hon. Member for Sidcup (Mr. Heath) said, we must look over the hill. In addition, the American Secretary of State has said that there is no military solution. Therefore, the House should be recalled if there is any sign of change within Argentina.
  Mr. Bob Cryer: I have been waiting to speak since 7 pm.
  Mr. Dalyell: I shall be brief.
  Elements of the Left in the Argentine Air Force and Army, together with some of the Left-wing Peronistas and—according to friends who work for a Latin American newsletter—the Communists, are almost certainly trying to put together some deal with each other. I do not say that General Menendez and his forces on the Falkland Islands are likely to surrender, but it is possible. Our forces face the most formidable terrain when crossing the island to Port Stanley. However, if General Menendez and his forces surrender, there will almost certainly be a coup or revolution in Argentina. If I were asked what evidence there was, I would point to an important fact that is known to the Foreign Office. Indeed, I have spoken partly in the hope that the Foreign Office will take it more seriously than those who put it to them suggest.
  Juan Abalmedina was secretary general of the Peronistas in the 1970s. Those of us who spoke to the Latin American delegates at the Latin American European Assembly conferences will know of the charisma that attaches to that man. He has been incarcerated—that is the word—in the Mexican embassy in Buenos Aires for the past six years. In a sense, he is a charismatic figure. He could have been given his freedom only with the connivance and agreement of at least sections of the Argentine armed forces. Therefore, I suggest that a deal has been made. We must study carefully what the right hon. Member for Sidcup called the other side of the hill.
  Hon. Members should imagine the scenario of the Argentines facing defeat, inflation and a debt of $35 billion. We have the ingredients for an explosive situation and either for a coup by the Right to achieve a more hard-line Government or for the advent of what can be described only as a Gaddafi-like situation. If that situation were to develop in the Southern hemisphere, it would be extremely dangerous for the West. It would play right into the hands of the Soviet camp. The one thing of which we can be certain is that any successor to the Argentine Government, Right or Left, will not be any more disposed towards negotiation. There is no likelihood of a civilian
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  Government who might negotiate. I suppose that one must look at it from our point of view and from theirs. Indeed, if it is worth dying for the islands, they must be worth keeping. The more blood spilled, the more intransigent the impasse that we have reached.
  However, Argentine intransigence would survive any British military triumph. Therefore, we would unleash a revolutionary process in Argentina that certainly would clash with the traditional sectors of society. That involves the British community. This is a new situation because there is no precendent for such a war in South America.
  The purpose of my speech is to stress that at this stage, and possibly in the next 10 days, we must be careful to look for any moment at which, by stopping fighting, we can help those forces in Argentina who want a dialogue with the West rather than the alternative of dependency on Moscow. For that reason, I am not happy about the EEC sanctions. The sanctions, which I suspect are inefficient, nevertheless create the atmosphere of the Hispanic world taking on the Anglo-Saxon English-speaking world.
  During Question Time reference was made to the French Government and their exports. The French Government said that the radar avionics for the Exocet were not exported by them. That is the weaponry that sank poor HMS "Sheffield". However, the chairman of Dassault, exulting in the missile's success and suggesting that his exports are really formidable, told us that it was a package. Both cannot be right. The question arises: who is right? If, as one suspects, the chairman of Dassault is right and the French Government are wrong, one begins to wonder about the efficiency of the embargo. The sanctions are not efficient, because Siemens has told the German Government that it will not obey the embargo, or words to that effect. So that sanction is not effective. And we all know what the Italians are doing.
  If we create the atmosphere of these sanctions, we are reinforcing the idea of the Hispanic world against the English-speaking world. That is extremely dangerous and it must be watched in the coming crucial 10 days. Incidentally, it is a situation that makes those around Willy Brandt, not necessarily around the German Chancellor, extremely angry with what is happening.
  Another reason I hope that there will be a report back concerns the delicate issue of what is happening on the South American mainland. The Leader of the House may look very bored about all this——
  Mr. Biffen: I have spent 30 years listening to the hon. Gentleman, and they have been the most pleasurable experiences that I have had.
  Mr. Dalyell: That is a gem for my election address.
  I endeavoured to raise this matter of considerable importance under Standing Order No. 9. If the press had not raised it, I do not think that I would have done. There is widespread belief that there has been an operation on the South American mainland. Unlike some of those with whom I am widely associated, I think there is a perfectly understandable reason for doing that. It is politically hazardous, but if we do not withdraw the task force, as would be my preference, something might have to be done about the bases. However, someone some time will have to explain why that helicopter crashed in Chile. We can be forgiven for the assumption that it was some kind of an attempt to do something about the Super Etendards that carried the Exocet that sank the "Sheffield".

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  If I were a member of the task force or had relations serving with the task force, I would be pressing as much as anyone—given that the task force was there—for something to be done about the Super Etendards and the Exocet. Rather than sending Vulcans to knock them out, frankly it might be better to send SAS parties—as has been suggested by the Daily Mail, among others—on to the Latin American mainland. To me, that is a reason for withdrawing the task force.
  If landing on the mainland has been found necessary, the Government are creating a new situation. We have been told by the Venezuelan President that once anything happens on the South American mainland, diplomatic relations will be broken with Venezuela. Certainly Roberto Campos gave the same indication to some of us about relations with Brazil, as did the Colombian ambassador. That therefore brings us back to the whole question of relations with the Latin American continent.
  The House has been patient with me. I thank the right hon. Gentleman for his promise. I merely seek to extract from him the courteous assent that he will raise these matters with the Foreign Office. It knows perfectly well that they have been raised before. I hope that, by raising them now, they will be taken seriously.
  9.31 pm
  Mr. Stuart Holland: I also support the amendment in the name of my right hon. Friend the Leader of the Opposition. I do not think that the House should adjourn, especially in view of the serious situation in my own constituency—and several other constituencies—over the operation of the community enterprise programme run by the Manpower Services Commission.
  The matter is urgent in Vauxhall, where Elephant Jobs Ltd., sponsored under the community enterprise programme, is threatened with foreclosure of its funding from the end of this month; in other words, before the House returns from the recess.
  I posed various questions to the Secretary of State for Employment and received a series of unclear replies. For example, I asked the right hon. Gentleman
  "whether he has required the Manpower Services Commission to reinterpret the guidelines for projects funded by the community enterprise programmes",
  and received a typically monosyllabic answer:
  "No".—[Official Report, 24 May 1982; Vol. 24, c. 228.]
  On the other hand, both Elephant Jobs Ltd. and the House of Lambeth Project, funded indirectly by the Manpower Services Commission through the Lady Margaret Hall Settlement, may have to close part of their project work because of a change in the interpretation of the guidelines on the financing of these programmes.
  The change in interpretation hinges—this has been confirmed by the Minister—on what is meant by "economic" and "economic benefit" and whether projects of this kind can put existing jobs at risk. So far as anyone concerned with these projects can tell, no evidence has been adduced to suggest that this is the case and that jobs are at risk.
  The reply that I have received from the Minister is purely hypothetical—that projects should not be put at risk but that there was a possibility that projects
  "could put existing jobs at risk or prevent the creation of potential new jobs."—[Official Report, 19 May 1982; Vol. 24, c. 111.]
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  What we have here by implication is a variant on the Government's general crowding-out argument from either public enterprise projects or public sponsored projects and their impact on the private sector. Just as the Government are mistaken in arguing generally that public spending drains rather than sustains the private sector, so, in the particular case of two projects—one of which, Elephant Jobs Ltd., employs 140 persons and the other, the House of Lambeth, employs 40 persons—the Government's reasoning is dubious and raises a fundamental question.
  If these projects are now to be called into question and further funding denied them, how is it that, under the same guidelines, they were approved for funding by the Manpower Services Commission and the community employment programme under the same provisions and under earlier spending commitments?
  The definition of what is or is not a project meriting benefit comes out of the CEP's sponsors handbook, which says that the community enterprise programme scheme should contribute to the improvement of the local environment, the conservation of energy or provide amenities or economic benefit to the community. But the handbook makes no other reference to community benefit. There are references to other things that the scheme should not do, but what is defined as community benefit is not made clear. Nor, frankly, is it made clear by the replies that I have had so far from the Minister. He says that projects put forward by sponsors are considered individually and the Government will judge whether projects are of economic benefit in the light of local needs and circumstances.
  However, if they were local needs and circumstances we might be talking about one or two isolated projects. I am not only faced with two projects that are now threatened with closure in my constituency, but another similar project is threatened. Several projects are now in question, not only in the London area, but in the rest of the country.
  Clearly the Secretary of State has passed instructions down the line that there should be a revision of the interpretation of the rules for funding which throws not only these projects but others into nothing less than crisis. The crisis is caused not only because current activities cannot be sustained, but also through not knowing how funding should continue. It is very difficult to know what lies behind the effective reinterpretation of the rules, but one suspects that it must be something which either the Manpower Services Commission or the Secretary of State prefers not to make public. One can only suspect that they hoped that this fudging of the community benefit criterion definition would not be observed.
  There is also a widespread suspicion that this is a covert way of changing the whole nature of the community enterprise programme projects nationally. The Minister assures me that this is not so and that the Government have made available additional resources under the programme to support another 5,000 places during the coming year. It is interesting to speculate how they will do this. It is very hard to imagine the creation of programmes that would escape the harsh and unrealistic redefinition of employment creation.
  What sense can be made of the community benefit of projects of this kind if they cannot create employment which, in effect, brings benefit to the local community? If the Minister is not clear about the benefit, it is possible to suggest grounds on which he should be able to judge

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  whether benefit is brought to a local area. These include the generation of income and surplus by the enterprise and higher spending power of some of those employed in inner city areas.
  Unfortunately, that is not the end of the matter. In Elephant Jobs Ltd. the average wage is £83 gross a week. About one-third of the employees are married or single parents, with dependants. But others are single persons. I have asked the Minister to state the net cost to the Exchequer if these people were made unemployed instead of continuing to be funded on these programmes. I was told that there would be no net Exchequer cost, for given reasons. The reason that was not given—which is important to the whole rationale of these programmes—is that they would be eligible for unemployment benefit that amounts to as much as they are being paid to work. There would be no net difference. The difference is that, instead of being engaged in craft training schemes and in employment, they would be unemployed and on the dole.
  I stress my reasons for being concerned about the immediate impact of what is happening in my constituency and in other inner city areas. The employees of Elephant Jobs Ltd. are largely drawn from the most deprived parts of a relatively deprived community. More than 50 per cent. are black. Many live in the Lambeth and Lewisham areas. Many are ex-offenders. It is people in these categories who are likely to be put on the streets by the change in the rules and guidelines for these programmes and who will view with considerable cynicism any seriousness on the part of the Government about realising the alleged intention of the inner cities programme to create jobs and to foster "community spirit" in those areas. These projects represent a first line of defence against a collapse of confidence in the social system as a whole, giving rise to the grave social discontent that was seen in the streets last year, not only in Lambeth and Brixton, but elsewhere.
  I am worried by the fact that the Minister does not seem to be aware of the manner in which the Manpower Services Commission is interpreting these rule changes. I was told that the Secretary of State had not requested the Manpower Services Commission to reinterpret the guidelines. Yet the House of Lambeth project, providing 40 jobs, mainly in woodworking, has received a letter from the Manpower Services Commission giving notice that
  "after taking Head Office advice, the House of Lambeth fails to meet the community benefit criterion of the Community Enterprise Programme and for that reason the scheme is not regarded as refundable."
  It is clear that, despite the Minister's assurance, instructions are coming down the line to axe a whole series of these projects in the inner city areas. The Manpower Services Commission says that there has been no change in the criteria. I have drawn attention to the guidelines, opaque though they may be, from the sponsor's handbook. It seems, however, that the Minister is not aware that the change in the interpretation of the guidelines means that capital projects approved last year will now be wasted. Resources have been committed to them, but the funds for their operation will not be available.
  The change in the attitude of the Government towards these programmes is made plain in the case of the House of Lambeth by the fact that this project came up for grant renewal last October and was encouraged to expand from 31 to 40 places, which was done. It seems that at that time the Manpower Services Commission was happy with the
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  criteria. So happy was it that it gave sanction to Lambeth council to approve a £13,000 grant from the job creation fund to help. That capital sum has been spent on a GLC rented factory, which, if the scheme closes, will be wasted.
  There is a strong case for claiming that the revision in the application of the funding rules at best amounts to maladministration by the MSC, for which the Secretary of State is responsible, and at worst represents a cynical attack on the principle of publicly funded projects in the inner city areas. Schemes such as the House of Lambeth expire in July. Following pressure, they were given a three-month extension beyond that date either to come within the criteria as redefined, or to find alternative funding, for instance to convert to a youth opportunities training workshop or a local authority sponsored workshop.
  However, as the House of Lambeth—sponsored by the Lady Margaret Hall Settlement—has submitted to me, it is difficult to answer the case that has been brought when one no longer knows of what one is accused. The attempts at definition by the MSC at informal meetings have been arbitrary and—in effect—obstructive.
  The future of the Government's programme for the long-term unemployed, the cut in places in a borough such as Lambeth and the loss of jobs are seriously affecting inner city areas. Since the events took place in Brixton last year we have had a virtual doubling of youth unemployment in the area. It is very worrying that on the one hand a project such as the House of Lambeth has been praised for "creating real jobs" through its various projects and on the other hand has been told that it is taking away jobs from the local community. The change in interpretation is ruining not only years of work but the morale of those who are employed.
  I asked the Minister of State, Department of Employment whether he was aware of what the impact of a cut of 40 of the places on the Elephant Jobs scheme would be on the enterprise. He replied that that was for Elephant Jobs to determine. Of course, it is not. If one takes 40 places from 140 places on such schemes, which have fixed overheads in terms of management personnel and the commitment of a basic management staff, that means the closure of the project.
  It is clearly time that the Secretary of State for the Environment and the Secretary of State for Employment got together to face the responsibilities of their respective urban and economic programmes. It is time that they got together to try to marry the commitment to the inner cities, of which we hear so much, with the real preservation of community sponsored jobs in inner city areas.
  At present we are in a "Catch 22" situation. All projects are required to benefit the community. They are supposed to do so through job creation. Yet when they move to viable areas of job creation it is claimed, without evidence, that they are competing with the private sector.
  The House should address itself to this issue. We should receive a reply from the Leader of the House indicating that he will not only draw these matters to the attention of the Secretary of State for Employment and the Secretary of State for the Environment, but will seek to ensure that projects such as these in the Vauxhall constituency can not only survive, but grow and flourish.
  9.50 pm
  Mr. Bob Cryer: May I say to my hon. Friend the Member for West Lothian (Mr. Dalyell) that when I was explaining my presence from seven o'clock and the fact that I had not been called I was not commenting on his speech? I was telling my hon. Friend the Member for Glasgow, Springburn (Mr. Martin) that it did not make any difference if one sat here all the time and tabled an amendment, and that a letter to Mr. Speaker was the only way of securing that one was called. That is one reason why the Chamber is continuously empty week after week. I am disappointed that my amendment was not called. It would have provided power to Back Benchers instead of the Front Bench and the Government who have power to determine the business of the House.
  I support the motion tabled by the Opposition Front Bench, because I believe that there is a continuing and growing need to reflect the criticism of the Labour and trade union movement of the Government's policy of waging war in the South Atlantic. That is no criticism of the men who face the grave danger in which the Government have placed them in the South Atlantic with a great deal of courage and fortitude.
  The reason why I believe that the House should not adjourn has already been mentioned by my hon. Friends and, significantly, not by any Conservative Members. It is the difficulty faced by National Health Service workers because of the position in which they have been placed by the Government. They have no wish to go on strike and they recognise the dilemma that they are in. They provide a continuous service that looks after those who are ill. They do not want to prejudice that position. If they have a face of compassion, the Government will not look at it with sympathy—they will kick it. That is the sad, glaring truth.
  Over the past three years Health Service workers—ancillary workers, nurses and ambulance drivers—have taken a cut in their wages. In 1980 when there was an annual inflation rate of about 18 per cent. ancillary workers received about 12 per cent. In 1981, with an inflation rate of about 12 per cent., ancillary workers had a wage increase of 7·5 per cent. over a 15-month period. Currently, with an inflation rate of about 10 to 12 per cent., the Government are offering a 4 per cent. limit. That is a wage cut. The Government do not say "We recognise the difficulties and the need to provide a continuous service". The workers see the Government imposing wage cuts because of the cash limits on the National Health Service.
  Mining is an occupation that has more regard for National Health Service workers than most occupations although most workers recognise their significance and importance. The National Union of Mineworkers in the Yorkshire area has said that it is prepared to take sympathetic action. That will be made illegal by the Government's Employment Bill that passed through the House this week. That is more action by the Government against workers organising themselves to fight for a just claim.
  The National Health Service is labour-intensive. It is a caring service for which significant funding is required. That includes the concept of paying decent wages to the staff. That is not against the interests of the national economy. If higher wages are paid, there is an increase in demand, which means an increase in demand for the goods
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  and services that we produce and make available. However, the Government are showing their concern for the National Health Service by encouraging the privatisation of the service. They are doing so by encouraging the growth of, for instance, the Yorkshire clinic, which is in the Aire valley and not in the Keighley constituency. A number of greedy consultants, aided no doubt by the banks, which are anxious to earn interest on the investment, have decided to open a new private clinic. This will be a drain on the Health Service: trained people will be moving from the service because the private sector does not provide adequate training. This is an indication of the Government's priorities.
  The Government have said that there is no money for NHS workers and only limited money for the Service. The public sector borrowing requirement is extremely high because of the massive dole queues created by the Government's policies and the consequent payments of unemployment benefit, supplementary benefit and loss of tax revenue. This is costing in excess of £10 billion.
  However, there is money for the Falklands episode. The Government have been highly selective in the military juntas that they have chosen to move against and to be critical of—indeed, a mere 20 months or so ago the chairman of the Conservative Party, the Chancellor of the Duchy of Lancaster and Paymaster General, far from being critical of the military junta, which was the same one that is now in control, went on a five-day mission to Argentina to try to improve trading relations between Britain and Argentina. The Government are now much more critical. All of a sudden they have discovered the junta's reactionary nature. That has happened because it suits their position. Money for the Falklands will be running into hundreds of millions of pounds.
  As other hon. Members have said, the Government—this has emerged not by open debate but by a planted question—have produced a top salaries review. We should always remind ourselves that the review is carried out by "top people". Queen's Counsel and Members of the Lords meet to decide that their chums are not nearly enough well catered for and that the under secretary, the deputy secretary, the second permanent secretary and others are merely rubbing along on £30,495 a year. That is the salary of a second permanent secretary. They find that the Permanent Secretary to the Treasury and the Secretary to the Cabinet are barely managing to make ends meet on £35,845 a year and that the Lord Chief Justice is somehow eking out a miserable existence on £44,500 a year. High Court Judges are just rubbing along on £35,000 a year. All these people have received an 18 per cent. increase without asking for it, without their striking, and without any organisation. The Government have given that to them on a platter. These people are not short of money.
  Last Wednesday I addressed a meeting in my constituency at the Airedale general hospital when the workers came out on strike, like many others in the National Health Service, to ask for a decent living wage by means of a 12 per cent. increase. There were over 300 at the meeting. These workers read in the newspapers that the "top people" are rubbing along on £40,000 a year and need an 18 per cent. increase. The "top people" have to be compared with the recipient of a wage slip for 4½ weeks' work, including weekends—this slip was received by a person who has been qualified for five years—of £283·23 net. Another worker at the same hospital received

  885
  £231 for the month of March. That is an approximate take-home pay of £56 a week. When they read about the massive increases to the massive salaries of those who sit in judgment, those who advise the Government in senior Civil Service positions and the rest, they feel a deep and abiding sense of outrage which is driving them to take the industrial action that they feel is necessary.
  It being Ten o'clock, the debate stood adjourned.

  Adjournment (Spring)

    BUSINESS OF THE HOUSE
    Ordered,
    That, at this day's sitting, the Motion relating to Adjournment (Spring) may be proceeded with, though opposed, until any hour.—[Mr. Boscawen.]
    Question again proposed, That the amendment be made.
    Mr. Cryer: Therefore, the message from the workers at Airedale general hospital and from workers throughout the National Health Service is that they will keep pressing, working and agitating for a decent settlement to their claim. That claim of about 12 per cent. will do no more than keep them level with the cost of living.
    The House should understand that the vast majority of our people face a difficult struggle week after week to pay the gas, electricity and food bills which increase year after year. Inflation is not falling. It increases year after year. The Government boast about the fact that inflation is at the level that they inherited when they won the general election in 1979. That is still an inflation rate of about 9 to 10 per cent. People are outraged when they are denied a decent wage settlement. The Government are denying them that settlement.
    The House should have the opportunity to debate these and other related issues as a matter of urgency in order to see that those people receive justice.
    10.1 pm
    Mr. Michael Martin: First, I should like to associate myself with the remarks about the rundown of the railway industry. The British Rail workshops are the largest employers in my constituency. All the workers in the Springburn workshops are worried about the future. Glasgow Members and Members from the surrounding areas are worried because the workshops create employment for people not only in Glasgow but in the surrounding areas.
    I wish to bring to the attention of the House a problem which was brought to my attention by a brave young lady who suffers from kidney failure. Normally, those who suffer from kidney failure have to undergo treatment on a kidney dialysis machine which requires them to attend hospital for about four hours a day on three days a week.
    The young lady to whom I have referred, Mrs. Grace Tait of Charles Street in my constituency, has informed me that about 800 patients in the United Kingdom undergo a treatment known as CAPD—continuous ambulatory perennial dialysis.
    Under CAPD, the patient must connect a bag of liquid four times a day to his or her stomach wall. The treatment allows the patients to go about their daily business. It means that patients are not tied to going to the hospital for treatment on the kidney dialysis machines.
    That treatment, while advantageous, is fraught with many dangers, the greatest of which arises when the bag of liquid is being changed. The patient must carry out the
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    operation himself and must ensure beforehand that the room in which he carries it out is free from germs. There is a great danger of the patient contracting peritonitis. A doctor who works at the Wolfson institute in Glasgow, which is a highly respected institute in Scotland, informed me that if he could obtain more money for research he could devise a better method that would ensure that the patient did not run the risk of contracting peritonitis. When I asked the doctor how much money he was talking about I expected him, in these days of inflation and sophisticated medical treatment, to talk in terms of hundreds of thousands of pounds, but he said that he needed about £20,000. It should be within the reach of the Government at least to examine the work of the Wolfson institute. If it can alleviate the suffering that many kidney patients must endure, £20,000 is a small consideration. I do not have all the facts, but I am sure that the Leader of the House will ask Ministers in the Department of Health and Social Security to consider the matter.
    Another point that worries me is that when the patient is changing the bag of liquid he must ensure that the area in which he is working is sterilised. Patients are given equipment such as sprays and face masks to ensure that sterilisation takes place and the risk of germs is at a minimum. But just before he changes the bag the patient must insert a syringe with several cc of a drug into the bag. There is a danger that the bag could be punctured, which would mean that the patient would have to leave the sterilised room or area to get another bag. Although it is regarded as a do-it-yourself process, most patients are reluctant to carry out the treatment without a member of the family to help them in case of emergency. It must be borne in mind that, when the old bag is taken away from the connection in the stomach, the stomach is exposed to air and germs.
    My constituent, Grace Tait, applied for the attendance allowance that dialysis patients are allowed and she was successful. I am not sure why she received the attendance allowance. I await a reply from the Minister. She suffers from diabetes and has an eyesight problem. She cannot guide the syringe into the hag properly. That could b,; a reason why she got the attendance allowance.
    I should like to think that every patient on the treatment, which requires a change of liquid four times per day, will receive an attendance allowance to allow a member of the family or a friend to be present in case an emergency crops up. It would mean that they do not have to leave the sterilised part of the house.
    I am grateful for the opportunity of raising this matter. Bearing in mind the problems of Mrs. Tait and her many friends, one could forgive them for not taking on any extra commitments. It says a great deal for the kidney patients that they were able to raise £500 through their own efforts to help with the research of kidney patients. It shows that even people with great problems of their own are prepared to take the initiative to help their fellow human beings. I hope that something can be done for those extremely brave people.
    10.11 pm
    Mr. John Silkin: I should like, first, to thank the Leader of the House for accepting the Opposition amendment. That was the right thing to do. The country would not have understood if we had merely said that we

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    were going away for our Spring Recess and would not bother about whatever might happen. The right hon. Gentleman made the right decision.
    Several of my hon. Friends mentioned the South Atlantic. That was inevitable as its shadow lies over us all. They put their points of view. It is an appropriate occasion for them to do that.
    The other domestic points that were made by hon. Members on both sides of the House were interestingly varied. Listening to them, I found a common theme, to which I shall return.
    The majority of hon. Members referred to what might happen with regard to British Rail. My hon. Friends the Members for Bishop Auckland (Mr. Foster), Swindon (Mr. Stoddart), West Bromwich, East (Mr. Snape), Derby, North (Mr. Whitehead) and West Lothian (Mr. Dalyell) were all concerned about the complete lack of financing and the fact that, having gone through the traumatic experience of Lord Beeching many years ago, British Rail was apparently to go through another period of emasculation when a massive investment policy was clearly the necessary action.
    My right hon. Friend the Member for Lewisham, East (Mr. Moyle), my hon. Friends the Members for Keighley (Mr. Cryer) and Fife, Central (Mr. Hamilton) and, in his own way, my hon. Friend the Member for Glasgow Springburn (Mr. Martin), who told us a moving story about one of his constituents, pinpointed what is happening in the National Health Service. They pointed out that pay is not the only issue, although it is an important factor, especially to the nurses and ancillary workers who are now being denied the justice that the country believes they are entitled to. It is also a question of keeping the National Health Service going, so there is a further factor which also requires funds and investment.
    My hon. Friend the Member for Sheffield, Attercliffe (Mr. Duffy) inevitably, and rightly, spoke about his constituency and the need for investment in Yorkshire and Humberside. The theme, again, was the decline of old industries such as the wool industry, the decline of the engineering industries, the decline of industry in general, the overwhelming of our industry by foreign imports, and the need for public investment to put this right.
    My hon. Friend the Member for Vauxhall (Mr. Holland) referred to the Manpower Services Commission and a committed project in his constituency. Other hon. Members may have come across the same problem. Again, however, it was a question of investment. That has been the common theme throughout the debate.
    The action sought by the hon. Members for North Fylde (Sir W. Clegg) and Bedfordshire, South (Mr. Madel), when one looks into it, also required some public funds.
    My hon. Friend the Member for Fife, Central made a very shrewd point. I do not agree with his analysis of events in the South Atlantic, but we are all entitled to our views on that. He made the very shrewd point that, right or wrong—I believe that it is right—when it comes down to it, there is always sufficient money available to mount a great military assault, just as there was in the last war, but that when it comes to doing things that one's own country needs, the money is not available. Only a year ago, money was not available for any of the matters that have been mentioned. Yet suddenly, without asking the cost, the money is available for an expedition 8,000 miles
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    away. As I have said, I happen to think that it is right, although others think that it is wrong. The point is that the funds are available for that but not for the things that our fellow citizens desperately require.
    There was once a Latin secretary to a Lord Protector. The Lord Protector did not have a very high reputation in this House, as he closed it down, and he and I might differ on that. The Latin secretary and I, however, would have had much in common in our views when he said:
    "Peace hath her victories,
    No less renown'd than war."
    That is the basis of what my hon. Friends have said. They have referred to the requirements and needs and to the great victories that we could win for our own people if only we had the breadth of imagination and vision to see that the funds are available and can be applied, and that they are desperately needed.
    With that in mind, I repeat that it was right to tell the House and the country that, if necessary, we are willing to come back next week, Whitsun Recess or not. My own feeling is that events will probably direct that we do. In any event, it was right for the Opposition to table the amendment and for the Government to accept it.
    10.18 pm
    Mr. Biffen: The right hon. Member for Deptford (Mr. Silkin) spoke of the shadow of the Falklands which lies across the Chamber in today's debate and in so many of our other debates. He also very properly observed that the debate has fulfilled its traditional role of allowing a great range of subjects to be raised. I shall try to deal with them briefly but, I hope, as comprehensively as is appropriate.
    I begin by assuring the hon. Member for Glasgow, Springburn (Mr. Martin) that I shall certainly see that the problem of securing additional research facilities is brought to the notice of the appropriate Ministers on the Treasury Bench. I use that rather guarded form of words because a Scots Member discussed a Scots situation and has referred to an institute which sounded to me to be gilt-edged Scots. I would not wish to say that it was the Department of Health and Social Security that would have its locus on the matter, but I assure him that it will be examined and referred as appropriate. That goes also for the point about the attendance allowance.
    The community enterprise programme as conducted in his constituency was referred to by the hon. Member for Vauxhall (Mr. Holland). I must admit that I lived in the gentrified end of his constituency until recently, sharing that privilege with, as far as I know, a fair slice of the Parliamentary Labour Party. The hon. Gentleman asked whether I would raise the difficulties which he catalogued in a formidable fashion with my right hon. Friends the Secretary of State for Employment and the Secretary of State for the Environment. I give him that undertaking. For good measure, I will throw in the chairman of the Manpower Services Commission as well.
    The hon. Member for Newport (Mr. Hughes) raised the daunting issue of Welsh water charges. He is a skilled parliamentarian, because, as I understand it, the matter erupted only 24 hours ago, and here he is having a battle on the Floor of the House. He is also a courteous parliamentarian, because he gave me notice that he would raise the issue. I shall refer the matter to my right hon. Friend the Secretary of State for Wales, because it would be more appropriate that a comprehensive reply should

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    come from him rather than that I should try to be a surrogate Welsh Secretary and answer the points that the hon. Member raised.
    The problems of the fishing industry were raised by my hon. Friend the Member for North Fylde (Sir W. Clegg). The common fisheries policy will bring that topic into sharp focus. My hon. Friend might be able to raise this or hear it raised in the debate tomorrow. I would have thought that the terms of that debate would allow discussion of the fisheries policy. I shall bear in mind my hon. Friend's anxiety that there should be a statement on this matter as soon as possible after the recess.
    Economic policy in its regional terms—this is understandable, because we speak here with strong constituency experience—was raised by the hon. Member for Sheffield, Attercliffe (Mr. Duffy) and by the hon. Member for Walsall, North (Mr. Winnick). I will ensure that the points made by both hon. Members are referred to the Secretary of State for Industry. The reference to the textile industry in Yorkshire—here I felt that the hon. Member for Attercliffe was probably speaking instinctively for the hon. Member for Keighley (Mr. Cryer)—underlines the need to monitor the negotiations taking place concerning the multifibre arrangement, where the Commission is acting on behalf of the countries of the Community. We shall be anxious to report back to the House when we have substantive news to announce on this important industry.
    The point made by the hon. Member for Attercliffe on the significance of Selby on the older pits in the coal industry should be taken to heart by all of us. The whole problem of industrial renewal and the pace at which it can be pursued, remembering the social dislocations which are inherent, will be waiting to greet us after the operations in the South Atlantic are over and, one hopes, consigned to a satisfactory niche in history. I suspect that none of us in the Chamber, with whatever satisfaction we view the heroism of our Forces in the South Atlantic, will be other than delighted that we can return to the more familiar forms of political contest.
    The right hon. Member for Lewisham, East (Mr. Moyle) drew attention to the subject of National Health Service pay. His argument was powerfully reinforced by the hon. Member for Fife, Central (Mr. Hamilton). This is the first opportunity that I have had to address the hon. Member across the Floor since his recent engagement. It was splendid news, and I hope that he has many happy years in which to reflect on that settled state and that he will mellow almost to the point of becoming the Social Democratic establishment. Perhaps that is not the kindest wish, so I withdraw it immediately. I simply say that it was great news, and I am sure that the whole House joins me in my good wishes.
    A number of hon. Members spoke on the subject of National Health Service pay. I shall not go into the argument, not because I wish to desist from controversy on the matter but because, as Leader of the House, it is perhaps wise not to be too provocatively controversial. One of the facts which has caused some unease has been the absence of the opportunity for a wider discussion of the matter. I am happy to tell the House that my right hon. Friend the Secretary of State for Social Services will make a statement during the course of the week—and I can say that it will not be made on Friday. I move with great nervous caution in this life, because I know that the House wants to discuss the matter at a time that is appropriate to
    890
    the magnitude of the subject. I hope that it fulfils the almost atavistic words of the hon. Member for Fife, Central that he wanted to get the Secretary of State "to that Box". Perhaps we shall all go away a little happier—the hon. Gentleman because he has got my right hon. Friend to the Box, and those on the Conservative Benches because my right hon. Friend will have vindicated the Government's policy so signally.
    I turn to the major issue of the railway workshop closures. The hon. Member for Bishop Auckland (Mr. Foster) raised the matter, and I appreciate his feelings on this subject. Oswestry is not normally thought of as a railway town, except to the cognoscenti who study these matters, but I inherited the constituency when it still had the Cambrian railway workshops and it was still thought of as the headquarters of the Cambrian railway, even though it had been absorbed in reorganisation. The closure left a sharp mark, which has not been totally erased, even a decade after the event.
    There were others who took part in the debate, including the hon. Member for Swindon (Mr. Stoddart), the hon. Member for West Bromwich, East (Mr. Snape), who made a powerful contribution, the hon. Member for Derby, North (Mr. Whitehead), and my hon. Friend the Member for Bedfordshire, South (Mr. Madel). Clearly, the closure programme is a matter of great controversy, but essentially it is a management decision that has to be taken by British Rail, taking into account future requirements. Naturally, the matter will be debated in the course of time. The right hon. Member for Deptford said that this will always be part of the central economic argument between us, that railway expenditure is one manifestation of it, and, as he said, clearly a massive investment policy would be needed in this respect.
    If I could take the right hon. Gentleman quietly out of the Chamber and gently lead him upstairs to the Standing Committee on the Finance Bill, which I agree would be quite a formidable undertaking, he would discover that amendment after amendment is being pressed by the Labour Party to reduce taxation and the resources that will be available to the Government. If that is to be argued upstairs, while on the Floor of the House we are arguing for ever-increasing public spending, I look forward with relish to the debate that must eventually emerge about the prudent conduct of economic policy over the months and years ahead.
    Mr. John Silkin: The right hon. Gentleman had better be careful. I will send him copies of half a dozen of my speeches; and that will really punish him.
    Mr. Biffen: No great cause is there but worthy of sacrifice, and the sacrifice that I would make in the cause of victory at the next election is not merely to read the right hon. Gentleman's speeches but to reproduce them.
    Mr. Winnick: We all accept and share the mood in which the right hon. Gentleman is engaging, but there is one aspect of taxation that he has not mentioned. Does not he consider that it is wrong—I described it as vindictive—that 1¼ million unemployed people will not pay income tax because their income is too low whilst the 5 per cent. that was taken off their unemployment benefit in lieu of taxation by his Government in 1980 is not being restored?
    Mr. Biffen: No. Given the occasion I would defend those actions. As a Treasury Minister I was a party to

    891
    them. I am certain that that, along with all the other considerations, will be properly and fully debated. As I say, I look forward to that proceeding in the months ahead.
    May I make one final point on the question of the railway workshops? The hon. Member for Derby, North spoke as though it were a debate by proxy for one that might have been. I was sensitive to the comments that he made. I hope that when we return from the recess the pressures on debating time that have inevitably resulted from the Falkland crisis will be eased so that there will be some early allocation of Supply time for the debating of those issues that are of rising concern on the Opposition Benches.
    We have had a traditional debate, ranging from the personal questions of Mrs. Tait and the important general proposition that can be deduced from such individual circumstances to the railway workshops and the National Health Service. However, the Falkland issue is the one that overshadows all others.
    The speech made by the hon. Member for Walsall, North on the Falkland issue was challenging, radical and, broadly speaking, aggressive. That is as it should be. It was always intended that in Parliament, even in circumstances such as this, the voice of dissent should never be snuffed out. If the hon. Gentleman believes that there is a scheme for a snap election which could be exploited to the benefit of the Treasury Bench, one flippant reply is that I simply do not believe that the Conservative Central Office could seize the opportunity even if it were pressed firmly into its hands.
    A more serious reply is that that kind of analysis really derives from British society as it was two generations ago. Perhaps in the spirit of Mafeking, the Boer War and so on, such an analysis could be made. It could be said that a certain pattern of political behaviour could then be traced. It is unthinkable that there could be any attempt to politicise the South Atlantic conflict by trying to secure some quick electoral advantage. May we lay that ghost, because there are many more real things that we can argue about?
    Perhaps the most damning comment that I can make to the hon. Member for West Lothian (Mr. Dalyell) is that he made a speech that was characteristically thoughtful and absolutely in the spirit of dissent that must be accepted and accommodated within our society. I shall certainly ensure that all of his points are put to the Foreign Office. He mentioned the problems of political instability in Argentina, and they are just the type of issues that deserve the consideration of the House.
    The hon. Member for West Lothian will probably still have opportunities to contribute to debates on this issue in the weeks ahead. I shall try to secure opportunities for him
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    to conduct his campaign of dissent, but—to invert Voltaire—I would defend to the death my right to disagree with him.
    Mr. Dalyell: Would it not clear the air and be better from every point of view if the Government came clean—[Interruption.] Perhaps that is not the right phrase, but would it not be better if the Government cleared up the question whether there have been operations on the South American mainland? Allegations have been made. Although I am one of those who dissent, I understand that if there must be a task force there may have been overwhelming reasons—that are not dishonourable—for SAS operations. After all, the Exocet and the Super Etendard pose a serious threat. Should there not be a short statement or a private notice question tomorrow to clear up the issue one way or the other? There would be nothing dishonourable in telling the truth.
    Mr. Biffen: I have listened to the hon. Gentleman and I heard the exchanges at Question Time today. I have said that I shall draw the Foreign Secretary's attention to the hon. Gentleman's speech. The matter might reasonably rest there. Therefore, I commend the motion, as amended, in the hope—[Interruption.] If the hon. Member for West Lothian wishes to intervene, I shall gladly give way, although it is highly inconvenient to do so just as one is reaching one's faltering peroration. Nevertheless——
    Mr. Dalyell: I simply wish to point out that the Secretary of State for Defence should make a statement one way or the other on whether the article on the front page of today's edition of the Daily Mail is accurate. If it is accurate, there should be a statement telling us why. If it is inaccurate, it should be completely dismissed. However, we can be certain that it creates grave problems for many States in Latin America.
    Mr. Biffen: The hon. Gentleman had his chance during defence questions this afternoon. I cannot go beyond what I have said. I have made a generous response to the hon. Gentleman's argument.
    However, there is a very good case for adjourning for the time specified in the motion. I very much hope that events in the South Atlantic will not require us to reconvene. When we eventually return to the House, I hope that we can proceed in the same workmanlike way as in recent weeks.
    Question, That the amendment be made, put and agreed to.
    Main Question, as amended, put and agreed to.
    Resolved,
    That this House at its rising on Friday do adjourn until Tuesday 8 June, but that, pursuant to Standing Order No. 122 (Earlier meeting of House in certain circumstances) should the public interest so require, Her Majesty's Ministers of their own volition or following representations from Her Majesty's Opposition shall represent to Mr. Speaker that the House should meet at a time earlier than that to which the House stands adjourned.

  South West Water Authority
  Motion made, and Question proposed, That this House do now adjourn.—[Mr. Goodlad.]
  10.40 pm
  Mr. Peter Mills: I am grateful for this opportunity to put forward some of the problems experienced by my constituents with the South West water authority. To be fair to the authority, it does not have an easy task with all the problems that it is experiencing because of the restrictions on finance and the high cost of capital expenditure. It must also be remembered that it had to take over many small and old water undertakings, let alone the large number of sewerage schemes that are required in the area.
  I place on record the courteous way in which the chairman and the staff have always dealt with my queries, but there are fundamental disagreements between us. First, I refer to the problem of the Roadford reservoir. A sad and bad decision has been made. It cannot be right for useful agricultural land to be flooded and homes destroyed when Dartmoor is close at hand, with poor land and no houses. Whatever some people may say, building a reservoir on Dartmoor will not spoil the area. In fact, I think that it will enhance it.
  I regret my right hon. Friend the Secretary of State's decision and, above all, the failure of the South West water authority to go for a reservoir on the moor. The authority knows that it is the right place, but it lacks the courage to propose it and to push it through. If a poll were taken in the South-West, I am certain that most people would say that the moor should be used rather than deprive people of their living and their homes. I hope that even at this late hour the Secretary of State will think again.
  I now come to the comments of the Plymouth chamber of commerce on Roadford. It is sad when urban and city people criticise my stand to protect the farming people and villagers who live in the Roadford area. Mr. Wood, the member of the Plymouth chamber of commerce who gave evidence at the inquiry, is reported in the local press as saying that
  "the sacrifice of about 30 farming people has to be balanced against the sacrifices"
  of thousands of people in Plymouth. I feel that that is extremely insensitive. There would be a terrific row if this were happening in Plymouth.
  If there were no alternative it would be a different story, but there is an alternative. There is land that can be flooded and has been flooded to the benefit of many generations living in Plymouth. The Plymouth chamber of commerce has much to answer for in its attitude.
  I was extremely annoyed by the remarks of Mr. David Widdicombe, QC, representing the South West water authority at the recent inquiry. He said that I was irresponsible. I am used to being attacked and got at. I have been called far worse than irresponsible. All that I was doing in regard to Burrator and its future was asking the authority to clarify the rumour that Burrator was to be closed, or the water diverted elsewhere. I have every right to raise at an inquiry or in the House of Commons the views and the fears of my constituents. It is wrong of the QC representing the South West water authority to seek to
  894
  restrain or stop a Member of Parliament from putting the fair question that I did. I hope that the Minister will look into the matter and obtain an apology from him.
  Fortunately, the chairman of the South West water authority, Mr. Hill, has made the SWWA' s position clear in a letter to me. He said:
  "May I first assure you that I have never sought and, indeed, would never seek, as a strong believer in parliamentary democracy, to hinder any Member of Parliament horn undertaking his proper duties."
  Mr. Mills concluded his letter:
  "Finally, I reiterate my total respect for your integrity."
  It is important to put on record, for the benefit of future inquiries, that a Member of Parliament must have the right to put forward the fears and views of his constituents. I inquired whether this was a question of privilege but was told that it was not. That should be noted by inspectors in any future inquiries.
  I now wish to say something about what I call "leaky mains". This is a serious problem in the South-West, particularly in the Plymouth area. According to the local newspaper, in Plymouth alone estimated leakages in 1978 were 120 litres per head per day. They were actually higher than the estimated domestic use of 110 litres per head per day and the measured use of 101 litres per head per day. That amount of water is leaked every day from our reservoirs. Between 28 and 30 per cent. of all the water produced by my constituency is leaked away and wasted. That is an absolute disgrace.
  The Minister will probably say that other areas have similar leakages, but the South-West has a water shortage. If an area has plenty of water it can perhaps afford that level of leakage, but I do not think so. When we have a shortage, it is criminal that this is allowed to continue. The new reservoir at Roadford could be reduced in size if those leaks were repaired.
  It is wrong for the South-West water authority to say that we should build another reservoir to overcome the shortage. It does not say that we should repair the leaks. That is mad. My message to the water authority is "Put your house in order first before you build Roadford."
  What about the cost to the ratepayers? They are suffering a hard and heavy burden already. If a reservoir is built on the ground, the energy used to pump the water around—and therefore the cost—is very much greater. If it is built on the moor, the water gravitates downwards anti it is, therefore, cheaper to operate. The new reservoir will cost millions of pounds.
  Constant bursts also occur. It is no wonder that the ratepayer is finding it difficult to pay his rates and is annoyed. These matters must be looked at first.
  I shall not dwell on this matter for too long, because my case is simple, practical and right. If my hon. Friend the Member for Devon, North (Mr. Speller) catches the eye of the Chair, perhaps he will add to what I have said.
  What about the future? At present, all the signs point to a water shortage in the South-West. Already the river levels are extremely low. I do not entirely agree with my hon. Friend the Member for Devon, North that we need more water, though in a sense that is true. The extraordinary thing is that we have an abundance of water, but much is wasted and not enough is stored.
  I believe that the South West water authority has not made sufficient plans this year to deal with the possible shortage of water. There is already talk in the North Devon area of restrictions, even before the summer has begun.

  895
  First, the water authority must undertake these repairs and save the 30 per cent. of the supply that is being lost. Secondly, there must be more transportation of water through mains—in other words, better distribution from one area to another. Thirdly, we must use every source of water.
  Many water supplies have been abandoned in the interest of major supplies. In Okehampton, the East Ochment and the old Hampton water supply system are not being used. Many of those sites should again be brought into use before a small, new reservoir is built. Why cannot Wimbleball supply the North Devon area? There is much that can be done.
  If there is a drought this summer we shall be told that a reservoir is needed. I disagree with that approach. There is a need for a reservoir, but there is also a need to put the house in order and deal with leaks.
  I hope that the Minister will endeavour to see that the South West water authority deals with the points that I have raised. I refer especially to the intemperate and disturbing remarks of Mr. David Widdicombe. I am not normally sensitive, but I do not like it when people try to stop me from putting the case that my constituents want me to put in the House or at a public inquiry.
  10.50 pm
  Mr. Tony Speller: I wish to associate myself with the remarks of my hon. Friend the Member for Devon, West (Mr. Mills), who is also my good neighbour, when he speaks of the particular gentleman making reference to his irresponsibility. I cannot think of an hon. Member less likely to be accused of irresponsibility. That is the kind of phrase that slips out at the wrong moment. I am with my hon. Friend all the way.
  The South West water authority comprises a chairman and 15 members. Although it is generally assumed to be the ogre of the south-western world, it is fair to say that nine of its members are appointed by county or district councils. The remedy therefore lies in the hands of the electorate, who seem to think that the water authority, perhaps like other nationalised industries, is something far away and remote.
  The key issue in North Devon is not so much where the reservoir should be located as when it should be provided. As my hon. Friend the Member for Devon, West has mentioned, the Bideford and North Devon Gazette, the North Devon Journal-Herald and the Advertiser all say that hosepipe restrictions will be coming shortly. This is a trailer that North Devon experiences every year. Only three of the last 19 years have been without some form of water restriction in the area that I represent. This has probably also been the case to a lesser degree in other parts of the South West water authority area. We need water through the taps rather than through the edges of the pipes. We need it now, or at least soon, not to give us some advantage but to allow us to catch up with the rest of the country in normal development.
  The development of many parts of North Devon is prevented by lack of water, yet for nine months of the year if falls from the heavens in torrents—sometimes even in summer, although I would not normally admit this except with parliamentary privilege behind me. It is unbelievable that an area surrounded by water and often covered with
  896
  water should contain folk memories of standpipes and holidaymakers preferring to return home from the West Country rather than queue for a bucket of water.
  I do not care from where the water comes so long as there is some water. I believe that investigations have cost £1·5 million at current prices. My hon. Friend the Member for Devon, West did not mention the pressure groups that have kept water away from Dartmoor or the national park area. There is no doubt in my mind that the right and logical place for reservoirs is national parks. I do not believe that a reservoir spoils the appearance of an area. On the contrary, the appearance is normally enhanced. While local people and pressure groups fall out, local authorities run short of water. Although, by and large, I do not care where the new reservoir is built, I accept that Roadford is not ideal.
  However, the reservoir cannot be located on the sea shore. In past years, a parliamentary Committee has ruled against Dartmoor. This means, I suspect, that the water authority believes that there would be a ruling against Exmoor. If the reservoir cannot be located either on the sea shore or on the moors, that leaves built-up areas—an unreasonable proposition—or farmland.
  The problem is that if the water has to be produced in reservoirs and if we cannot get around to stopping unaccounted water, which seems a vast amount, a reservoir had to come somewhere. I and the people whom I represent in Bideford, Northam and Westward Ho! must have water. Please let us have it soon.
  While the message is "Get on with it," the problem arises of how long the nation can go on with its pipes becoming more elderly, the cracks becoming larger and the leaks increasing. If the amount of money to be spent on a reservoir were spent in detection of loss, we could avoid the need for a reservoir. In the House we often set ourselves up as engineers, architects, town planners and so on. I require water because North Devon requires water. I hope that we will get it soon. I do not think that the water authority is as black as it is sometimes painted. I fear that if we do not get on soon, we will not have the water. There will be one more standpipe year, and there will be little tourist industry left.
  I ask my hon. Friend the Minister to state that water will come to us soon. I wish to have the reservoir. I care not too much where. My hon. Friend the Member for Devon, West says that we should make savings. Without the water that we need, we will lag further and further behind in prosperity, jobs and housing.
  "Water, water, every where,
  Nor any drop to drink."
  is the theme tune sometimes in North Devon.
  The Under-Secretary of State for the Environment (Mr. Giles Shaw): It is clear that my hon. Friend the Member for Devon, West (Mr. Mills) is extremely anxious about the siting of the reservoir and my hon. Friend the Member for Devon, North (Mr. Speller) is less anxious about the siting but wants the water. There is a general fear that the needs of the area will not be met on time. It is in that tangled web that I have to try to weave a consistent thread.
  My hon. Friend the Member for Devon, West raised two points. He referred first to leakage. I agree that it is not a satisfactory state of affairs to have as large a leakage problem as that in the south-western area. My hon. Friend was absolutely right. Through the National Water Council,

  897
  the Government are urging the regional water authorities to do all that they can to reduce the waste of resources. I have written recently to the chairman of the National Water Council, Sir Robert Marshall, a letter which I think will be of interest to my hon. Friend. I wrote to him on 19 May:
  "You will be aware, as I am, of the fierce public criticism of water undertakers over what is seen as excessive leakage from water supply systems. The topic has been of major importance in a number of recent public inquiries into proposed reservoir projects and the Department have made it plain that new reservoirs will not be authorised unless cost-effective measures, including leakage detection and waste prevention, have first been taken in the supply area."
  I entirely accept my hon. Friend's point, so as recently as 19 May I wrote in those terms. I said, further:
  "I should be grateful if, in co-operation with the water authorities, you would produce a comprehensive report on leakage control describing the steps taken by each water authority, the progress made and the difficulties encountered."
  The leakage in Plymouth is severe. My hon. Friend quoted the figure of about 34 per cent. of total supply, but the authority is already working hard to reduce that. There are now two full-time teams working on detection and reparation of loss. Their target figure is a 28 per cent. leakage figure. That compares with targets of about 25 per cent. in the local area. It compares not unfavourably with the national average of 24 per cent. and a figure of about 29 per cent. for unaccounted flow in the neighbouring Wessex water authority.
  I ashamedly give those figures because I want the House to understand how severe is the national problem of leakage from the distribution system of the water supply. It is for those reasons that I take the strongest possible view of the action needed to deal with the problem. It is not a problem peculiar to Plymouth or to the South West water authority, but it is a national problem and national action must be taken to correct it.
  My hon. Friend the Member for Devon, West then referred to the Roadford inquiry itself. The proposal has been the subject of a previous inquiry when the inspector accepted that the main advantages of the Roadford scheme would be that the single new source at Roadford would meet the needs of the whole of the water supply for the Plymouth area, South-West Devon and North Devon. That will give a desirable operational flexibility to the scheme.
  Another advantage is that the Roadford scheme will give greater benefit in the augmentation of rivers. A further advantage is that the alternatives would be potentially more damaging to the fisheries. The inspector recommended that the scheme should be approved. There were continuing objections to the proposal and concern was expressed about the loss of some 1,000 acres of farmland. That has been the main burden of the case of my hon. Friend the Member for Devon, West. The case was referred to my right hon. Friend the Secretary of State for a decision. He sought further evidence on the need for the scheme, and in view of the submissions that he received he decided that another inquiry should be held. That inquiry was held last month and looked only at the size of the proposed reservoir.
  I know that my hon. Friend the Member for Devon, West has questioned whether that was a legal step for my right hon. Friend the Secretary of State to take. We took legal advice on the matter, and we are fully satisfied that we were and are acting intra vires to limit the terms of the inquiry. My hon. Friend then referred to an incident that
  898
  occurred in evidence given by Mr. David Widdiconbe, QC, who appeared on behalf of the South West water authority.
  The chairman of the water authority wrote to my hon. Friend on 22 May. He said that my hon. Friend had left after giving evidence but that the problem about Mr. Widdicombe's remarks may have arisen because the point was raised in terms which required that the rumour that came up in evidence should be robustly rebutted. Mr. Widdicombe made the remark which appeared in press reports and caused my hon. Friend such anxiety.
  Mr. Peter Mills: It was certainly not very wise of him to call me irresponsible.
  Mr. Shaw: The occasion for the remark was the fact that other witnesses had elaborated on the point that my hon. Friend had made about the Burrator reservoir. I believe that the remark of which my hon. Friend complains is a matter for the learned gentleman himself to correct. I should merely opine, as my hon. Friends have done, that no one can have acted with more responsibility than my hon. Friend. I believe that the whole House will recognise that to be the case.
  I also endorse the view, which the chairman of the water authority clearly expresses, that in relation to his constituents and the evidence he gave at the inquiry my hon. Friend acted as he always does with perfect correctness and with the interests of his constituents at heart.
  The question of the Roadford reservoir includes the resources in the South West water authority area. My hon. Friend the Member for Devon, North is concerned that those resources should be augmented. The cost of the development is about £19 million. My hon. Friend the Member for Devon, West is concerned about the costs that will be incurred by his constituents and the consumers. The percentage increase in bills in the South West water authority area for the year 1982–83 is 8·6 per cent., compared with a national average of 11·5 per cent. and with movements in the retail price index of 9·4 per cent.
  There is no suggestion that the water authority is doing anything other than operate an extremely tight and efficient control of its financial resources. The capital investment that is being made is substantial, but I trust that both my hon. Friends will be aware that the capital investment plans of that authority are £23 million in 1981–82, and £28·6 million in 1983–84. That size of investment is to be expected if we are to provide a substantial increase in resources for that region.
  There have been recurring problems of water shortage in the South-West. It is a difficult problem. The water authority is faced with the need to conserve diminishing water supplies during the summer months when there is low rainfall. That is when there is a substantial increase in population, and therefore in consumption. Today the rivers in North Devon are at only a quarter of their normal height after an unusual period of low rainfall over the past six weeks. That means that from Friday of this week a hosepipe ban will be introduced in North Devon.
  Further and more extensive measures may need to be taken if the weather continues to be drier than average. These problems demonstrate the need to establish once and for all a strategic water supply that is satisfactory for the full all-the-year-round demand in the South-West,

  899
  irrespective of the leakage problems to which my hon. Friend the Member for Devon, West has drawn the attention of the House so vividly.
  I reassure my hon. Friend that his interests are being served——
  Mr. David Penhaligon: Is the Minister aware that in many areas the pipes are not large enough to get the water to the villages even when it is available?
  Mr. Shaw: I am well aware of that and the hon. Gentleman is right to make the point. In most systems we are dealing with a distribution network that is no longer satisfactory to carry the weight of water which demand requires. This requires continuous and substantial expenditure in the form of capital reinvestment. That must be undertaken by each authority as a long-term aim.
  I assure my hon. Friend that the construction of Roadford reservoir will mark the completion of the authority's strategic plan for water supply. A plan that involves three new large reservoirs is a significant injection into the economy of the region. It will provide jobs and considerable income during construction, and once completed it will release a constraint on industry and agriculture that has been far too evident and far too frequent. I hope that it will reduce the number of occasions on which restraints are imposed upon the public of the South-West. It will enable farmers and industrialists to adopt newer and, where appropriate, more extensive methods of working.
  900
  Plymouth and North Devon will be well served by the new Roadford reservoir, with South-West Devon reaping a small reward also. These are substantial gains, of which the Roadford reservoir is an intergral and essential part.
  I understand my hon. Friend's anxiety on behalf of his constituents that minimal disruption should occur in the creation of a reservoir on the site that my right hon. Friend has selected. It is for that reason alone that a second inquiry is being held, to reduce the valuable land take to the minimum that is required. In the assessment of the need and in the calculations that are to be undertaken to determine the size of the reservoir that is ultimately to be built, the problems that my hon. Friend has raised, such as leakage control and ultimate demand, will form a significant part. In arriving at his ultimate decision my right hon. Friend will bear these matters in mind.
  I hope that my hon. Friend will take it from me that we shall grapple with leakage and that every effort will be made to deal with the problem.
  I hope also that my hon. Friend will accept that the chairman of the water authority has made it clear that there is no possibility in the Roadford inquiry of the Burrator reservoir being declared redundant as a result of the new investment, and that with those remarks he will feel that, despite the regularity with which he has raised the issue, the importance of the Roadford reservoir and the potential benefit to those in the South-West, including the constituents of my hon. Friend the Member for Devon, North, will outweigh the significant disadvantages which my hon. Friend the Member for Devon, West has raised so responsibly.
  Question put and agreed to.
  Adjourned accordingly at eight minutes past Eleven o' clock.

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

NHS Staff: Pay Dispute
Lord Molloy: 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 intervene in order to resolve the current dispute in the National Health Service concerning wage negotiations.
The Parliamentary Under-Secretary of State, Department of Health and Social Security (Lord Trefgarne): No, my Lords. The conduct of pay negotiations in the National Health Service is a matter for the Whitley Councils. The Government consider that the pay offers made by the Councils are both fair and realistic.
Lord Molloy: My Lords, is the noble Lord aware that if there is one thing which is totally unacceptable to the medical profession, the nursing profession, and probably the people of this country, it is the last part of the noble Lord's reply? Would he be prepared to ask his right honourable friend to consider sending the issue to ACAS in the hope of getting it resolved?
Lord Trefgarne: My Lords, if the noble Lord is suggesting that this matter should go to arbitration, I would have to disagree with him, because within the context of the cash limits an increased pay offer would only mean a reduced service.
Lord Molloy: My Lords, is the noble Lord aware that he is confusing the activities and endeavours of ACAS with a court of arbitration? It does not necessarily follow that being referred to ACAS means that there is going to be some form of arbitration. That may come later. Often ACAS will resolve things without using the arbitration machinery.
Lord Trefgarne: My Lords, there is of course already existing machinery for these purposes within the Health Service. It is in any event, as I said, a matter for the various health authorities, but I am sure that any helpful suggestion from ACAS would be carefully considered by those bodies.
Lord Jacques: My Lords, is the noble Lord aware that arbitration, both sides accepting the decision, is the best alternative to industrial action?
Lord Trefgarne: My Lords, as I said just now, arbitration is not a practical proposition in these circumstances, because, as I said, within the context of the cash limits
1068
which we must necessarily impose in this area, an increased pay offer, for example, could only mean a reduction in the standard of service.
Lord Rochester: My Lords, is it not greatly to be regretted that, in the absence of any general arrangements for determining pay in the public services, and when certain public servants have recently been awarded relatively high increases in their salaries, there appears to be no means by which this particular dispute can be referred to independent arbitration?
Lord Trefgarne: My Lords, the noble Lord is right to point to the lack of machinery for some of the purposes of pay determination in the public sector. That is why the Megaw inquiry, for example, which is looking into these matters in connection with the Civil Service, have been asked to make proposals, and why indeed my right honourable friend the Secretary of State has said that we would be willing to create appropriate machinery with respect to the nurses and midwives.
Lord Winstanley: My Lords, does the noble Lord accept that, perhaps because of their previous reluctance to take industrial action, health workers as a whole are among the lowest paid throughout Europe? In order to determine precisely where we in Britain stand on this matter, is the noble Lord in a position to tell the House how many health service workers are at present in receipt of the family income supplement, which the noble Lord knows is paid only to those who, in the light of their family commitments, would otherwise fall below the poverty level?
Lord Trefgarne: My Lords, I doubt that very many health service workers are in receipt of the benefit to which the noble Lord refers. The average earnings, for example, of the ancillaries is of the region of £104 a week.
Lord Shinwell: My Lords, is it not asking too much at the present time to ask the Government to intervene in wage negotiations? Have we not got another dispute on our hands? Although I usually support the workers in their demand for higher standards of living, and will continue to do so, would they not mind deferring consideration of these negotiations and demands until we have dealt with the people 8,000 miles away?
Lord Trefgarne: My Lords, there is as so often, if I may say so, considerable merit in what the noble Lord has to say, but nonetheless a reasonable offer has been made through the Whitley Councils to these various groups of employees, and we hope that they will accept them.
Baroness Wootton of Abinger: My Lords, is the noble Lord's figure of £104 a week a compound of male wages and female wages, an average of the two, or does it refer solely to male wages?
Lord Trefgarne: My Lords, it is in fact the average earnings of a full-time male ancillary worker. A number of other workers in the health service are of course part time.
Lord Wallace of Coslany: My Lords, is the noble Lord aware that, although undertakings are given by unions in this regrettable industrial dispute that patient care will not be affected, it is inevitable that patient care will be affected however much help is given by administrative officers, and so on? I cannot understand the Government's attitude to this position, because nurses particularly should be dealt with as a special case. Secondly, the Government will not accept arbitration, will not agree to arbitration. The Government will not seek arbitration. This is the point. It is all very well—
Several noble Lords: Question!
Lord Wallace of Coslany: Is the Minister aware—and I am well able to take care of myself here without assistance from the Government side of the House—
Several noble Lords: Order!
Lord Wallace of Coslany: My Lords, is the Minister aware that it would appear that the Government are set on their course and will not do their best to try to resolve this regrettable dispute? Further, is the Minister aware that the Whitley Council have put forward a settlement which lines up with the Government's attitude? This is a matter of great importance. It is a matter that has happened before and must not happen again, and it is about time that the Government did not take advantage of nurses who, because of their membership of the Royal College of Nursing, do not take industrial action.
Lord Sandys: Questions should he as brief as possible, my Lords.
Lord Trefgarne: My Lords, the noble Lord asks that we make a special case of the nurses and midwives. We have indeed done just that. We have made available for that purpose extra funds—some £82 million—which has resulted in the enhanced offer to the nurses and midwives through their Whitley Council. As for the earlier part of the noble Lord's supplementary, about the difficulty of conducting industrial action in the health service without affecting patient care, he is quite right; it really is not possible, in our view, to conduct industrial action in the NHS, at any rate on the scale we saw last week, without affecting patient care. There was one example to which I would refer your Lordships, where the normal catering staff of 60 were replaced by only five people to serve meals in a certain hospital, and I fail to see how they could have provided a proper service.
Lord Winstanley: My Lords, as the Minister is apparently unaware of how many of these people receive family income supplement, may I ask him to arrange for his department to collect the information and then study it?
Lord Trefgarne: My Lords, I will see if the information the noble Lord seeks is available and whether it can be provided to him and the House in a meaningful form. I doubt whether there are very many such people. A large number of workers in the health
1070
service are part-time workers, and others achieve at least the average earnings to which I referred.
Lord Blyton: My Lords, does the Minister think it possible that the nurses' case can be sent to the Top Salaries Review Body, which could then give an award of 21 per cent.?
Lord Trefgarne: No, my Lords.
Lord Molloy: My Lords, is the noble Lord aware that Britain's nurses, midwives and health workers do not want to indulge in the activities in which they have been compelled to indulge, and that their leaders are desperately keen to see that there is no escalation of the dispute? May I ask him to ask his right honourable friend not to commit himself in any way whatever but simply to say that he will consider sending the whole issue to ACAS—a course which, I am sure, would receive the approval of the nurses, their leaders and every other sane person?
Lord Trefgarne: My Lords, I should perhaps say tha t the great majority of nurses have not so far indulged in industrial action and that, so far as I know, they do not intend to do so because, as I understand it, the rules of the Royal College of Nursing preclude that, although I gather that that may be a matter they are planning to consider. As for referring the matter to ACAS, as I said earlier, there is well-established machinery in the health service—namely, the Whitley Councils—for determining the pay of those who work in the health service, and that is the proper method to use.
Lord Sandys: My Lords, as we have spent 10 minutes on this Question, I suggest we move to the next one.

Stroke Units
2.47 p.m.
Lord Segal: My Lords, I beg leave to ask the Question which stands in my name on the Order Paper.
The Question was as follows:
To ask Her Majesty's Government how many stroke units are at present operating in England and Wales, and when their number is likely to be increased.
Lord Trefgarne: My Lords, no central record is kept of the number of wards which may have been designated locally as "stroke units". We are, however, aware of growing interest in them among the professions. The decision to set up such units is a matter for local professional and management discretion.
Lord Segal: My Lords, I thank the Minister for that reply. Is he aware that stroke units offer by far the speediest and most efficient form of treatment of the condition, and that no extra financial commitments need necessarily be involved? Is he further aware that several London hospitals, notably the new Charing Cross Hospital, already have the full facilities for a stroke unit? Will he undertake to look into the matter in rather greater depth than he has done hitherto?
Lord Trefgarne: My Lords, we want to provide the best facilities we can, within the limits of our resources, for stroke patients. I must say, however, that it is not yet proved that the units to which the noble Lord refers are necessarily the best way of doing it. A number of studies have been carried out into the matter—two in particular in 1980, of which I have the results with me—which tend to show that in certain ways, at least, it is better to treat patients in the general wards of hospitals. But the Government do not have a closed mind on the matter, and if further evidence becomes available or studies are made we shall be very willing to look into the matter further, but in the end it is a subject for the local area health authorities.
Baroness Trumpington: My Lords, is my noble friend aware that I am surprised at his last answer, that cures for stroke patients in general hospitals work as well, because a great deal of time has to be spent on stroke patients, which is not available in general hospitals?
Lord Trefgarne: My Lords, I am of course aware that there are some stroke units already in existence which are doing an admirable job, but in general, as I say, the case for them is not as clear-cut as some have had us imagine. The Government do not have a closed mind on the matter, and if further evidence comes to light, or if further experience of the existing units is more favourable, we shall be happy to consider the matter further.
Baroness Masham of Ilon: My Lords, may I ask the Minister whether he is aware that very often stroke patients take a long time to rehabilitate fully? Is he also aware that after they have been in hospital they have to return to the community, and will he ensure that the support services for rehabilitation in the community are available? These are therapists and community nurses.
Lord Trefgarne: Yes, my Lords, certainly in recent years there has been a significant increase in the number of expert therapists of different kinds available to patients, and perhaps I may write to the noble Baroness with the details. There are also the stroke clubs, in which I know the noble Baroness has an interest. Many of them are under the auspices of the Chest, Heart and Stroke Association, for which my department provides financial support.
Lord Harmar-Nicholls: My Lords, is my noble friend aware that many people will be surprised to read his reply that this is a matter which should be left to the area health committees? If there is any point behind this Question, surely it is a national problem, not an area one, and one would have thought that guidance or suggestions ought to come from the centre, in order to be country-wide, and not be left to area decisions, as his answer seemed to suggest.
Lord Trefgarne: My Lords, the point is that circumstances vary from hospital to hospital and from district to district, and that is why it is better for local people to take decisions of this kind on the spot. If I may say so, the Health Service is not a puppet con-
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trolled with strings by my right honourable friend from the Elephant and Castle. It is much more an organisation with local roots for local people.
Baroness Masham of Ilton: My Lords, may I ask another supplementary question? I should like to ask the Minister whether he will arrange for his department to undertake some screened controls on preventing strokes, such as checking for high blood pressure?
Lord Trefgarne: Yes, my Lords. I understand that hypertension and high blood pressure are an important cause of strokes, and that is why research into the matter is going on, I think by the Medical Research Council, again with my department's financial support.
Lord Segal: My Lords, will the noble Lord undertake to see that arrangements are made for a hospital consultant to be available for domiciliary visits in the early stages of an attack, since much research into this condition is still needed?
Lord Trefgarne: My Lords, I agree that more research into this matter is necessary. There might be difficulties in proceeding along the lines which the noble Lord suggests of having specialists visit patients in their homes at an early stage, if only because of the problem of determining when that should be. However, what the noble Lord says will certainly be borne in mind.

Civil Defence Training
2.53 p.m.
Lord Renton: 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 steps are being taken nationally and locally to train members of police forces, fire services and ambulance services in their responsibilities in the event of conventional or nuclear attacks upon the United Kingdom or in the event of radioactive fallout drifting over from the continent of Europe.
The Parliamentary Under-Secretary of State, Home Office (Lord Elton): My Lords, at national level there is provision for the training of all three services referred to in my noble friend's Question at the Home Defence College. The Government have increased the capacity of the Home Defence College at Easingwold from 50 to 70 places, so providing fresh opportunities for such training. Training at local level is a matter for police authorities, local authorities, and the National Health Service.
Lord Renton: My Lords, may I thank my noble friend for that reply as far as it goes? Is he not aware that as a rule international crises occur unexpectedly and suddenly, and therefore is it not desirable that, as envisaged in Section 5 of the Civil Defence Act 1948, the Government should make arrangements for all members of police, fire and ambulance services

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to receive instruction, so that they would know what to do in these emergencies?
Lord Elton: My Lords, as to my noble friend's opening remarks, I think that we are all aware that international emergencies can arise suddenly and unexpectedly. As to his substantive supplementary question, I am aware of the provisions of the 1948 Act and indeed the Civil Defence (General) Regulations 1949, under which the requirement to which he referred exists. I can tell him that all local authorities are presently complying with their obligation under the Civil Defence Act 1948.
Lord Gladwyn: My Lords, will not the Government agree that the idea that a radioactive cloud could one day drift over the continent is conceivable only in the event of the total annihilation and vaporisation of either the United States or the Soviet Union, or both—in which case, of course, we should obviously in this country have been vaporised too? Therefore, would not the Government come to the conclusion that any precautions taken in this country against the effects of nuclear war are a total absurdity and the money should be devoted to other purposes?
Lord Elton: My Lords, I would not accept that the noble Lord's apocalyptic vision is the only interpretation of a possible international confrontation. Furthermore, the Civil Defence services are required to act in conventional emergencies, as well as in nuclear emergencies; my noble friend's Question was addressed to both.
Lord Paget of Northampton: My Lords, would not the urgency seem to be increased by the fact that the scientific press seems to be unanimous in the view that the Argentine will have nuclear weapons before the end of this year, or do we feel that the junta's humane restraint can be relied upon?
Lord Elton: My Lords, I am not certain of exactly what the noble Lord was asking me. If he was asking me whether I view the escalation of the present conflict to a nuclear level as likely, I would say, God willing, I do not. If he was asking whether I rested that expectation upon the scientific press, the answer is that I do not do that, either.
Lord Jenkins of Putney: My Lords, would it not be generally agreed that there now may well be a role for these services in the case of a conventional war? But would not many people agree with the noble Lord, Lord Gladwyn's interpretation of the probability of nuclear war, and would not the conclusion that one would draw from that be that it would be best for us to opt out of the consequences by getting rid of our own nuclear weapons?
Lord Elton: My Lords, it is entirely fanciful to suppose that by disarming ourselves we somehow protect ourselves from attack. I also think that it is fanciful to suppose that the only attack that can be envisaged will wipe everybody out at a blow. No scenario that I know of suggests that there will be no
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survivors, and I must say that if the noble Lord thinks that we should not prepare to succour those who do survive, then I simply could not agree with such a hard-hearted philosophy.
Lord Renton: My Lords, is it not possible that some irresponsible and bomb-happy dictator, in order to teach somebody else a lesson, could drop just one nuclear bomb, from which many other countries might suffer? Is not that a possibility which should not be ignored?
Lord Elton: My Lords, no possibility should be entirely ignored. I think that the best thing that I can say to reassure my noble friend is that it is intended to increase national Civil Defence expenditure by about 60 per cent., to £45 million annually by 1983–84, and local authority expenditure is, we hope, to be doubled.
Lord Leatherland: My Lords, the noble Lord says that there might be a few survivors in some circumstances. Can he arrange that I shall be one of them?
Lord Elton: My Lords, even if my term of office were to last as long as the noble Lord's life—and I hope for his sake that it does not—I could not give such a guarantee.

British Rail: Punctuality and Infrastructure
2.57 p.m.
Lord Davies of Leek: 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 agree with the statement in the Annual Report for 1981 of the Central Transport Committee (page 5, para. 6) that improved punctuality on the railways depends upon better track maintenance which has deteriorated because of the financial constraints imposed on British Rail by the Government.
The Earl of Avon: My Lords, the Government share the concern of the Central Transport Consultative Committee about the level of expenditure on track maintenance. To avoid further reductions in expenditure on necessary renewal and maintenance of the infrastructure, my right honourable friend the Secretary of State for Transport has announced his intention to earmark part of this year's public service obligation grant for this purpose.
Lord Davies of Leek: My Lords, I thank the noble Earl for that splendid and hopeful Answer. In order that I may streamline my supplementary question, will he again look at paragraphs 5, 7 and 40 of the excellent consultative report, so that track maintenance at least can be handled as practically as possible? Is the noble Earl aware that, if we want to move people, it is absolutely necessary to have a first-class railway system? Finally, could we not use some of the contingency fund immediately for track improvement?
The Earl of Avon: My Lords, I follow the noble Lord in his three supplementaries, though I am not quite sure what he means by the contingency fund, and perhaps we could have a look at that afterwards. We agree entirely with the idea that British Rail present a wonderful option for transport in our country. Like the noble Lord, I have read the figures, and I was delighted to see that over the last two years punctuality has remained more or less constant.
Lord Underhill: My Lords, does the Minister agree with the comments by the CTCC, and confirmed in British Rail's own annual report, that part of the problem is due to the financial targets and the fact that British Rail has therefore had to spend £90 million less on investment as a consequence of trying to reach the financial targets? Has the noble Earl seen the report that appeared in the press only this week, that British Rail has had to throw out its timetables for the excellent London-Birmingham route because of the backlog of work required on the track, and that consequently there are 25 speed restrictions between London and Rugby?
The Earl of Avon: My Lords, I have not seen the figures which the noble Lord, Lord Underhill, has just quoted to me, but, of course, I shall look into them. Perhaps I may just say that in point of fact a renewal of track does not count against the investment income; so this is a separate item which I believe ought to be spent on renewal of track, which was the point of my earlier answer to the noble Lord, Lord Davies of Leek.

Stock Transfer Bill
3 p.m.
Lord Cullen of Ashbourne: My Lords, I beg to move that this Bill be now read a second time. This is a technical and, I fear, somewhat complex Bill. Its principal function is to make certain changes to the law in order to allow the Bank of England and the Stock Exchange to introduce a computerised system for the settlement of bargains in gilt-edged securities. The Bill is not in fact needed to set up such a system; nor are the Government themselves involved in the establishment of the computerised system which the bank and the Stock Exchange have in hand. The Bill is necessary because the law as it stands does not provide for computerised transfer. In short, it is an enabling Bill.
The decision to put the settlement of bargains on computer was taken some years ago by the bank and Stock Exchange because of the strain placed on the present manual system of increasing activitity in the gilt-edged market. So that participants in the scheme can proceed with the acquisition of equipment in the knowledge that the legal obstacles to the use of that equipment have been removed, it is necessary to get the enabling legislation on the statute book. These obstacles are lifted by the first three clauses of the Bill, together with the two schedules.
I suspect that most people regard the term "gilts" as synonymous with Government securities, which are indeed the main stocks traded in the gilts market.
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There are, however, other types of security traded in that market, and most of these have their own rules, supported by, or enshrined in, legislation. Clause 1 of the Bill therefore lists the existing powers for the Government to make regulations relating to gilt-edged securities, and provides for these existing powers to be used to permit the relevant securities to be transferred through a computerised system.
Clause 1(4) allows the same provision to be made in relation to securities that are not covered by any of the powers listed in Clause 1(3). This new power would, for example, cover securities issued by foreign borrowers on the London market, and any new type of gilt that may be issued in the future. The exercise of this power will be by order subject to the Negative Resolution procedure. As a safeguard, the Treasury will not be able to bring any security on to the computerised system without the consent of the issuer of that security or the person currently liable for that security.
Clause 1 also provides that transfers made under these regulations are valid notwithstanding any existing requirements, whether statutory or contractual, for transfer of the securities in question to be by "instrument in writing". Schedule 1 to the Bill specifies the classes of security that the Government believe will need to be covered, but Clause 2 empowers the Treasury to change this list by order. Clause 3 provides further powers to make regulations. These powers will be used to establish the legal framework for the operation of the computerised system.
Clauses 4 and 5 are concerned with gaps in the existing law relating to gilt-edged securities. They do not deal with computerisation, but the Government think it right to take the opportunity presented by the Bill to remedy these deficiencies. Clause 4 amends the law on two aspects of the redemption of Government stock. First, it gives additional flexibility in the method of payment, so as to authorise block payment of redemption monies to the head office of a bank for distribution via its branches to their customers. Secondly, the Treasury is given power to make regulations to provide statutory backing for the bank's practice of requiring stock certificates to be surrendered before stock is redeemed, and of requiring an indemnity where certificates are claimed to have been lost or destroyed.
Clause 5 permits the Government to make regulations governing the storage and eventual destruction of local authority stock transfers, thus placing local authority stock transfer documents on the same basis as Government stock transfer documents. I have already explained the function of Schedule 1. Schedule 2 contains consequential amendments to a number of Acts. These amendments are necessary to bring those enactments up to date with the computerised transfer system mentioned in Clause 1.
As I said earlier, this is a complex but mercifully a short Bill, and I have accordingly made my speech short; but if I can later help noble Lords on any points I shall be very glad to try to do so. My Lords, I commend the Bill to the House and beg to move that it be now read a second time.
Moved, That the Bill be now read a second time.—(Lord Cullen of Ashbourne.)
3.6 p.m.
Lord Bruce of Donington: My Lords, the House will be indebted to the noble Lord for having given us a good explanation of the Bill, which, indeed, can hardly be said to be one which will have an earth-shattering effect upon the majority of the population of the United Kingdom; so much so that it had a perfunctory Second Reading in another place, and I observed that its Committee stage took exactly four minutes. As a Member of your Lordships' House, I am very often a little suspicious of Bills that go through another place with such alacrity, and I think it is desirable that we have one or two matters clarified a little.
One point arose in Committee in another place, where an assurance was requested that the computer terminal in this regard should be situated in the United Kingdom. The Minister, Mr. Bruce-Gardyne, was good enough to respond by giving that assurance. That being so, there would seem to be no reason why this undertaking should not be incorporated in the Bill itself.
This brings me to another question—one which I would say reflects the expression of what is often termed "judicial ignorance". I observe that in the Bill there is reference to a computer-based system. Although it is very difficult to anticipate any legal action arising out of any breach of the provisions of the Bill itself, I can imagine a learned judge sitting in the Queen's Bench Division or elsewhere saying, on any case being brought before him, "What is a computer-based system? "—because a computer-based system is, of course, nowhere defined in the Bill.
This is not entirely academic. There is always scope within computerised machinery for breakdown, and if a breakdown took place before a purchase was finally complete—and I agree it would he a split second—it would of course leave one party who had sold stock and another party who had not yet bought it. This may be entirely fanciful, but, after all, this is a Bill, and presumably it is anticipated that at some time it might be enforced. Exactly what rights would accrue to the particular parties, unless they went to law? And if they went to law, I can imagine the learned judge saying, "What is a computer-based system? "I am not a lawyer, and I am certainly not an electronics engineer, but it seems to me that, somewhere, some definition is required. I do not want to make a long story about this, but there is another point.
This new system of transfer, even though it operates only over a very limited field, represents a subtle departure again from the whole business of concluding a contract. At one time it was under seal, or under hand, or verbal; and then there was the ordinary transfer system whereby the transferee need not obtain the signature of the transferor before the transfer of shares became effective because that was accomplished on deposit of the instrument. Now we are getting transactions done, in effect, by computer—I agree only over a limited sphere.
What I am anxious about is this. Will this be taken as a precedent? Your Lordships have been through many Bills which have been handled through many competent Ministers from the Benches opposite in which it has been prayed in aid that a particular measure was incorporated in, say, the Local Govern-
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ment Act 1972, it has lasted all these years, why should we not have it in this Bill? I am anxious to have an undertaking from the Government that, although this is probably perfectly all right, never will it be quoted as a precedent for saying, "Well, you passed it in the Stock Transfer Bill. Why legitimately object to it over a wider field?"
Finally, I am worried, particularly with a complex technical Bill, that it should make provision for regulations. It is an enabling Bill, as the noble Lord himself has said. I do not like enabling Bills, anyway, particularly where the subject is as technical as this.
I must apologise to the House for having raised, possibly in my ignorance, a number of questions which are susceptible to easy answer and which may appear to those skilled in this field to be somewhat inconsequential. Nevertheless, at the risk of somebody correcting me on the various matters that I have raised, I still think they are important and I aver that where the other place gives small scrutiny to a Bill it is up to this House to go into that Bill in rather more detail by way of getting explanations.
3.13 p.m.
Lord Terrington: My Lords, as I had the privilege six years ago of introducing the Stock Exchange (Completion of Bargains) Bill into your Lordships' House, I thought that it might be appropriate to say a few words in support of this new Stock Transfer Bill. The completion of bargains Bill was, in a way, the forerunner of the Bill we are discussing today. It was only concerned with the settling of transactions on the computer of equities and corporate fixed-interest securities by a system known as Talisman, while this Bill seeks to take modernisation of the system a stage further by introducing a new computer for settling and completing Stock Exchange bargains in Government securities through a system called BET, as explained by the noble Lord, Lord Cullen of Ashbourne.
One of the reasons why I wanted to say a few words today about the new Bill—and it is a point which the noble Lord, Lord Bruce, has raised just now—is that, so far as the Talisman system is concerned, I am in a position to confirm that the reliability of the computers has been absolutely first class. I felt that it was important that noble Lords should be aware of this fact when considering a Bill to extend computerisation to Government securities, and I am pleased to be able to make this statement with complete authority. The other reason why I am in favour of this Bill, introduced so clearly by the noble Lord, Lord Cullen of Ashbourne, is that it represents yet another stage in the modernisation of procedures of the central securities market. Having spent most of my working life in the securities industry in the City of London, I have been very aware over the years of the need for modernisation and, in fact, I emphasised this very point when I introduced the Bill to legalise Talisman.
My Lords, this is the third piece of legislation over the last 20 years that we have had towards the modernisation of procedures. The first was in 1963. It was the Stock Transfer Act which simplified the written form of transfer and was introduced by the noble Lord, Lord Clitheroe. The second was the Stock Exchange (Completion of Bargains) Act, which I introduced in 1976 and which enabled the Stock Exchange to bring

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the Talisman system into operation in April 1979 using computers. Now we have another and most important stock transfer Bill which, I understand, will result in the Stock Exchange and the Bank of England introducing their new computer system by 1984. I welcome this Bill most warmly.
Lord O'Brien of Lothbury: My Lords, although my name does not appear on the list of speakers, I should like to be allowed to add a word of support to this Bill. I am not in any way authorised to speak on behalf of the Bank of England, where I spent so much of my life, in the early part of which I was engaged at the very lowest possible level in dealing with transfers in the gilt-edged market, which, in those days, were relatively few in number and were dealt with by clerks who had only just abandoned their quill pen. Much has happened since then. The gilt-edged market is now of enormous volume, technology has advanced with increasing speed, and it is only right that that technology should be applied to these processes which at one time were so extremely laborious.
I am glad to see a Bill come before your Lordships which takes that process a good step further. On the other hand, I agree very much with the noble Lord, Lord Bruce of Donington, that a Bill of this character, although a highly technical Bill which interests relatively few people, is of immense importance. Everybody who engages in the transfer of securities can be affected by it. I think it is important that his point should be dealt with carefully and that in your Lordships' House we should examine the Bill very closely indeed. Nevertheless, in general terms, I add my commendation of the Bill to your Lordships.
3.18 p.m.
Lord Cullen of Ashbourne: My Lords, I am grateful to noble Lords who supported this Bill, both the noble Lord, Lord Terrington, and the noble Lord, Lord O'Brien. I agree with the noble Lord, Lord Bruce of Donington, and the noble Lord, Lord O'Brien, that it is right that this House, as a revising Chamber, should look carefully at Bills of this kind. I am very glad that my noble kinsman, Lord Clitheroe, is in his place today. He was responsible for bringing forward the forerunner of this Bill many years ago. I know that the noble Lord, Lord Terrington, supported him on that occasion and I, in turn, supported Lord Terrington in the Talisman Bill; so the team is at work, a team which has been going for a long time.
The noble Lord, Lord Bruce, asked me several questions which I shall do my best to answer. His first question was about external terminals. The intention is that the terminals should be internal and that no terminals should be situated abroad. The noble Lord seemed slightly concerned about this. I am not quite sure why and I think it important that at the next stage of the Bill, we should know what that concern is; because the terminals will be used for checking deals and transferring money and securities. They are not used for extracting data except in relation to the terminal user's own accounts. So there is no danger of somebody with a terminal getting hold of information to which he should not be entitled. I do
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not know whether that was in the noble Lord's mind, but I think he can be reassured on that point.
Lord Bruce of Donington: My Lords, perhaps I could put it back to the noble Lord in this way: if the noble Lord himself does not consider it important, why did his Minister, Mr. Bruce-Gardyne, think it necessary at Committee stage to give the specific assurance? I put it back to the noble Lord.
Lord Cullen of Ashbourne: My Lords, personally I am happy about the situation. If the noble Lord wishes to pursue this matter at another stage in the Bill, of course he may do so.
There was a point about some breakdown in the computer, when somebody says that they bought stock and a split second later somebody says that they have not sold it. I think that was what the noble Lord was suggesting. Again, I do not think that he need worry about this because the computerised system is simply a question of settlement of bargains, and until a bargain is agreed on both sides—either by having gone through the market through jobbers, or if the transaction is negotiated outside the market—it will not enter the system. The system is simply on settlement of the bargain.
The noble Lord is concerned, as always, about this being an enabling Bill. But the purpose of this Bill is to clear away legal obstacles so that regulations can be made to develop what is a very complex system. There is no doubt about it, it is a complex system. The Bill has to get to the statute book so that the hardware can be selected and purchased, thoroughly tested and the participants in the scheme over the next year or so can be collected. The regulations which will follow this are all subject to negative procedure in this House and to the scrutiny of both Houses. It will then be the time to go into the real detail of this Bill. I would have said that this was a case where an enabling Bill was thoroughly justified. Does the noble Lord wish to speak?
Lord Bruce of Donington: My Lords, I do not want to interrupt the noble Lord. However, will he deal with the latter part of my request for assurance? This is a very technical and complex Bill. The instantaneous transmission of information becomes itself the instrument of transfer. This is the nub of it. Will the noble Lord give the House an undertaking that this will not be cited as a precedent when other Bills of this type come up, so that it will be without prejudice to our considering the whole matter anew if any other circumstances arise?
Lord Cullen of Ashbourne: My Lords, I am most grateful to the noble Lord for paying me such a compliment. He must know that I am in no position to make any such statement, either for this Government or for any other. I do not think that I have been asked any other questions. I hope that I have dealt with those few that I have been asked.
On Question, Bill read a second time and committed to a Committee of the Whole House.

Social Security and Housing Benefits Bill
3.25 p.m.
Report received.
Clause 7 [Rate of payment]:
Baroness Jeger Baroness Jeger moved Amendment No. 1:
Page 5, line 21, leave out ("£37") and insert ("£45").
The noble Baroness said: My Lords, I hope that we may take the three amendments to Clause 7 together. We were very concerned during the Committee stage of this Bill and we tried to increase the amounts that were to be paid as statutory sickness benefits. There was no response from the Government. We now make no apology for coming back again because we are still very concerned at the low level of these amounts.
May I remind your Lordships that an employee whose normal pay under his contract of service is not less than £60 is to receive £37 a week. Those who receive between £60 and £45 are entitled to £31. Others are to receive £25 a week, except for those thousands of workers who are to get nothing at all because they earn less than £29·50 a week when they are at work. It seems to us that there is a case for a more generous scale. We hope by the very moderation of our proposals that the Government will be able to agree some increases.
We are aware that the Secretary of State has discretion but no obligation to increase these amounts on review of the cost of living. We have to ask whether these amounts are to be index-linked or whether they are to be in any statutory way fixed to the cost of living. We are very worried because these amounts were written into the Bill well before March 1982 when it came to the Commons.
Surely there is already need for some uprating of those amounts, even though the rate of inflation is down now between 9 per cent. and 10 per cent. Surely, if inflation is 9 per cent. that must mean that £37 is now worth something less in purchasing power than it was in March of this year. Perhaps the Minister can tell us what the rate of inflation has already done to the amounts that were set out in the First Reading of the Bill. Also, there is the latest news from the EEC. That is bound to lead to an increase in prices in the shops for farm produce. We all know that the price of food is a bigger element in the budget of the lowest paid workers than in the budget of those who are better off.
I hope that your Lordships will agree with the modesty of our proposals. I do not apologise for coming back to this subject because it is so important. It is very difficult to see the basis of the Government's calculation of these figures. I refer particularly to the minimum income for a married man with one child to qualify for family income supplement, for instance. That is £74 a week. A man with two children can start claiming family income supplement up to £82 a week in wages.
Surely these sums are meant to indicate the poverty levels which the Government accept. Otherwise, there is no meaning in these figures. So the sums now proposed for statutory sick pay indicate a new level of
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grievous and harsh poverty. I do not want the noble Lord the Minister to tell me that all these impoverished people can claim supplementary benefits, because many of us are hoping to see a decrease in the number of people who have to ask for supplementary benefits, and an increase in the number of people whose statutory income provides for their main needs when they are ill.
It seems to us—and perhaps the Government can explain otherwise—that when a man claiming family income supplement, because his wages are up to £74 a week, becomes ill, his income drops to £37 a week. On that £37 a week he has to pay—this is new—a national insurance contribution of £3.23. That is a Class 1 contribution; and if he is fortunate enough to have any other income he may have to pay income tax.
There are two innovations here. One is that no regard is paid to the family circumstances and the number of children there may be, so that a girl typist living at home will get the same sick pay as a married man with three, four or five children to support. The second is that, unlike national insurance benefit, this new benefit is to be subject to national insurance contributions. Therefore the figures in Clause 7 of the Bill are not the real figures. From them has to be deducted the national insurance contribution. There is an exception—and this is another point on which I should like an answer. Will the contributions of those people who are so poor that they are only able to get £25 in statutory sickness benefit and are below the compulsory rate of Class 1 contributions, be credited, as happens with ordinary national insurance sick pay, so that their contribution record is kept up? If not, they are going to be in great trouble if, later in life, it is found that the deficiency in the stamps on their card means that they are in difficulties when they claim.
It seems to us a strange philosophy that with the lowest paid of all, the poorer a man is at work the poorer he is when he is ill. The Low Pay Unit reckons that 5 million low-paid workers will be worse off under this Bill than under the national insurance sickness scheme; so we feel it is fair to come back and ask the Government whether, since the committee stage, they have had a chance to look at this again. Often the lowest paid are the most vulnerable to illness and often they are badly paid just because they are disabled, inadequate or less robust than others, either mentally or physically.
In April 1981, according to official figures, more than 5 million people in this country were earning less than £60 a week. These are the people who, if they have the misfortune to fall sick, under this Bill will get £25. If such a man fell ill under the national insurance scheme—a man with a wife and two children—I have worked out that he would receive £43.62. It seems to me extraordinary that in the first six weeks of a man's illness the Government say: "You can only have £25 a week, but after that you can go back to the national insurance and get £43.62." It seems unfair to the people concerned; and at Committee stage we really did not get an answer to the philosophy behind this situation.
I understand that the Bill is not to come into force until next year. I ask your Lordships: what will these amounts be worth then? The small increases we suggest might help at least a little towards the

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payment of Class 1 contributions; but I think we have really been too modest in what we have asked for, because we have made clear on other occasions our opposition to this Bill. Unlike national insurance, it discriminates against the poorest paid. It says to the people who are poor when they are at work that they have to be poorer still if they happen to be ill. I have to point out that when there is illness in a family there are often more expenses to be incurred and therefore to drop to £25, irrespective of the number of children or other responsibilities, seems to us very unfair. I want to anticipate the Minister's reminding us that there is a child benefit of £5.25, but we know that has not kept pace with the rate of inflation; and there will be further discussion during Report stage on the question of child benefit, so I will not go further into that now.
Turning to Amendment No. 3, at Committee stage we suggested an amendment which would ensure that a person would be paid his normal earnings or £40, whichever was the lower. Today Ministers might be surprised that we have come back with a rather "meaner" amendment which refers to "£38, or whichever is the lower ". We did that in the hope that the Government will meet us. (" Some hopes!", my noble friend says.) But I can only say that we felt that £38 was better than what has been proposed, and we took the figure of £38 because it seemed to be more nearly equivalent to national insurance sick pay for man with a wife and child. However, he is still at a disadvantage because of having to pay the £3·23 national insurance contribution. Therefore he would be left in effect, even with our amendment, at £34·77 a week.
The Explanatory and Financial Memorandum says that as a result of this Bill expenditure will be reduced by £385 million in a full year. That must mean that £385 million has been taken away from the sick pay of the employees. What else can it mean? I honestly think that it is not unreasonable for us to ask for some generosity from the Government side. A reduction in this £385 million saving would surely not bankrupt the Government, and even small increases which are suggested in this modest amendment would help many families in difficult circumstances. So I end by asking the Government whether they can give some assurance about uprating, which at present is not mandatory under the Bill. Can they make any reference to the possibility of index-linking? Can they assure the House that there will he franking of national insurance cards for the poorest people, as happens at present, so that their contribution record is not disturbed?
May I also ask the Government—perhaps hopelessly, as my noble friend Lord Wallace might agree—whether they will try to look at these changes in the context of increased dental, optical and prescription charges and, for many people, increased rates and rents and all sorts of other difficulties, which are bound to result from a 9 per cent. inflation rate, however much the Government may congratulate themselves on the reduction to that figure. I beg to move.
3.39 p.m.
Lord Underhill: My Lords, may I make a brief intervention in support of my noble friend, because
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we were advised by the Minister at Committee stage that noble Lords should read Financial Effects of Statutory Sick Pay. I have done so, and I should like to quote just two or three extracts very briefly. On page 1, in the introduction, paragraph 3 reads as follows:
"An estimate is therefore made of the actual amounts of extra sick pay that employers will pay to employees. This is compared with the amount of national insurance benefit withdrawn from employees. The rates of statutory sick pay have been set so that, taken as a group, those employees will be left with about the same net income…that they would have received if national insurance benefits had themselves been taxable".
Then we find on page 4 a continuation of paragraph 10. That reads:
"By setting the rate of statutory sick pay at £37 per week (or less for those earning under £60 per week) employees, taken as a group and allowing for occupational sick pay already received, will receive about the same extra net income as they would have done if national insurance benefits for incapacity were subject to taxation".
Finally, in the summary, which details the effects of the statutory sick pay scheme, we find:
"Employees overall are left with the same net income".
The point about quoting those extracts is that they are referring to employees as a group; employees overall. The position of individual employees, which is the subject of my noble friend's amendment, is not taken into consideration, and I hope that the House will support the amendment.
3.41 p.m.
Lord Trefgarne: My Lords, the amendment and the two that follow it, which have been tabled by the noble Baroness and her noble friend, go to the very heart of this Bill. Therefore, I hope that your Lordships will forgive me if I deal with them at rather greater length than I would normally, but I hope at not quite the same length—I make no complaint of this—as that of the noble Baroness in introducing the amendment.
As the noble Baroness has explained, the effect of these amendments would be to change the rates of statutory sick pay so that £45, rather than £37, a week would be payable to someone earning £60 or more a week; £40, rather than £31, would be payable to someone earning less than £60 but not less than £45; while someone earning less than £45, but not less than the lower earnings limit of £29·50, would receive £38 or his normal earnings, whichever was lower instead of the £25 mentioned in the Bill.
The rates of statutory sick pay were debated during our Committee consideration of the Bill towards the end of April. However, perhaps that debate failed to clarify the issues concerned as fully as was necessary. This was because, as many noble Lords then remarked, the financial background to the Bill is indeed complex. I should say that the wording of the Bill itself in Clause 7 is, to my mind, straightforward enough. But the arithmetic underlying the provision of the rates of statutory sick pay is not. Nor can it readily be simplified, since complex calculations are unavoidable in estimating the financial effects of the statutory sick pay scheme on employers, employees and the public purse. This is why we have made a paper on these financial effects available in the Printed Paper Office to which the noble Lord, Lord Underhill, has referred.

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Perhaps I can provide a little further clarification now.
First, I should make it clear that I do not quarrel with the noble Baroness that there will be some individuals whose statutory sick pay, net of deductions for tax and national insurance contributions, will be less than their present entitlement to sickness benefit. The Government have never claimed anything else. What we have made clear is that the rate of statutory sick pay has been set so that, as a group, employees will be in the same financial position as they would be if sickness benefit were brought into tax. And the extra national insurance contributions that they will pay have been taken into account in estimating this.
However, before seeking to explain the arithmetic for employees as a group, I must answer the noble Baroness's point about potential individual losers. Clearly it is of legitimate concern that individuals should not be caused hardship or forced on to supplementary benefit as a result of the statutory sick pay scheme. On that we are agreed. The noble Baroness gave during our Committee discussions the example of a man with a dependent wife, who currently gets £36.40 in sickness benefit and who, at the rates specified in the Bill, will be entitled to £37 statutory sick pay less about £3·23 (at the non-contracted-out rate) national insurance contributions. Incidentally, I hope I have made it clear that the rates of statutory sick pay will be increased from April 1983 to take account of price increases. This man's net entitlement under statutory sick pay after deduction of contributions would thus be about £33·77, which is about £2·63 less than his current entitlement to sickness benefit.
However, the likelihood of married men having to rely solely on statutory sick pay during sickness is relatively small. Many will have working wives. Our sickness benefit statistics show that only one-third of all male beneficiaries receive additions in respect of adult dependants. Available data suggest that more than half of that group, in addition, receive occupational sick pay. In all, we estimate that the number of men with an adult dependant who will receive only the statutory minimum when sick after the introduction of the scheme is in the region of 600,000. But even they will not be materially worse off. At present, a married man with a dependent wife, who receives sickness benefit of £36.40, no occupational sick pay from his employer and who has no other resources, is entitled to supplementary benefit. The current supplementary benefit scale rate for a man and dependent adult is £37.75, plus £7.90 or £11.90 for each dependent child, depending on the child's age. Thus the people about whom noble Lords are particularly concerned would already be entitled to supplementary benefit. Not only is their financial position safeguarded, but we are not creating additional claims to supplementary benefit. All our estimates indicate that the statutory sick pay scheme will not increase the number of claims to this benefit. Indeed, many individuals will find that the new scheme lifts them off supplementary benefit, since for those without an adult dependant the £37 rate of statutory sick pay, even after deductions, will represent a considerable improvement over their present entitlement to sickness benefit.
I should make the point that, in the case of a married man who receives only £37 statutory sick pay, less contributions for a week's sickness, it is unlikely that
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any tax will be deducted that week. The personal tax allowance for a married man is now £2,445, which is equivalent to just over £47 a week. So in a week where his taxable income totals £37, no tax would normally be deducted, although of course the £37 would count as part of his annual income for tax purposes.
I will now turn to the financial effects of the statutory sick pay scheme upon employees as a group. The extra national insurance contributions payable by them as a result of the introduction of the scheme have been taken fully into account in the calculation of the statutory sick pay rates. I should like to reassure your Lordships on this in a little more detail, since it is very important that the House should be satisfied that there is no sleight of hand, or hidden taxation, involved in our setting the rates of statutory sick pay, as we have, and making statutory sick pay subject to tax and national insurance contributions. I should make it clear that this explanation is of the broad principles involved in our calculations. To reduce its complexity, I have not included the effect on the sums quoted of low earners, or of married women and widows who pay reduced rate contributions.
The objective in setting the rate of SSP was to ensure that employees as a group receive broadly the same net extra sick pay as a result of the introduction of the scheme as they would have received in sickness benefit if that benefit were taxable. About £365 million a year (at current benefit levels) will no longer be paid out in sickness benefit when the statutory sick pay scheme is in operation. If this sum were paid to employees and were taxable, it would give them a net income of about £255 million. The rate of statutory sick pay has been set so that employees, as a group, receive about the same amount in net extra sick pay as a result of the scheme. Because sick pay is subject to both tax and national insurance contributions, this corresponds to a gross amount of extra sick pay of about £400 million. With a statutory sick pay rate of £37, the total extra gross sick pay that we estimate will be received by employees as a result of the introduction of the scheme is, therefore, about £400 million. Taking into account the tax and national insurance contributions payable on this, employees' total extra net sick pay is estimated to be about £250 million, which is broadly equivalent to the £255 million, which we estimate would have been their net income from sickness benefit if that were taxable.
To summarise, I have explained that the scheme will not have the adverse effect on individuals which the noble Baroness fears. And I have explained that the extra national insurance contributions which will be payable by employees have been fully taken into account in setting the rates which are quoted in the Bill. Employees as a group will receive about the same pre-tax income after the scheme is introduced as they do now. It is also worth mentioning that the effect of the scheme will be to redistribute income from those on generous occupational schemes, who currently receive more when sick than when well, to those who are in less generous occupational schemes or who currently receive no occupational sick pay.
I apologise for the length of my remarks, but I hope that I have demonstrated that the fears which have prompted the noble Baroness and her noble friend to

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table these three amendments are unfounded. The amendments, if made, would mean a considerable loss to the National Insurance Fund, because employers would be able to deduct the extra statutory sick pay from their remittances of national insurance contributions. This loss would have to be made up somehow; and it is not justified, because, as I have explained, the extra national insurance contributions which employees will pay have already been fully taken into account in setting the rates of SSP.
May I just deal with two or three of the points which have been made by the noble Baroness in the course of her opening remarks. As I have said, the rates in the Bill apply from April 1982, but they will be revised and uprated from April 1983 when the scheme is introduced. The basis of the uprating will be the movements of prices, as provided for in Clause 7, although my right honourable friend the Secretary of State can vary the increase in the light of other circumstances. But Ministers in another place have given a commitment that the rates will be increased from next April. I can give an assurance that if somebody who has received the lowest rate of statutory sick pay on which no contributions are payable has a deficient contribution record in consequence, he will receive the necessary credits to top up his contribution record. This is of course no change from the present position.
Family income supplement, referred to by the noble Baroness, is awarded on the basis of recent past earnings. Once awarded, it continues in payment without recalculation for a year. It is not a measure of poverty, as the noble Baroness—perhaps inadvertently—suggested. It tops up the incomes of low paid working families. I hope that on reflection the noble Baroness and her noble friend will feel able to withdraw these amendments.
Baroness Jeger: My Lords, I thank the noble Lord for his courteous reply. He should not apologise for its length. Nor do I apologise because, as the noble Lord has said, this is the heart of the Bill and it is very important for us to try to get it right.
I am very glad that the noble Lord said that the amounts specified in the Bill which are the subject of this amendment will be increased from April 1983. I hope that this is a total commitment. One of the reasons why we put down these amendments is because it is laid down in Clause 7 of the Bill that the Secretary of State may increase the amounts and that if he decides not to do so he must put a report before Parliament. That is Clause 7(8). If there is now a total commitment not that the Secretary of State may put up these rates but that he will increase them in April 1983, in view of the movement in prices, we very much welcome it.
I welcome also—as I am sure all my noble friends do—the fact that the noble Lord has made it absolutely clear (it has not been made clear previously) that for those below the minimum rate for payment of national insurance contributions there will be credits for every week of sickness so that they do not lose out on their contribution record.
The noble Lord referred to family income supplement as topping up the wages of the low paid. But when a low paid worker is ill, is it not a fact that he will lose his family income supplement and that he will be totally
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dependent on possibly £25 or £31? I understood that the family income supplement was payable only as a supplement to wages and not as a supplement to benefit. I shall be very glad to hear the noble Lord's answer.
Lord Trefgarne: My Lords, I understand that family income supplement would continue to be payable along with statutory sick pay. Thus the fear expressed by the noble Baroness is unfounded.
Baroness Jeger: My Lords, I thank the noble Lord for his answer. That point has not been made clear in previous debates and it is a considerable reassurance. In view of what the noble Lord has said, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendments Nos. 2 and 3 not moved.]
Clause 13 [Appeals]:
3.56 p.m.
Lord Cullen of Ashbourne Lord Cullen of Ashbourne moved Amendment No. 4:
Page 12, line 11, leave out ("his") and insert ("the insurance officer's").
The noble Lord said: My Lords, this is a technical amendment which clarifies the meaning of Clause 13(3). The clause refers to a period "beginning with the date on which notice of his decision was given to the appellant", but there is no indication—at least as a matter of grammar—whose decision "his decision" is. The insurance officer's decision is meant, and the amendment simply clarifies this. I beg to move.
On Question, amendment agreed to.
Clause 16 [Enforcement of decisions]:
Lord Cullen of Ashbourne Lord Cullen of Ashbourne moved Amendment No. 5:
Page 13, line 26, leave out from beginning to end of line 29 and insert—
("16.—(1) This section applies to any case where—

(a) a decision of an insurance officer, local tribunal or Commissioner in proceedings under this Part is that an employee is entitled to an amount of statutory sick pay; and

(b) the requirements of regulations made under section 8(2) of this Act (time within which statutory sick pay to be paid) have not been satisfied in respect of the whole or any part of that amount.

(2) In a case to which this section applies—

(a) any amount payable in pursuance").

The noble Lord said: My Lords, this amendment has two effects, both of which are technical. First, it ensures that an employee cannot invoke Clause 16 to enforce against his employer a decision of the statutory authorities that he is entitled to an amount of statutory sick pay until the time within which that amount of statutory sick pay is to be paid has elapsed. That time will be prescribed in regulations made under Clause 8(2). Secondly, it deletes the reference in the clause to England and Wales, so as to leave the ordinary rules governing jurisdiction to determine whether the enforcement process ought to be pursued in England and Wales or Scotland.
The first part of this amendment corrects a deficiency in the Bill as drafted. As it stands, immediately the

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statutory authorities have given a decision an employee could seek to enforce payment thereunder against his employer. But there are times stipulated in Part I in which an employer may appeal against the decision of the statutory authorities. It would clearly be wrong if an employee could take enforcement steps against his employer before either the time for appealing had expired or the rights of appeal had been exhausted. The change is in the employee's interest since an employer could apply for a stay of the enforcement process if he wished to appeal against the decision of the statutory authorities. In that event, an employee might well lose the fee he had paid to initiate the action.
The regulations under Clause 8(2) will require the employer to pay SSP by the next normal pay day after the time for bringing an appeal against the decision of the statutory authorities has expired and either no appeal has been brought or the rights of appeal have been exhausted. (In circumstances where there are practical difficulties in achieving this, payment may be made by the subsequent pay day.) The amendment thus prevents a precipitate and potentially wasteful use of the court's time and that, I think, will be welcome to noble Lords.
The second part of the amendment enables an employee to enforce a decision of the statutory authorities in whichever jurisdiction is appropriate; that is, in Scotland or England and Wales. The change covers the situation in which the employee works in one country but his employer's assets are in another. This easement will benefit a small number of employees and I commend it to your Lordships. My Lords, I beg to move.
On Question, amendment agreed to.
Lord Cullen of Ashbourne Lord Cullen of Ashbourne moved Amendment No. 6:
Page 13, line 39, at end insert—
("(3) Regulations may, in relation to cases to which this section applies, make provision for payments to be made by the Secretary of State to employees in prescribed circumstances in connection with court fees (including sheriff officers' and messengers-at-arms' fees for doing diligence) incurred, or likely to be incurred, by those employees in seeking to enforce decisions by virtue of subsection (2) above.
(4) The regulations may, in particular, make provision for the recovery of payments made under the regulations from persons to whom such payments are made; and any sum so recoverable may, without prejudice to any other method of recovery, be recovered by deduction from prescribed benefits, ("benefits" having the meaning given by the regulations).
(5) Any payment made by the Secretary of State under the regulations shall be paid out of the National Insurance Fund, and any sums recovered by him under the regulations shall be paid into that Fund.").
The noble Lord said: My Lords, this amendment has the effect of enabling the Secretary of State in certain circumstances to advance to an employee an amount in respect of the court fees payable as a result of invoking Clause 16. In Scotland, the fees concerned are sheriff officers' and messengers-at-arms' fees for doing diligence. The change meets a commitment, given by my honourable friend the Minister for Social Security in another place that this help would be provided.
Noble Lords will appreciate that there are only likely to be a few cases a year brought under Clause 16. It is very much the long-stop of the Bill. Since employers will be compensated for any statutory sick pay they disburse, it is highly unlikely that any of them will
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refuse payment once the statutory authorities have given a decision that liability exists. But we have to cover the situation where an employer does refuse. Clause 16 enables an employee by a very simple procedure to invoke the assistance of civil procedures to enforce payment.
But, as was pointed out in another place, there are fees to be paid in taking this course. If the employee initiates proceedings in a county court in England and Wales he will have to pay a plaint fee, which varies according to the amount of statutory sick pay at stake. And, if the employer does not act on the court order obtained, the employee can issue enforcement process—for which further fees are payable. But fees would of course be recoverable from the employer.
Nevertheless, an employee might have to pay out between £20 and £45 in court fees in England and Wales depending on the amount of statutory sick pay at stake in order to recover that to which he is entitled. And that could, in a few cases, be a deterrent. This amendment allows us to advance to the employee any court fees which he has to pay. I stress it is a loan; we shall recover the sum from the employee when his employer finally pays up. Alternatively, we shall be able to deduct the loan from any future benefit payments. The amendment is wholly beneficial to employees and I feel sure will be welcomed by the House. I beg to move.
On Question, amendment agreed to.
Clause 26 [Interpretation of Part I and supplementary provisions]:
Lord Trefgarne Lord Trefgarne: moved Amendment No. 7:
Page 21, line 22, at end insert—
("(7) In this Part any reference to Great Britain includes a reference to the territorial waters of the United Kingdom adjacent to Great Britain.").
The noble Lord said: My Lords, with your Lordships' permission, I will move Amendment No. 7 and speak to Amendments Nos. 15 and 16 at the same time. These amendments sustain the intention of past and present social security legislation in respect of its application to our territorial waters. They are necessary to clarify the position in the light of a recent decision which has cast doubt on the previously accepted interpretation.
At least since 1948, our social security legislation has been drafted and interpreted by the statutory authorities on the basis that references to people or circumstances inside or outside of Great Britain, the United Kingdom or their constituent parts embraced not only the relevant land areas but also their adjacent territorial waters. For example, take the case of an employed earner (not being a mariner or an airman to whom special provisions apply) who sustained an industrial accident in the territorial waters of the United Kingdom. It has been accepted that he was not debarred from receiving industrial injuries benefits, even though such benefits are not in general payable in respect of industrial accidents happening outside the United Kingdom.
However, a recent decision of Mr. Justice (now Lord Justice) Slade, in Earl of Lonsdale v. The Attorney General, which I understand is not being appealed,

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casts grave doubt upon the correctness of this approach. If the intention of our past and present legislation is to be secured, we require specific provisions to this effect. The proposed amendments provide for this. The amendment to Clause 26 provides it in respect of Part I of the current Bill. The new clause proposed after Clause 43 provides it in respect of those existing social security enactments to which it is relevant. The amendment to Clause 47 provides that the new clause shall come into force when the Bill receives Royal Assent. My Lords, I hope that these arguments will be compelling and that your Lordships will see fit to agree to this amendment. I beg to move.
Baroness Jeger: My Lords, the arguments are indeed compelling and I thank the noble Lord for making them so clear. I just wanted to ask him one question. In this reference to territorial waters, I find myself thinking about people working on oil rigs who might be without this statutory definition of territorial waters, although they might be working for British firms. I am just wondering how far this question of territorial waters would go for deep sea divers and other workers on oil rigs whose work may take them some distance away. Would they be covered by this amendment? I very much hope we might get some information on this. I put the point purely interrogatively.
Lord Trefgarne: My Lords, I understand that generally speaking oil rigs do count as part of the United Kingdom even though they might be outside territorial waters. There is a whole plethora of special legislation relating to the conduct of affairs upon oil rigs. In general, I think the noble Baroness can be assured that the workers on them are properly protected.
Baroness Jeger: I thank the noble Lord.
On Question, amendment agreed to.
Clause 28 [The statutory schemes]:
Lord Wallace of Coslany Lord Wallace of Coslany moved Amendment No. 8:
Page 22, line 15 at end insert—
("( ) In the calculation of housing benefit for a qualifying student actual income shall be used.").
The noble Lord said: My Lords, I beg to move the amendment standing in the names of my noble friend and myself. This is, of course, a different amendment from that which I moved at Committee stage, and is probably a little more simple and direct. The intention of the amendment would be to eliminate an important area of discrimination against students in the present rent allowance scheme and the proposed housing benefits scheme. All students receiving a grant are assumed to receive the full grant, when rent allowances are calculated, and this I understand will continue into the proposed scheme. However, it is very important to note that no other group of claimants is assumed to be in receipt of income which does not actually exist. Benefits are normally calculated on the basis of the actual income of the claimant.
A detailed investigation of student income and expenditure conducted for the Department of Education and Science in 1974–75 showed that over 70 per
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cent. of parental contributions were not paid in full. A survey of students at Kent University in 1979–80 revealed that only two-thirds of students had income equivalent to the value of the full grant. At Glasgow University in 1981–82 50 per cent. of a sample of 2,000 students did not receive the parental contribution in respect of which they had been assessed.
The Government have worsened the position for students in 1982–83 by assessing the parental contribution scales at their 1981–82 levels. Many students are in receipt of discretionary awards paid at very low levels. They, too, are assumed to be in receipt of grant at the maximum mandatory rate. For example, at present a student receiving a £1,100 grant with no assistance from his or her parents, and paying an assessable rent of £13 per week, should obtain a rent allowance of almost £2. If the rent allowance was calculated on the basis of actual income the student would receive about £5·50. Such a student is thus £3·50 a week worse off than a comparable claimant merely because of his or her student status. I think this is a quite clear and direct amendment, and I hope that, after consideration, the Government will feel able to accept it. I beg to move.
Lord Banks: My Lords, I should like briefly to support the amendment. I think the case has been put very clearly by the noble Lord, Lord Wallace of Coslany. It does seem wrong to single out one particular section of the community and to say, "We shall not take the actual income, what you have actually received, but we shall take something you are assumed to have received, whether or not you have done so". That does seem wrong, and therefore I support the amendment.
Lord Trefgarne: My Lords, present advice issuing from the department on this point, which is in Circular 81/77, is that when a student's educational award has been reduced because of a parental contribution, his income may normally be assessed as including the full amount of the award before the reduction. This is in line with existing supplementary benefits policy, which similarly takes account of the assessed parental contribution to the grant. The noble Lord has claimed that this can cause hardship, but I think that the noble Lord is addressing his complaint at the wrong target. If it is considered right within the grant system to look to the parent to make a contribution to his child's grant, then that is not a fact we can ignore when considering the claim for housing assistance of the student himself.
If I may say so, the noble Lord's quarrel is really with the grant system and that, with respect, is not the matter that we are discussing today. But clearly, that area has to be included in the general need to relate public expenditure to what the country can afford. It is not for housing benefits or supplementary benefit to serve as a backdoor supplement to the grant system. In particular, this would simply encourage some parents to reduce or stop paying their agreed contributions since they would know that these benefits could meet some or all of the amount instead. I am not, therefore, able to accept the amendment.
I should like to add one further point. I suppose a circumstance could arise when a student had been

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assessed as having a certain parental contribution, and for reasons outside the control both of the parent and, indeed, the student, the parent became unable to support the child on the basis that had been agreed. In those circumstances, I understand that it is possible for the student to have the grant re-assessed to take account of his parent's temporary or permanent inability to pay the contribution that had been originally anticipated. I do not, therefore, think that any genuine hardship need arise in these circumstances and I hope that the noble Lord will be satisfied.
Lord Wallace of Coslany: My Lords, I thank the noble Lord for his explanation. He has indicated that there is some ground for quarrelling with the grant system but, of course, I accept that that matter does not come within this Bill. I do not think that there is any point in pressing this amendment at this stage. I shall read very carefully what the noble Lord has said and—who knows?—I may come back to it on Third Reading. However, that is a matter for me to decide. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
4.14 p.m.
Lord Wallace of Coslany Lord Wallace of Coslany moved Amendment No. 9:
After Clause 28, insert the following new clause:
("Claimants' right of appeal
. Any claimant of housing benefit shall have the right of appeal to a Supplementary Benefits Appeal Tribunal against any decision of a housing or rating authority regarding such person's entitlement to or level of housing benefits").
The noble Lord said: My Lords, I beg to move Amendment No. 9, which stands in my name and that of my noble friend Lady Jeger. This is a very important amendment of principle to which I have returned. To be quite frank, it was withdrawn at the Committee stage mainly because of the lateness of the hour and out of a certain degree of consideration for the noble Lord, Lord Bellwin, who has, let us face it, been under considerable pressure. Therefore, I read what the noble Lord said at that stage and I now come back with the same amendment.
As I have said, this new clause embodies a very important principle—namely, that of the right of appeal. In Committee the noble Lord, Lord Bellwin, agreed that an important principle was involved. However, the noble Lord went on to state that the best approach for claimants was to their local council, through representations to a councillor, and not by appeal to a supplementary benefits tribunal. En other words, local councils are to be judge and jury.
We cannot escape the fact that this is a very complicated Bill the carrying out of which will present difficulties and complications for councils and councillors. Councillors themselves will find difficulty in understanding its provisions and will tend to be guided by officials. Speaking from some experience, this is not always to the advantage of the councillors or of the poor constituent involved.
With all due respect, I have been involved in local government for many years in the past and feel that it is a qualification for coming to another place in due course, but on the other hand, not all councillors are diligent and persuasive. More important still—and this is an unfortunate fact—the majority of people
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do not even remember the name of their ward representative. In my view at least 80 per cent. of people living in a particular ward—and I am taking the country as a whole, although there are notable exceptions—do not have a clue about their representative. They vote, on a very poor percentage, for their councillor and afterwards they do not have a clue who he is. To be quite frank, at the moment I honestly cannot remember who my representative is, although I did vote. I shall be quite frank about that, but given time I shall find out.
In many housing cases and local authority matters, because of the difficulties of people finding out who their councillor is, they turn to the sitting Member of Parliament who now holds a surgery. I use the word "surgery" but I hate and detest the use of that word and much prefer the phrase" citizens' advice sittings". People go to their poor old MP. From my own experience, and no doubt my noble friend will agree with me, the great percentage of the matters that come to the MP at weekends are local council matters. Some MPs have a councillor sitting with them. To say that people should go to their sitting councillor and to say, as the noble Lord, Lord Bellwin, has said, "Leave it to the councillor", is dodging the issue.
For people whose circumstances are humble and tinged with poverty and who are not in a position to chase around looking for some inspired, active and determined councillor, it is essential that included in this complex Bill there should be the right of appeal so that people can be represented. No one will deny that this is a complicated Bill which could lead to anomalies, mistakes, errors of judgment, et cetera. People in need should have the right of appeal against injustice even if, as is often the case, it involves an accidental error of judgment.
I am apealing to the House on this matter because during the passage of the Mental Health (Amendment) Bill we fought for the right of appeal on legal aid. In their wisdom and honesty, the Government have conceded that point, and I welcome it. Here again is another vital matter of principle on which I am sure many Members of this House feel very strongly. It is no good the council saying that it would put additional work on to the supplementary benefits tribunals. That is what they are for—to work and to see that justice is done. In this complicated issue involved in the Bill it is only right and decent that people should have a right of appeal, and it should not be left to some little local councillor who himself probably does not understand half of what the Government intend to do. I beg to move.
Lord Molloy: My Lords, I wish to support the amendment standing in the names of my two noble friends, and in particular to support the submission made by my noble friend who has just spoken. I really believe that it must be understood that the submission made by the noble Lord, Lord Bellwin, is totally different from the situation in real life. Let me give your Lordships an example. Supposing we carried on further, and, instead of an appeal having to be made to a councillor, it is made to a Member of Parliament and his party does not like it; there is a debate and it is put on a three-line Whip. That is how the issue will be decided: Who has the most MPs? Who has the

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most councillors? This is a crass absurdity in such an emotional issue as this. Therefore, there should always be somewhere, higher even than the other place or this House, where appeals can be made.
My noble friends are saying that in issues like this there should be the provision of a home for a family, and that there should be some higher forum to which to appeal after the local council has made its decision. To say that an ordinary person should go to his or her councillor, could create this sort of mix-up: there could be two identical cases being decided by a council. In one ward, the councillor who has been approached belongs to the majority party and he convinces his colleagues and they win; whereas the unfortunate person who lives in a ward where his councillors are in a minority will never stand a chance of winning. I do not believe that any Member of your Lordships' House would agree that that is an absurdity which we should allow to go unchallenged.
Therefore, this afternoon we have an opportunity to put that right. The new clause, in the name of my noble friends Lord Wallace and Lady Jeger, states:
"Any claimant of housing benefit shall have the right of appeal to a Supplementary Benefits Appeal Tribunal against any decision of a housing or rating authority regarding",
his or her entitlement. Both those authorities can be divided politically. It has happened in the past. I speak from some 21 years' experience in local government, having held practically every chair and having had the great privilege of being the leader of Fulham and Hammersmith Council for a number of years. I have seen this happen. I beg your Lordships to try to understand—as I am sure you will—that sometimes councillors of all political persuasion say to themselves: "What on earth was Parliament doing when it allowed us to be put in such an absurd situation, that if you belong to one party which has great strength, your constituents will be in a powerful position, but if you are councillor in a minority party, your constituents will be in a different position? They are no less British, are they? They are no less entitled to right and justice, are they? "There is a very grave danger here and I have seen it happen.
I believe that the amendment moved by my noble friend follows the tradition of our parliamentary system, particularly in the area of local government. That, perhaps above all, is why I believe that the amendment should be supported. It provides one other place outside the town hall to which a person can turn. He is not asking to have a case overturned; he is not asking or demanding something which the council has refused him. He is asking that an independent source shall judge his point of view and the authority's point of view. I believe that such a proposition would capture both the imagination and the support of Members of your Lordships' House.
The Earl of Avon: My Lords, I very much hope that what the Government are proposing will, equally, catch both the imagination and support of the House. I should like to say how much I appreciated the way in which the noble Lord, Lord Wallace of Coslany, presented his arguments, and I shall try to do the same.
I want to begin by making sure the House understands the Government's case. We totally support the
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need for review arrangements for claimants to challenge the decisions of local officers who have considered their case. But it is in the interests of everyone that these arrangements are as speedy and as direct as possible, especially when we remember that housing benefits will be a weekly benefit.
We are proposing to make regulations so that all housing benefits claimants will have the right to a review of their housing benefits determined by a committee of councillors. The committee's decision, with reasons, would have to be given to the claimant in writing. Although there are no detailed review arrangements in the present legislation, a number of authorities have, rightly, set up their own arrangements whereby claimants can challenge officers' decisions before a committee of elected councillors. The noble Lord, Lord Molloy, mentioned the word "absurdity"; but, on the other hand, this is gently happening now and so far nothing has come to the Government's attention to show that what is happening does not work.
The Government's proposal builds on this good practice and makes it a general obligation. There will also be the additional safeguard, which was announced in the other place, that Ministers will be keeping a close watch on the review procedures. We shall be asking authorities to provide the department with information about the number and kinds of reviews they undertake and the outcome. If we see particular difficulties or particular problems arising, we shall be able to amend the regulations, to ensure that equity prevails.
The Department of Health and Social Security officials have been able to establish that the local authority reaction to the outline proposal is favourable; the detailed proposals are now under consideration.
The Government put forward these proposals for a number of reasons. First, they build on existing successful arrangements in this field. Secondly, housing benefits are a local authority matter, and therefore one for which local councillors must carry direct responsibility. Democracy can only work effectively in local authorities if councillors accept their responsibilities and actively participate in the work of their authority. Our proposal is based on the fundamental principles that councillors are best placed to intervene on behalf of their constituents to review officers' decisions taken in the name of the council.
The noble Lord, Lord Wallace, said that he did not know the name of his local councillor; he also said that they did not have a clue. I thought for a moment he was going to say that this was not a very good method of doing it on the grounds that the councillor would know everybody, but he answered that argument for me by saying that they would not have a clue. I am sure that no councillor who is, frankly, worth his salt would let himself be bluffed by his officials. It was also argued that councillors are an interested party. But they exist to serve their local community, and that includes ensuring that their constituents get a fair deal.
The Government have yet to receive any concrete examples of councils, already applying the principles behind our proposals, which have acted in an unfair manner. Finally, I believe that this will give claimants the most direct and speedy remedy against decisions about which they are unhappy. The councillors are in the best position to correct mistakes quickly.

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Against this, the Government find the Opposition's proposal unattractive. We do not believe that the supplementary benefit appeals tribunals are appropriate to intervene in local authority matters. They form part of the independent supplementary benefit adjudication system. This is a specialised role and their main task is to review decisions of the independent supplementary benefit officers. At the moment they have no expertise in the calculation of housing costs using the existing rebate rules and needs allowance formula. Extending the remit of the supplementary benefit appeal tribunals to housing benefits would therefore require them to take on a new and, in many ways, very different role. They would have to develop expertise from scratch in the housing benefit rules at a time when they are still building up their knowledge of the new supplementary benefit scheme introduced in 1980. But, more to the point, they would have to come to terms with the very different, and political, world of local authorities. The Government do not believe that the traditions and existing role of the supplementary benefit appeals tribunal would fit them for this, without significant changes in their outlook and membership.
Thus, our proposals offer claimants a direct and speedy means of seeking and securing a review of their housing benefits claim from the body that can best help them—their local council. The alternative proposed by the Opposition requires a major shift in the operation and outlook of the tribunals. I believe that believers in local democracy should support the Government's proposals.
Lord Wallace of Coslany: My Lords, to some extent the Government are coming a little closer to what I am after. May I say very bluntly and directly that this is in no way a political point and has nothing to do with any political complexion of any council? This is just a question of principle so far as I am concerned. I cannot accept that a committee of local councillors would deal with these matters. If the noble Earl had been on a local authority, as I have, and sat in the old days on the old poor law appeals committee, as I used to on Saturday mornings, he would realise that some councillors have not got a clue about these things and some are not always sympathetic. This is a point we must bear in mind. Therefore, we want something a little more direct, more legal, so far as the individual is concerned.
The noble Earl said that the Government feel that this should be a matter for the local authority. He said that in his and the Government's opinion the appeal tribunal should not get itself involved in local matters. But I would point out to the noble Earl and others that in point of fact there is an ombudsman in another field dealing with local authority cases, so the Government have taken that principle along and there is no reason why they should not do it now. I shall be quite frank with the noble Earl, the trouble with him is that he reads a very good brief so charmingly that it melts a heart of stone, but with me, it is not a question of a heart of stone: my heart, is more in the principle behind the amendment. I honestly think that, although—and I give the Government credit—they have crept a little towards what I want, this is
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just not good enough. Therefore, I shall press this amendment to a Division.
Lord Molloy: My Lords, before my noble friend sits down, may I point out to him that I do not know who wrote the brief that the noble Earl read out so well, but it could well be that from a similar source we have had information and pamphlets pointing out the need to bring together the department and social security? There was a similar example given here today where the commission could easily operate in conjunction and in liaison with the local authority.
It is difficult for any of us when on one particular day the argument is in favour of bringing the supplementary benefits tribunal nearer to local authorities, and asks us to understand that this will help both ways, to be told, when we are presented with an opportunity, no, they must be kept apart. I hope it will be the former that the Government will accept and that they will be prepared to accept the case so ably submitted by my noble friend Lord Wallace.
Lord Wallace of Coslany: My Lords, my noble friend said "before I sat down". He certainly made excellent use of the Report stage before I had said that I had nothing further to say. I think that the House should reach a decision on this vital question of principle.
4.34 p.m.
On Question, Whether the said amendment (No. 9) shall be agreed to?
Their Lordships divided: Contents, 71; Not-Contents, 114.

DIVISION NO. 1

CONTENTS

Airedale, L.

Kaldor, L.

Ardwick, L.

Leatherland, L.

Aylestone, L.

Lee of Newton, L.

Banks, L.

Listowel, E.

Beswick, L.

Llewelyn-Davies of Hastoe, B.

Birk, B.

Bishopston, L.—[Teller.]

Longford, E.

Blease, L.

Lovell-Davis, L.

Blyton, L.

MacLeod of Fuinary, L.

Boston of Faversham, L.

McNair, L.

Briginshaw, L.

Mayhew, L.

Brockway, L.

Milford, L.

Brooks of Tremorfa, L.

Molloy, L.

Byers, L.

Oram, L.

Chitnis, L.

Peart, L.

Collison, L.

Phillips, B.

David, B.

Pitt of Hampstead, L.

Davies of Leek, L.

Ponsonby of Shulbrede, L.—[Teller.]

Davies of Penrhys, L.

Donaldson of Kingsbridge, L.

Rochester, L.

Elwyn-Jones, L.

Ross of Marnock, L.

Elystan-Morgan, L.

Shinwell, L.

Evans of Claughton, L.

Somers, L.

Gaitskell, B.

Stedman, B.

George-Brown, L.

Stewart of Alvechurch, B.

Gosford, E.

Stone, L.

Gregson, L.

Strauss, L.

Hampton, L.

Taylor of Mansfield, L.

Hooson, L.

Underhill, L.

Hughes, L.

Vernon, L.

Hunt, L.

Wallace of Coslany, L.

Hutchinson of Lullington, L.

Wedderburn of Charlton, L.

Jacobson, L.

Whaddon, L.

Jacques, L.

Wigoder, L.

Jeger, B.

Winstanley, L.

Jenkins of Putney, L.

Wootton of Abinger, B.

John-Mackie, L.

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NOT-CONTENTS

Addison, V.

Kinloss, Ly.

Adeane, L.

Kinnaird, L.

Ailsa, M.

Kinross, L.

Airey of Abingdon, B.

Kitchener, E.

Alexander of Tunis, E.

Lane-Fox, B.

Alport, L.

Lauderdale, E.

Ampthill, L.

Long, V.—[Teller.]

Auckland, L.

Loudoun, C.

Avon, E.

Lucas of Chilworth, L.

Bathurst, E.

Lyell, L.

Belhaven and Stenton, L.

McAlpine of Moffat, L.

Bellwin, L.

McFadzean, L.

Beloff, L.

Macleod of Borve, B.

Belstead, L.

Mancroft, L.

Blake, L.

Mar, C.

Bridgeman, V.

Marley, L.

Cairns, E.

Massereene and Ferrard, V.

Cathcart, E.

Merrivale, L.

Chesham, L.

Mersey, V.

Clifford of Chudleigh, L.

Mills, V.

Clitheroe, L.

Milverton, L.

Cork and Orrery, E.

Morris, L.

Craigavon, V.

Mowbray and Stourton, L.

Craigmyle, L.

Newall, L.

Crawshaw, L.

Onslow, E.

Cullen of Ashbourne, L.

Orkney, E.

Daventry, V.

Oxfuird, V.

Davidson, V.

Porritt, L.

Dilhorne, V.

Rankeillour, L.

Dormer, L.

Reay, L.

Drumalbyn, L.

Redcliffe-Maud, L.

Ebbisham, L.

Reigate, L.

Eccles, V.

Renton, L.

Ellenborough, L.

Renwick, L.

Elliot of Harwood, B.

Rugby, L.

Faithfull, B.

St. Davids, V.

Ferrers, E.

St. Just, L.

Fortescue, E.

Sandford, L.

Fraser of Kilmorack, L.

Sandys, L.—[Teller.]

Gainford, L.

Selkirk, E.

Gibson-Watt, L.

Sempill, Ly.

Glanusk, L.

Sharpies, B.

Glenkinglas, L.

Shrewsbury, E.

Gormanston, V.

Spens, L.

Gridley, L.

Stamp, L.

Grimston of Westbury, L.

Stodart of Leaston, L.

Hailsham of Saint Marylebone, L.

Strathclyde, L.

Strathspey, L.

Halsbury, E.

Sudeley, L.

Hankey, L.

Terrington, L.

Harmar-Nicholls, L.

Trefgarne, L.

Hatherton, L.

Trumpington, B.

Henley, L.

Vaux of Harrowden, L.

Hylton-Foster, B.

Willoughby de Broke, L.

Inglewood, L.

Windlesham, L.

Killearn, L.

Wise, L.

Kilmany, L.

Wynford, L.

Kimberley, E.

Resolved in the negative, and amendment disagreed to accordingly.
4.42 p.m.
Lord Wallace of Coslany Lord Wallace of Coslany moved Amendment No. 10:
After Clause 28, insert the following new clause:
("Claimants in hostels.
. Claimants living in hostel accommodation shall be treated on the same basis with regard to housing benefits as all other claimants.").
The noble Lord said: My Lords, this is a probing amendment similar to one I moved in Committee, which I withdrew at that stage. The main issue, as I said then, is the principle that people who live in hostels should be treated on the same assessment basis for entitlement to housing benefit as all other claimants.
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I will not repeat what I said in Committee, when the noble Lord, Lord Bellwin, went a long way to meet my point of view and confirmed the Government's sympathetic approach to what is admitted to be a difficult problem. By and large, the Government have indicated action which will go some way to meet the requirements of the new clause. In another place, the Minister agreed to meet organisations concerned with the problem. Perhaps we can be told whether consultations have now taken place and what, if any, results there have been. That is the information I want, because on this issue the Government should have consultations with organisations involved with the problem. I beg to move.
The Earl of Avon: My Lords, as the noble Lord, Lord Wallace, said, my noble friend Lord Bellwin explained in Committee at some length the Government's reasoning on the amendment, and that actually followed discussions with the local authority associations and voluntary organisations most concerned. The Government therefore decided that the most practical way of helping boarders in receipt of supplementary benefit was to provide for them to continue to receive their housing assistance via the supplemantery benefit scheme. I should emphasise that the term "boarders" includes, but does not refer exclusively to, hostel dwellers, so there is no question of singling out hostel dwellers as a different class for different treatment.
My noble friend has already explained the special difficulties which would be faced by boarders in receipt of supplementary benefit if they were required to claim housing benefit to cover the rent and rate element of their board and lodging charge, and I do not therefore propose to repeat the arguments. Suffice it to say that the Government have taken this decision in what we firmly believe to be the best interests of the claimants concerned. There is no question of hostel dwellers or other boarders being treated less favourably, or receiving less benefit, than they would otherwise. On the contrary, the Government proposal will ensure that they receive their full entitlement to housing assistance as speedily, and with as little fuss, as possible. That, I am sure, will be important to those whose need is urgent. Those not in receipt of supplementary benefit will of course be treated in the same way as all other claimants. They will be eligible for housing benefit if they live in the hostel as their home for a minimum of two weeks. That will be a considerable improvement on the existing situation, where many hostel dwellers have to serve qualifying residential periods of as long as six months. The noble Lord asked specifically about consultations. The ministerial correspondence with the bodies concerned is in hand. I hope I have allayed his fears and that he will feel he has probed far enough.
Lord Wallace of Coslany: I thank the noble Earl for that reply, my Lords, and I am glad that consultations are proceeding. It is obvious—I wish to be frank about it—that the Government are seized of the problem. It is a complicated and growing problem because unfortunately more and more people are being forced into hostel accomodation. However, I

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am not dissatisfied with Government action so far. I thank the Minister for his reply and I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 30 [Local Schemes]:
Lord Kinross Lord Kinross moved Amendment No. 11:
Page 25, line 38, at end insert—
("(6) Without prejudice to the generality of the powers conferred by subsection (1) above, a variation under that subsection of the statutory scheme may provide that in ascertaining for the purposes of a rate rebate, a rent rebate and 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 Lord said: My Lords, my noble friend Lord Campbell of Croy, whose name also appears to the amendment, has asked me to explain that he is in the United States doing his best to promote British business. The amendment is in exactly the same terms as one I moved in Committee, when I withdrew it so that our advisers might consider what the Minister had said. Immediately after the Committee stage, the Minister gave to Lord Campbell and me independently what I took to be an assurance that if the pressure was maintained and an amendment tabled, the Government would accept it, although it was pointed out that its drafting might need amending, which was quite acceptable to me because my drafting is never very satisfactory. My noble friend Lord Campbell was left in no doubt that the Government would table their own amendment to the same effect; in case they did not, the amendment now before the House was tabled. It was with some surprise, therefore, that I received a letter later from the Minister asking me to withdraw my amendment, which noble Lords can see I have not done.
The amendment requires some explanation. It seeks to re-enact certain existing legislation which authorises local authorities in Scotland to make variations in their model schemes for rent rebates and allowances and their standard schemes for rate rebates. The legislation is contained in the Housing (Financial Provisions) (Scotland) Act 1972 and the Local Government (Scotland) Act 1973, both of which contain a subsection to the effect that in assessing the income of a person who applies for a rate or rent rebate or allowance, there is a total disregard of war disablement pension and war widow's pension. That is permissive and not mandatory, but the specific reference to the disregard of war disablement and war widows' pensions has proved of great advantage to the war pensioner and war widow in Scotland because, as a result, at present all nine regional, three island and 53 district councils operate a total disregard, as do the five new town development councils and the Scottish Special Housing Association.
The object of the provisons to which I have referred is to draw the attention of local authorities in Scotland to the fact that war pensioners are in a very special position. This special position comes about because the pensions are paid as compensation for loss of the amenities of life, and not as a supplement to income. For the same reason war pensions are not subject to income tax. There is no doubt in my mind that had it
1102
not been for this legislation, this advantageous position—that is, for the war disabled—would not subsist. But this legislation is not being carried forward into the Bill. It is in order to obtain for the war pensioners throughout the United Kingdom the more advantageous legislation on this matter, which at present applies only to pensioners in Scotland, that I have put down the amendment. If the amendment, or another to the same effect proposed by the Government, is not accepted, we shall be thrown back on the more limited partial disregard of a fixed sum of £4 of war pension permitted and referred to in English legislation.
I do not doubt the sincerity of the Government when they say that they recognise the special nature of war disability and war widows' pensions, and at a time when alas! the number of war pensioners and war widows is increasing as a result of the Falklands crisis, that is gratifying to know. The Government say that they are anxious to do their best for the war pensioners. In such case they should be prepared to perpetuate the more favourable Scottish legislation, which would then apply throughout the United Kingdom and give all war pensioners, wherever they live, the best.
I agree with the Government that the Bill enables local authorities to give a total disregard of war pension, but I disagree as to the method by which the specific reference to the disregard should be brought to their notice. The Royal British Legion, Scotland, favours the existing Scottish method of drawing attention to the war pensioner by referring to him in the primary legislation, whereas the Government think it enough to refer to the power in a circular to local authorities. The proof of the pudding is in the eating thereof. All the local authorities in Scotland have given effect to the 100 per cent. disregard. I ask the Government to perpetuate the existing legislation by accepting the amendment.
The noble Lord tells me that his parliamentary counsel have advised that my amendment would not make sense in legal terms, since it is not required to achieve the legal effect desired. Lawyers are very ingenious people. I do not claim to be a lawyer myself. I retired a year ago, not with all that ingenuity, but I am sure that with their ingenuity parliamentary counsel can emulate their predecessors and produce some form of legislation which will perpetuate the Scottish position. This is not a party political matter; nor indeed is it a political matter. It is a matter of justice to the ex-serviceman who has been disabled in war, or his widow. I ask for the support of the House for the amendment. I beg to move.
Earl Cathcart: My Lords, I should like to support the amendment proposed by my noble friend Lord Kinross. Perhaps I should declare some interest in what the amendment tries to achieve, since not only am I a member of the Royal British Legion, Scotland, but I am also deputy president of the British Commonwealth Ex-Service League, which also wishes to support the amendment. I should also say that I was very sorry that I was not able to be present at the Committee stage.
The details and principles raised by the amendment are very complex, but my noble friends Lord Kinross and Lord Campbell of Croy both explained in great detail at the Committee stage what they wanted. As

1103
my noble friend Lord Kinross has said this afternoon, the disregard proposed arises because war pensions are paid as compensation for loss of the amenities of life and not as a supplement to income. I think that that really needs to be stressed.
I am quite certain that the disregard would not have operated so successfully in Scotland had there not been specific reference to it in the two Acts referred to by my noble friend Lord Kinross in his speech in proposing the amendment. Clause 28(5)(b) of the Bill before us repeals the relevant subsections of the two Acts and relies on drawing the attention of local authorities by means of an advisory circular. I can only hope that the Department of Health and Social Security will issue frequent reminders of the disregard; otherwise through the passage of time its effect will become diluted over the years, and there would not be on the statute book a section through which the British Legion could impress on local authorities their responsibility in establishing this principle, which is so important to ex-servicemen. I therefore beg to support the amendment.
Baroness Elliot of Harwood: My Lords, I, too, should like to support the amendment. The noble, Lord, Lord Kinross, has put the matter very clearly and very simply. I was approached by the noble Earl, Lord Haig, who, I think, is president of the British Legion, Scotland, and who unfortunately cannot be here today. I know that he feels very strongly about this matter. When something is working well, is a success, and fills an important gap in this type of legislation it is a great mistake not to continue it. So often legislation is concerned with changing things when change is not necessary. The existing legislation and the amendment that is being put forward reflects exactly what is happening and what should continue. I hope the Government will realise that certainly in Scotland we should be extremely disappointed if the legislation is not continued. If it is a success, why not let it continue, and include it in the Bill, so that it would cover more people? So I very much hope that the Government will do what Lord Kinross seeks and accept the amendment.
Lord Wallace of Coslany: My Lords, from this side of the House I wish to support the amendment and draw to the attention of the noble Earl what he said during the Committee stage, as reported at col. 66 of Hansard of 10th May. He stated:
"First, I said that the amendment is unnecessary. That is because Part II of the Bill essentially sets out enabling powers to set out the details of the housing benefits scheme in regulations. The enabling powers are sufficiently wide to provide for total disregards of war pensions, so no further primary legislation is required".
That is all very well, but the question is, What do the Government say? Do they, or do they not, intend that war pensions should be disregarded? If they were to make a simple declaration of faith on that, I am sure that the noble Baroness and others would be satisfied.
Lord Drumalbyn: My Lords, I wish to join in supporting the amendment. I believe that there are two important aspects which I hope my noble friend will be able to clarify. First, so far as Scotland is concerned,
1104
the total disregards are to be continued. I very much hope that that is so. I understand that the complete application of the disregard by all the local authorities and other authorities in Scotland has been achieved without mandatory powers. That, of course, is extremely creditable, not least to the British Legion, of which my noble friend Lord Kinross is chairman, and the other sponsor of the amendment last time, the noble Earl, Lord Haig, is president. That was the situation, I remember, when I visited them in my then capacity as Minister of Pensions and National Insurance.
I think it is equally important from another point of view; that in previous times we have had separate legislation for Scotland. Now, in this case, Scotland and England have been drawn together. Whenever Scotland comes together with England, I think we have to be quite certain that Scotland does not lose thereby. On the contrary, as my noble friend anticipated my saying, we would hope that as usual Scotland will bring benefit to England. The second aspect of it is that there should be benefit to England, and that what has happened in Scotland will become the rule—not the law, necessarily, but the rule—in England. My noble friend Lord Avon said (again at col. 66) that, under the Bill,
"In fact, local authorities will have power under Clause 30 to frame more generous schemes within their areas which disregard war widows' and disablement pensions completely".
That is the situation is Scotland. The Bill will not enable Scotland to have more generous treatment, because it already completely disregards such pensions.
My Lords, that is the second aspect I want to ask about; that is, how this is going to come about in England and Wales. I hope it will come about in the same way as in Scotland. It may be that in Scotland we have closer regard for the law than they have South of the Border, and that in England people prefer to have circulars to guide them. But what on earth is to prevent them from doing both? I would have thought that my noble friend was absolutely right to enshrine this amendment, or something like it—he himself ought to know, but he may not have drafted it in the same perfect way as those who do nothing but drafting—in the legislation; and of course there should be circulars to draw the attention of members and officials of local authorities to what is in the legislation. This is the best way to do it, and I hope my noble friend will be able to say that this is what will be done.
Lord Sandford: My Lords, I rise to support certainly the intention of my noble friend Lord Kinross, if not his precise amendment. My chief reason for doing so is that, as president of the Association of District Councils—the 300 housing authorities who operate this scheme in England—I am anxious, as my noble friend Lord Drumalbyn has said, that the same happy situation should prevail in England as already prevails in Scotland. I am not yet absolutely clear what factors lead to this state of affairs. It could, I think, be one of two or three. Certainly the fact that the chairman and the president are the noble Lord, Lord Kinross, and the noble Earl, Lord Haig, is a help. So is the fact that a friend of mine, another former naval person, is in charge of the pensions for the British Legion in Scotland. That must be an advantage as well.

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I suspect it is something to do with the legislation, in which case it is clearly necessary to do something in this Bill. I cannot think that it is the meanness of the district councils in England which has anything to do with it. The Scots are perhaps a generous people, but, then, so are the English. I really think there is something which needs to be done in the legislation so that the benefits which are being felt in Scotland are available in England. It may not be by means of my noble friend's amendment, but I hope that my noble friend on the Front Bench will either accept the amendment or enter into a firm undertaking to produce an amendment for the Government at the next stage.
Lord Somers: My Lords, I should like to add one or two words of support from these Benches. It is only too easy to find economic or political reasons for avoiding doing that which is absolutely morally essential, and I sincerely hope that the Government will think very deeply over this amendment and will not fall into the trap of just taking the easy political way.
Lord Hughes: My Lords, from this side of the House I, too, should like to support the amendment. I am tempted to do so by what has just been said. It has not apparently been for economic reasons that the Government are talking against it. I once sat on the Government Front Bench and the most unsatisfactory briefs I ever had as a Minister were the ones which were headed "Resist" and which then followed on to say, "It is not necessary to put this in, because it is already covered in the Bill". It is a good principle that, if there is any risk of disaster, belt and braces are worthwhile, and all that is being asked for in this case is that the braces should be supplemented by the belt.
I was more than a quarter of a century in local government, and during all that time this principle applied in Scotland. It has not changed with the reorganisation of local government; the new authorities accepted it in the same way as the old town and county councils had accepted it. For these reasons I invite the noble Earl to alter his brief, if it is still being presented in that form, and, instead of resisting the House, to resist his advisers.
The Earl of Avon: My Lords, there is very little in my brief which has not been quoted at me from one side or the other during the course of this debate. Having sat through the discussions when we in this House talked about devolution, I wonder what would happen to my supporters if we had lost Scotland at that particular time. Of course, there is nothing economic or political in this, as noble Lords know. I think I must stress just one or two things, particularly as my noble friend Lord Drumalbyn asked me about one point. The Government wholeheartedly agree that authorities should be able, as now, to disregard war pensions completely when they assess claimants under local schemes. Nothing in the housing benefit legislation will prevent authorities from so doing.
A lot has been said about the precedent of Scotland, and perhaps I may explain that. The existing Scottish legislation is not actually relevant. Under current Scottish legislation, Scottish authorities must seek the approval of the Secretary of State before making any
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enhancement of the national scheme. That is why the Scottish provisions at present give authorities power to disregard war pensions; otherwise, permission would be required in individual cases. But in England and Wales no prior permission is required in this area. We have decided up to date with the housing benefit to bring Scotland into line with the simpler English and Welsh provisions. The Scottish authorities will no longer need the Secretary of State's permission to make local modifications. General legislative clearance will not be required.
However, of course I have listened to all sides of the House in this debate, and what I should like to say to my noble friend is that if he will withdraw his amendment I will undertake to bring forward an amendment in similar terms at the next stage, having duly consulted my noble friend.
Lord Kinross: My Lords, I thank my noble friend for that very welcome statement. I am very happy to do what he wants, and, on condition that he brings forward an amendment at the next stage of the Bill, I am happy to withdraw this amendment. Before doing so, for the record I think I should say that I am not chairman of the British Legion (Scotland), though I was some 15 years ago. I thank noble Lords for their contributions. I have not heard any voices from any side of the House against the amendment and therefore, on the undertaking given by the Minister, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 32 [Subsidies to authorities]:
The Earl of Avon The Earl of Avon moved Amendment No. 12:
Page 27, line 34, leave out from ("period") to end of line 36 and insert ("of twelve months ending with 31st March 1983.").
The noble Earl said: My Lords, I think that this is a simpler amendment. Its purpose is to ensure that those authorities which are already spending money in preparing for the introduction of the new scheme can be reimbursed for that expenditure. Without the amendment, it would not be possible under the present definition of the words "initial year" to pay a subsidy for any expenditure incurred before Royal Assent. With the first phase of the new scheme only a few months away, it is clear that some authorities are already incurring development costs. The Government have undertaken that all necessary costs of this type will be met in full by the Exchequer, and the amendment makes it possible for us to honour that commitment in full, irrespective of the particular point in the financial year when the spending takes place. I trust that this will command the general support of the House. I beg to move.
On question, amendment agreed to.
Clause 39 [Industrial injuries]:
Lord Trefgarne Lord Trefgarne moved Amendment No. 13:
Page 33, line 12, leave out from beginning to end of line 18 and insert—
("Sickness benefit in respect of industrial injury.
50A.—(1) In any case where—

(a) an employed earner is incapable of work as a result of a

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personal injury of a kind mentioned in section 50(1) of this Act; and

(b) the contribution conditions are not satisfied in respect of him;

those conditions shall be taken to be satisfied for the purposes of paragraph (a) or, as the case may be, (b) of section 14(2) of this Act as that paragraph applies in relation to sickness benefit.
(2) In the case of a person who—

(a) is entitled, by virtue of this section, to sickness benefit under subsection (2)(b) of section 14; and

(b) is not also entitled to sickness benefit under subsection (2)(c) of that section;

the weekly rate at which sickness benefit is payable shall be determined in accordance with regulations.
(3) In subsection (1) above "contribution conditions" means—

(a) in the case of a person who is under pensionable age, the contribution conditions specified for sickness benefit in Schedule 3, Part I, paragraph 1; and

(b) in the case of a person who has attained pensionable age but has not retired from regular employment, the contribution conditions for a Category A retirement pension specified in Schedule 3, Part I, paragraph 5.").

The noble Lord said: My Lords, the terms of this amendment are forbiddingly technical, though their purpose is clear. The amendment is designed to ensure that, after injury benefit has been abolished on the introduction of SSP, people over pension age—that is, 60 for women and 65 for men—who are injured at work, will be entitled to state sickness benefit, until, under the ordinary rules, that benefit comes to an end. This means until they retire or they reach the deemed retirement age, 65 for women and 70 for men.
Clause 39 brings forward two changes to the industrial injuries scheme which were announced in the White Paper, Reform of the Industrial Injuries Scheme, published last November. The first abolishes injury benefit and the second applies the resultant savings to improving the provisions for disablement benefit. Injury benefit, as your Lordships will know, is the scheme's incapacity benefit. When it is abolished, benefit cover will be provided for most people by statutory sick pay (SSP) followed by state sickness benefit. Some injured people, however, will not have paid sufficient contributions to qualify for sickness benefit. Clause 39(4) already provides for the contribution tests to be waived for them, but it does not cover the case of people over pension age for whom the tests are different. For them, entitlement depends on the rate at which retirement pension would be payable if they had retired. Not everybody, however, qualifies for a retirement pension, and some qualify for only a modified rate of pension. The amendment enables them to get standard rate sickness benefit during periods of incapacity due to industrial accidents or diseases. It will also enable those who would be entitled to retirement pension at a higher rate than standard sickness benefit to receive benefit at that higher rate.
Sickness benefit will not be payable in any case after retirement; or if retirement has not been taken place by then, after the deemed pension ages of 65 for women and 70 for men in accordance with the normal rules. I hope that the House will find this amendment agreeable. I beg to move.
Baroness Jeger: My Lords, we welcome this improvement to the Bill and are glad that help is to be available for the older workers and for those whose
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contribution records may be in default. Perhaps I may ask the noble Lord whether he is satisfied that these changes will not have the effect of making anybody worse off and, if there are to be people worse off, who those people are who are to be put at a disadvantage by the abolition of the old injury benefit. We know that many disabled workers in the past have benefited from the industrial injuries legislation and we have some concern that this change may not be helpful to everybody.
I noticed during the Second Reading of the Bill in your Lordships' House that the Minister said:
"The money saved by this measure is being used to make disablement benefit—the scheme's long-term benefit—available from a fixed date in all cases. This will be 15 weeks after the accident or the incidence of the prescribed disease. These changes will bring substantial benefit to the more seriously disabled, and that is one of the principles underlying our proposals for the reform of the Industrial Injuries Scheme as a whole". [Official Report, 6/4/82; col. 127.]
My Lords, will the Minister give some indication as to how this reform of the industrial injuries scheme is taking shape and whether he can assure the House that no workers, disabled or suffering from industrial diseases, will be worse off?
Lord Trefgarne: My Lords, I am not aware of any category of persons who would be worse off as a result of this provision than if the change were not to be made. It will not affect many people in total. I have a figure of about 9,000 people altogether who will be affected. I hope the noble Baroness will forgive me if I do not go into greater detail about sickness benefit and injury benefit at this moment.
On Question, amendment agreed to.
Clause 43 [War pensions.]:
Lord Molloy Lord Molloy moved Amendment No. 14:
Page 38, line 30, leave out ("six") and insert ("ten").
The noble Lord said: My Lords, I beg to move the amendment standing in my name on the Marshalled List. This amendment will be recognised as the limited backdating of awards. I should like to say at the outset that the Government, even with the Bill in its present form, have improved the situation considerably and I should like to make it clear that I understand that. But, in my judgment, the particular subsection in which this change has been made does not go to the extent that it should. Nevertheless, we are grateful for gradual improvements. My concern is this. Let us suppose that an ex-serviceman claimed a war pension in 1950 and was rejected, he then went to an appeals tribunal and lost; and then, perhaps years later, in 1973, he decided, on medical advice or without medical advice, to appeal again. This time he was successful. Hitherto, the pension has started from the date on which appeal was successful. This meant that for all the time he was wounded and hurt and his life was affected a grateful country did not bother to recompense a penny to such a man.
This particular amendment at this time in today's circumstances ought to be extremely closely scrutinised, because I hope we shall not have a situation in five or six years' time when somebody is able to say: "I was at the Falkland Islands. I did not think I was

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wounded at the time; but then something bad happened to me. I made an appeal and it was turned down, and later I made an appeal and was successful. Now I have lost five or six years". We do not want those men to say to us: "You were so full of praise for us at the time but now when the law says I have to be paid for something that I suffered, you are backsliding on the commitment".
At the same time, I have to say that the Government proposal is a considerable improvement on the previous situation. When one goes on to examine the proposition, under the old system, if a man had been wounded, say, in the Second World War and, five or six years later, submitted his case and was turned down, he might later have submitted it again because this time—and this is the point your Lordships must bear in mind—there had been such an advance in medical science that some of the things they did not know in 1950 were now available to them. This is particularly so in regard to the causes of disabilities. I know that your Lordships will take that point particularly seriously because it is the submission of the Royal British Legion. I do not think that we ought to treat that organisation with any form of hilarity. As the vice-chairman of the Greenford branch, I suppose I ought to claim some interest in this. We have always argued that this limiting of back-dating of awards is morally wrong. The only loophole that we had was that the Secretary of State had discretion to order the pension to start from the very first application. That has not always been done.
Most of the cases that have been coming up in the past 25 or 30 years have of course come from the Second World War. There have been a few more from the hostilities in Northern Ireland. Now—alas!—there may be a few more in the not too far distant future arising from the Falklands issue. I ask this House to bear with me and treat this amendment seriously. 1 believe—as I know full well the Royal British Legion believe—that the limited back-dating of awards is both unjust and unfair, particularly where a person is entitled to compensation for a longer period. It is our view that payment should be backdated to that period when they should have commenced. I cannot think what is wrong with that.
If the medical people say, "Yes, what you have been suffering from for the past 20 or 30 years all started from the time when you went down the scrambling nets on D Day", or, "It started when you clambered ashore on the Falkland Islands—regrettably, it was not seen immediately, but now we are convinced that is the day when your award should have started", I cannot see anything wrong in that. I know 1 am speaking for the Royal British Legion when I say that payments should be back-dated to that period. I hope that I am a reasonable pragmatist as well.
In conclusion, I want to thank the Government and congratulate them on the advance that they have made. My amendment seeks to delete six years and insert 10 years. It is another move forward, step by step in the Fabian tradition. Bearing that in mind, I hope that the Government will be prepared to move that little further on the road to fair play and proper justice. I beg to move.
Lord Trefgarne: My Lords, the effect of the amendment, as the noble Lord has explained, would be to
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increase from six to 10 years the period which payment of awards of war pension in certain appeal cases could be back dated.
May I explain briefly how the appeal system works. Where an ex-serviceman's claim for war pension is rejected, he can appeal to the independent pensions appeal tribunal. If the tribunal uphold the department's decision, he can turn to the High Court or, alternatively, use what is known as the" joint application procedure. This latter procedure is more favoured by appellants. A good example would be where an appellant is able to produce fresh evidence. If the department agrees that the fresh evidence is sufficiently cogent, the two of them approach the president of the pensions appeal tribunal jointly to have the earlier appeal tribunal decision set aside and the appeal reheard. If the second tribunal finds in favour of the ex-serviceman, my department make an award accordingly.
In such cases, it has been the practice to fix the commencing date of the award as the date of the representations leading to the joint application, that is, the date the fresh evidence was produced. This practice has been quite consistent with the general policy on commencing dates of awards as reflected in war pensions legislation. The commencing date is customarily taken as the date of the start of the action which results in the award. This policy has been generally accepted as fair, given that a claim to war pension has no time limit and can be made at any time.
However, because of advice from our lawyers that in appeal cases this policy was not supported by the legislation, it became necessary to clarify the position. It follows from what I have said that it would have been consistent to legislate in this clause for no back-dating. But we felt this was not sufficiently generous. We propose therefore to pay back to a date appropriate to the original appeal unless this was more than six years before the date of the representations leading to the joint application, in which case arrears will be set at six years. Altogether it is anticipated that arrears will be payable in some 200 cases. In some cases there will be individual payments of several thousand pounds.
The situation in which we are limiting the payment of arrears is where the pensioner has waited a number of years before bothering to reactivate his case. It seems only fair that, in such circumstances, some kind of limit should be placed on the extent to which pension is back-dated. We chose six years as being a generous measure of back-dating, on a par with for example the time allowed for income tax purposes when someone wants to claim arrears of a tax allowance. Back-dating for social security benefits is a good deal less favourable. For instance, there is a maximum back-dating of 12 months for claiming retirement pension; and with a benefit such as attendance allowance there are no arrangements for back-dating at all. Time limits for claiming are, of course, a fundamental feature of all social security payments.
I should add that the Secretary of State's discretionary powers to backdate an award of war pension further than six years will remain and will be exercised as at present—that is, where the appellant was prevented by physical or mental incapacity from acting earlier or where there is evidence that misdirection or

1111
material error on the part of the department contributed towards the original decision to reject. The position is therefore that the Government have already departed substantially from normal policy and practice in accepting a period of six years for payment of arrears. I do not therefore think that a further extension to 10 years is justified. I hope that the noble Lord will be persuaded by that and withdraw his amendment.
Lord Davies of Leek: My Lords, is the noble Lord aware that I remember a similar case that we had to deal with when I was in the Ministry? In the case of pneumoconiosis a man may not find out and the doctors may not assert that his lungs are sufficiently incapacitated for a long period of time. It often takes a long time and many a coroner has given the result of death as pneumoconiosis contracted more than 10 years earlier. Exactly the same situation can happen in the modern, sophisticated world in which we are using new materials, new plastics; and, particularly in wartime, there are fumes that were not encountered in the old conventional days. While I do not want to lengthen the debate, there is a case for looking into this. Some maladies take quite a long time to activate. It would have been worthwhile looking at 10 years rather than six as in this clause.
Baroness Jeger: My Lords, we are all indebted to my noble friend Lord Molloy for the way in which he moved the amendment. As a wounded ex-service man himself who saw a very rough time in the last war we know that he is speaking from experience. Of course, we appreciate the improvements that have been made by the Government. I would take slight exception to the noble Lord having referred to ex-servicemen not bothering to make their claims. There are all sorts of reasons why there are late claimants. It may be that the symptoms did not manifest themselves for a considerable time. It is not always because the late application is due to people not bothering. I am sure that the noble Lord was not implying any fault on the part of these late applicants. I am not very impressed that the figure of six years was chosen because that is the period for claiming back income tax, I think the noble Lord said. That seems a total irrelevance. I found myself wondering, when thinking about this amendment, what was the medical magic in six years rather than four, five, seven or, as we suggest, 10. I do not think we can take this discussion much further today, but I hope that in other places and at other times it may be further considered, because it seems to me very fair.
As the noble Lord, Lord Davies of Leek, said, with sophisticated weapons of all sorts nowadays it may well be that symptoms sometimes may take a long time to develop. I was in America last summer and I found there a great deal of evidence about illness developing among Vietnam veterans several years after they had returned to their families and gone back to work. They seemed perfectly all right to begin with and then there was some sudden psychiatric or physical breakdown which was attributable to war service. So it may be that we can accept six years today, but I hope that, especially in view of these dangerous times in which many of our ex-servicemen
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are being exposed to the latest terrible weapons of war, we shall not look upon this matter as closed.
Lord Molloy: My Lords, if I may reply very briefly, I am bound to say to the noble Lord, Lord Trefgarne, though I say it without any malice, that I was in no way enamoured or convinced by his submissions. The probability is that if he had been replying in that vein with some form of understanding, it would have been a more warming speech and one which would have given us something to hope for. I should like to illustrate a point made by the noble Lord, Lord Davies, because one of my former comrades, only just four years ago developed an illness—and we all came down with a great cluster of parachutes together, landing among a lot of S-mines, and so on—and it was only when he thought he had a kidney stone that it was discovered. He had been feeling discomfort for some 20 or 30 years, there was a suggestion that it might be indigestion, ulcers, that it might be this, that and the other.
Eventually, he had a kidney stone operation, but inside was a piece of shrapnel and it was on its way down moving to a very dangerous area. It was the pain which had saved his life. He had suffered pain for 30 years and of course it had an effect upon his earning a living. There was no way in which a grateful nation because of legislation passed by us, could make amends. In so far as I believe that the day will come and in so far as I once again say that the Government have improved the situation, I hope I shall have an opportunity later to come back to this issue. In view of that, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord Trefgarne Lord Trefgarne moved Amendment No. 15:
After Clause 43, insert the following new clause:
("Application of social security legislation in relation to territorial waters
.—(1) The following enactments are referred to in this section as the "listed enactments"—

(a) the Family Income Supplements Act 1970;

(b) the principal Act;

(c) the Industrial Injuries and Diseases (Old Cases) Act 1975;

(d) the Child Benefit Act 1975;

(e) the Supplementary Benefits Act 1976;

(f) the Pensioners' Payments and Social Security Act 1979.

(2) The listed enactments shall have effect, and be deemed always to have had effect, as if—

(a) any reference to Great Britain included a reference to the territorial waters of the United Kingdom adjacent to Great Britain;

(b) in any reference to the presence or residence of a person in the United Kingdom (however expressed) the reference to the United Kingdom included a reference to the territorial waters of the United Kingdom; and

(c) in any reference to a person residing or being in Northern Ireland (however expressed) the reference to Northern Ireland included a reference to the territorial waters of the United Kingdom adjacent to Northern Ireland.

(3) Where any of the listed enactments is derived from an earlier enactment (whether directly or indirectly) anything done under or by virtue of a provision of, or made under, that earlier enactment which contained a reference of a kind mentioned in paragraph (a), (b) or (c) of subsection (2) above shall have effect as if that reference had at the material time been the extended reference provided for by that paragraph.
(4) The Secretary of State may by regulations make such provision in respect of any enactment (including a listed enactment) as he considers necessary or expedient in connection with the operation of that enactment in relation to the territorial waters of the United Kingdom.").
The noble Lord said: My Lords, this is consequential to Amendment No. 7. I beg to move.
On Question, amendment agreed to.
Clause 47 [Short title etc.]:
Lord Trefgarne Lord Trefgarne moved Amendment No. 16:
Page 40, line 22, after ("42") insert ("(Application of social security legislation in relation to territorial waters)").
The noble Lord said: My Lords, again, this amenment is consequential to Amendment No. 7. I beg to move.
On Question, amendment agreed to.
Schedule 1 [Circumstances in which periods of entitlement do not arise]:
5.36 p.m.
Lord Trefgarne Lord Trefgarne moved Amendment No. 17:
Page 41, line 7. at end insert ("or in such other circumstances as may be prescribed
The noble Lord said: My Lords, this amendment is essentially technical. It brings Schedule 1 (which sets out the circumstances in which periods of entitlement to SSP do not arise) in line with Clause 3 (which sets out the circumstances in which periods of entitlement to SSP end).
Clause 3(5) enables regulations to be made providing for a period of entitlement to SSP to end otherwise than in accordance with Clause 3(2). But there is no corresponding power in Schedule 1 to make regulations providing that a period of entitlement shall not arise in circumstances other than those listed in paragraph 2 of that schedule. This amendment provides such a power.
Apart from the circumstances already provided for in Clause 3(2) and Schedule 1, it is intended to make regulations providing that an employer's liability for SSP ceases if an employee is taken into legal custody; that is, if he or she is arrested or sentenced to a term of imprisonment. As with all other categories of exclusion from SSP, employees in legal custody may become entitled to sickness benefit, subject to the existing regulations covering such circumstances. It is not at present proposed to make any other use of these regulation-making powers. I beg to move.
On Question, amendment agreed to.
Lord Cullen of Ashbourne Lord Cullen of Ashbourne moved Amendment No. 18:
Page 41, line 11, leave out ("twelve weeks") and insert ("three months").
The noble Lord said: My Lords, in moving Amendment No. 18 I should like to speak also to Amendments Nos. 20 and 21. These amendments bring the definition of short-contract workers for the statutory sick pay scheme into line with that in employment protection legislation. This fulfils an undertaking given by my honourable friend the Minister for Social Security in another place. Alignment of the definitions in the two statutes constitutes a simplification for employers and for others who have to apply or understand employees' statutory rights under various enactments.
The Government accepted amendments to achieve this same objective at Report stage in another place.
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At that time, a short contract was defined in employment protection legislation to be one of 12 weeks or less; the amendments then made brought the statutory sick pay definition into line with this. However, the Employment Bill, which will shortly be considered by your Lordships, has since been amended to provide for a change in the definition in employment protection legislation, from "12 weeks or less" to "3 months or less", which is a simplification for employers who have to operate it.
To restore the equivalance of the two definitions, it is therefore necessary to amend Schedule 1 to this Bill again. It was accepted by all parties in another place that it would not be sensible for there to be two definitions of a short contract for the purposes of two different statutes. I commend these amendments to the House.
Lord Wallace of Coslany: My Lords, I should like to ask just a simple, innocent, little question. What is the difference between 12 weeks and three months? Secondly, if it is three months and there is a difference, is it three calendar months?
Lord Cullen of Ashbourne: My Lords, the difference between 12 weeks and three months is one week—13 weeks as against 12 weeks.
Lord Wallace of Coslany: Would the noble Lord allow me? That depends on which part of the year you are talking about.
Lord Cullen of Ashbourne: That may be so, but three months is a quarter of a year and 13 is a quarter of 52, so perhaps we can leave it at that.
On Question, amendment agreed to.
Baroness Jeger Baroness Jeger moved Amendment No. 19:
Page 41, line 33, at end insert ("which is not an official dispute").
The noble Baroness said: My Lords, I beg to move this amendment; and may I pre-empt whatever criticism may come from the noble Minister about the drafting of this amendment. I am aware that it may be defective but I thought it was important for us to try to clarify some of these regulations in Schedule 1. In the first place, I should like to refer back to the Committee stage when the noble Lord, Lord Trefgarne, promised to write and clarify some of our doubts. I know it is often a formality in your Lordships' House to thank noble Ministers for their courtesy and kindness, but in this case I mean it most sincerely, because the noble Lord took a lot of trouble and sent me a stack of case law, which has kept me awake night after night and which I still find very difficult to understand.
But I must come back to this problem because it seems to me that, so far as industrial relations are concerned, the less case law we have the better, and the more we can make the situation clear in statute law the better for everybody. Too much reliance on case law puts the people most closely concerned at a great disadvantage. Here I am thinking of the workers themselves, of shop stewards, trade union officers, employers and especially small employers, who may not have a lot of professional advice available.
In spite of the detailed letter and the information

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which was sent to me—of course I know it was sent to other noble Lords—it does not become public and therefore it is not information which is available to the majority of the people concerned. During the Committee stage, the noble Lord said at col. 794 of the Official Report on 27th April:
"It is better for both the employee and employer if the state takes over … so removing sickness during stoppages from the employment arena".
I feel that the effect of the schedule, as it stands, is precisely the opposite; that it puts sickness benefit and entitlement to statutory sickness benefit right in the centre of the employment arena.
I cannot move this amendment without referring very briefly to paragraph 7 on page 42, which lays down that non-payment of sick pay does not apply to employees who prove that at no time, on or before the relevant date, did they participate in or have a direct interest in the trade dispute in question. Our amendment is to make it clear that disentitlement to statutory sickness benefit should not apply where a man or woman has been engaged in an official stoppage.
I thought that many supporters of the Government believed very much that there should be secret strike ballots before stoppages of work. I am genuinely confused about what will happen in a workplace—I do not know why the noble Lord laughs, because he can sometimes get confused and I am being very honest and modest—if there has been a secret ballot in support of a strike. The strike takes place, and any worker falling sick while the strike is on is disentitled to statutory sickness benefit, under the schedule as it stands, unless he can go to his employer and say "I was against it, anyhow. It was the others." That contradicts the secrecy of the ballot. What is the use of a secret ballot if, in order to get statutory sick pay, a worker has to say "I voted against"?
This is a genuine query. If there is a ballot before strike action—we know that this happens already in several unions, especially in the National Union of Mineworkers—is the whole of that workforce to be debarred from statutory sickness benefit? Quite honestly, 1 rather wish they were, because I cannot imagine anything worse for industrial relations than to have some people saying, "I can have my statutory sickness benefit, because he is a sheep and I am a goat and I did not vote in the ballot for the strike."That seems to me very dangerous and unreal. It is not how people work together.
In the Minister's letter to my noble friend Lord Mishcon, he stated:
"I think it will generally be quite clear to all concerned whether an employee is participating in, or is directly interested in, a dispute".
I must contradict that. It is not quite clear in many complicated circumstances that that is, indeed, the case. We have put down this very limited amendment in order to try to get some clarification. We have put it down very modestly, referring only to official disputes, because we recognise that the situation is much more complicated in unofficial disputes.
I cannot help wondering how this would apply to the present National Health Service dispute. It might be said that all the workers in the National Health Service have a direct interest in an official strike, in
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the sense of supporting it. But a worker could be on a rota for emergency duty and, in the present sad situation, a nurse could be on a picket line one day and the next day could be working in the intensive care unit or the maternity ward, because the unions have agreed that they will give that kind of cover. Then, if that nurse goes sick next week, is she, or is she not, entitled to statutory sick pay under Schedule 1?
I submit that the differentiation between one worker and another is invidious and impracticable. If a worker becomes sick while his colleagues are on official strike, he can hardly be said to be participating in the strike. If he is ill at home, how can I-.e be participating in the strike? But he may be sympathetic to the strike, and may even have voted for it before he became ill. So I submit that the Government would be economising by paying him statutory sick benefit. The employer will get the money back anyhow.
As I understood what the Minister said in Committee, if statutory sick pay is refused, the worker can go to the DHSS and, if his contributions are in order, he will get national insurance sick benefit which is at a higher rate than statutory sick benefit. He will also get relief from contributions, as well as money for his wife and children. So I cannot see what the Government want to do, because the very provisions which debar workers engaged in disputes from getting statutory sick benefit will benefit those workers. It cannot be at all punitive, because they will just go down to the DHSS and get more money. I did not make that up; I could not have done. It was the Minister who said at col. 793 of the Official Report of 27th April:
"There is no question that sickness benefit would be withheld in these circumstances, subject to the normal rules".
So I move this amendment with a genuine sense of inquiry as to the Government's objective and as to the practicalities, especially in modern situations such as we have in my example of the National Health Service. I move the amendment to give your Lordships and the Government an opportunity to make the situation clearer to the rest of us. My Lords, I beg to move.
Lord Davies of Leek: My Lords, there are eight or nine circumstances in Schedule 1 where there would be no entitlement to sickness benefit. What this amendment does is to clarify the situation by asking us to add the fact that a dispute is not official. As matters now stand, if one is sacked while taking industrial action, one can still claim unfair dismissal, unless the employer has discriminated against one. But if a person is taken ill a day or two before a strike is announced, will he or she be regarded as having supported the strike, even if they were at home? This needs clarification because, ultimately. it will lead to legal discussion. If someone falls ill during industrial action, an employer may be justified in assuming that he is supporting the strike. But if someone is ill before official action begins, difficulties arise. Clarification of this clause is needed would be adding only tautological remarks if I said more. I have made the point. It is a little deeper than superficially we are inclined to think.
5.50 p.m.
Lord Banks: My Lords, may I return briefly to the point which I made during the Committee stage

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discussion of this matter. I think I am right in saying that then it was explained to us by the Government spokesman that the reason for the inclusion of this provision in the Bill was because it is not easy, once a person or a body of workers are on strike, for them to deal with the employer and that therefore it would be better if they could deal directly with the Department of Health and Social Security. I said at the time, and I still think, that there is a good deal in that argument from the point of view of the workers.
The difficulty which I saw then and to which I do not think I have heard an answer is that statutory sick pay and sickness benefit are not the same. If somebody who would be entitled to statutory sick pay is told that he cannot have it he may not qualify, either, for sickness benefit, so he has no benefit as of right. That seems to me to be the difficulty. They are not the same. If it were a question of two different ways of achieving the same aim, clearly it would be more satisfactory if one could achieve it without having to involve the employer if employees were on strike against him. But that is not what this is. These are two benefits for which the qualifications are different, and the actual amount paid is not the same.
I am not sure that the amendment helps us to get round that problem. As I understand it, the amendment says that a person who is on unofficial strike would have to go to the Department of Health and Social Security but that the person who was on official strike would have to go to his employer. Therefore we should still have the problem of dealing with the employer while perhaps the majority of people are on strike, so we should not have solved the problem. I shall be most interested in what the Government spokesman has to say to us about these problems.
Lord Trefgarne: My Lords, the noble Baroness will not, I suspect, be surprised to hear that the Government cannot accept this amendment, which introduces an unnecessary complication into the rules governing statutory sick pay. As it stands at present the rule relating to entitlement to SSP during a strike is straightforward. If an employee falls sick during a trade dispute his entitlement is to sickness benefit, not to SSP. If your Lordships will pause for a moment and consider those two separate terms, the difference in the circumstances will, I think, be apparent.
There are two reasons for adopting that approach. First, it is simple and will be understood both by employees and employers. It also mirrors what happens in many occupational schemes. Secondly, it will avoid putting the employer in a difficult position. If an employee claimed he was sick during a trade dispute the employer would have to decide whether there was incapacity or not. The decision might be a hard one to make, given that there clearly existed a difficult industrial relations situation. It is better for both the employee and the employer if the state takes over, as it does now.
The amendment would remove the easily understood rule and replace it by one in which payment or otherwise would depend upon the nature of the dispute. It would be difficult to operate and to justify. For example, consider the fairly frequent situation in which a dispute begins as an unofficial one and is made official at a later date. Employee "A" falls sick during the unofficial period and claims sickness
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benefit; this would continue to be paid to him for as long as he was incapable of work, even if the incapacity lasted into the official period. Employee "B", in exactly the same circumstances, falls sick after the strike is official. Under this amendment he would be entitled to SSP. What justification is there for different treatment of these two employees, whose circumstances differ only because they fell sick during different phases of the same dispute?
The amendment would also, in our view, harm industrial relations and put suspicion on sick employees where none need exist. An employee who falls sick during a dispute, official or unofficial, is vulnerable to the suggestion that his incapacity is not genuine. To ask an employer to pay SSP in these circumstances will only make a bad industrial relations situation worse. May I for a moment refer to my own experience. As is the case with many noble Lords, I have been concerned with the management of small businesses. I can well imagine a situation in which the manager or perhaps the owner of a small business might deeply resent the industrial action being taken, perhaps without justification. To ask him at the same time to make payments to these employees who were part of the industrial dispute and who may or may not be claiming sick pay properly would only make a difficult situation even more difficult,
The noble Baroness also referred to secret ballots. The position is that how the employee votes in the ballot is largely irrelevant in these circumstances, because in this case the question which would have to be answered is whether or not he is participating in the dispute. The fact that he has voted for or against it is not a matter which need occupy the manager in determining whether or not the employee is eligible for sick pay. In any event, the employee is not obliged to claim a disinterest in the dispute to get his statutory sick pay. If he prefers, he can simply go and get his sickness benefit, which, as the noble Baroness pointed out, is sometimes at a higher rate.
If I may refer to the point which was raised by the noble Lord, Lord Banks, the fact is that the employee is no worse off than at present. If he does not get sickness benefit now, he will not get it in the future, either. The fundamental objection to the amendment moved by the noble Baroness is the harm which it would do to industrial relations. The Government genuinely believe that in these circumstances it is better to remove the matter from the industrial arena and for the state to take over responsibility for the payments. I hope that the noble Baroness will be persuaded by these observations and will see fit not to press her amendment.
Baroness Jeger: My Lords, I thank the noble Lord for his explanation, but I remain unconvinced. I would take him up especially on the point that if a man is sick, obviously he is not participating in the dispute. But my amendment has to be read with paragraph 7 on page 42 which says that he did not participate in, or have a direct interest in, the trade dispute in question. This seems to me to be an unanswered point. The employee can be sick and have an interest in the trade dispute. As a result of the trade dispute he might get a rise or better conditions, even though he may be unconscious at some point during the dispute.
The noble Lord quite fairly gave two examples of workers in different situations. But I do not propose

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to create two situations. It is the noble Lord and the Government who are creating two situations—who are saying to one worker, "You can have statutory sick pay" and to another, "No, you must have national insurance sick pay". I should prefer—I agree to this extent with the noble Lord—to keep this out of the employment arena. Therefore, I should like all employees to be entitled, provided that their contribution records are in order, to national insurance sick pay. It seems to me that this schedule is disadvantaging people who fall outside paragraph 7 on page 42. It is what some employers may look upon as the good workmen, who do not go on strike, who have to put up with mean amounts of statutory sick pay, whereas all the "cowboys" can go off to the DHSS.
I am still not convinced that this makes sense, but I am sure that however much longer we go on discussing it tonight we will not make sense of it. I say to the noble Lord that I am very anxious about the effect of splitting into two categories workers involved in industrial disputes. I very much regret that the Government are going ahead with this schedule in its present form. I hope they will watch the situation very carefully. We will want to have further discussions and, while acknowledging the total inadequacy of my amendment, I believe that the discussion we have had today has been helpful, and it may well be a subject to which we might want to return. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
6.1 p.m.
Lord Cullen of Ashbourne Lord Cullen of Ashbourne moved Amendment No. 20:
Page 41, line 45, leave out ("twelve weeks") and insert ("three months").
The noble Lord said: My Lords, I spoke to this amendment when moving Amendment No. 18. I beg to move.
On Question, amendment agreed to.
Lord Cullen of Ashbourne Lord Cullen of Ashbourne moved Amendment No. 21:
Page 42, line 11, leave out ("twelve") and insert ("thirteen").
On Question, amendment agreed to.
Schedule 2 [Relationship with benefits and other payments, etc.]:
Lord Banks Lord Banks moved Amendment No. 22:
Page 47, line 4, at end insert—
Child Benefit
(".Before the provisions of this Act with regard to Statutory Sick Pay come into force, the Secretary of State shall ensure that Child Benefit is increased to offset the non-incorporation in Statutory Sick Pay of the allowances for dependent children available with Sickness Benefit in the year ending November 1982.").
The noble Lord said: My Lords, I beg to move Amendment No. 22, which stands in my name and that of the noble Lord, Lord Kilmarnock. At Committee stage I introduced an amendment which was designed to deal with provision for children. However, it was linked to a proposal to abolish the three-tier
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system of payment of statutory sick pay. Noble Lords may remember that the noble Lord, Lord Mottistone, suggested that it would be better to deal with the two issues separately. I thought he was right, and I withdrew the amendment at that stage. That amendment sought to provide a benefit for each child which, after the payment of the employee's national insurance contribution, would be roughly equal to the current child dependency addition under national insurance sickness benefit of 80p. per week.
The noble Lord, Lord Trefgarne, said he thought we were agreed that the way to help children was through child benefit. I pointed out that the problem was that child benefit was not being increased to offset the non-incorporation of child dependency additions in statutory sick pay. What we were objecting to was the reduction in total benefit due to the fact that there was no increase in child benefit to compensate for the absence of any statutory sick pay benefit for children. The Government are also reducing the value c f the child dependency additions under sickness and unemployment national insurance benefit, but again, of course, with no increase in the real value of child benefit to compensate.
The first report of the Social Security Advisory Committee had something to say about this Government's policies. In Chapter 2, paragraph 31, they say this:
"We support the Government's objective of including the short-term child dependency additions in child benefit but only in so far as the overall value of child support for people on contributory benefits is maintained in real terms".
I repeat that last phrase:
"… only in so far as the overall value of child support for people on contributory benefits is maintained in real terms".
The Committee go on to say:
"We consider that the methods used by the Government for uprating the dependency additions does not achieve this. The result is that total family support for people on contributory benefits does not keep pace with inflation".
What the Social Security Advisory Committee say is precisely what the supporters of this amendment say.
In Chapter 3, paragraph 30, the Committee go on to say:
"In principle we fully support the objective of successive governments that child benefit should replace child dependency additions to short-term contributory benefits. But we are equally clear that the present method of achieving this is wrong".
That is the point of view we are expressing this evening; that the present method used by the Government to achieve a generally accepted aim is wrong. That it is wrong is evidenced by the fact that there has been a drop of 13 per cent. in the real level of child support provided by the combination of child benefit and the short-term child dependency addition between April 1979 and November 1981. This, of course, increases dependence on supplementary benefit—and that, surely, is something we all want to avoid.
Having failed to incorporate the child dependency allowances in statutory sick pay and having expressed a preference for dealing with the matter through child benefit, the Government are surely obliged to increase child benefit to compensate. This the amendment would ensure. At the same time, if they accept the amendment, the Government will be helping to compensate those on sickness and unemployment benefit

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who have had their child dependency additions reduced, and indeed all other recipients of child benefit—for all of whom child benefit is lower in real value today than it was when the present Government came to office. I beg to move.
Baroness Jeger: My Lords, this amendment has been so ably moved by the noble Lord, Lord Banks, and with such a wealth of expert detail that I rise only to say that the amendment has our fullest support. We think that the problem of child benefit has not been taken on board in this Bill, and we hope very much that what the noble Lord, Lord Banks, has said will be taken into account by the Government. It certainly has our support.
Lord Kilmarnock: My Lords, as the noble Baroness, Lady Jeger, has said, there remains extremely little to add to what has been said by the noble Lord, Lord Banks. It seems to me that this amendment gives the Government a chance to remedy both the injustice perpetrated in the Bill by the non-incorporation of allowances for dependent children which were previously available, and also to restore child benefit to its proper level. This would be enormously popular and would go a long way towards reversing the Government's poor record in respect of social security benefits.
When talking about child benefit, it is very important to recall that we are not talking about charity. Child benefit was phased in between April 1977 and April 1979 to replace the income tax child allowances and the social security family allowances. It is not a novel form of charity, and it is interesting to observe that in the report of the Social Security Advisory Committee, to which the noble Lord, Lord Banks, referred, in table 3.2 on page 31, they demonstrate that child benefit—that is to say, excluding child depedency addition—across the board is now worth 8 per cent. less in real terms than when its phasing in was completed.
If the noble Lord, Lord Trefgarne, is going to argue that it is too expensive to provide what the noble Lord, Lord Banks, has called for, I would remind him, as I have reminded the Government on a number of occasions before in this House, that the Government have saved something like £1.5 billion in real terms on the social security system by various measures they have introduced since they came to office. They have also a shortfall of £2 million on the PSBR. I would like to suggest to the noble Lord, Lord Trefgarne, that this is the time for an imaginative gesture and that he has the money in hand to make it.
Lord Trefgarne: My Lords, if this amendment were to be accepted by the House, the effect would be to increase the general level of child benefit by 80p a week for each child in a family. The principal aim of the proposition, I presume, is to produce the equivalent of a child dependency addition for statutory sick pay by increasing child benefit by the amount of the child dependency addition to sickness benefit which is currently in payment. At the same time, of course, the amendment, if accepted, would enhance the value of child benefit, which in any case is to be increased from its present level of £5·25 to £5·85 per child per week when the uprating becomes effective in November 1982.
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The advantages, in avoiding complexity in the statutory sick pay arrangements, and in avoiding the necessity for those who run employers' sick pay schemes to delve into the circumstances of families, have been debated in other places at other times. But I would make the point that with no additions for dependents the proposed level of statutory sick pay approximates to the level of income replacement which would otherwise be available from taxed sickness benefit. There is, therefore, no specific provision for dependency additions in the sick pay provisions.
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. Child benefit is a universal benefit available to everyone with children and not just the recipients of sick pay. There are always good arguments for improving the level of child benefit and few of us would disagree about the important role it plays in contributing to the costs of bringing up a family. But I find it difficult to accept that the level of the benefit should be debated in the narrow field of statutory sick pay. The rate of child benefit is always debated in the general context of the Budget proposals and that seems to me to be the appropriate forum in which to assess each year the appropriate level of this comprehensive benefit.
If I may just say something about the level of child benefit, in November this year the rate will go up by 60p to £5.85 a child a week, and this will not only protect the benefit in line with the forecast of a 9 per cent. increase in prices between November 1981 and November 1982 but will make good the 2 per cent. shortfall which became evident at last November's uprating. This restoration and maintenance of value will fulfil the undertaking which the Secretary of State gave in another place in July 1980. The undertaking was that the value of child benefit would be maintained at its November 1980 level—subject to economic and other circumstances.
Maintaining and improving the rate of child benefit is always an attractive proposition. But truly the cost is staggering. The 60p rise I have mentioned will cost an additional £330 million in a full year and in 1982–83 the total annual cost of child benefit will be in the region of £3,800 million. The cost of increasing child benefit by 80p a week, as the amendment proposes, would be £440 million in a full year. We have to match expenditure with available resources and we have made great efforts to protect the value of child benefit in difficult circumstances. This is, I think, a creditable achievement and as far as we may go at the moment. I hope, therefore, your Lordships will think that the amendment ought to be withdrawn.
Before I sit down may I pick up two points made by the noble Lord, Lord Banks. Child dependency additions to national insurance benefits, which are of course in payment in some cases at the present time, are in fact being phased out. This indeed has been the policy of successive Governments and not just this one. As for further increases in child benefit, in addition to the one to which I have referred taking effect later this year, strictly speaking, that is, of course, a matter for the Budget, but it is certainly being considered within the context of available resources.
The noble Lord, Lord Kilmarnock, was referring to

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the general savings that had been made in social security matters generally in recent years. The uprating of social security benefits in November this year, in addition to the child benefit uprating to which I have referred, will cost £3 billion in a full year, which I submit is no mean achievement. As I said, the child benefit increase will cost £330 million in a full year. I do not think the Government can be accused of being mean or parsimonious in these matters. We are making available enormous additional sums for these purposes. I hope, therefore, that noble Lords will see fit not to press this amendment.
Lord Banks: My Lords, I would like to thank those who have supported this amendment, and I am grateful to the noble Lord for his reply, even if I do not find it a very satisfactory one. The noble Lord said that there is to be an increase in November in child benefit, and of course we know that; but we know, as he said, that that is merely to account for inflation and for a shortfall in the previous year. It in no way compensates for the removal of the child dependency additions. The noble Lord said that the child dependency additions were being phased out. Well, that was not news; we had already referred to that and we knew that they were being phased out. The complaint was that they were being phased out without any compensation, no compensating increase in child benefit. It is to that that we were objecting.
I agree with the noble Lord that the cost would be £440 million if what we proposed in this amendment were to be brought into effect. But of course we have to bear in mind that child benefit is a replacement for allowances against income tax. How much does it cost to increase the income tax allowances? One has to see it in that context. I believe that an expenditure on this scale could be justified because it would compensate for the non-incorporation of child dependency additions in statutory sick pay. The reduction in child dependency additions in sickness and unemployment benefit would also be compensated for, and for others the fall in the real value of child benefit since the present Government came to power would to some extent be compensated for, and the general decline in the relative position of families over the years would be offset.
While I agree that it may not he right to attempt to bring in what I believe would be a very justified measure as an amendment to this Bill in the House of Lords, I think that in tabling this amendment we have underlined the case for an increase in child benefit; we have drawn attention to the Government's policy of removing or reducing child dependency additions with no compensating increase in child benefit, a policy which the Social Security Advisory Committee described as wrong. If the Government will not increase child benefit, then child dependency additions should be retained and at their present value. It may well be that we shall return to that point at a later stage. In the meantime, 1 beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Schedule 4 [Amendments and transitional provisions.]
Lord Trefgarne Lord Trefgarne moved Amendment No. 23:
1124
Page 52, line 45, at end insert—
("9A. In section 15 of the principal Act (invalidity pension) the following subsection is inserted at the end—
"(6) Regulations may make provision in relation to entitlement to invalidity pension

(a) corresponding to that made by or under section 50A of this Act in relation to sickness benefit for persons who have attained pensionable age but have not retired from regular employment;

(b) restricting entitlement to invalidity pension in cases where in respect of one or more of the 168 days mentioned in subsection (1) above the person claiming invalidity pension (whether or not he has attained pensionable age) would not have been entitled to sickness benefit but for the provisions of section 50A(1) of this Act."").

The noble Lord said: My Lords, this amendment is consequential upon Amendment No. 13. I beg to move.
On Question, amendment agreed to.
Lord Trefgarne Lord Trefgarne moved Amendment No. 24:
Page 55, leave out line 16 and insert—
("18A. In section 32 of the Social Security Pensions Act 1975 (contracted-out schemes) the following subsection is added at the end—
"(7) An occupational pension scheme which—

(a) at any time before the coming into operation of the first regulations made under paragraph (a) of subsection (2) above did not satisfy that paragraph; but

(b) would have satisfied it if those regulations had then been in operation;

shall, for the purpose of determining whether the scheme satisfied that paragraph, be treated as if those regulations had been in operation at that time."
19. In section 61(2) of the Act of 1975 (duty").
The noble Lord said: My Lords, the 20th 13ulletin of the Occupational Pensions Board, issued in March 1982, drew attention to certain doubts as to the effect of the interaction of the preservation requirements under the Social Security Act 1973 and the contracting-out arrangements under the Social Security Pensions Act 1975 in relation to the "buying out" of scheme benefits via insurance policies or annuity contracts. We are advised that, as the social security legislation stands at present, in those circumstances any annuity contract must comply with the stricter contracting-out requirements concerning requisite benefits, and the wider options permitted under the preservation requirements are not then applicable.
It is recognised that annuities may already have been issued in good faith which do not meet the precise contracting-out requirements but which meet the statutory requirements for alternatives to short service benefit. It is also possible that some scheme rules may have provided for annuities meeting the preservation requirements and the contracting-out requirement only as far as guaranteed minimum pension was concerned hut not covering requisite benefits in excess of it.
To remedy the above situation, it is intended to make regulations under the powers contained in Section 32(2)(a) of the Pensions Act to modify the contracting-out requirements of Sections 33 to 37 for requisite benefits in excess of guaranteed minimum pension in relation to early leavers where annuity contracts are purchased. In addition, it is necessary to take action to enable those regulations to have retrospective effect. We have finally been advised that this may only be achieved via primary legislation.
I apologise to your Lordships for the short notice

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at which we bring forward this proposal. In the mean-time, I beg to move.
On Question, amendment agreed to.
6.21 p.m.
Lord Wallace of Coslany Lord Wallace of Coslany moved Amendment No. 25:
Page 57, line 18, 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;
(c) one after consultation with the head of the Department of Health and Social Services for Northern Ireland;
(d) not less than one after consultation with organisations representative of authorities operating rate rebate schemes; and
(e) not less than one after consultation with organisations representative of authorities operating rent rebate and rent allowance schemes.").
The noble Lord said: My Lords, I beg to move Amendment No. 25, standing in my name and that of my noble friend. This is quite a simple amendment and very direct and I do not see why it should not be accepted, but you never know your luck! The Social Security Advisory Committee is expected to assume, in relation to housing benefit, the very useful functions currently undertaken by the Advisory Committee on Rent Rebates and Rent Allowances. Since the advice tendered by the committee to the Secretary of State may have considerable effects on the work and responsibilities of the local authorities operating the rent rebate and rent allowance schemes, it is clear that these authorities should have the same opportunity of contributing to the advice and assistance tendered to the Secretary of State in these areas through representation on the committee, as have employers, workers, et cetera, in relation to other aspects of social security. Such representation can best be effected by the appointment of the proposed additional members being made by the Secretary of State after consultation with the relevant local authority associations.
I would add that this amendment is supported by the Association of District Councils. I hope that the Government will see fit to accept it, because it would bring a degree of expertise into the committee which would be very welcome. I beg to move.
The Earl of Avon: My Lords, as was announced during the Committee stage in another place, the Social Security Advisory Committee will assume responsibility for advising Ministers on housing benefit when the new scheme is introduced. I should not like noble Lords to think that the Social Security Advisory Committee will not have available the expertise to cope with the new benefit. Department of Health and Social Security Ministers and the Chairman of the Social Security Advisory Committee, Sir Arthur Armitage, agreed that the membership should be increased by two, specifically to allow the committee to be strengthened for its new responsibilities. But both Ministers and the chairman of the committee take the view that the Social Security Advisory Committee should remain a fairly small committee, in which all the members are involved in all the main subject areas, if it is properly to fulfil its role of advising Ministers. We believe that it would obviously weaken the committee's ability to advise on specific issues in
1126
their wider context, or to keep the whole spectrum of social security matters under review, if the committee were so large that it had to operate through subcommittees.
Clearly, this philosophy means that there must be flexibility: individual members, whatever, their background, must be willing to cover the range of subjects covered by the committee, and Ministers in their turn must have flexibility to appoint the most appropriate people to the committee. I believe that this particular amendment limits that flexibility. Apart from the Northern Ireland representative, whose inclusion on the committee is self-evident, all the members on the Social Security Advisory Committee, 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. The arguments that there must be local authority representation on the committee to advise on housing benefit could be echoed, for other bodies, in other areas of the committee's work, which are equally, or more, complicated or detailed. To avoid the committee becoming too large, specific representation has been avoided in all policy areas, and the Government would therefore wish to resist it today for housing benefit.
I can assure the House that, while Ministers must retain sufficient freedom to ensure that all the main social security areas are adequately covered in the committee, they are anxious to ensure that the Social Security Advisory Committee will be sufficiently geared up to cope with housing benefit. It is still too early to say who might be appointed to achieve this, but the Government's amendment to this Bill in the other place, increasing the size of the Committee by two, is a firm indication that we are live to this need. At the same time, it should not be imagined that the committee is currently devoid of local authority expertise; some of the members have been members of authorities with housing responsibilities.
I hope that these points will reassure the noble Lord that we have looked into this matter seriously. We believe that a committee of the size of about 11 is the right number to be really effective. I very much hope that the noble Lord will not feel the need to press his amendment.
Lord Wallace of Coslany: My Lords, the trouble, as the noble Earl will probably admit, is that the Government are too conservative with a small "c". I am only asking in this amendment for the maximum of four more people and, quite frankly, it seems somewhat ridiculous to say that that would make the committee too large. I still think that it is very essential and perhaps the Secretary of State will bear in mind that there is a need for somebody with definite local authority experience. It is no good saying that there should be someone who might in the past have had some local authority experience. We want somebody who knows his job; a person, for instance, like the noble Lord, Lord Bellwin, or a character of that type who knows what he is talking about. He is a good local authority man as distinct from the other members of the Front Bench, who do not have a clue. I regret

1127
the asperity that has suddenly crept into this debate because I was trying to be kind and gentle with the noble Earl because he has been so nice to me all the way through.
I shall not prolong the proceedings. I am feeling a bit peckish myself. I think that perhaps we might have another think about this matter. I shall take some advice on it. Indeed, it is quite obvious that I have had advice from a certain association and I shall be in touch with them and see what they say. Meanwhile, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Schedule 5 [Repeals]:
The Deputy Speaker (Lord Ampthill): My Lords, we now come to Schedule 5. In the Fifth Schedule the numbering has been omitted in the Marshalled List and the two amendments should be numbered 26 and 27. So the next amendment is No. 26.
Lord Cullen of Ashbourne Lord Cullen of Ashbourne moved Amendment No. 26:
Page 60, line 55, column 3, at end insert (""benefit or" and paragraph 11 or, as the case may be,"").
The noble Lord said: I beg to move Amendment No. 26, my Lords, and I should like also to speak to Amendment No. 27. Both these amendments are technical. They add to the schedule of repeals further references to injury benefit which are made redundant by the abolition of that benefit by Clause 39 of the Bill. The references are in Section 65(4) of the principal Act, as it will be amended when Schedule 1, paragraph 1(1)(b) of the Social Security Act 1980 comes into force, and in Section 3(2) of the Social Security (No. 2) Act 1980. I beg to move.
On Question, amendment agreed to.
Lord Cullen of Ashbourne Lord Cullen of Ashbourne moved Amendment No. 27:
Page 61, line 55, at end insert—

("1980 c. 30.

The Social Security Act 1980.

In Schedule 1, in paragraph 1(1) (b) the words "benefit or" and "paragraph 11, or as the case may be," and in paragraph 6 the words "of injury benefit and".

1980 c. 39.

The Social Security (N0. 2) Act 1980.

Section 3(2).").

The noble Lord said: My Lords, I have already spoke to this amendment. I beg to move.
On Question, amendment agreed to.

Community Enterprise Programmes
6.30 p.m.
Lord Wells-Pestell Lord Wells-Pestell rose to ask Her Majesty's Government whether they will state their policy in respect of community enterprise programmes and the proposal to reduce substantially the grant being made to Elephant Jobs Limited of London SE1.
The noble Lord said: My Lords, I beg to move the Question standing in my name on the Order Paper. As your Lordships will see, it falls into two parts. It is:
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"To ask Her Majesty's Government whether they will state their policy in respect of community enterprise programmes",
and to give me an opportunity to draw to your Lordships' attention what is happening to an organisation in South London known as Elephant Jobs Limited.
It is not my intention to say anything at all about the Government's policy in relation to community enterprise programmes because I think I am right in saying that the noble Lord, Lord Kilmarnock, will deal with that. So far as possible, I do not want to impinge upon what other noble Lords will say, and I know what two or three of them are likely to say. I want to make my own position perfectly clear. I, personally, have no connection with Elephant Jobs Limited. I am not a member of its committee; I have never been associated with it; I intervened because it is under threat of closure by the Government within the next month. My friends in South London, particularly those in the professional social work services and the probation service—with which, as your Lordships know, I was connected for some years—are appalled at the prospect of this organisation being closed down.
The position is that Elephant Jobs Limited was started in 1976 by the Blackfriars Settlement and by Cambridge House, in order to provide a work experience for young people. In the last six years no fewer than 850 young people have passed through that job centre—I think each of them having done a year's work—and have left not only with work experience but with some new experience. Some of them, between 18 and 25 years of age, are engaged on community enterprise projects; the rest, being between 16 and 18 years of age, are engaged in the Youth Opportunities Programme. Both schemes are administered and run by the Manpower Services Commission.
During that time, as I said, it has given work to 850 young people. I cannot say how many of them were black; I cannot say how many of them were white; but I should think it is pretty well down the middle. As the right reverend Prelate the Bishop of Southwark, who is taking part, will say, that is an activity of supreme importance in an extremely difficult area of London. At the present moment 154 young people are engaged.
I made my own inquiries to see whether there was any real justification for closing it down and the more that I have inquired into it and the more people that I have seen, the more difficult it has become for me to realise that it is a necessity. As I have said, this work is known by a large number of people in the area and I have not yet found anyone who has had any adverse criticism to make of it.
When I tabled this Unstarred Question, I hoped that I would be in a position to withdraw it some days ago, because I had an opportunity of discussing the matter with the noble Lord, Lord Lyell, who will be answering tonight, who was good enough to make arrangements for me to meet him and some of his advisers at the Department of Employment about a week ago, where we had a very full and frank discussion. At the end of it, I was even more bothered about it closing down because I could not believe that there was a good and sufficient reason for doing so.
Later the same morning the right reverend Prelate the Bishop of Southwark and I went along to see the

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Minister of State in the Department, Mr. Michael Alison, and I think I can speak for the right reverend Prelate when I say that we were deeply grateful to him, not only for seeing us, but for giving us a tremendous amount of time with his advisers, including one from the Manpower Services Commission. I do not know how the right reverend Prelate felt when he left, but, out of the two meetings, I did not find much to give me encouragement for the future.
Perhaps I could just explain what it is all about. At Elephant Jobs in South London, they have most of these 155 young men working on community enterprise programmes. That means that they do something of communal significance as distinct from individual significance. They will, perhaps, try to organise some sort of play centre; they might try to organise some sort of playground; they might redecorate and repair a centre. It is some community enterprise. Over the six years this is precisely what they have been doing.
But the criteria laid down by the Manpower Services Commission has, in fact, changed from time to time. It started off with a job creation programme, and it was much broader than it is at the present moment. Then it was changed to a special temporary employment programme and that went on until April 1981, when, to qualify for continued assistance, centres of a similar kind were expected to concentrate on community enterprise projects.
But during that period Elephant Jobs had developed other skills; for example, they have a small pottery section where they turn out excellent pottery, because I went down to see exactly what they did for myself; they turn out some really first-class wool carpets; they have a small silk screen printing section—it does not employ very many people. However, these three have developed into skills. It is perfectly true that they are able to sell some of these things privately and on the market, and, apparently, as I understand it—and I do not think that I have got it wrong—this is the nub of the problem, because obviously these job centres are not supposed to engage in some kind of activity that will probably cause unemployment in the community. That I understand and that I accept. But no one can say that what this particular group of young people is doing is ever likely to do that.
In fact, on their committee they have business men who know precisely what is going on. They have on their committee a trade unionist, who also knows what is going on, and neither has taken any exception to it. If I may be permitted to say so, I can be sure that the trade union representative would take exception to it if it was likely to interfere with the employment of other people.
I regard it as a fairly insignificant contribution when it comes, shall I say, to competing with the outside world. I do not think one can really say that they are competing. This I gather is the problem; it may be that this kind of activity—I do not know what the noble Lord is going to say—that seeks to provide a work experience for young people has to be looked at afresh. I think the time has come when it has to be looked at afresh. We cannot have these hard and fast and rigid lines between this activity and the other. I can see no reason why they cannot both continue.
I want to say here and now that the Manpower
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Services Commission has behaved extremely generously to this particular organisation over the six years that it has been going. They have had hundreds of thousands of pounds. Without that help, it would have been impossible to channel 850 people and give them about a year's work experience through the centre. They were looking forward this year to a grant of something like £700,000. I think my figures are right. It is a sizeable venture. The amount that the Manpower Services Commission has given year after year since 1976 has been increasing. I should like to say that the Manpower Services Commission has in fact made a remarkably generous contribution to that, and to many other similar organisations. But what grieves me is that this is likely to come to an end.
I took exception when I heard that they were going to be cut off in about a month. There is some disagreement between me and the Government as to whether it really is a month or whether in fact they were given longer notice. The fact is that, so far as I can tell, whatever notice they were given was not much longer than that. I want to ask your Lordships is it reasonable, when an organisation has been going for six years and has made a contribution of this kind, to expect them to cease within one month, which they need not do if they will conform to the required criteria, which I understand are exclusively community enterprise programmes and not the other activity that they are engaged upon?
Following the discussions that the right reverend Prelate and I had with Mr. Michael Alison last week, we were not given any promise. I do not know whether the right reverend Prelate has been given any since. But there was some suggestion, "It is due to finish at the end of June. Perhaps it could go on until the beginning of September ". But the Government department concerned is being totally unrealistic if they think that an organisation of that size and, if I may say so, that calibre, can completely reorganise within a period of three months.
I have had some discussion with this organisation recently, I am sure that the right reverend Prelate has too, and they are willing to conform. They realise that if this is what is required of them, then they must meet the requirements. But what I want to say to the Government is that it is unrealistic to expect them to be able to do so by the beginning of September. What I should like the Government to do—because I presume that the Manpower Services Commission has to get authority from the Government to do what it is doing —is to give the Manpower Services Commission authority to continue to grant-aid this organisation until 31st March next, which is not much more than six or seven months. Within that time they will be able to meet the criteria expected of them now.
The Government have a vested interest in this. The Government have a vested interest in keeping people at work, and of finding work for people who have not got work to do. But they have a far greater interest, or should have, in keeping young people employed even if it is only giving them work experience for one year. I have seen some of the stuff they have turned out. It amazes me what people who had no equipment, no experience, no knowledge of what had been done there when they went there, had been able to do and had done. I recognise that they must

1131
concentrate on the community enterprise programmes and, as 1 say, they are quite willing and happy to do that. But I feel that they have to be given time to be able to do this.
I have tried to put the position fairly. It would be lamentable if they were not permitted to carry on. I do not want to deal with the whole question of community enterprise programmes because I am hoping that the noble Lord, Lord Kilmarnock, will have something to say about it. 1 hope your Lordships will feel at the end of this short debate that it is important that something is done so far as this particular organisation is concerned.
6.47 p.m.
Lord Byers: My Lords, the House will be grateful to the noble Lord, Lord Wells-Pestell, for raising this question of the community enterprise programme and particularly the plight of Elephant Jobs. I have been in correspondence with the Secretary of State for Employment and the Manpower Services Commission over Elephant Jobs in the past few weeks. I was grateful for the extension of their life by three months but, as the noble Lord said, this time is running out and, so far as I can see, they are due to close by the end of June.
I should like to support everything that the noble Lord has said. I hope that in the time that is left, and in a further extension (if, as I hope, it will be granted), the importance of keeping the project, particularly Elephant Jobs and others in the community enterprise programme, in being will be recognised as part not merely of a contribution to employment but as a contribution to social policy itself. I have knowledge of two of these projects; not only Elephant Jobs but also the Burnbake Trust, which is in the same position and is doing a very good job indeed.
Marks and Spencer, to whom I have acted as a consultant on community involvement over the last five years, has helped both of these projects by providing people either to run them or to help run them. The people we have seconded to do this job have been extremely impressed by the transformation of these trainees, these 18-year-olds and older, as a result of the training they have had. This is something which I would be loath to destroy, because once you see what they have been able to achieve in a year you realise what a tremendous social contribution they have made.
The training which they get in the 12-month period is not in any way limited to training in a craft or a skill. They get that, but that is probably the least important facet, important as it is. The point that has to be hoisted in is that they learn while they are there the discipline of the workplace. They learn to arrive on time to get up early enough to be there by eight o'clock; they learn how to behave; how to maintain reasonable standards of hygiene and appearance; the use of acceptable language, not an easy thing to teach; consideration for others; they learn about quality control and what it feels like to have something returned to them as being not up to standard. Those are important aspects of the training they receive. In addition they improve their literacy and life skills. They also produce and sell things and I can see nothing
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wrong in that; it is important that they should have the experience of being able to come up to the standards required in the market place.
We cannot afford to close down that type of project today. Instead, we should be increasing the capacity of the community enterprise programme from 30,000 to 60,000 because we have here the chance to defuse, to their own advantage, many of those who would otherwise be among riot leaders in high risk areas of our inner cities. From what one can see of the way they behave during their training, one of the first lessons they learn—they confess it quite openly—is that they do not want to go back to getting into mischief because of having nothing to do. They want to have a job from eight o'clock until the workshop closes, and it is the turning point in the career of many of them.
Nothing should be done to disturb, for example, the picture-framing activities of the Burnbake Trust. It seems excellently run, the people are getting a skill and selling their products, but they are not undercutting others. So far as Elephant Jobs are concerned, I understand there have been problems over what is called (I do not know the details) financial accountability. The suggestion has been made that their operations are outside the scope of the existing criteria for a community enterprise project; that is, the criteria agreed between the Secretary of State for Employment and the Manpower Services Commission.
On that issue I would make two suggestions. The first is that financial accountability should be dealt with in the normal way, by bringing in accountants to ensure that the financial systems are improved and that they are given systems which they can operate so as to make sure they are financially accountable. I am sure they would accept that. Secondly, so far as the criteria are concerned, if it is difficult to bring the project within the existing criteria, the criteria in a case like this should be reviewed. It is easy to close down a project of this kind. It is extremely difficult to start it and build it up again.
Those of us who are in the business of job creation—indeed, that is the business we are all in; every one of us is interested in the subject because we want more jobs created—are struggling and striving to encourage people to put up projects which will take our young people off the streets and give them an opportunity of learning something worthwhile, as in this case, not just immediately but, one hopes, for the rest of their lives. It is terribly disheartening to those of us who are interested in job creation—be they small businesses, training workshops or whatever—to be told that a project which is going very strongly and is doing such good work must be closed down. I hope the Government will think very seriously about the whole project and, before taking any action to close it down, will visit these two units and others.
6.54 p.m.
The Lord Bishop of Southwark: My Lords, we have had two excellent speeches from the noble Lords, Lord Wells-Pestell and Lord Byers, and I hope the House will forgive me if in some respects I cover something of the same ground; it is sometimes a help if the same points are made from a slightly different angle, and I want strongly to support all they said about Elephant Jobs. I first heard that name about a year

1133
ago, shortly after I had come south to my present diocese, and the speaker was Canon Peter Challen, a senior chaplain in the South London Industrial Mission and chairman of the board of Elephant Jobs. I admit that when I first heard the name I was rather intrigued, thinking it might have something to do with a product rather than, as it turned out, an area, but I quickly learned. I quickly learned too, as noble Lords have heard, that it is a major enterprise; it must be one of the largest funded by the MSC, and it involves a substantial commitment by many organisations and individuals, many of them in a voluntary capacity.
Earlier this year, I heard from a number of quarters that Elephant Jobs were threatened with imminent closure. The first threat actually came some months ago, and I thought it might be helpful to the House if I read an extract from a letter which I received at that time from the Vicar of St. Matthew's, Brixton, which underlines one of the points that has been made. He wrote:
"It has been the most successful of all the enterprises run in South London"—
he means of this kind—
"and, speaking as the Vicar of Brixton, I can say that many young people from this area have been, and are, employed by it".
He and others were devastated by the possibility that it might have to go and have urged me and others to do all we can to try to avert that. Since then, there has been an extension, which is shortly to run out, and some of the difficulties have already been resolved.
Both noble Lords spelt out clearly the kind of background to the problems which remain. The key problem, as I have understood it, centres both on the definition of "community benefit" within the community enterprise programmes and the speed with which an organisation like Elephant Jobs can change some of its present activities while remaining viable. From the many conversations, including the helpful ones, to which reference has been made, with the Minister of State—I was most grateful for the opportunity to have those conversations—it appears that key problem can be laid out in at least three ways.
The first is that it had been known that there were difficulties relating to the definition of "community benefit" in relation to this particular craft section for some months, and I think it is fair to say that there was initially, and still is perhaps, on the board and elsewhere, some resistance to the idea that change would have to come, if only because the definition seemed to be capable of varied interpretation, as has been said. The enterprise had been running happily for some years without any question being raised about that, and it has been an important part of the activities. There was, therefore, a very understandable hope that the MSC might be in a position to continue to be a little more flexible.
It could also be argued—indeed, I would want to argue the point—that a phrase like "community benefit" should include the whole question of how you are helping the people involved, rather than just thinking in terms of the particular things you may be doing for this centre, that club or whatever it may be. The fact that you are providing people with new or further skills in the all-important aspect of work experience is of itself an enormous community benefit. I put it in that positive way first, though there is a negative side, too,
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in that you are perhaps also doing something to avoid the increase of social tension in areas of high unemployment. That, therefore, is the first point; that there was, so to speak, for that very understandable reason, a certain slowness to respond to the sudden new threat.
Then came the realisation that, if action had to be taken, it would be difficult to find alternative outlets for products of such a rather particular, high quality kind because they are, after all, not the sort of things which are required by, say, local youth club. They do not need hand-made rugs or hand-made pottery. Other people are glad to have those in their homes and are glad to pay money for them; and in some cases they have replaced goods imported from abroad, which in itself seems to be quite significant. That also presents a considerable problem—how do you find either a new market for the goods, or change the activity into something different, given that you have the particular equipment, machinery, and so on?
So while I think that we all appreciate that the MSC is operating under its particular constraints—and that includes applying a kind of three-month rule if a particular activity is not conforming to the rules; I realise that a national organisation is trying to maintain consistency—Elephant Jobs is operating under equally great, I would say much greater, constraints in trying either to find new markets, or to find new products which can be made with the existing equipment that it has.
I want to add my own small plea to that which has already been made on behalf of many people, that the enterprise, if it has to change, be given enough time to change in the ways required. That cannot be done in the next three or four weeks, it really cannot. Alternatively—and I suppose that it would be better from most points of view—perhaps a little more flexibility can be built into the whole definition (which we shall be hearing more about) of community benefit in such a way that the enterprise might be able to continue this extraordinarily valuable piece of work that it is doing alongside so much else.
7.2 p.m.
Lord Kilmarnock: My Lords, the plight of Elephant Jobs has been most eloquently put by the noble Lord, Lord Wells-Pestell, and backed by the right reverend Prelate, and the noble Lord, Lord Byers, has set the community enterprise programme in a slightly wider context. Among the main criteria listed for community enterprise schemes we find included
"economic benefits to the community",
which is the phrase invoked by Elephant, as I understand it, in its defence. Then there are a number of main headings under which eligible schemes are listed. These are: environmental improvement, provision of social amenities; and social and cultural work—for many of which there will be no off-setting payments received. But there is no reason why saleable goods and services should not qualify, and indeed it is so provided in the sponsors' handbook, in paragraph 24. I think that the noble Lord, Lord Wells-Pestell, was a little doubtful about this, but it is certainly in the sponsors' handbook.
Logically craft production should also be possible. Indeed it could be argued that some of the products of craft training are likely to be saleable goods.

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Elephant apparently produces hand-tufted carpets, silk screen prints, jewellery and pottery, as the noble Lord, Lord Wells-Pestell, has told us. But it seems to be the carpets that have got it into trouble by achieving a certain amount of commercial success; they have actually made money. According to the rules, trading receipts have to be paid back to the MSC, which seems fair enough so long as wages and some running costs are subsidised. But it seems a pity that immediately anything is sold over the counter, the MSC seems to get cold feet and wants to withdraw abruptly, quite regardless of whether or not the enterprise is in a state of commercial take-off. I hasten to add that I am not in any sense an enemy of the MSC. In fact shortly after the Recess I shall be introducing in your Lordships' House a debate on the MSC Youth Task Group Report, for which I have the greatest admiration.
The threat of sudden withdrawal of support is bound to make sponsors think twice before entering the rather onerous covenant required of them. I have recently, for example, become aware of an aborted scheme—it did not come off—in North London, where the local authority nudged some qualified people in the direction of a craft workshop which would have done some contract sewing work for local schools and other institutions, as well as design work of its own. A number of keen, young trainees would have been taken out of unemployment. What happened? No sponsor could be found. Approximately £63,000 would have to have been put up for a year for three instructors and six trainees; the operation could be closed within four weeks, at any time; and the fact that all the money earned had to be immediately ploughed back foreclosed on the possibility of a viable business coming into being at a later date. In short, although all the ingredients were there, no one would take on the responsibility for it. Enthusiasm ebbed and turned to bitterness. For one of the promoters CEP became
"a no-hope Government scheme, panacea, a cover-up for gross ineptitude and inability to tackle unemployment at grass-roots level".
Well, it is a pity that that kind of bitterness should be created quite unnecessarily. I think it has to be accepted that CEP builds in quite heavy disincentives, in particular to private sponsors. Of coul se, I understand about accountability for public funds and possible shortcomings of those unaccustomed to accounting procedures. But we must get this in proportion. None of this is a huge bonanza for anyone. As Elephant's directors say very frankly, in, I think, paragraph 5.2.2(9), in answer to their own question:
"Has there been any secondary private gain on the part of sponsors?— it is a matter of opinion, but probably not, other than experience gained".
In essence these schemes are an effort of good will and hard work for low material reward, or they are nothing.
I was slightly alarmed when the noble Lord, Lord Wells-Pestell, left the broader issues in my lap, because I thought that, with his much greater experience, he would probably refer to them himself. However I think it is just worth taking a quick look at the future of the community enterprise programme—which was touched on by the noble Lord, Lord Byers, too—
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because I believe that it has a very important role to play in the future. The CEP evolved out of STEP, which had become restricted to special development areas in inner cities. Its importance is that it casts its net wider, and now that the number of long-term unemployed is in the region of 1 million—1 million, my Lords—its potential clientele is very large indeed. Not surprisingly, there have been calls for its expansion. The MSC itself wanted 60,000 places for 1982–83—I think that the noble Lord, Lord Byers, also set his sights at 60,000 places—and was restricted to 30,000 by the Department of Employment. I personally regret that. Youth Aid called for a guaranteed place lasting 12 months for all who are eligible. This is certainly desirable in the long run, but I doubt whether it could be achieved except in a number of stages.
In the meantime, it seems to me that the first step should be to advance to the offer of a place to all those aged between 19 and 24 who have been unemployed for six months or over; and here is my first question to the Government. Can the noble Lord tell us whether the Government will support this objective, and if not, what do they propose to do about this age group, which can really not be said to be any less, or much less, disadvantaged by unemployment than the 16- to 19-year olds, about whom we are all so rightly concerned?
The next point I want to make is that whatever the numbers to be catered for under the community enterprise programme, the role of the sponsor is absolutely vital, and we shall need not only public sector sponsors, such as local authorities, but private sponsors, voluntary bodies, enterprise trusts, and so on as well; other wise we have no hope of meeting the needs. But if sponsors are presented not only with a formidable set of obligations, but also with uncertainties over interpretation of the rules, they will simply, and quite understandably, not come forward, as in the case that I outlined earlier.
I can myself almost off the cuff think of a number of ways in which the sponsor's position could be made less unattractive. First, the regulations should not be changed at short notice, or subjected to capricious interpretation. The noble Lord, Lord Wells-Pestell, touched on this. Secondly, the phrase,
"economic benefit to the community",
should be interpreted with some imagination; or if it is not to be treated with some flexibility, what in fact it really means should be clearly specified. Thirdly, where goods and services are traded it would be sensible to allow a moratorium of, say, two years on the return of any trading income, provided that it is put to reserve or reinvested, or otherwise used to build up the enterprise. It would then be much easier to judge whether it had any hope of becoming self-supporting. Finally, it should be accepted that even where the production of goods and services does not approach this point, such activities do make a valuable contribution to training, employment, and morale—a point that I think has been made by all noble Lords who have spoken so far—and are therefore deserving of support from public funds.
I am not asking the noble Lord, Lord Lyell, to accept or reject any of these ideas this evening, because I seriously think that they require further study and debate; but I am asking him to agree—and I think

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he can hardly fail to do so—that the whole question of sponsorship should be reviewed. This point was also made by the noble Lord, Lord Byers.
Next, I want to ask the noble Lord whether the MSC has considered the cost to the Government if a withdrawal of one-third of the present level of support brings about a collapse of Elephant Jobs. The aim appears to he to save some £230,000, but if 150-odd people become unemployed as a result, even on the Government's own estimate made in 1980 the cost in benefits, revenues foregone and national insurance contributions would be in the region of £500,000 a year; and if more recent estimates are to be given credence, as I think they should, the cost could well equal the whole of the £700,000 grant. All that would be achieved is further misery and disillusion at little or no real saving. I simply cannot believe that the MSC intends that or that the Government want that.
In conclusion, my Lords, when the noble Lord comes to reply will he not agree that the queries that I and other noble Lords have raised, and the considerations that I have myself tried to advance, are in fact all good reasons for helping Elephant to put its house in order? I think the noble Lord, Lord Byers, said that they should be given the free facility of proper accountants coming in and telling them how to do it. Surely these are good reasons for helping Elephant to put its house in order, if it is in fact in breach of some minor regulation, rather than for harassing it out of existence. Is not the restoration of the threatened reduction, at least for one year or to the date that the noble Lord, Lord Wells-Pestell, suggested, the only fair and sensible course?
7.12 p.m.
Baroness Ewart-Biggs: My Lords, I, too, should like to thank my noble friend Lord Wells-Pestell for raising this very important subject of the future of Elephant Jobs, and also, in a more general way, the subject of the future of community enterprise programmes. I feel that after the previous speaker there is little I can add, but my reason for wishing to say a few words in this debate is because of my interest and personal involvement in an organisation in Paddington which is called the Beauchamp Lodge Settlement, which is one of a small group of voluntary organisations in Westminster that sponsors an adult employment scheme similar to Elephant Jobs. It is in this way that I have become acquainted with these job schemes generally, and have also been made very much aware of the important contribution that Elephant Jobs have been making to the community.
So, in the first place I can really only reiterate what my noble friend and previous speakers have said: there is an overwhelming case for continuing the grant to Elephant Jobs. No one could deny that the need for the scheme is absolutely unequivocal, operating as it does in a deeply-deprived area of South London where, as we know, the unemployment figures arc well above the national average, and operating as it does in an area which contains many coloured communities. It is indeed a fact that out of the 154 workers employed by Elephant Jobs, who are all threatened by the withdrawal of its grant, one-half are black and many are living in the Brixton area. Indeed, as the noble and
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learned Lord, Lord Scarman, said in his report on the 1981 Brixton riots:
"Unemployment is a problem which faces both white and black people, but there is evidence that its weight falls disproportionately heavily on black people".
Furthermore, there can be absolutely no doubt that Elephant Jobs have absorbed disabled workers and ex-prisoners from the dole queues, and have truly helped some of the most disadvantaged members of the community.
So, as I have said, there really can be no doubt that Elephant Jobs are playing a vital role in relieving social pressures caused by unemployment in an area where social pressures are already very great indeed. Having agreed on that, as my noble friend and the previous speakers have said we are just left with the question of whether or not the Elephant Jobs scheme does or does not fall within the meaning of the Manpower Services Commission's criterion for such schemes. It is a matter of defining what constitutes an appropriate contribution to the community, as again previous speakers have said. Elephant Jobs say most adamantly that their employment schemes and craft and building sections do without doubt bring great benefit to the community; and, as I have already said, and as other noble Lords have said, there is tangible evidence that this is so. On the other hand, the Manpower Services Commission say that Elephant Jobs have deviated from the guidelines laid down regarding community benefit criteria, so clearly an impasse has been reached.
Thus I, too, should like to advocate most strongly that if the Government cannot agree either that Elephant Jobs craft workshops do fall within the meaning of the criteria laid down, or, failing that, that they will amend the criteria to accommodate them, then surely the Government should, as we have all advocated today, allow Elephant Jobs a stay of execution for at least 12 months to enable them realistically to seek alternative funding. This, surely, is the least that the Government can do.
Finally, coming out of my slight experience of the work being done by the Beauchamp Lodge Settlement in the Paddington area, may I conclude with a few comments on the subject of community enterprise programmes in general, and the anxieties being experienced by those involved in them. In the light of the present employment situation it is very important for them to know, first, what is the Government's exact attitude towards the present employment schemes. Secondly, it is very important to define what the precise co-ordinating system should be among the Manpower Services Commission, the local councils and the voluntary organizations—in fact, all those bodies concerned with employment schemes.
So, on the first point, what undertaking can the Government give that the Manpower Services Commission's work and policies, as agreed at recent meetings, will continue? Furthermore, will the Government make a clear definition, as they see it, of the community enterprise programme and its community role? Because there can be no doubt that such issues as these are put in cause when successful schemes such as those which have been firmly established by Elephant Jobs are challenged. If the Government wish to change the rules, then those new rules must be clearly defined and understood.

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Finally, on the question of the actual process of co-operation between all agencies, both statutory and voluntary, engaged in this all-important task of reintegrating into the community those of its members who through no fault of their own have fallen outside the system, there is concern that the apparatus set up to co-ordinate these efforts is no longer adequate to deal with the present situation. The Manpower Services Commission have had failures in planning, it is felt. In the first place they expected local authorities to be the main sponsors for programmes, whereas in fact it has been the non-statutory bodies, already worried about unemployment, who have responded more quickly than councils. In the next place, the Manpower Services Commission—and this is yet another fear which has been expressed to me from the Beauchamp Lodge Settlement—have not established any feed-back system whereby they might learn from experience and consequently alter schemes accordingly. All in all, the voluntary organisations regard the role of the Manpower Services Commission more as that of a policeman overseeing schemes rather than acting as a partner within them.
From the point of view of the voluntary organisations actually sponsoring schemes, I know that the Beauchamp Lodge Settlement, for one, find they that are not themselves properly prepared to receive workers. Their own supervisors need training in administration and managerial skills. They need to be more informed on unemployment law, PAYE, health and safety, et cetera; and through having been unemployed the workers they take on have low morale and very little confidence. Thus the burden for the sponsoring organisations is especially heavy. Their employees are finding it difficult to create the structure in which successfully to carry the burden. They feel strongly that they need help in building the structure; otherwise, they fear, their present efforts in taking on workers merely provide a cosmetic effect of keeping people off the unemployed list.
In my view there is no doubt that the crisis currently experienced by Elephant Jobs Limited has put many questions at issue. As to the question concerning the all-important area of re-channelling to the common good the energies and talents of those people who drop outside the system, it seems vital for the Government to face to up those questions and answer them in their interest and in the interest of all concerned in an area of such great importance.
7.20 p.m.
Lord Lyell: My Lords, I am sure that the whole House will feel that it is a tribute to the noble Lord, Lord Wells-Pestell, that the House is so full on an evening like this to hear the noble Lord put his case; and he put the case of the matter of Elephant Jobs very well before us today. First, I should like to thank the noble Lord, Lord Wells-Pestell, for his traditional courtesy. As he has already explained to your Lordships, he had one brief meeting with me and another meeting, in conjunction with the right reverend Prelate, with my right honourable friend the Minister.
I should like to express the gratitude of my department to the noble Lord for his remarks about the generosity and help given by the Manpower Services
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Commission in this and in other fields, but the subject which we have before us tonight and which has been raised eloquently by the noble Lord, Lord WellsPestell, and mentioned by every other speaker, is the position of Elephant Jobs Limited. As your Lordships will be aware, the case has been in the news over the last few weeks and Elephant Jobs have put their own case in a very able and vocal manner. I hope that this evening, the Unstarred Question asked by the noble Lord, Lord Wells-Pestell, will give me the opportunity to put the case as the Government see the position.
As your Lordships are aware, Elephant Jobs has been funded since 1976 under the Government's special employment programmes; first, under the jobs creation programme, then the special temporary employment programme and, most recently, since 1st April 1981, under the community enterprise programme. In order to improve the cost effectiveness of all these programmes, the qualifying criteria have changed in various respects from programme to programme. Under the community enterprise programme, the two main relevant criteria are that the jobs supported under these programmes should not put real jobs at risk and, secondly, that the work done had to be of community benefit.
Community benefit among other things, is, essentially the production of subsidised goods and services which would not normally be produced but for the programme—for example, the clearance of a derelict site or the construction of an adventure playground. The work done under the programme must be of benefit to the community at large and not simply the limited number of people who are provided with jobs under the programme. For this reason, schemes which produce goods or services for sale on the open market normally do not qualify for support because to fund them might put real jobs in other organisations at risk.
Out of a total of 111 places approved for funding under the community enterprise programme at Elephant Jobs, only about 40 places are affected by the dispute over the interpretation of "community benefit". I should like to explain in more detail the reason why the MSC feels unable to renew funding for these 40 places. Elephant Jobs are receiving payment in full for their managers'/supervisors' and employees' wages as well as a contribution towards their running/operating costs. All this is paid by the Manpower Services Commission. Elephant Jobs are competing in the same market place with private industry for sales of their jewellery, pottery and carpets, but private industry has to pay wages and operating costs from their sales. For this reason, Elephant Jobs are at a distinct advantage. They could be putting real jobs at risk or frustrating the creation of real jobs.
Furthermore, at a meeting on 11th May this year, Elephant Jobs met their constituency MP, the right honourable gentlemen Mr. Bob Mellish, and they also met the chairman of the MSC. The chairman advised Elephant Jobs to bring these places within the qualifying criteria of "community benefit". If they could not bring these jobs within the qualifying criteria, they were advised to try to transfer the jobs to the workshop supported by the youth opportunities programme, where there are different qualifying criteria. I understand that Elephant Jobs see this particular matter as a question of principle and, as far as we know, have

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apparently not heeded this advice that they were given. In not heeding the advice, they are putting all their other places which are approved under the community enterprise programme and the youth opportunities programme at risk. In total, they have 150 places approved under these programmes and are currently employing 50 people. I think your Lordships will be interested to learn that the hundred or so vacancies could be filled twice over in the Southwark/Lambeth area, which includes the area where Elephant Jobs carry on their work. Also, the community benefit aspect was examined by the MSC special programmes board meeting on 18th May this year. This independent board has representatives of employers, trade unions, educationalists and voluntary organisations on it. They all concluded that the definitions as now. applied by the Manpower Services Commission was the right one. I understand that the chairman of the MSC has written to my right honourable friend the Minister of State at the Department of Employment giving him details of their decision, and my right honourable friend is now considering the chairman's and the special programme board's recommendations.
The other aspect of Elephant Jobs which is causing concern affects some unsatisfactory financial features. I must say that there is every hope that they will be resolved, Elephant Jobs have now stated that they are resolved and, as we have been discussing this, we can now say definitely that an auditor from MSC will be verifying this in the near future with the assertion of Elephant Jobs that this problem has been overcome. I would stress that officials of the MSC have devoted a considerable amount of their time to helping Elephant Jobs over these particular financial issues but I hope your Lordships may hear with me if I spell out in detail the matters of substance which are involved at the moment. First, Elephant Jobs have operated a second bank account through which receipts from all sales made by the scheme were passed. When remitting these funds to the scheme, Elephant Jobs Limited deducted 23·08 per cent. The MSC requires all revenue pertaining to schemes to be remitted to the scheme's account and MSC is now trying to establish from Elephant Jobs Limited in writing the reason for this deduction.
Between November 1980 and July 1981 the scheme undertook work on private dwellings for which it appears no invoices were raised at the time. This is wholly contrary to the Manpower Services Commission criteria in respect of work being of community benefit. This work provided private gain for its recipients and this was clearly unacceptable. I believe that the situation has been partially resolved in that invoices have now been issued and one of them has been paid. This is one of the matters on which the auditor will be reporting.
The last factor is the charitable status of Elephant Jobs itself. The Manpower Services Commission suggest that sponsors under the community enterprise programme should obtain charitable status and so avoid paying a national insurance surcharge of 3.5 per cent. Elephant Jobs do not have this status and so this is resulting in a additional expenditure for the commission to reimburse. This matter is still awaiting resolution because Elephant Jobs do not wish to obtain
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charitable status and the Manpower Services Commission are awaiting the reasons for this standpoint.
It has been suggested in various quarters outside this House that these are matters of little substance. I hope your Lordships will agree, in view of what I have described, that this is not the case. Some other matters affecting rents, VAT accounts and assets registers have either been resolved or are well on the way to resolution following the audit last year by the Manpower Services Commission.
The Government, the Manpower Services Corn-mission and noble Lords who have spoken this evening are all in agreement that the jobs sponsored by Elephant Jobs under the community enterprise programme and the Youth Opportunities Programme are worthwhile and useful. However, this does not mean that all Elephant Jobs schemes can automatically continue to receive indefinite funding regardless of whether they meet the agreed rules. Let me summarise the present position and the steps the Manpower Services Commission have taken to try and keep Elephant Jobs going.
First, despite serious departures from normal MSC accounting procedures (which were well known to Elephant Jobs), Elephant Jobs were allowed three months funding after their schemes expired in March this year to put matter straight. Secondly, MSC officials went over every aspect of the financial problems with Elephant Jobs offering help and advice and suggesting ways of resolving the problem. Considerable MSC staff resources were devoted to Elephant Jobs, offering free financial advice. Thirdly, MSC have discussed the qualifying criteria of both CEP and YOP and have suggested ways in which the 40 places affected can be brought within the criteria. Finally, only yesterday, the chairman of the MSC offered an extension of funding provided that Elephant Jobs bring their schemes into line with the criteria.
In conclusion, let me stress that there is no reason why Elephant Jobs should close. They claim they have resolved the financial problems. If that is so (and it will be examined by an auditor) then these problems cease to exist. The remaining difficulties affect only 40 to 150 places currently funded with Elephant Jobs. Even if the difficulties cannot be resolved, there seems no point in closing down worthwhile opportunities for the sake of those 40 places, of which 15 are at present filled. But I believe that the difficulties can be resolved, and MSC have offered suggestions as to how this might quickly he done.
I should like now to try to answer some of the questions raised. 1 hope I will cover most of them. I shall examine the questions very carefully and will write to your Lordships if I leave any gaps.
Lord Wells-Pestell: My Lords, when the noble Lord has finished with his reply to the questions, will he sit down very slowly to give me the opportunity of asking a question before he sits down?
Lord Lyell: My Lords, I cannot guarantee to sit down so slowly as to depart wholly from the procedures of your Lordships' House. If the noble Lord could make it a very quick question I could probably give him the benefit of the doubt; but I could not guarantee to answer his question tonight. I hope that

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will keep him in anticipation. We have had so far a fairly good run on this particular problem. I shall try to answer most of the points that he and other Members of your Lordships' House have raised this evening.
The noble Lord, Loaf Wells-Pestell, raised one particular point about the local trade unions who he understood did not object to the jobs which were sponsored under the programme. This may well be the view of the local trade union representatives. I doubt whether it is a view that is shared by the trade union representatives of the special programmes board, and indeed the trade union commissioners of the Manpower Services Commission. The production of these goods must be in direct competition with private industry which is producing the same type of items. As I have already described, the cost of the production of these goods is not comparable.
Great play has been made of the number of jobs which are at risk. I would stress once again that there are 150 places at Elephant Jobs which are approved under the community enterprise programme and the Youth Opportunities Programme. Of these, 111 places are approved under the community enterprise programme which has been the main thrust of the noble Lord's Question this evening. As I have mentioned, only 40 of these 111 places are affected by the community benefit definition and 15 of these particular places are currently filled.
The noble Lord, Lord Byers, raised two major points. He mentioned financial accountability. I hope I stressed in the course of my remarks that the Manpower Setvices Commission's auditor is helping to try to resolve these problems which cover all aspects of auditing —not just finance, but also stock control and one or two other aspects of the auditor's task. It is the responsibility of each sponsor in the scheme to see their way to keeping adequate records. As I have said in my main remarks, I hope that this problem is either resolved or is very near to resolution.
The noble Lords, Lord Byers, Lord Wells-Pestell, and others referred to the problem of the qualifying community benefit criteria. When the community enterprise programme was introduced in April 1981 there was a shortage of sponsors. As I am sure all of your Lordships are aware, Elephant Jobs had worthwhile objectives so funding was very definitely continued. Because of the large number of schemes which are coming forward for support which come within the qualifying criteria, the Manpower Services Commission have had to review these schemes where the qualifying criteria for support are more doubtful. This is one area where Elephant Jobs are at the moment found to be situated.
The right reverend Prelate also raised the point of the condition of community benefit in Elephant Jobs. As I am sure he is aware, and as your Lordships will be aware, jobs supported under the Government's special employment programmes must not put real jobs at risk. To do so would mean that support would be withdrawn by employers and trade unions on whom we rely for the operation of these special measures. The community benefit condition ensures that real jobs are not put at risk. The jobs supported under the community enterprise programme are benefiting the community at large and not just a narrow
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sector of it.
The noble Lord, Lord Kilmarnock, raised a number of pertinent and rather detailed points. I shall attempt to cover the majority of them. He first of all raised the problem of the guarantee, as he called it, of a place for the older young person. I think he classified them as from 19 to 24 years of age. I understand that there are approximately 250,000 young people between the ages of 19 and 24 who have been unemployed for more than six months. A programme on this scale would have to be financed by taxation or borrowing. Therefore we think it would jeopardise jobs elsewhere, but my right honourable friend the Chancellor of the Exchequer has pointed out that a new programme to help the long-term unemployed will shortly be launched to help 100,000 people, at a net additional cost of £150 million. So I hope we can go some way towards covering that aspect which was raised by the noble Lord, Lord Kilmarnock.
The noble Lord also raised three other points, one of which was the cost of making Elephant Jobs' employees redundant. Elephant Jobs is not being closed to save money but because it has not yet satisfied the rules. No money would be saved if Elephant Jobs closed, because the places would immediately be taken up by other sponsors in the Lambeth and Southwark areas, as I mentioned earlier. I hope the noble Lord will accept that the community enterprise programme in no way discourages sponsors. We have found that there is no shortage of sponsors; indeed the programme is heavily over-subscribed, and clearly many sponsors are happy to come forward. The noble Lord, Lord Kilmarnock, raised a point on economic benefit, which was also mentioned by other speakers, including the noble Lord, Lord Byers. I should like to say that if it were a sufficient criterion merely for jobs to he provided, then the great firms mentioned by the noble Lord, Lord Byers, such as Marks and Spencer, Woolworths or any other trading company, would qualify for subsidy under the scheme. I can hardly think that would be the intention of your Lordships, especially as regards the special help we are trying to give under the community enterprise programme and also under the Youth Opportunities Programmes.
Lord Byers: My Lords, if I may intervene, when the noble Lord is taling about Elephant Jobs, is he giving any credit at all to the life skills which are taught at Elephant Jobs? To get a playground made is quite different to bringing people in at 8 o'clock and teaching them the life skills they need for work.
Lord Lyell: My Lords, if that is relevant to, and part of, the community enterprise programme, I am pleased to give credit to it. I am not sure whether it is. However, if I have not totally covered this point, then I will write to the noble Lord. I cannot be sure but I do not think the kind of programme which was outlined by the noble Lord, praiseworthy though it is, is covered under the criteria of the community enterprise programmes, or indeed is at issue under the 40 places filled with 15 persons.
In conclusion, I would say that if Elephant Jobs were to close it will be because they have failed to meet the requirements that are accepted by all other sponsors. Moreover, if they do close, the Manpower Services

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Commission will fund the same number of places elsewhere in this region, and so there will be no loss of opportunity. However, I hope, as do the Government, that they will not close, and I hope that all your Lordships who have spoken this evening will urge Elephant Jobs to seize the opportunities which have been, and will continue to be, offered by the Manpower Services Commission to keep their worthwhile projects going.

Port of London Bill
Returned from the Commons with the amendments agreed to.
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